Marshalls: Yorkshire building materials firm sees trading boost on horizon from Labour's housing plans
Yorkshire-based building materials giant Marshalls says it is expects a trading boost from the Government’s commitment to new housing and expected interest rate falls this year after posting reduced revenue and profits for 2024.
The Elland-headquartered company saw revenue drop eight per cent to £619.2m last year while adjusted profit before tax was down two per cent to £55.2m. Marshalls saw pre-tax profits grow by 77 per cent to £39.4 million for the year after cutting costs.
The company told investors it expects a market recovery later this year, which will get stronger as 2025 progresses.
It said in a statement to the London Stock Exchange: “This confidence is underpinned by the Government’s ambition to reinvigorate new house building and to invest in the nation's infrastructure alongside further likely cuts to the base rate.
"The group is well-placed to leverage this recovery through its diverse portfolio of businesses. The group is well positioned to respond swiftly to improving activity levels as key end markets recover and the board remains confident about delivering a material increase in profitability and returns over the medium-term.”
Chief executive Matt Pullen said: "I am pleased to report our results for what has been an important year for Marshalls, where the group has shown resilience in challenging markets by restricting the reduction in profit before tax to two per cent despite an eight per cent contraction in revenue.
"During the year, we also launched our 'Transform & Grow' strategy which establishes a solid foundation for future market outperformance across our diverse and balanced business portfolio.
"We are particularly pleased with the growth in Roofing Products in the year. Marley Roofing returned to growth in the second half of the year and Viridian Solar performed strongly driven by the increased adoption of in-roof solar solutions in new housing. Our Building Products segment, including Marshalls Bricks and Marshalls Water Management, has also strengthened, with revenues improving sequentially in the second half, good profit growth for the full year and an expanding order book.
“The positive performances of our Roofing and Building Products, which contributed more than 80 per cent of our profit in 2024, highlight the strength of a diverse portfolio. The focused improvement plans in Landscaping that were implemented last year are gaining traction and will deliver a progressive and significant improvement in profitability.
"Additionally, our disciplined focus on working capital management has strengthened our balance sheet through a £39 million reduction in pre-IFRS16 net debt. I am proud of the Group's performance and deeply grateful to all my colleagues for their support, hard work and dedication throughout the year.
“As we look ahead, we are encouraged by the Government's commitment to boosting new house building and investing in national infrastructure, which together with our ‘Transform & Grow’ strategy and the positive impact of operational leverage, will benefit all our businesses in the medium term. In the nearer term, we expect a market recovery later this year, which should strengthen progressively."
Mark Crouch, market analyst at EToro, said: “Marshalls’ investors had hoped the building material supplier had turned a corner in 2024.
“After committing to aggressive cost-cutting and streamlining operations to boost efficiency, it has seen some success.”
Shares in the company were down 2.2 per cent in early trading.