Landscape-products specialist Marshalls (MSLH) has been fighting a slow but constant battle over the last five years against weak spending on infrastructure and consumers keeping a tight hold on the purse strings. But by keeping a firm hold on costs and trimming capacity, underlying profits have held up surprisingly well.
Headline profits in 2012 were distorted by £21.5m of restructuring and impairment costs, so operating profits provide a much clearer picture; last year these rose by 25 per cent to £16.1m. Once again, it was a tale of two halves, with bad weather trimming sales in the first half by 4 per cent. That trend reversed in the second half to leave sales up 2 per cent on the year.
Crucially, Marshalls is now starting to see signs of a recovery in orders. As chief executive Martyn Coffey pointed out, the group has the ability to increase manufacturing output by 25 per cent without any significant capital investment. Analysts at Numis Securities are forecasting pre-tax profits for the coming year of £17m and EPS of 7.4p.
Group finances are much improved, with debt down from £63.5m to £35.6m thanks to cost control and a £17.5m gain from the sale of a number of sand and gravel quarries.
| MARSHALLS (MSLH) | ||||
|---|---|---|---|---|
| ORD PRICE: | 181p | MARKET VALUE: | £357m | |
| TOUCH: | 180-183p | 12-MONTH HIGH: | 198p | LOW: 122p |
| DIVIDEND YIELD: | 2.9% | PE RATIO: | 26 | |
| NET ASSET VALUE: | 87p* | NET DEBT: | 20% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 312 | -2.4 | -0.4 | 5.25 |
| 2010 | 309 | 10.4 | 4.2 | 5.25 |
| 2011 | 334 | 13.7 | 3.8 | 5.25 |
| 2012 | 301 | -12.2 | -3.3 | 5.25 |
| 2013 | 307 | 13.0 | 6.9 | 5.25 |
| % change | +2 | - | - | - |
Ex-div:04 Jun Payment:04 Jul *Includes intangible assets of £41m or 21p a share | ||||
