Norcros Share Discussion Threads

[kipper7] 12/4/2024 20:36

We’ve been reading these stories for years. Every analyst thinks they worth 240-250
Fact is they are ex growth

[fegger] 12/4/2024 13:10

Exactly Kipper7. Thats why Im out after 5 years. And there are much better dividend stocks on offer at present such as Polar Capital Holdings which Ive topped up with half the Norcros proceeds. 9% dividend plus good growth prospects.

[kipper7] 11/4/2024 14:27

Does anyone care?There appears to be no interest/ no volumeCompany is fine but no growth in revenues/ eps etc. Dividend stock not growth imo

[edmonda] 11/4/2024 11:54

Agreed, edmundshaw

Norcros has again demonstrated great business resilience in the face of challenges in both of its primary markets, and reduced net debt.

Equity Dev retain their 233p/share fair value in new research note. Free access here:

[edmundshaw] 11/4/2024 10:00

Decent update. UK looks robust and debt coming down very well.

[shbgetreal] 28/3/2024 13:27

Yes, and share appreciation in the past usually equals less appreciation in the future, if we're talking strictly value...

[fegger] 15/3/2024 13:44

My holding period has been 5 years for Sylvania Platinum. That therefore includes the past 3.5 years where you say performance was woeful.

It tells me which investment has been better for me. I had also not realised how significantly better the Sylvania Platinum dividends had been as several had been specials.SO useful analysis for me.

[rmillaree] 15/3/2024 10:47

posting historical results tells us nowt about the future - note presumbaly you were LUCKY enough to buy Sylvania Platinum "back in the day" - its performed pretty woefully for the last 3.5 years.

[fegger] 15/3/2024 09:30

I've done the maths on my holding of Norcros shares.

Have held Norcros shares for just over 7 years and bought and sold a few along the way
Value of total shares bought: 30501
Value of total shares sold: 12800
Dividends received over 7 years: 6018
Value of current shares in market today: 20341

Therefore for an investment of £17700 I have had a return of £26359 over 7 years.

A 4% interest rate would have produced £23408


As a comparison I recently did the same exercise for Sylvania Platinum another share I hold with South African exposure. The return on Sylvania has been for an investment of £14621 I have had a return of £45204 over 5 years.

Norcros pays a decent dividend but Sylvania is better and better share appreciation. Have sold some Norcros today and will likely sell more over next few months

[davebowler] 08/1/2024 09:14

Zeus top ten 2024 pick -
UK underappreciated, South Africa misunderstood Norcros was one of our top picks 2023 and whilst the shares did not get the rerating we argued it deserved they did perform relatively well due to the strength of the operational execution in what was a very difficult year. The company remains a top pick for 2024 due to its discount to peers, despite long term margin expansion within the UK, its ability to win market share and, hopefully, a gradually improving operating environment that will highlight the undervaluation of the South Africa business. The UK business reported 13% operating margin in H1 24 and the SA business consistently generates both profit and cash but both seem to be undervalued by the market. An improving economic backdrop in SA might focus attention on the margin expansion in the UK leading to investors placing a higher multiple on the Group as a result.  The UK business continues to perform well: Over the last 10 years, Norcros has successfully grown revenue in its UK business in all but the two years during the pandemic. Impressively, over the last 5 years, UK revenue has grown at a 8.1% CAGR, whilst rising operating margins have magnified this result on its underlying EBIT, growing at a 5-year CAGR of 14.9%. During H1-24, the UK business also saw a 160bp improvement in its operating margin, growing to 13.0% from 11.4% a year earlier, despite a small drop in revenue. More importantly, this was somewhat driven by its recently acquired brand Grant Westfield (May 2022), highlighting the successful execution by management. If, as we expect, operating margin can get to mid teens over the next couple of years Norcros’ current multiple looks to materially undervalue the business relative to peers. A final point worth highlighting was the ability of its leading shower brand, Triton, to grow volumes during the first six months of the year, bucking the trend vs its peers and the wider RMI market.  South African business misunderstood: Representing c. 33% of Group revenue in FY23, Norcros’ South African business has a strong track record of growth with a 11.0% revenue CAGR between FY13 - FY23 (constant currency) and robust profitability. During H1-24, the region suffered due to some of the worst electricity load-shedding seen in recent history coupled with a GBP/ZAR exchange rate at historic lows. Whilst FX has a clear impact on reported numbers, management recently confirmed the region remains cash generative with no additional cash needed to fund operations, making the region self-sufficient. We believe this is misunderstood by the market. We also have reason to believe recent developments in the South African electricity market will drive higher demand in the medium term. In mid2023, the South African Government approved a new law to open up the electricity market for private companies, allowing the establishment of a competitive market away from its lossmaking state-owned monopoly, Eskom. Not only should this improve manufacturing operations, but less frequent load shedding should drive demand higher as confidence in the economy grows.  Valuation compelling: Based on consensus estimates, Norcros trades on a one-year-forward P/E of 6.2x and EV/EBITDA of only 4.8x, with a 5.4% dividend yield. The P/E ratio is more than a 50% discount to the average of its UK building products peers despite Norcros having forecasted average EBIT margins over the next three years in line with the peer average. At the current average FY1 UK peer EV/EBIT multiple (12.9x), the UK business alone would be worth c. 460p per share (adjusting for all of the Group’s net debt and leases and applying a UK EBIT margin of 12.5%), which is 140% more than the Group’s current share price.

[s34icknote] 20/12/2023 12:20

Some chunky buys Following house builders up !

