Norcros (LSE: NXR)

Last close As at 27/03/2024

GBP1.89

2.50 (1.34%)

Market capitalisation

GBP167m

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.

The UK’s new build housing market is subdued following the interest rate increases, although the repair, maintenance and improvement market has been more robust. In South Africa, demand across the board has been affected by the ongoing power disruption issues, which are likely to remain a feature.

Latest Insights

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Industrials | Update

Norcros — UK margins up materially, South Africa stabilising

Industrials | Update

Norcros — Strong anchors weather the storms

Industrials | Update

Norcros — New CEO likely to pursue existing strategy

Industrials | Update

Norcros — In-line update highlights undervalued entity

Sector

Industrials

Equity Analyst

Andy Murphy

Andy Murphy

Director, Financials & Industrials

Key Management

  • James Eyre

    CFO

  • Thomas Willcocks

    CEO

Balance Sheet

Forecast net debt (£m)

40

Forecast gearing ratio (%)

18

Share Price Performance

Price Performance
% 1M 3M 12M
Actual 3.8 0.0 2.7
Relative 3.4 (0.1) (1.8)
52 week high/low 195.0p/135.5p

Financials

Norcros’s H124 total revenue fell 8.3% on a reported basis, but declined only 4.1% on a constant currency basis, reflecting tough UK market conditions and power outages in South Africa. Underlying operating profit declined just 2.7%. The company’s market leading businesses, brands and superior service offering allowed it to unlock market share opportunities that offset weaker markets. We continue to believe Norcros’s key strengths are undervalued and that most, if not all, of the legacy issues, particularly the pension deficit, have been resolved. We retain our estimates and value Norcros at 246p, implying upside of c 35%.

Y/E Mar Revenue (£m) EBITDA (£m) PBT (£m) EPS (fd) (p) P/E (x) P/CF (x)
2022A 396.3 47.0 38.6 37.99 5.0 3.2
2023A 441.0 52.3 41.5 40.89 4.6 3.2
2024E 411.7 49.3 35.3 30.00 6.3 3.4
2025E 412.0 49.8 36.5 30.92 6.1 3.4

Research

Update

Industrials

Norcros — In-line update highlights undervalued entity

Update

Industrials

Norcros — Well placed to gain market share

norcros03

Update

Industrials

Norcros — Broadening the UK bathroom product offering

Update

Industrials

Norcros — Record revenue and EBIT in FY22

Update

Industrials

Norcros — Delivering progress

Update

Industrials

Norcros — Sure-footed progress

Update

Industrials

Norcros — FY21 profitability exceeds prior year

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