Norcros Share Discussion Threads

[hastings] 11/10/2014 14:22

Agree with your thoughts Paul and recent weakness caught my eye.
You outline the key points and now looks as a good an entry point as any, despite mkt sentiment etc. Dividend well covered and I would expect a continued strong performance on the trade side, with an improvement on the retail section.

[paulypilot] 11/10/2014 13:40

Interesting to note from recent trading update that business has actually been improving (a better Q2). So the long, gradual decline in share price this year has been caused purely by market sentiment and/or a selling overhang.

The forward dividend yield is now 3.8%, net debt has come down to a level where it is exceeded by the value of the company's freehold property, so not an issue at all.

Pension fund is very big, but has been for a long time, so that's not a new issue at all, and not the reason for the share price having fallen from 25p to 16p.

Once stock market confidence returns, I could see this share re-rating to 20-25p easily. However in the short term nobody really wants to buy anything at the moment, as fear is widespread in the stock market generally.

This correction somehow feels a lot worse than previous ones.

Still, nothing wrong with the fundamentals at Norcros, and at a fwd PER of just 7.7, the stock looks dirt cheap, without good reason. Two brokers agree, both putting out 30p price target on the stock last week & saying the price is an anomaly compared with peer companies.

Regards, Paul.

[trytotakeiteasy] 10/10/2014 11:55

South African business is actually seeing good underlying growth... could be a major long-term growth driver... returned to profitability recently.... if rand strengthens it will boost the company's profits considerably....

[dangreen86] 07/10/2014 12:53

I agree, the £420m turnover target is not very useful, should be targeting improved margins and profitability. To reach the turnover target, Norcros will need to acquire about £150m of revenue before 2018.

I think the SA business is showing signs of contributing to overall profitability and looks to be performing quite well with LFL sales increasing at Tiles Africa.I am sure the results will look better if the Rand improves against the pound.

[trytotakeiteasy] 07/10/2014 12:26

dangreen86 - setting a silly sales growth target... CEO actually seems reasonable as a bean counter (accountant)... but announcing a growth target that can only be achieved through acquisitions in my view completely misses the point... what investors want are returns on capital not expansion at any price...

[dangreen86] 07/10/2014 12:22

What has formed your opinion of mediocre management? I've not met management, but the acquisition of Vado seems to have been a good move by management, along with the sale of the Australian business.

[dangreen86] 07/10/2014 10:19

Judging by the number of posts on this board, NXR is not the most popular share. I imagine Paul Scott will give a detailed write up in his small cap report this morning as he holds here. That may attract a few more buyers.

Having held this share in the past, I bought back in yesterday after watching it drip down this year. I am happy with H1 performance and added this morning.

Norcros are looking to increase revenue to £400m by 2018, do people think this is possible? Organic growth is not exactly steaming ahead to reach those figures, so more acquisitions such as Vado will be needed. Vado seems to have been a shrewd acquisition, but I am not sure the Norcros has the balance sheet to make any more acquisitions without a share dilution.

[hatter2] 07/10/2014 08:52

Well after the relentless drift in the share price since January, I am happy with this update which by Norcros terms is touching on exciting. Honestly, they have earned themselves a place in recent history as one of the most dreary announcement producers around. If they managed a cup winning football team I am sure their RNS would “we cannot predict with any certainty our performance next season”.

Also we done to Paul Scott as I see the FD has taken your advice and put the headline “Performance in the first half is in line with full year market expectations” right at the top of the announcement.

We will never be excited by Norcros but I can live without the excitement as we climb back towards and hopefully over 20p over the coming weeks/months plus a decent divvy thrown in to the pot.

[sjc] 07/10/2014 08:45

Cracking chart worth a look imo.

[3offthet] 06/10/2014 11:04

Thanks Davidosh. Interesting stuff. To save others wading through the whole thing, the NXR coverage starts at 21:50 minutes.

[hatter2] 06/10/2014 10:16

Thank you for that davidosh: a very decent webcast to listen to.

[davidosh] 06/10/2014 00:50

Norcros are discussed in this small cap report...hxxp://www.smallcapvalue.co.uk/webcasts/

[gohilster] 03/10/2014 11:07

Was annoyed when my stop took me out at 17p, but in hindsight was a good move. Looks to be support at 15p. If it drops much below this, I would be worried if I was still holding. I don't think its drifting just because its a boring company; if I remember correctly, the last set of results weren't great and the tone was rather down beat?

[hatter2] 01/10/2014 15:03

Over recent years the trading update for the 26 weeks ending 30th September has been issued on the first Thursday in October.
On that basis we should get an update on Thursday 2nd October although this is very tight against the end of September but Norcros do seem to be on organised bunch.

[hatter2] 01/10/2014 11:54

Unfortunately the price movement continues to be downwards and has been this way for the best part of 2014 despite reasonable if unexciting announcements from Norcros during the year. On 23rd July the interim management statement said “the Board remains confident that the Group should continue to make progress in line with market expectations for the current year”. Last year ahead of the interim results, we had a trading update on 3rd October; I assume and hope we are due one within the next few days.

[downsize] 01/10/2014 11:39

Isn't a trading statement due any day now?

[hatter2] 19/9/2014 16:16

To be honest Brian91, by far my best returns over the years have been achieved by a combination of boring stocks and me sitting on my hands; must be a message to myself there!

[brian91] 19/9/2014 15:57

hatter. it is a boring stock. but divis not bad

[pj 1] 19/9/2014 15:55

Certainly unloved presently

On the W/L

[hatter2] 19/9/2014 15:54

Topped up again today which makes NXR marginally my largest % holding within a fairly substantial portfolio. Can't see much wrong with the stock other than being utterly boring; numbers etc look good to me.

[anony mous] 04/9/2014 08:04

No reason for the fall hat.Recovery is good here but the share price keeps dripping.This rate we be under 10p.I am holding for now.

[kazoom] 03/9/2014 22:51

Just for the sake of coherence - the last couple of comments refer to this announcement :



Bssically 2 directors received some options and "then sold Shares in order to satisfy the tax liabilities arising on the option exercises".

Oh and in one case sold all of the rest as well just for the heck of it and it in the other case sold half of the rest and gave the other half to his wife.

Nothing against that of course I just thought the way they worded the RNS was vaguely amusing.

Some people put a lot of weight by what the Directors do with their shares, but personally I'm a bit more relaxed about this.

FWIW the CEO came into c. £340k worth of shares and after tax he will have got £185 for selling the lot. (He does still though own £1.3m of shares)

The FD received c. £235k worth - £130k after tax of which he sold half and kept half in his wife's name, doubling "his" current holding to £130k.

Nothing at all exciting there at all IMHO - even directors are allowed to spend their bonus surely.

Of course it will have impacted the price in the short term, having put a few extra shares for sale on the market.

[wizard7] 03/9/2014 16:47

All done...often the sort of thing that helps a share price in the medium term - lots of people who have never heard of it will have seen it plummet and recover...and think to themselves...that might imply strength after a long period of weakness.

Or not of course.