WILMSLOW: Norcros, the U.K. and Ireland’s leading bathroom products company, announced Tuesday that it will cease manufacturing at Johnson Tiles South Africa (JTSA) by the end of the month, following a strategic review of the business.
JTSA, part of Norcros’ South African subsidiary Norcros South Africa (Pty) Ltd, will wind down operations after production stops, with inventory continuing to be sold through Tile Africa, the company’s tile and bathroom retailer.
The Olifantsfontein-based business reported £12.3 million ($15.2 million) in external revenue for fiscal 2025, accounting for less than 4% of Norcros’ group revenue. JTSA recorded a small underlying operating loss before central costs and an operating cash outflow of £4.4 million ($5.4 million) in the period. As of March 31, 2025, the business held fixed assets worth approximately £5 million ($6.2 million), including land and buildings that will remain in use by the group, and working capital of around £14 million ($17.3 million).
The closure process, including manufacturing shutdown costs and inventory sales, is expected to be cash neutral upon completion. A minor cash outflow is anticipated in fiscal 2026, offset by inventory sales the following year. Norcros confirmed it will meet all commitments to employees, customers and suppliers.
Going forward, JTSA’s financial performance will be reported separately as a discontinued operation.
Thomas Willcocks, Norcros CEO, said the decision aligns with the company’s focus on building a “capital-light and cash-generative” portfolio.
“After a thorough review, we made the difficult choice to close Johnson Tiles South Africa, recognizing both its long history and the impact on our people,” Willcocks said. He thanked employees for their dedication amid “ongoing macroeconomic challenges.”
Norcros’ South African management will now prioritize growth in its remaining profitable businesses in the region.
Norcros is a market-leading supplier of sustainable bathroom and kitchen products in the U.K., Ireland, South Africa and select export markets. Its brands include Triton, MERLYN, VADO and Tile Africa.
The company, headquartered in Wilmslow, Cheshire, employs around 2,000 people and is listed on the London Stock Exchange.
Strategic and Financial Impact on Norcros
- Minimal Group Revenue Exposure: JTSA contributed less than 4% of Norcros’ group revenue (£12.3 million in FY25), making its closure financially non-disruptive to the broader group.
- Loss-Making Operation: JTSA recorded an operating loss and a cash outflow of £4.4 million, reinforcing its unsustainability amid macroeconomic pressures.
- Capital-Light Strategy: The move aligns with Norcros CEO Thomas Willcocks’ strategy to build a “capital-light and cash-generative” portfolio, shifting focus to more profitable and scalable operations.
- Cash-Neutral Exit: The shutdown is expected to be cash neutral, with minor outflows in FY26 offset by inventory sales in FY27.
- Asset Retention: Fixed assets worth £5 million, including land and buildings, will remain in use by Norcros South Africa, preserving some operational infrastructure.
Impact on South African Tile Industry
- Loss of a Major Manufacturer: JTSA was one of South Africa’s largest ceramic tile producers, with a 110-year legacy. Its exit leaves a significant gap in local manufacturing capacity.
- Pressure on Competitors: JSE-listed Italtile and other domestic players may face increased demand but also supply chain strain, especially if imports rise to fill the void.
- Retail Continuity via Tile Africa: Inventory will continue to be sold through Tile Africa, maintaining some market presence and customer continuity.
Social and Employment Impact
- Job Losses: While Norcros has committed to honoring employee obligations, the closure will inevitably result in job losses at the Olifantsfontein facility.
- Employee Acknowledgment: CEO Willcocks publicly thanked staff for their dedication, acknowledging the human cost of the decision.
Operational Shift and Future Focus
- Discontinued Operations Reporting: JTSA will now be reported as a discontinued operation, streamlining Norcros’ financial disclosures.
- Focus on Profitable Units: Norcros South Africa will prioritize growth in its remaining profitable businesses, such as Tile Africa and other bathroom/kitchen brands.