[rmillaree] 05/12/2023 14:35

what i like here is that the forecasts lkook realistic and are warts and all. So many companies promise the earth then faily deliver. all nxr wants its to be valued at 7.4 * earnings - not much of an ask really is it? or is it ?

[pj84] 05/12/2023 14:13

Valuation suggests c 50% upside

Following the H124 results, we have essentially maintained our profit estimates and therefore our valuation of Norcros. Our P/E based valuation implies a value of 236p/share based on our diluted underlying FY24 EPS estimate of 31.5p/share, while our dividend discount model (DDM) implies a value of 255p/share, and if we take the average of the two, we arrive at 246p, implying c 50% upside. Norcros is trading at the lower end of its long-term consensus forward P/E range on 5.4x (Edison forecast P/E: 5.2x), suggesting that a lot of negativity is priced in. As and when we begin to see recovery in the UK and/or South Africa, the company may well attract a higher multiple.

Simple forward P/E multiple valuation implies 236p/share

The chart below details the progression of Norcros’s forward P/E over the last cycle. The range at the extremes is a low of 4x reached briefly post COVID-19 and again in 2022, and the high is c 12x at the end of 2013, before the Brexit hiatus. Over this period and outside the extreme ratings, the ‘real’ range has arguably been 6–9x and the average over the whole period is 7.4x.


If we apply the 7.4x forward P/E multiple to our estimate of FY24e diluted underlying EPS of 31.5p, we arrive at a value of 236p/share, implying c 45% upside to the share price. Arguably, this method gives little credit for future potential acquisitions, which are part of the company’s strategy and may be forthcoming.

[pj84] 20/11/2023 09:34

Norcros 1 of 5 shares in this morning's expert view update on


Norcros shares look cheap, says Peel Hunt

Bathroom supplier Norcros (NRX) has continued to deliver and the shares are cheap, says Peel Hunt.

Analyst Sam Cullen retained his ‘buy’ recommendation and target price of 220p on the Citywire Elite Companies A-rated stock, which was trading at 164p on Friday.

The group delivered a ‘solid set of interims’ with operating profit 3% lower than the previous year at £21.4m. Cullen kept expectations for full-year 2023 unchanged and reduced 2024 estimates by just 3%.

‘Norcros is delivering against its strategy in what are tough markets,’ he said.

‘The group’s UK brand continues to win share and has scope to grow further new product development and enhanced collaboration. The shares look cheap on just five times current year 2024 earnings, with a 10% free cashflow yield and 7% dividend.’

[rmillaree] 17/11/2023 17:05

Hello Pugugly

I guess we will have to agree to disagree - its not to often sound companies get the chance to buy back shares at dirt cheap levels. Ok norcros has pretty much been the exception to that rule alot byut we shouldnt presume this would be the case in 18 months time. The debt is so under control here i would say if they spent even £10 mill buying back shares now - that would not even start to trouble the debt levels we have. all they would probbaly be doing is delaying repayment of that amount of debt by 9 months or so. This company has proven its ability to pay down debt every time and debt is already over £10 mil below peek levels. Heyho my opinion is just that we all have our own take on what they shoudl be doing - i would say it certainly isnt a stupid option based on decent profits they expect to be making.

[deanowls] 17/11/2023 17:03

They are and they will and have done that historically prior to buying bolt ons.

The increased sales and profit with a backdrop of reducing the weight of the pension and the difficulties within the tile market has been fantastic.

[pugugly] 17/11/2023 16:27

Buy back stupid - Should be using spare cash to reduce debt.

[rmillaree] 17/11/2023 16:00

I doubt it takes much to move the needle 10% here - certainly over on stokopedia no updates as of yet from paul scott or the others yet - albeit he has made note "cheap"next to company - they are a hard bunch to please over there at times as they have only given this an "amber rating" last 2 times the company has been looked at - perhaps if its Paul Scott updating this time he may be generous enough to give it a green mark.

perhaps the equity developments report has helped a little - company is clealry cheap so if enough peeps are slapped in theface with this fact then ......

In some resepects a lack of bad news on p/e of 5 is actually good news and the equity developmnet note confirms outlook is acceptable and debt coming down.

Personally i wish it was the comany buying back shares by the bucketload every time the price drops belopw 160p - 150-160p seems a natural bottom here even if it did overshoot below that briefly (withouty me noticing)

[edmonda] 17/11/2023 15:53

Fegger - no doubt many factors, but the link about 3 cms above your post appears to be one of them. NXR shares have been'overlooked and undervalued' far too long...

[fegger] 17/11/2023 15:35

Sudden price increase of 11% today. Does anyone know a reason for this?

[s34icknote] 16/11/2023 12:46

P E of five maintained div

[edmonda] 16/11/2023 07:58

"Overlooked and undervalued" - initiation report

Norcros has leading positions in its market segments built upon strong brands, new product development, channel diversity and supply chain strengths. It is seeking to drive further market share gains organically by intensifying group synergy benefits and through M&A activity.

H1 results saw an 8.3% reported group revenue decline (or -4.1% on a constant currency, LFL basis) was substantially driven by lower demand in South Africa while the UK was broadly flat y-o-y. EBIT came in 2.7% lower (unchanged in constant currency) reflecting a better UK outturn – being the net effect of exiting Norcros Adhesives and two additional month’s contribution from Grant Westfield (GW) – more than offsetting adverse operational gearing in South Africa.

Norcros is profitable, strongly cash generative and moderately geared at 1x EV/EVITDA. We initiate coverage with our DCF analysis suggesting a fair value midpoint of 233p / share, giving c. 50% upside potential on a rerating.

Link to initiation here: