Marshalls Regulatory News (MSLH)

25 July 2025

Marshalls plc

('Marshalls' or 'Group')

Trading Update as challenging market for Landscaping continues

Marshalls, a leading manufacturer of sustainable solutions for the built environment, provides the following trading update for the six months to 30 June 2025 and Notice of Results.

Trading performance

The Group delivered revenue of £319 million (2024: £307 million), which is a year-on-year increase of four per cent with volume growth being partially offset by weaker pricing and product mix. However, activity levels in our key end markets softened from the end of May, and the Board does not currently see any immediate catalyst for improvement in these for the remainder of 2025.

Landscaping Products revenue contracted by one per cent year-on-year to £135 million (2024: £137 million), which is a significant improvement on the 11 per cent year-on-year reduction reported in the second half of 2024. This positive revenue trend has been underpinned by improved engagement with key customers leading to volume gains and regaining of market share.

However, Landscaping end markets remain challenging with structural overcapacity in the UK supply chain continuing to exert downward pressure on prices. Additionally, cumulative inflation in building materials has driven increased value engineering in construction projects, shifting demand toward commodity products over higher margin value-added solutions. The combination of these market headwinds, together with a less profitable product mix, underutilisation of our manufacturing network and targeted investment in pricing to win share, have impacted profitability during the period. This fell short of the Group's original expectation and the Board is now assuming that these headwinds continue with no increase in market activity levels in the remainder of 2025. This is expected to result in continued pressure on profitability in the second half.

A central part of the Landscaping improvement plan is optimising our manufacturing footprint to create a more flexible and responsive national network. In the first half of the year, the Board acted to reduce capacity through a partial site closure, which will deliver annualised savings of approximately £3 million.

Further actions are planned in the second half to improve profitability, aiming to increase the total annualised benefit to approximately £9 million. Alongside this, we remain focused on executing all key workstreams at pace, positioning us for a material improvement in performance in 2026.

Building Products revenue grew by five per cent to £86 million (2024: £82 million). This growth reflects a continued strong performance in Water Management driven by good commercial execution alongside securing incremental infrastructure business. In addition, our Mortars business delivered good revenue growth with moderate improvements in build rates on housing developments favouring ready-to-use mortars.  Brick revenues contracted in a competitive market as the business maintained a disciplined pricing strategy, choosing to protect margin rather than chase volume at lower prices.

Roofing Products revenue increased by 11 per cent to £98 million (2024: £88 million), sustaining the strong momentum reported in the second half of 2024. This performance was primarily driven by the continued exceptional growth of Viridian Solar, which achieved approximately 50 per cent revenue growth in the first half of the year. Additionally, Marley Roofing delivered modest gains, reinforcing its market-leading position by growing its share in clay plain tiles and timber battens, while holding share in concrete tiles.

Balance sheet and liquidity

The Group's balance sheet remains strong, ending the period with pre-IFRS16 net debt of £152 million (June 2024: £156 million; December 2024: £134 million). The increase in net debt in the first half reflects the anticipated impact of the Group's seasonal working capital requirements together with the settlement of the final Viridian Solar contingent consideration payment of £6.6 million. The Group had £145 million undrawn on its revolving credit facility at the end of the period, which provides the Group with significant liquidity to fund its strategic and operational plans.

Outlook

Being mindful of continuing uncertainty in the macro-economic environment, the Board currently sees no improvement in market activity levels through the remainder of 2025. Accordingly, its full year expectations for the Group have reduced and it now expects adjusted profit before tax to be in the range of £42 million and £46 million in 2025. In response, the Board is taking decisive action to accelerate the optimisation of the national manufacturing network and reduce costs whilst continuing to deliver on all elements of the Landscaping performance improvement plan.

Management will hold a conference call for analysts and investors today at 8am BST. Participants are invited to pre-register for the call via the following link:

https://event.loopup.com/SelfRegistration/registration.aspx?booking=7mfjQZTyvtgveeV1xyFg6P0tqqPWVwKylE3FPRkTWZg=&b=2389e96d-457b-46a8-bebb-fec356d5b031

Upon registration, dial-in details and a unique access code will be provided.

Matt Pullen, Chief Executive of Marshalls plc, said:

"The performance of our Building and Roofing Products segments, which both delivered revenue growth in subdued end markets, demonstrates the benefits of the Group's acquisition strategy. However, our Landscaping Products segment reported a weaker than expected performance. We remain focused on executing the performance improvement plan in this segment, however the softening of demand, a weaker product mix and targeted price investment have reduced our Group profit expectations for 2025. We have taken action to reduce costs and optimise our national manufacturing network in the first half of the year and are taking further action at pace in the second half, which together are expected to improve Landscaping profitability materially in 2026.

We remain focused on executing our 'Transform & Grow' strategy and are well positioned to respond swiftly to improving activity levels when our key end markets recover."

Notice of results

The Group will announce its results for the six months ended 30 June 2025 on Monday 11 August 2025.

A presentation for analysts and investors will be held at 10:00am BST that morning at the offices of Peel Hunt and will also be webcast, details of which will be provided within the results announcement.

The Company will also host a live interactive presentation on the Engage Investor platform at 9:00am BST on Friday 15 August 2025. Marshalls invites all current shareholders and interested investors to join and encourages investors to pre-submit questions. Investors can also submit questions at any time during the live presentation. Investors can sign up to Engage Investor at no cost and follow Marshalls plc from their personalised investor hub.

Register interest for this event here: https://engageinvestor.news/MSLH_IP_25

Certain information contained in this announcement would have constituted inside information (as defined by Article 7 of Regulation (EU) No 596/2014), as it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018) ("MAR") prior to its release as part of this announcement and is disclosed in accordance with the Company's obligations under Article 17 of those Regulations.

Enquiries:

Note to the Editor:

About Marshalls plc:

Established in the late 1880s, Marshalls plc is a leading UK manufacturer of sustainable solutions for the built environment. It operates through three trading divisions: Landscaping; Building; and Roofing. At a Group, divisional and brand level, Marshalls' strategy centres around its customers who value its unique set of capabilities, namely leading brands, best in class technical and design support and carbon leadership. This is underpinned by business wide enterprise excellence, leadership in ESG governance and standards and its people, organisation, and culture.

The Group operates a national network of manufacturing and distribution sites. 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. Its strategic goal is to become the UK's leading manufacturer of sustainable solutions and products for the built environment. 

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 2024.