Trading Statement

Marshalls PLC
5 July 2002




                  
MARSHALLS PLC
                              Friday 5th July 2002




TRADING STATEMENT - SIX MONTHS TO 30 JUNE 2002



Marshalls sales in the six months to 30 June 2002 were £181 million, 7 per cent
ahead of the comparable period last year.  The Group expects profits in the
period to show a pleasing improvement over the first half of 2001.



All Divisions achieved sales growth.  Landscape Products increased by 5 per cent
and Natural Stone and Emerging Businesses showed significant improvement.  Sales
in the Clay Products Division were slightly ahead of 2001, pleasingly so, given
that Industry volumes were again below the equivalent period last year.



GROUP OVERVIEW



The Group had experienced strong trading conditions in the first five months
with sales 15 per cent ahead of last year.  Shareholders will, however, recall
that the first quarter of 2001 was weak due to widespread floods, and therefore
the comparatives were not particularly demanding.



The impact of the special events in June, though, that have been widely referred
to by others throughout industry, when combined with the fact that there were
three less working days in the month compared with June 2001, made a significant
dent in the cumulative improvement achieved by the end of May.  The three less
working days alone equate to a reduction in Group sales of £5 million in June.



The sales decline in June was most noticeable in the Landscape Products
Division, specifically in domestic garden and patio products.  Nevertheless our
network of Registered Installers has indicated that despite the slowdown in June
its order books are good.  Some City Centre projects were also affected as work
was halted or postponed until after the celebrations.



The second half of this year presents the Group with a stiff challenge compared
to 2001.  Last year we achieved sales growth of 15 per cent in that period as we
cleared the backlog of demand from the first half.



Taking the Group as a whole, and with increasing activity this year in the
commercial and public sector markets, we do currently expect to meet our sales
targets for the second half.



We have previously indicated that we do not anticipate significant property
disposals this year, or for there to be any operating exceptional items within
our results.



LANDSCAPE PRODUCTS DIVISION



This Division, which represents 75 per cent of the Group, had sales of £136
million, 5 per cent ahead of last year.  This year's sales were 4 per cent ahead
of 2001, excluding the impact of the Aggregate Levy.  This levy which was
introduced on 1 April 2002 has been passed through the distribution chain and is
therefore reflected in our customers' prices.



The demand for our products in the domestic sector increased by 4 per cent, and
in the commercial and public sectors by 7 per cent in the first half.  The
balance between the sectors changes over time depending on economic conditions.



While the level of housing transactions is important to continuing growth in the
private sector, the home improvement market is the largest contributing factor.
However, to some extent we take comfort that commercial and public sector
projects will provide significant business opportunities for the foreseeable
future.



CLAY PRODUCTS DIVISION



The Division increased sales by 1 per cent to £15.3 million in the first half.
This was achieved against the background of yet another fall in Industry
volumes, which is estimated at 3.4 per cent in the first 3 months, the latest
period for which final statistics are available.



Our customers, particularly the builders merchants, are increasingly purchasing
bricks through our Landscape Products Service Centres, whose competitive
advantage is one of the main reasons why our sales have again risen at a time of
Industry decline.



NATURAL STONE DIVISION



This is the first occasion on which we have provided separately information on
our Natural Stone business.  We said we would do so because the business has now
reached the size where it merits the status of a Division.  It includes our own
natural stone products, imported stone and granite products, and aggregates sold
from our own quarries.



In the first six months, sales of this new Division, including Stancliffe Stone
acquired in June 2001, amounted to £12.5 million, an increase of 52 per cent
over last year.  Organic growth in sales was 16 per cent.



EMERGING BUSINESSES DIVISION



The results of this Division last year incorporated our Natural Stone business.
The sales of the remaining businesses, on a like for like basis, increased by 13
per cent to £17.5 million in the period.



In the case of Drainage and Flooring, two businesses where we have been
investing capital and making structural changes, sales were significantly ahead
of last year.  Street Furniture also saw a good improvement in sales.



CHAIRMAN'S STATEMENT



Christopher Burnett, Chairman said 'The first half sales performance is
pleasing, given the unusual trading conditions in June.  We are currently
experiencing growing commercial and public sector activity; however last year's
second half was very strong.  Industry forecasts are predicting that
construction growth will exceed the increase in gross domestic product for the
first time since the 1970's.  If, as we expect, domestic demand returns to more
normal levels, as we have seen in the first three trading days of July, we
should meet expectations for the full year'.



The interim results of the Group will be announced on Friday 6 September 2002.



Enquiries:



Christopher Burnett         Chairman, Marshalls plc             01422 306400
Ian Burrell                 Finance Director, Marshalls plc     01422 306400


Jon Coles                   Brunswick Group                     020 7404 5959
William Cullum              Brunswick Group                     020 7404 5959





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