Marshalls determined to maintain market position despite falling demand
PAVING specialist Marshalls today warned of challenging times ahead but said it was in good shape to maintain its leading market position.
The Huddersfield-based group said that poor summer weather, tight budgets, and weak demand particularly from September onwards had hit profits and its forward order book.
Revenue for the 10 months ended October 31 was down 3.5% to £339m compared to £351m the year before.
Like-for-like revenue for the four months to period end was down 9.7% from £141m to £128m.
Sales to the domestic market fell by 15% while sales to the public sector and commercial market, which represents around 58% of Marshalls’ revenue, was 5% below. Sales for the full 10 months however were 4% ahead of 2007.
“In the domestic market, installer order books at the end of September 2008 were as expected at 7.5 weeks (June 2008 8.2 weeks),” it said.
“Since then we have completed a further survey at the end of October 2008, which reflects more recent events, and this shows installer order books have fallen to 6.4 weeks (October 2007 9.9 weeks).”
The Chelsea Flower show sponsor said that despite the deterioration in its markets its public sector contract work remained positive although there were signs of weakening demand in the commercial and industrial markets with projects being delayed or cancelled.
As a result it is focussing efforts on sales in market sectors that are robust, accelerating cost reduction initiatives and conserving cash to retain financial flexibility. In addition it is still looking to extend its competitive advantage through new product development and service solutions.
Earlier this year it completed the acquisition of a further natural stone paving and walling business in South Wales for £5m and made an investment in a further Cotswold Limestone business taking our acquisition and investment for the year to £7m.
The firm also stressed its strong financial position thanks to the release of £4m cash following the closures of concrete manufacturing operations in Cannock and Sawley.
A maintained interim dividend of 4.55p (2007 4.55p) per share will be paid on December 3. This will take the total dividend paid in the year to 13.85p (2007 13.40p) per share.
Established in the late 1880s, Marshalls is one of the UK’s leading manufacturer of superior natural stone and innovative concrete hard landscaping products, supplying the construction, home improvement and landscape markets.
The group operates its own quarries and manufacturing sites throughout the UK, including 10 regional service centres and two national manufacturing and distribution sites.
It has undertaken some prestigious projects over the past years including supplying stone paving for Trafalgar Square in London.
