Marshalls Share Discussion Threads

[waldron] 26/11/2022 16:05

Consensus

Mean consensus OUTPERFORM

Number of Analysts 8

Last Close Price 296,20 GBX

Average target price 496,29 GBX
Spread / Average Target 67,6%

High Price Target 800,00 GBX
Spread / Highest target 170%

Low Price Target 260,00 GBX
Spread / Lowest Target -12,2%

[masurenguy] 26/11/2022 14:04

James Thorne of Columbia Threadneedle on Marshalls - @32 minutes.

[waldron] 18/10/2022 10:28

Support 225.40p

[waldron] 18/10/2022 10:27

Calendar

OCT/20 Ex-dividend day for interim dividend

[wskill] 18/10/2022 09:52

See IBST had a decent update today should bode well for MSLH which is very unlikely to require a rights issue being profitable and has borrowings of only twice profits ,a more sensible action will be to reduce dividends if required.

[my retirement fund] 12/10/2022 22:06

Another company that failed to fix the roof whilst the sun was shining. This could easily require a fundraising but the issue I suspect is no investors would support it whilst energy prices remain uncertain. The best thing they can hope for is for the Ukraine war to end.

[sphere25] 12/10/2022 11:41

It's all just one big mess out there and we are now paying the price for the excesses of free money. You hope they will be sensible and stick to QT but who knows how fragile the financial system is.

Is it too late? Will they have to reverse QT? The market will move an easy 10% higher in a flash if the FED reverses course at some point next year, which is all good and well for the next debt filled and free money bubblicious party, but it won't be alot later down the line when the whole thing blows up!

BANG!

Anywho...

Berenberg:

"A profit warning from Marshalls (MSLH) was disappointing and Berenberg expects further downgrades for the landscaping materials manufacturer.

Analyst Lushanthan Mahendrarajah retained his ‘hold’ recommendation and reduced the target price from 380p to 280p on the stock, which closed down 2.1% at 244p on Tuesday. The beleaguered shares tanked 17% on Friday after the profit warning.

‘MarshallsR17; profit warning last week was disappointing, in our view, damaging the group’s reputation within the sector as a “more resilient” play,’ he said.

Mahendrarajah said while the group cut expectations for its 2023 financial year in line with his previous forecasts, he has now cut assumptions again, taking Berenberg’s forecast 10% below the new guidance.

‘With leverage the highest in our coverage, its debt floating and exposed to rising rates, and further downgrades likely from a slowdown in the new-build residential market, we struggle to turn more optimistic on the stock,’ he said."

This is all going to be one longgggg, slowwwwww drawnnnnnn out process.

All imo
DYOR

[porsche1945] 10/10/2022 10:04

Love the way people keep saying things related to building are oversold. Check out price action for 2007 through 2014 recession period to see how bad it can get for property and how long it lasts, there is never a soft landing for property and this has been a long time coming. House prices will go back to pre brexit fiasco level 2015 would seem a reasonable assumption, so 20/25pc fall, maybe 30pc in london. Mortgage rates will be high but there are other factors at play as well, ie the U.K. just fxcked after 10 plus years of loony Tories. Expect dividend cut and suspension here to pay Marley acquisition debt.

[kalai1] 07/10/2022 12:25

Marshalls plc issued a trading update for the 9 months ended 30th September. Group revenue was £544m, up 20% including the benefit of the acquisition of Marley, or up 4% on a like-for-like basis. Segmental performance was contrasting, with Marshalls Building Products and Marley doing well, Marshalls Landscape products struggling. Volumes and costs are being reduced in the softer Landscape segment with a view to returning the business to a 15%+ operating margin. But near term this means that FY22 guidance was lowered a little, profit will now undershoot the lower end of consensus expectations. Nonetheless even a minor undershoot of expectations would still count as solid performance given the deteriorating macro environment. Valuation is also increasingly attractive following a 70%+ correction in the share price over the past year. For now the share price remains in this correction, there is no rush to buy. But MSLH is a solid name in the Construction Materials sector and will be well worth owing at some point in the next year or so. Monitor for now...

