Posted on April - 22 - 2010
Optimism at Norcros sees shares surge
Showers and tiles company Norcros today responded to a surge in its share price by issuing a trading update ahead of schedule, saying it expects results for the year to March 31 to be ahead of forecasts.
Norcros, based in Wilmslow, said it anticipates revenues for the period to be around £169m against £154.2m last year, with pre-tax losses before exceptional items down from £2.9m to £2.5m.
The company said in a stock market statement that market forecasts had been for losses of £4.9m.
Shares have gained ground over the past couple of days and were today up a further 19.21 per cent at 8.5p, their highest level since last October.
Norcros, led by chief executive Joe Matthews, owns the Triton showers brand and the H&J Johnson tiles business in the UK.
It also has operations in South Africa, where it makes tiles and runs shops.
Norcros said all its operations in the UK have performed well.
In South Africa, its businesses continue to be hit by weak economic conditions and reduced building activity, although its adhesives division has proved resilient and losses in its tile operations have been significantly cut during the second half of the financial year.
It expects to incur exceptional charges of £2.5m arising from store closures in South Africa and around £6m in impairments and other costs relating to a group loan to its Greek associate.
Norcros added: “The performance of our UK businesses remains robust in spite of the continuing difficult economic conditions.
“Operational improvements have been implemented in the South African tile manufacturing and retail businesses by the new management team and despite continuing market difficulties there, we are confident of re-establishing a solid base for future growth.
“The outlook for our markets remains uncertain and we will continue to manage our costs and cash generation consistent with the tough trading environment.
“However, the board believes that the group’s businesses are in a much stronger position to take advantage of the opportunities open to them.”
Full-year results are due on Tuesday, June 22.
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