Norcros (NXR) – Pension

I was surprised to see today that Norcors’s pension trustees calculated fund liabilities as at 1/4/2018 to be virtually the same the IAS 19 accounting liabilities on 31/3/2018, resulting in a very similar deficits on both basis. This is highly unusual, for example I reported yesterday that MPAC’s trustees calculate liabilities about 17% higher than IAS 19, resulting in a significant deficit and recovery payments vs a significant accounting surplus.

Ultimately the only explanation is that the differences between assumptions used by the accountants when calculating IAS liabilities and those used by the trustees are much smaller than with other companies / funds. By why?

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7:59 cut – NXR

Norcros (NXR) – FY Results

Revenue is 10% ahead as guided in their recent trading statement. Underlying EPS of 31.7p compares to the 30.7p normalised EPS consensus shown on Stockopedia, although it is difficult to know if these are calculated on the same basis. Debt was £35.0m vs £36.0m guided, although of course this could be window dressed for the year end and is certainly seasonally lower than at the half-year point.

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7:59 cut – PEG, NXR

Petards (PEG) – FY2019 results

The main news for me today is the Petards (PEG) results.

The good:

  • Revenue of £20.0m is above expectations of £18m.
  • Normalised pre-tax profit up nearly 60%.
  • Small contract win separately announced today (as I speculated), with work commencing immediately.
  • Order book up and further orders expected.
  • Net funds down only £0.3m despite £1.25m acquisition.

The bad:

  • Second half weighting for FY2019.
  • Warning of reduced defence business in FY2019.
  • Order book (at year end) is only modestly higher at £19m vs £18m of which the forthcoming year is up from £12m to £13m.
  • Gross margins down.
  • Normalised EPS not reported and I cannot immediately compare to forecasts.

I would expect a modest rise in the share price this morning. However I already have a moderate position and due to the negatives highlighted above I will be holding off adding until there is an unjustified price fall or further positive news.

Norcros (NXR) – FY trading update

In-line update. This is reassuring giving that they carry some debt and pension liabilities.

I had reduced my position at a higher price over concerns whether FY results could be achieved and so will be looking to re-add this morning. Note that despite its relatively small size, this is not an AIM stock.


I hold shares in Petards and Norcros.