...from WealthOracle

hxxps://wealthoracle.co.uk/detailed-result-full/MSLH/565

[archy147] 07/10/2022 09:08

r200 - thanks for the nod to WJG, I've bought in there this morning as it looks well undervalued.

I'm stil considering whether to buy here too

[bubloo] 07/10/2022 08:23

managed to finally catch the presentation. Got the impression that they need a fair amount of rejigging their manufacturing base and more dependent on distributors stock situation. Was planning to get in today for long term but not anymore after listening to extremely poor presentation.
any views please.

[bubloo] 07/10/2022 07:53

has anyone got details of how to log on to investor call today. their inefficiency shows as there telephone number provided to get log in details does not work and no response on email provided.
please can someone post the details of how to log in if you have managed to get them

[74tom] 07/10/2022 07:46

Taking on £210m debt to buy Marley at 10.7x EBITDA isn't looking particularly clever at present (given MRSH is now trading at ~4.2x current year EBITDA!)

The key debt covenant is net debt can't be greater than 3x EBITDA, net debt was £252m at 30/06, so if EBITDA falls below £84m then things may get sticky.

That's what I expect the market (and shorters) to play with over the next few months until we get more clarity on UK housing dynamics post huge mortgage increases.

Once clarity is received and assuming it's positive, the likes of MSLH will re-rate significantly. Until then there is a risk of further downside IMO.

[little beaker] 07/10/2022 07:43

It's on the forward view with Q3 down 16%, there will be lots of red ink forward for fy23 which they might not hit.

Best way to play the sector is to buy quality with strong balance sheets. Not sure which companies they would be as I haven't been addressed to do any research but there will be a wave of eliminations and consolidation with those companies coming out as long term winners.

Don't like companies that go on a buying spree in good times like Marshalls have though.

[r2oo] 07/10/2022 07:39

Just like one of my other Holdings: Watkins Jones (WJG), they release a trading update with a mild warning of tougher times on the horizon and the shares tank double digit on panic selling.These are superb buying opportunities in quality companies that are clearly oversold.

[babbler] 07/10/2022 07:25

wow. Slightly below expectations drops 27%!!

[wskill] 07/10/2022 06:57

Seems to all be in the price now we are back to 2015 share price levels but in today's market you never know. Will top up a few more myself as MSLH is a quality company.

[sphere25] 07/10/2022 06:41

Interested to see how this reacts today. It's on the list for the attempt at a longer term holding portfolio, but as per many bearish posts now, it still doesn't feel like the right time.

MSLH have been a quality operator but these headwinds are going to be nigh on impossible to come out of without any damage.

Slightly below the bottom end is a mild warning but this bit here:

"The rate of contraction increased in the third quarter to 16 per cent compared to one per cent at the half year"

That is a substantial drop off and it would be hard to not see further warnings coming here.

The reasons:

"due to a marked softening of demand for private housing RMI in both the UK and international markets and destocking in the distribution channel"

I was trying to ride the momentum higher in VIC yesterday. If you're ahead, oversold and surprise the market with heavy buying coming in it is worth a go for a pop higher but clearly this sector is in trouble. Have to see if 40p holds now!

Anywho, keeping note because I am sure there will come a time when shares do bounce on the warnings.

As I said, I want to buy and the mark downs make some tempting to nibble at, but it is still an awful mess out there.

All imo
DYOR

[waldron] 07/10/2022 06:20

Marshalls will host a conference call for investors and analysts at 9am on 7 October 2022 (today). Please contact MHP Communications via [e-mail] or 020 3128 8666, to receive the conference call details.

[waldron] 07/10/2022 06:17

7 October 2022

Marshalls plc

('Marshalls' or 'Group')

Trading update

This announcement contains inside information

Group revenue for the nine months ended 30 September 2022 was GBP544 million (2021: GBP453 million), which represents year-on-year growth of 20 per cent including the benefit of the acquisition of Marley. On a like-for-like basis, Group revenue growth was four per cent.

