Marshalls (MSLH) investor relations material

Half year performance and strategic overview

• Revenue grew 4% year on year, with roofing and building products up 11% and 6% respectively, while landscaping revenue contracted by 1%, a marked improvement from the previous 11% decline.

• Profitability improved in roofing and building products, but landscaping margins were impacted by subdued markets, pricing pressure, and a shift to lower margin products.

• A performance improvement plan in landscaping aims to deliver £9m annualized savings by 2026, with £3m benefiting 2025, through cost reduction, network optimization, and portfolio simplification.

• The group maintained a robust balance sheet, with net debt reduced by £4.2m and operating cash flow conversion at 94%.

Segment performance and financial results

• Roofing saw strong growth, driven by regulatory tailwinds for solar and robust performance in clay tiles and timber battens.

• Building products growth was led by water management and mortars, with water management securing higher margin infrastructure projects.

• Bricks faced pricing pressure due to increased sector capacity and lower activity, leading to a strategic focus on margin over volume.

• Group operating profit contracted by 16% to £28.4m, with earnings per share down 16% and interim dividend reduced by 15%.

Landscaping business transformation

• Landscaping returned to volume growth (6%) due to improved customer engagement and new trading agreements, but margins were hit by price investment and product mix shift.

• The improvement plan includes site closures, production relocation, and a 28% SKU reduction, targeting a clearer, more profitable product range.

• Commercial actions have led to an 8% increase in value add product order intake between April and July.

• The new leadership team is focused on regaining market share and improving margins, with multiyear trading agreements boosting brand presence.