Round-up | NEWS
Howdens sees 5.4% growth amid concerns over Brexit
HOWDENS JOINERY UK revenue grew by 5.4% in the fi rst half of the year, despite doubt surrounding Brexit. Even with the growth, the company said it remained cautious and had stockpiled £12 million of additional inventory in preparation
for a “no-deal Brexit”.
The company announced that its profi t before tax of £78.1m (2018: £68.8m), was down to good sales growth with improved gross margin, partly offset by continued investment in the business. The gross profi t margin of 61.9% (2018: 61.3%), refl ected by a price increase in January and a more disciplined balance between volumes and price achieved in depots. Howdens also revealed its plans to open a total of 40 new depots in 2019, including fi ve in Northern Ireland and fi ve in France. Fifteen of those planned new depots were launched in the fi rst half of the year and included the fi ve new Irish depots as well as one of the fi ve French depots. Howdens CEO, Andrew Livingston, said: “Howdens delivered another positive performance in the fi rst half of 2019, with sales increasing by 5.4%, against tough volume comparators in the prior year. Just as importantly, gross margin improved as we achieved a more disciplined balance between price and volume in our depots. Profi t before tax was up strongly, at £78.1m and we ended the half-year with £217m in cash, having invested £24m in the business and having returned £46m to shareholders. “We have made good progress with our new initiatives, focusing on depot openings and our new format, range management and the development of our digital platform. We opened 15 new depots in the period, all in the new format, including fi ve in Northern Ireland and one in France, and are reformatting a further eight of our older UK depots. “We are encouraged by the start we have made to the year and, despite the economic uncertainties ahead, remain confi dent in our business model. With our peak trading period still ahead of us, we are on track with our plans for the year as a whole.”
Norcros reports a ‘resilient’ fi rst quarter
BATHROOM AND kitchen products supplier Norcros has reported a “resilient” performance in its trading statement for the 13 weeks to June 30. The group, which owns the Triton, Merlyn, Vado, Croydex, Abode, Johnson Tiles and Norcros Adhesives brands, said that it continued to win market share in its key markets with group sales for the 13-week period up 4.9% like for like on the same period last year.
Nick Kelsall, group chief executive
of Norcros (pictured), said: “We have delivered a resilient fi rst quarter in an uncertain economic and political environment, which is a testament to our leading market positions, our portfolio of well-established brands, the strength of our offer and our strong fi nancial position. The board remains confi dent that the group will continue to win market share and make progress in line with expectations for the current year.”
In its UK business, Norcros said that revenue was 0.4% lower than
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the same period last year, which it put down to variability in its export markets and some UK customer destocking. The UK grew its domestic revenue by 3% on 2018. Norcros completed its acquisition of House of Plumbing in South Africa on April 1, and said that revenue there grew 25.4% on a constant currency basis and by 15.6% in sterling terms. That was up 0.8% like for like on the same period the year before. In its 2018/2019 full-year results,
Norcros reported a tenth consecutive year of growth, with sales up 11.6% to £331 million and underlying operating profi ts of £34.3m (up 25%).
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