Bathroom firm announces 50 job losses at its subsidiary
Bathroom specialist Norcros has announced it is to cut 50 jobs at its subsidiary Johnson Tiles.
The news came in a trading update to the Stock Exchange and is further evidence of the problems facing the retail sector.
Wilmslow firm Norcros supplies showers and bathroom accessories and its preliminary results will be made public in June.
The company said its underlying operating profit for the year is expected to be in line with expectations.
Revenue for the year is expected to be in the region of £300m compared with £271.2 last year.
Revenue for the year was 10% higher than the prior year reflecting in part the first time contribution from shower enclosure business Merlyn which was acquired last November.
A restructuring programme took place at Johnson Tiles last year with the aim of improving operating performance and manufacturing flexibility. The restructuring saw around 90 people made redundant.
However, the business, which is based in Stoke-on-Trent, remains loss making with market conditions in the second half of the year proving more challenging than expected.
As a result, the firm has implemented a further restructuring programme which will involve the loss of up to 50 jobs.
This will result in a charge of around £2.1m, to be treated as an exceptional item. Annual savings are expected to be at least £2m.
Nick Kelsall, group chief executive, said: “The group expects to deliver its ninth consecutive year of revenue and underlying operating profit growth despite increased market headwinds.
“This trading performance continues to demonstrate the resilience of the group’s business portfolio and operating model.
“The group continues to focus on complementary growth opportunities, both organic and via acquisition. It is pleasing to note the strong performance of Merlyn, our largest and most recent acquisition.
“We are confident that Merlyn will prove to be a valuable addition to the Group and we are exploring a number of new business opportunities working with our other group businesses.
“We are pleased with our overall performance during the year. Despite a backdrop of challenging market conditions, the board believes that the resilience of our diversified business portfolio and the strength of our market positions leaves the group well placed to make further progress.”