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Marshalls Plc

Marshalls PLC Revenues up 14% and strong start to 2019

Marshalls plc (LON:MSLH), the specialist Landscape Products Group, announced today its full year results for the year ended 31 December 2018.

Financial Highlights

 

       Year ended

31 December

2018

       Year ended

31 December

2017

Increase

%

Revenue

£491.0m

£430.2m

14

EBITDA

£80.8m

£67.9m

19

Operating profit

£64.8m

£53.4m

21

Profit before tax

 

£62.9m

£52.1m

21

Basic EPS

 

26.29p

21.52p

22

Total dividends – ordinary and supplementary

16.00p

14.20p

13

Final ordinary dividend – recommended

Supplementary dividend – recommended

 

Return on capital employed (“ROCE”)

 

Net debt

8.00p

4.00p

 

21.9%

 

£37.4m

6.80p

4.00p

 

20.8%

 

£24.3m

18

 

up 110

basis points

 

Note

Alternative performance measures are used consistently throughout this Preliminary Announcement. These relate to like-for-like, EBITA, EBITDA and ROCE.

Highlights:

· Revenue up 14% to £491.0 million (2017: £430.2 million)

· Profit before tax up 21% to £62.9 million (2017: £52.1 million)

· ROCE improved 110 basis points to 21.9% (2017: 20.8%) and on a like-for-like basis (excluding the acquisition of Edenhall) ROCE was 23.3% (2017: 24.8%)

· EPS up 22% to 26.29 pence (2017: 21.52 pence)

· Strong cash generation has continued with Group operating cash flow at 92% of EBITDA

· Net debt of £37.4 million (2017: £24.3 million) reflects cash outflow of £16.4 million relating to the Edenhall acquisition

· Final ordinary dividend increased by 18% to 8.00 pence (2017: 6.80 pence) per share

· Supplementary dividend of 4.00 pence (2017: 4.00 pence) per share, reflecting better than expected year end debt levels

· Strong trading start to 2019 – sales up 16% including Edenhall (up 8% underlying) in first 2 months

Delivering our strategic growth objectives:

· EBITDA growth continues alongside improved ROCE, strong cash flows and a strengthened brand

· Self help programme well advanced and delivering efficiency gains

· Organic capital investment continuing strongly

· Research and development expenditure continues to be increased

· Focus on innovation, new product development and service to drive sales growth

· Focus on increasing profitability of the emerging UK businesses continues

· Wide-ranging digital strategy gaining momentum and continuing to drive real benefits across the business

· Integrating CPM and Edenhall and continue to target selective bolt-on acquisitions

· Maintain a 2 times dividend cover policy

Commenting on these results, Martyn Coffey, Marshalls plc Chief Executive, said:

“The Group delivered a strong result in 2018 and continues to outperform the Construction Products Association’s (“CPA”) growth figures, despite ongoing macro-economic and Brexit uncertainty. The CPA’s recent Winter Forecast predicted a decrease in UK market volumes of 0.2 per cent in 2018, followed by an increase of 0.3 per cent in 2019. However, our recent trading has been strong and the underlying indicators in the New Build Housing, Road, Rail and Water Management markets remain supportive to our growth strategy and plans.

Good progress has been made during the year, notably the successful integration of CPM and the ongoing self help programme to drive organic growth and these have been enhanced by the acquisition of Edenhall. The Group’s focus remains the delivery of long-term sustainable growth, whilst maintaining a strong balance sheet and a flexible capital structure.”