Slide 1: Norcros plc Interim Results Six Months to 30th September 2012
Norcros plc Interim Results Six Months to 30th September 2012
Slide 2: Introduction
Introduction Martin Towers Chairman
Slide 3: 2012 H1 Highlights
2012 H1 Highlights Page 3 Page 3 Revenue increased by 9.4% on a constant Revenue1 currency basis £106.3m +9.4% Underlying2 operating profit increased by 4.8% Underlying2 operating profit South Africa growing strongly and returned to profit £6.6m +4.8% Interim dividend up 10.7% Basic underlyi
Slide 4: Financial Review
Financial Review Martin Payne Group Finance Director
Slide 5: Income Statement
Income Statement Page 5 Page 5 26 weeks 26 weeks +/- 52 weeks Sept Sept Mar 2012 2011 2012 £m £m £m Revenue 106.3 102.4 +3.8% 200.3 Underlying1 operating profit 6.6 6.3 +4.8% 12.1 Margin 6.2% 6.2% 6.0% Finance charges – cash (0.6) (0.9) (1.4) Underlying1 PBT 6.0 5.4 +11.1% 10.7 Exceptional – finance
Slide 6: Income Statement – Key Bridges
Income Statement – Key Bridges Page 6 Page 6 Revenue Underlying operating profit 0.5 0.0 5.9 0.0 0.8 £m (5.2) 106.3 £m 6.6 (0.5) 102.4 2.7 6.3 Sep-11 Currency UK SA RoW Sep-12 Sep-11 Currency UK SA RoW Sep-12
Slide 7: Tax, Earnings and Dividends
Tax, Earnings and Dividends Page 7 Page 7 Underlying Reported Sept Sept Mar Sept Sept Mar 2012 2011 2012 2012 2011 2012 Basic underlying EPS (pence) £m £m £m £m £m £m Profit before Tax 6.0 5.4 10.7 6.6 4.3 9.4 1.9 Tax credit/(charge) 0.1 (0.3) 0.4 (0.1) (0.5) - Earnings 6.1 5.1 11.1 6.5 3.8 9.4 1.1
Slide 8: Cash Flow
Cash Flow Page 8 26 weeks 26 weeks 52 weeks Page 8 Sept 2012 Sept 2011 March 2012 £m £m £m Working capital increase £6.9m EBITDA pre exceptional 9.7 9.5 18.4 Working Capital (6.9) 0.3 (0.4) Other 0.5 0.3 0.1 UK £5.5 Operating cash flow 3.3 10.1 18.1 SA Capex (2.4) (3.1) (6.7) £0.9 Proceeds from prop
Slide 9: Balance Sheet
Balance Sheet Page 9 Page 9 Leverage 1.1x EBITDA Net debt before prepaid finance costs 20.2 UK Pension deficit increased to £22.3m £m 18.1 18.5 • Liabilities still 94% funded • Fall in applicable discount and inflation rates Sep 12 Sep 11 Mar 12 • Consultation in progress to close DB section to
Slide 10: Operating Review
Operating Review Nick Kelsall Group Chief Executive
Slide 11: Business Overview
Business Overview Page 11 Focused Group supplying high quality and innovative showers, ceramic wall and floor Page 11 tiles and adhesive products Three complementary UK businesses: Triton Showers • Market leader in the manufacture and marketing of showers in the UK Johnson Tiles • Leading suppli
Slide 12: UK Operations – Resilient performance in difficult markets
UK Operations – Resilient performance in difficult markets Page 12 Page 12 Overall revenue -8.3% • UK -6.4%; Exports -18.7% UK market volume decline estimated to be c. 7% UK market share gain – stronger electric performance Exports – Irish market remains challenging Q1 impacted by timing o
Slide 13: UK Operations – Resilient performance in difficult markets
UK Operations – Resilient performance in difficult markets Page 13 Page 13 Overall revenue +17.0% • UK +20.6%; Exports -10.7% Very strong revenue growth despite market decline UK market share gains, particularly in DIY multiple channel • B&Q tile range review and new in-store tile shop Expor
Slide 14: UK Operations – Resilient performance in difficult markets
UK Operations – Resilient performance in difficult markets Page 14 Page 14 Overall revenue +1.5% • Increased market share in a declining market • National contract specification & new distributor gains Profits maintained Strong new product introductions • Waterproof tiling system for wet rooms
