Trading Update

RNS Number : 6584E

Marshalls PLC

10 May 2017

 

Trading Update: 10 May 2017

Trading Performance

Group revenue for the four months ended 30 April 2017 was up 6 per cent at £135 million (2016: £127 million) with the underlying indicators remaining strong in Marshalls' end markets. The Group's positive cash generation has continued.

Sales in the Domestic end market, which represented approximately 33 per cent of Group sales, were up 13 per cent compared with the prior year period. The survey of domestic installers at the end of April 2017 revealed our highest ever order books of 12.7 weeks (2016: 12.4 weeks) and which compared with 10.9 weeks at the end of February 2017.

Sales in the Public Sector and Commercial end market, which represented approximately 62 per cent of Group sales, were up 2 per cent compared with the prior year period. The Group continues to target those parts of the market where higher levels of growth are anticipated, and Water Management, Rail and Newbuild Housing continue to show strong order intake.

The Group continues to deliver strong operational cash flows through the continuation of the tight control of inventory and effective management of working capital. Net debt at 30 April 2017 was £19.1 million (2016: £33.5 million).

2020 Strategy

Good progress continues to be made delivering the growth initiatives set out in the 2020 Strategy and the Group is continuing to prioritise organic capital expenditure projects. Our significantly increased capital expenditure programme is making good progress. We have increased research and development and new product development resulting in an encouraging pipeline of new products. Our strategy is to maintain a strong balance sheet, flexible capital structure and a clear capital allocation policy that drives growth and rewards shareholders. Our acquisition focus remains centred on the Minerals, protective Street Furniture and Water Management markets. We are being selective but have identified good "bolt-on" acquisition opportunities in each area.

Outlook

The Construction Products Association's ("CPA") recent Spring Forecast predicts growth in UK market volumes of 1.3 per cent in 2017, which represents a slight improvement on their Winter Forecast. Group sales and order intake have continued to be strong in the first 4 months of 2017 such that the Board is now increasingly encouraged regarding the Group's performance for the current year overall.

The Board believes that Marshalls' innovative product range and strong market positions will continue to support the growth objectives of the 2020 Strategy and that the Group is well placed to drive through further sustainable improvements in operational efficiency.

Enquiries:

Martyn Coffey	Chief Executive	Marshalls plc	[phone]
Jack Clarke	Group Finance Director
Andrew Jaques		MHP Communications	[phone]
James White

Note to the Editor:

About Marshalls:

Established in the late 1880s, Marshalls is the UK's leading manufacturer of superior natural stone and innovative concrete hard landscaping products, supplying the construction, home improvement and landscape markets.  Marshalls provides the product ranges, design services, technical expertise, innovative ideas and inspiration to transform gardens, drives and public and commercial landscapes.

Marshalls operates its own quarries and manufacturing sites throughout the UK, including a national network of manufacturing and distribution sites, and has operations in Belgium and sales representation in other international markets.  As a major plc, Marshalls is committed to quality in everything it does, including the achievement of high environmental and ethical standards and continual improvement in health and safety performance.

Forward-Looking Statements:

Any statements in this release, to the extent that they are forward-looking, are subject to risk factors associated with, amongst other things, the economic and business circumstances occurring from time to time in the markets in which Marshalls operates.  It is believed that the expectations reflected in these statements are reasonable but they may be affected by a wide range of variables which could cause actual results to differ materially from those currently anticipated.  More information about the factors that may affect Marshalls' performance is contained in the Annual Report to shareholders for the year ended 31 December 2016.

 

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