But in light of the weaker market conditions, the Huddersfield-based group is to axe 140 jobs by closing two concrete manufacturing bases at Cannock, Staffordshire, and Sawley, Nottinghamshire.

Marshalls, which decided to bring forward its cost-saving plans in the light of the tougher market and inflationary pressures, is in talks with unions and staff over the closures.

Sawley will be retained as a regional distribution centre. The group's shares closed the day up 16.25p to 147.75p.

Marshalls said the closures would cost about £8m including asset writedowns of £4.5m and a cash cost of £3.5m. The cash cost will be recovered within a year.

Marshalls reported robust demand in its public sector and commercial markets, which account for 55 per cent of revenues, where sales rose 9 per cent in the six months to June 30.

In contrast a slowing DIY market knocked 10 per cent off domestic sales as people spend less on home improvements at a time when they are struggling to cope with rising food, fuel and mortgage costs.

About 80 per cent of the company's domestic sales are installed by professionals on behalf of a householder.

Marshalls said installer order books stood at 8.2 weeks at the end of June, compared with 9.7 weeks a year earlier, although that figure was inflated due to the backlog created by wet weather and flooding last year.

The group, which sponsors the Chelsea Flower Show, said the strength of its brand, its efficient manufacturing and sourcing, comprehensive distribution network and decisive action on cost reduction would maximise its short-term performance in an uncertain market.

Numis Securities analyst Chris Millington said: "Marshalls remains a well managed, invested and balanced business, but the macro-economic headwinds are clearly having a progressively larger impact."

The Construction Products Association is forecasting flat growth in the domestic market this year and a three per cent decline in 2009.

In contrast the public and commercial sector should show growth of 4.6 per cent this year and a further 4.2 per cent increase in 2009.

Marshalls is less exposed to the economic downturn than other home improvement companies as its customers tend to be more affluent and mature than the typical DIY customer.

Revenues in the six months to June 30 rose from £210m to £211m and the group said that acquisitions contributed £1m to group revenue. Like-for-like revenue was maintained.

The group said its balance sheet remains strong and investments over the last few years in both productivity improvements and acquisitions will let it reduce capital expenditure in the medium term.

Given the current outlook, the group has decided to maintain its dividend. That will result in a reported dividend for the full year of 13.85p per share.