Marshalls (LSE:MSLH), the diversified building products manufacturer, reported adjusted operating profit of £30.7 million for the six months ended 30 June, up 8.1% from £28.4 million a year earlier.
Group revenue was £317.8 million, little changed from £319.5 million in the first half of 2025, with the profit gain driven by a recovery in Landscaping Products that offset weaker performance in Building Products and Roofing Products.
Adjusted basic earnings per share rose 14.4% to 7.6p from 6.6p, helped by lower finance costs and a reduced effective tax rate, while adjusted operating margin improved 0.8 percentage points to 9.7%.
The interim dividend increased 13.6% to 2.5p per share from 2.2p, and pre-IFRS 16 net debt stood at £136.8 million, with leverage of 1.7 times and operating cash conversion of 98%.
Landscaping Products remains on track to deliver £11 million of annualised cost savings by the end of the 2026 financial year, with market share gains and improved customer service supporting the early stages of a profit recovery.
Building Products was mixed: Mortars & Screeds stayed resilient, but Bricks & Masonry and Water Management were hit by weak new-build housing demand. Roofing Products held up better, with Marley Roofing gaining share in a competitive concrete tile market and Viridian Solar growing revenue 7% as Part L 2021 regulation becomes embedded.
"We are not factoring a material market recovery into our second half assumptions," said chief executive Simon Bourne, adding that operational progress and the diversified portfolio support the board's confidence in the full-year outlook.
The company said full-year profitability expectations remain unchanged.
News Intelligence what this means for the company
Marshalls grew H1 adjusted operating profit 8.1% to £30.7m despite flat revenue, driven by cost savings in Landscaping Products offsetting weakness in Building Products and Roofing Products. The company is not expecting material market recovery in H2 and has held full-year guidance unchanged, signalling management sees the profit lift as operational efficiency rather than demand-led growth.
The turnaround in Landscaping Products—on track to deliver £11m annualised savings by end-2026—is real and measurable, but it masks underlying market softness: revenue flat, Building Products hit by weak new-build housing, and management explicitly ruling out material H2 recovery. Margin expansion via cost-cutting in a static revenue environment is defensible but not a growth story.
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