12th Dec 2018 08:26
LONDON (Alliance News) - Paving stone manufacturer Marshalls PLC said Wednesday it expects to "exceed" full-year expectations, after revenue growth has accelerated of it, while it also announced the acquisition of brick maker Edenhall Holdings Ltd.
Marshalls explained the boosted expectations were driven by "better" second half revenue growth which has resulted in "strong" trading. For the 11 months ended November, revenue grew 14% to GBP465 million from GBP407 million the year prior.
"The self-help programme to support organic growth is progressing well and the underlying indicators in the new build housing, road, rail and water management markets remain supportive," Marshall added in a statement.
In a separate announcement, FTSE 250-listed Marshalls announced it had acquired concrete brick manufacturer Edenhall for up to GBP17.2 million on a debt and cash free basis.
Marshalls will pay an initial GBP11.8 million cash consideration as well as a further GBP5.4 million deferred consideration. The initial consideration has been reduced by GBP5.2 million to reflect the net debt balance at Edenhall.
In 2017, Edenhall generated GBP2.8 million in pretax profit from revenue of GBP33.0 million. For comparison, Marshalls generated GBP52.1 million pretax profit on GBP430.2 million over the same period.
"Marshalls' strategy is to grow both organically and through carefully selected earnings enhancing bolt-on acquisitions with a particular focus on those parts of the market where higher levels of growth are anticipated, including new build housing, road, rail and water management," Marshalls Chief Executive Officer Martyn Coffey said.
"The acquisition of Edenhall represents a significant step towards achieving further growth in the new build housing market," Coffey added. "Edenhall is a profitable business with a strong track record of quality, reliability and service, primarily targeting builders' merchants and regional and national housebuilders. The acquisition is in line with our stated strategy of expanding into adjacent building products related to new build housing."
Shares in Marshalls were 4.1% higher at 434.00 pence on Wednesday.
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