Marshalls (MSLH) generates around two-thirds of group revenue from selling building materials to the public and commercial sector, but also serves the domestic sector which accounts for about a third of group revenue. This provides a useful element of diversity, for while sales to the public sector were up a modest 2 per cent in 2017 from a year earlier, sales in the domestic end market rose by 12 per cent.
The rise in domestic sales came despite a relatively subdued repair, maintenance and improvement market in the wider economy, and to some extent reflected spending by people improving their homes and using capital released from pensions.
Throughout the business, Marshalls continued to focus on product innovation as well as operational and manufacturing efficiency. The latter helped to drive return on capital employed 180 basis points higher to 24.8 per cent, excluding the acquisition of CPM. Integration of CPM is proceeding according to plan, and as a specialist in underground operations this takes Marshalls’ product range below the surface, making it more able to offer a full water management capability.
Analysts at Peel Hunt are forecasting adjusted pre-tax profits for the year to December 2018 of 59.5m and EPS of 24.4p (from £52.1m and 21.5p in 2017).
| MARSHALLS (MSLH) | ||||
| ORD PRICE: | 459.2p | MARKET VALUE: | £916m | |
| TOUCH: | 459.2-459.8p | 12-MONTH HIGH: | 487p | LOW: 307p |
| DIVIDEND YIELD: | 2.2% | PE RATIO: | 21 | |
| NET ASSET VALUE: | 118p** | NET DEBT: | 10% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2013 | 307 | 13.0 | 6.9 | 5.25 |
| 2014 | 359 | 22.4 | 10.1 | 6 |
| 2015 | 386 | 35.3 | 14.3 | 7 |
| 2016 | 397 | 46.0 | 19.0 | 8.7 |
| 2017 | 430 | 52.1 | 21.5 | 10.2* |
| % change | +8 | +13 | +14 | +17 |
| Ex-div: | 07 Jun | |||
| Payment: | 29 Jun | |||
| *Not including special dividend of 4p a share **Includes intangible assets of £73m, or 37p a share | ||||
