Bright future being paved by Marshalls

MARSHALLS, the specialist paving and landscaping company, today reported a slight increase in profits and said it planned to open 10 new 'display centres' by the middle of this year as part of its growth strategy.

The Huddersfield-based group saw revenues increase 6.6% from £378.1m to £402.9m in the year to December 31. Reported pre-tax profits were up 1% to £42.1m while operating profit increased by 2.2% to £48.8m.

Marshalls, which said it would continue to sponsor the Royal Horticultural Society's Chelsea Flower Show, said its planned expansion of its display centres would “drive sales growth, improve product mix and facilitate installation”.

The centres give customers the chance to see how products look in a garden setting before they are purchased.

On a like-for-like basis, revenue from continuing operations was up 4% at £393m. Like-for-like sales to the public sector and commercial market – where Marshalls makes 55% of its total sales – were 7% ahead of 2006.

However the group, which provided the stone paving for Trafalgar Square, said although the outlook for the commercial and public sector markets was positive going forward, the domestic market was more difficult to predict.

This was because of lower consumer confidence, tougher loan conditions and a slowing housing market, Marshalls said, although it noted its domestic market's order books were “normal for this time of year”.

Chief executive Graham Holden said: “Last year began and ended positively and that momentum has continued into 2008. Our strategy is clear, we are investing for growth and we are continuing to deliver operational improvement.

“The public sector and commercial market, which represents 55% of the group's revenue, remains robust and lead indicators are positive for 2008 and 2009.

“We are continuing with our development plans and will maintain a strong emphasis on cash management. The strength of our brand, our efficient manufacturing and sourcing, and our comprehensive distribution network give us confidence for the future.”

Marshalls said it would continue to acquire complementary businesses to its portfolio and said it had invested £12.8m into acquisitions in 2007 which had added £10.1m of revenues.

The group said it also continued to seek opportunities to expand its natural stone reserves and had made two acquisitions in this area last year.

It had also invested in a sand and gravel reserved on the outskirts of Manchester and at a natural stone reserve next to the M62 motorway in West Yorkshire.

Final dividend per share was up 5.1% to 9.3p while the total dividend for the year was 13.4p, up from 12.7p.