Slide 15: UK Operations – Resilient performance in difficult markets
UK Operations – Resilient performance in difficult markets Page 15 Page 15 Revenue Underlying operating profit 7.0 12.0% £61.1m £58.4m £58.4m 6.0 10.0% 5.0 8.0% 4.0 6.0% £m 3.0 4.0% 2.0 2.0% 1.0 0.0 26 weeks 26 weeks 26 weeks 0.0% 26 wks to Sep 11 26 wks to Mar 12 26 wks to Sep 12 Sept 11 March 12 S
Slide 16: South Africa – Strong growth and return to profit
South Africa – Strong growth and return to profit Page 16 Page 16 Significant improvements in operational performance • Better quality, higher throughput and reduced downtime • Investment in new sorting and packaging equipment Underlying operating loss significantly reduced Independent sector
Slide 17: South Africa – Strong growth and return to profit
South Africa – Strong growth and return to profit Page 17 Page 17 Underlying profit significantly ahead of last year & strong cash generation Independent sector revenue +26.3% at c.c. Strong growth in Tile Adhesives and Building Products segments • Share gains in both sectors “Tilemate” tile
Slide 18: South Africa – Strong growth and return to profit
South Africa – Strong growth and return to profit Page 18 Page 18 Underlying profitability higher than last year Overall revenue +9.2% at c. c. Increased focus on imported product to improve depth of offer Procurement and stock planning processes strengthened Store upgrade programme ongoin
Slide 19: South Africa – Strong growth & return to profit
South Africa – Strong growth & return to profit Page 19 Page 19 Revenue 1 Underlying operating profit 0.6 1.5% £39.9m £34.0m 0.4 1.0% £32.2m 0.2 0.5% £m 0.0 0.0% (0.2) (0.5%) 26 wks to Sep 11 26 wks to Mar 12 26 wks to Sep 12 (0.4) 26 weeks 26 weeks 26 weeks (1.0%) Sept 11 March 12 Sept 12 Profit (0
Slide 20: Strategy
Strategy Page 20 Page 20 Deliver above market organic revenue growth Sustained investment in innovative new product, brand development and service offer Leverage DIY relationships in UK, South Africa and Australia • One stop shop product offer • Category management and logistics expertise In
Slide 21: Summary & Outlook
Summary & Outlook Page 21 Page 21 Solid trading performance in challenging markets Revenue and profits ahead; margins maintained Market share gains, investment in new products and focused sales and marketing plans driving improved trading performance Interim dividend increased by 10.7% to 0.
Slide 22: Appendix
Page 22
Slide 23: UK Pension Scheme
UK Pension Scheme Page 23 Page 23 Assets under management - £366m UK Pension surplus / (deficit) Mature Scheme; 10,077 members 10.0 • Pensioners 63%, Deferred 33%, Actives 4% • Average age of pensioners is 76 Investment Strategy 0.0 • Conservative asset allocation; 40% absolute return funds, 2
Slide 24: Legacy Leasehold Obligations
Legacy Leasehold Obligations Page 24 Page 24 Swindon - Light Industrial Units • Lease expiry 2014 • Occupied to lease expiry • Current cash shortfall against rental income c. £0.5m p.a. Swindon - Warehousing / Distribution Unit • Lease expiry 2022 • Vacant • Cash shortfall c. £1.0m p.a. Sheffi
Slide 25: Net Debt Reconciliation
Net Debt Reconciliation Page 25 Page 25 Sept Sept March 2012 2011 2012 £m £m £m Net debt – statutory basis (19.6) (17.3) (17.8) Prepaid finance costs (0.6) (0.8) (0.7) Net debt before prepaid finance costs (20.2) (18.1) (18.5) Sept Sept March 2012 2011 2012 £m £m £m Net debt before prepaid finance c