Marshalls lifts FY guidance after strong Q4 drives revenue rise

Landscaping specialist Marshalls lifted full-year guidance on Tuesday after a strong final quarter of the last fiscal year which helped drive a 26% increase in annual revenue despite raw material and labour shortages.

The company, which supplies the domestic and commercial hard landscaping markets, said it expected 2021 trading to be “slightly ahead of its previous view”, adding that its order intake was 13% higher than last year excluding the impact of price rises.

It said that despite ongoing supply chain challenges the outlook for the construction market remained positive, particularly in its key target markets of new build housing, road, rail and water management.

“The underlying indicators remain strong in each of these market areas,” the company said.

Group revenue for the year to December 31 was £589m, up from £469m in 2020 and £542m in 2019 before the pandemic struck. Marshalls said sales growth in the second half of the year was “increasingly strong” and 11% ahead of 2019.

“This positive trading performance across the Group has been achieved despite the continued backdrop of sector-wide raw material and labour shortages,” the company said.

“These operational challenges have given rise to significant cost inflation, additional overtime costs to cover Covid-19 related absenteeism and some customer project delays.”

Marshalls said cost increases were recovered through a mid-year price increase and a further price increase had been implemented successfully in January 2022.

“Underlying market demand continues to be strong and the business has been experiencing trading volumes that are outperforming the Construction Products Association's growth forecasts,” it added.