Marshalls paves the way for fresh buyouts as sales surge
Marshalls, the paving company which supplied flooring for landmarks including Trafalgar Square and Bond Street, enjoyed a jump in sales of more than one-sixth in the first half of the year, despite Brexit uncertainty hampering the construction industry.
Shares rose 0.8 per cent today as the firm said it had outperformed the rest of the market so far in 2019.
The figures
Pre-tax profit was £37.1m for the six months ending 30 June, a 14 per cent rise on the same period last year. Revenue rose 15 per cent to £280,1m.
The company upped its interim dividend to shareholders to 4.7p, 18 per cent up on last year. Net debt rose to £97.3m, from £48.9m.
Why it’s interesting
Marshalls said its order book will grow in the coming months, with work on Crossrail approaching. It also said a continuing trend towards pedestrianising urban areas, such as on Oxford Street in central London, would help sales.
Chief executive Martyn Coffey told City A.M. the company was “well advanced” in discussions to provide paving for Oxford Street.
He added that the company intended to continue making one fresh acquisition a year, after buying out concrete brick maker Edenhall late last year.
Britain’s construction industry has suffered this year as clients waited until they know the conditions of leaving the European Union before making big spending decisions on jobs such as infrastructure projects.
What Marshalls said
Coffey said: “The group continues to outperform the Construction Products Association’s growth figures, despite ongoing political and Brexit uncertainty.
“The CPA’s recent summer forecast predicts a decrease in UK market volumes of 0.3 per cent in 2019, followed by an increase of one per cent in 2020, while the underlying indicators in the new build housing, road, rail and water management markets remain supportive. Post period-end trading has remained strong.
“The board believes that the group’s new five year business strategy will continue to deliver sustainable growth, whilst maintaining a strong balance sheet and a flexible capital structure.
“The strategy is underpinned by strong market positions, focused investment plans and an established brand.”