MARSHALLS PLC, parent company of roof tile manufacturer Marley, logs an overall 7% reduction in revenue and 24% drop in EBITDA for the year ended 31 December 2023.

This was offset in the firm’s accounts by its acquired division, Marley. Marley Roofing Products sells pitched roofing products, accessories and roof integrated solar. The Roofing Products division reported that revenue increased by £47.4m but this includes the four additional months that were consolidated in 2023. It means that, on a like-for-like basis, Marley’s 2023 revenues were 9% lower than 2022.

Marley’s performance compares to Marshalls’ Landscape Products division suffering a 53% fall in adjusted operating profit. Marshalls Building Products experienced a 54% year-on-year fall to £12.2m, while central costs were reduced by 43%.

Marley Revenue

The company reports that approximately 40% of Marley’s revenues are generated from new build housing and 40% from commercial & infrastructure (including public housing RMI). The balance of around 20% is from private housing RMI.

The challenging market backdrop is blamed for the 9% reduction in like-for-like revenues. Weaker volumes of traditional roofing products were partially offset by revenue growth from Viridian Solar. The solar PV firm acquired by Marley in 2021, benefitted from the growth of energy efficient solutions and changes to Building Regulations, the firm says.

Marshalls adds that smaller reduction in revenues at Marshall’s Marley division than the Group’s other segments was “due to the less discretionary nature of the RMI activity that uses its products”.

Marley’s 12% reduction in revenue in 2023 was driven by weaker volumes of traditional roofing products. The contraction impacted both gross profits and operational efficiency, only partially offset by growing profitability from Viridian Solar.

Outlook

Reporting on the outlook for 2024, Marshalls revenue in the first two months of the year was lower than 2023. The company says it reflects the continued weakness seen in the second half of 2023.

In line with economic and industry forecasts, the Marshalls Board expects activity to remain subdued in the first half of 2024. A “modest recovery” is expected in the second half of 2024 as the macro-economic environment improves but this is now expected to be slower and more modest than previously assumed. It means that revenues in 2024 will be lower than previously expected and that profit will be at a similar level to 2023.

Overall, the Group is said to be well positioned for relative outperformance in the medium-term, with “a material improvement in profitability” as end markets recover.

On 1 March 2024 Matt Pullen was appointed as chief executive, succeeding Martyn Coffey.

Controlling Costs

Matt Pullen, said: “During 2023, the business was necessarily focused on controlling and improving the efficiency and agility of its cost base, leveraging its strength in operations, as well as rigorous and strong management of cashflow.

“I have been with the Group since early January and these first two months have reinforced my view of both the strengths of the business and the significant opportunity to deliver profitable growth and create shareholder value.

“Over the coming months our focus will be on evolving the existing strategy, with a focus on the medium and longer-term market opportunities related to climate mitigation and adaptation and the structural drivers that will fuel demand for the Group’s products and solutions.

“In the short-term markets are expected to remain challenging with continued weakness in the first half of the year followed by a progressive recovery in the second half as the macro-economic environment improves.

“This recovery is however expected to be slower and more modest than previously anticipated.

“The Board remains confident that … the Group is well positioned for relative outperformance in the medium term, and this will underpin a material improvement in profitability as end markets recover.”

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