Marshalls confident despite weak market as profits rise

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LANDSCAPE products group Marshalls today reported growing annual profits and said it is well placed to beat a weak market.

The Huddersfield-based group, which makes products ranging from natural stone paving to security bollards, posted pre-tax profits up 32 per cent to £13.7m for 2011. Revenues increased eight per cent to £334.1m.

Marshalls said while its growth plans should bring positive benefits despite industry body The Construction Products Association predicting falling UK market volumes this year.

It expects commercial work to continue improving from “historically low levels”, but said public sector demand is starting to weaken as current projects are completed. The 2012 Olympics provided a £10m boost for Marshalls which worked on projects ranging from a vast coach park to the Athletes’ Village.

The group said it has “re-balanced production” to meet stronger demand in the south, to “minimise distribution distance and reduce costs”.

Marshalls added the installer market, where approved contractors fit its products for households, remains stable and its international growth strategy is now in place after expanding in Northern Europe through acquisition.

It bought sites in Belgium last year, from where it plans to supply Northern Europe with niche products.

It recommended a final dividend of 3.5p per share, flat on a year ago, but said it is committed to a “progressive” dividend policy.

Chief executive Graham Holden said: “Marshalls has performed well in a tough environment, benefitting from our broad domestic, commercial and public sector customer base and our strong brand.

“Our commitment to innovation and appealing products and the development of our international activities has further boosted our performance.

“Marshalls continues to be well placed to outperform the market in the short term and to benefit more strongly from operational gearing, once market conditions improve.”