Marshalls (MSLH) H1 2024 earnings summary

Executive summary

• Delivered resilient performance in H1 2024 despite weak end markets, with Landscape Products particularly challenged while Building and Roofing Products remained in good shape.

• Revenue declined 13% year-over-year to £306.7m, with adjusted operating profit down 19% to £34.0m.

• Strong cost control, operational discipline, and diversification through recent acquisitions supported cash flow and reduced net debt by £28.8m to £155.8m.

• Interim dividend maintained at 2.6p per share, in line with policy.

• Strategy review underway, with new five-year plan to be presented in November 2024, targeting growth and value creation.

Financial highlights

• Revenue declined 13% year-over-year to £306.7m; adjusted operating profit fell 19% to £34.0m.

• Adjusted profit before tax down 20% to £26.6m; adjusted basic EPS decreased 23% to 7.9p.

• Group operating margin contracted by 0.7 percentage points to 11.1%.

• Adjusted ROCE declined to 7.6% from 10.6% year-over-year.

• Strong cash conversion at 111% of EBITDA; net debt reduced to £155.8m.

Outlook and guidance

• Full-year profit and net debt expected to be broadly in line with previous guidance, assuming modest H2 market improvement.

• Medium-term outlook positive, supported by government housebuilding targets and sustainability trends.

• Strategy review to be detailed at November 2024 capital markets event.