Marshalls benefits as people spend more time at home

The Elland-based firm said that sales to the domestic market rose 10 per cent on a like-for-like basis in July, August, September and October.

Many homeowners have chosen to spend money updating their outdoor space at a time when people are spending much more time at home.

The firm said that although market demand remains uncertain, it is focused on developing future growth opportunities and delivering the strategic objectives in its five year strategy.

“Our strategy is underpinned by strong market positions, focused investment plans and an established brand,” the firm said in a trading update.

Following the strength of recent trading, the firm is improving its expectations for 2021.

Marshalls, which is led by chief executive, Martyn Coffey, said that trading since the half year has continued to improve and it also improved in the four months to October 31.

Group sales have returned to the same level as 2019 on a like-for-like basis as the firm navigates its way through the coronavirus pandemic.

Sales growth has continued to increase and, on a like for like basis, group sales in October were up 5 per cent compared with the equivalent prior year period.

The company said the key drivers of this growth have been continued strong demand in the domestic market, a return to more normal levels of trading in the public sector and commercial market and continued strong growth in the international market.

The survey of domestic installers at the end of October showed a healthy order book of 12.8 weeks, up from 10.9 weeks in October 2019.

Analyst Graeme Kyle at Shore Capital said: “We understand that group like-for-like growth in November is at a similar level to October (+5 per cent) and has not been materially impacted by Lockdown 2.

“We expect to modestly increase our 2020 revenues forecast. Our 2021 forecasts are already materially above consensus. We are comfortable with this as it reflects our long-standing more optimistic outlook for construction demand.”

For the four months to October 31, sales in the public sector and commercial market were down 6 per cent compared with 2019, on a like for like basis, which is a significant improvement compared with the first six months of the year when sales were down 28 per cent.

The group is targeting markets where higher levels of growth are anticipated, including infrastructure projects in road, rail and water management.

The construction and manufacturing sectors are exempt from England, Scotland and Wales second Covid-19 national lockdown restrictions. All Marshalls manufacturing sites are fully operational and the firm said its priority is the safety and well-being of its employees, suppliers and customers.