£174.6m market cap

217p last close

Norcros is a leading supplier of showers, enclosures and trays, tiles, taps and related fittings and accessories for bathrooms, kitchens, washrooms and other commercial environments. It has operations in the UK and South Africa, with some export activity from both countries.

Investment summary

Norcros followed a very creditable FY19 financial performance with a Q120 trading update (23 July) containing flat underlying revenues enhanced by a maiden contribution from the newly acquired RAP/House of Plumbing business in South Africa. Domestic sales are ahead year-on-year in both main markets, but UK exports are providing a degree of drag on underlying top-line progress. The leading territories both remain fairly challenging markets to operate in but Norcros is delivering relative outperformance derived from share gains. The company’s expectations and our estimates for the full year are unchanged.

Y/E Mar
Revenue (£m)
PBT (£m)
EPS (fd) (p)
P/E (x)
P/CF (x)
2018A 300.1 34.7 24.4 26.8 8.1 6.3
2019A 331.0 42.2 30.9 29.6 7.3 4.9
2020E 359.9 46.3 34.0 32.0 6.8 5.1
2021E 368.4 48.3 35.9 33.5 6.5 4.0
Last updated on 19/09/2019
Industry outlook

In the UK, the residential new-build sector has performed well and there is impetus for this to continue. RMI spending has not recovered at the same rate. The South African economy is currently facing a number of challenges; wider distribution of wealth and an emerging middle class should benefit consumer spending over time. Norcros’s management has set new 2023 financial targets for the group: to attain £600m revenue with a balanced UK/overseas split and to sustain a ROCE of 15%+.

Last updated on 19/09/2019
Share price graph
Balance sheet
Forecast net debt (£m) 36.2
Forecast gearing ratio (%) 26
Price performance
Actual 1.6 (1.4) 4.3
Relative* (1.1) (1.5) 4.6
52-week high/low 228.0p/185.5p
*% relative to local index
Key management
Nick Kelsall CEO
Shaun Smith CFO

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