LONDON (ShareCast) - Norcros said Thursday that its annual results would be in line with expectations after a year of 'mixed' market conditions in the UK.

The home consumer products group said underlying profit before tax would be 26% higher at approximately £14.7m (2013: £11.7m) on revenue that it set to total around £229m, up from £210.7m in 2013.

The increase in turnover represents year-on-year growth of 16.4% on a constant currency basis and 8.7% on a reported basis.

Group underlying operating profit is expected to be 25% higher than the prior year at around £16.3m (2013: £13.0m), despite a 20% weaker South African Rand, which on conversion cost £0.4m.

Norcros explained that the retail sector remained weak for most of the year, although the company reported signs of improvement in the last quarter. UK revenue for the full year was 20.6% higher on a reported basis reflecting the Vado acquisition in March 2013.

On a like-for-like basis, excluding Vado, UK revenue was 3.1% lower than last year with good progress in Triton Showers and Norcros Adhesives offset by lower revenue at Johnson Tiles.

Looking ahead, Norcros said: "UK construction activity and an improving housing market has driven trade sector recovery during the year but the UK retail sector, as expected, is taking longer to benefit, although there have been some encouraging signs more recently. Whilst the medium term outlook in South Africa is positive, the weakening rand continues to have an adverse effect on rand profit translation to sterling.

"Nevertheless, with our strong brands, leading market positions and continued self-help initiatives focused on market share gain, the board remains confident that the group should continue to make progress in line with market expectations for the year to March 31st 2015."

Shares rose 7.32% to 22p in morning trade.

NR

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