The Group's segmental performance followed the trends that we reported at our results for the half year ended 30 June 2022, with the more positive backdrop within Marshalls Building Products and Marley offset by the continuation of tougher trading conditions in Marshalls Landscape Products, which has greater exposure to the discretionary element of private housing RMI.

Marshalls Building Products has seen revenue growth of 22 per cent to GBP149 million (2021: GBP123 million) in the nine-month period, with a particularly strong performance from the Bricks & Masonry business. Demand has remained robust throughout the third quarter, with revenue growth at a similar level to the first half of the year. Marley delivered revenue of GBP84 million in the post-acquisition period, which represents growth of nine per cent compared to the corresponding period in 2021. The business grew in the third quarter, albeit the rate of growth moderated due to a combination of a softer market backdrop and destocking in the distribution channel, however the business continues to trade ahead of our expectations at the time of the acquisition.

Marshalls Landscape Products has continued to face tough trading conditions and reported revenue of GBP311 million (2021: GBP330 million) in the nine-month period, which represents a reduction of six percent. The rate of contraction increased in the third quarter to 16 per cent compared to one per cent at the half year, due to a marked softening of demand for private housing RMI in both the UK and international markets and destocking in the distribution channel. We have responded by reducing our manufacturing output to manage inventory levels, which has impacted the efficiency of our factories in the short term. These actions will reduce capacity and costs within our manufacturing network and trading function to ensure alignment with lower levels of demand and this is expected to reduce operating costs by around GBP10 million per annum from the start of 2023. In the medium term, we continue to target returning this business to a 15 per cent plus operating margin.

The Group's balance sheet continues to be robust, with pre-IFRS16 net debt to proforma EBITDA expected to be approximately 1.5 times at the year end, and we maintain good headroom against our bank facility and its covenants, which will support investment priorities going forward.

We continue to effectively mitigate cost inflation through price increases. However, taking into account the combined impact of the accelerated rate of revenue contraction in Marshalls Landscape Products in the third quarter and the reduction in efficiency resulting from lower manufacturing output in this reporting segment, the Board now anticipates that the outturn for the Group as a whole will be slightly below the bottom end of the current range of market expectations*.

*Company compiled market consensus is GBP98.5 million with a range of GBP95.1 million to GBP101.0 million.

Marshalls will host a conference call for investors and analysts at 9am on 7 October 2022 (today). Please contact MHP Communications via [e-mail] or 020 3128 8666, to receive the conference call details.

Certain information contained in this announcement would have constituted inside information (as defined by Article 7 of Regulation (EU) No 596/2014), as it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018) ("MAR") prior to its release as part of this announcement and is disclosed in accordance with the Company's obligations under Article 17 of those Regulations.

Enquiries:


Chief Executive
Martyn Coffey Chief Financial
Justin Lockwood Officer Marshalls plc [phone]
[phone]
Andrew Jaques MHP Communications 8540
Charlie Barker


Note to the Editor:

About Marshalls plc:

Established in the late 1880s, Marshalls plc is the UK's leading manufacturer of superior natural stone and innovative concrete hard landscaping products, supplying the construction, home improvement and landscape markets. Marshalls provides the product ranges, design services, technical expertise, innovative ideas and inspiration to transform gardens, drives and public and commercial landscapes. Following the acquisition of Marley, the Group is now also a leader in the manufacture and supply of pitched roofing systems, including clay and concrete tiles, timber battens, roof integrated solar solutions and roofing accessories.

The Group operates its own quarries and manufacturing sites throughout the UK, including a national network of manufacturing and distribution sites, and has operations in Belgium and sales representation in other international markets. As a major plc, Marshalls is committed to quality in everything it does, including the achievement of high environmental and ethical standards and continual improvement in health and safety performance.

[sarkasm] 22/9/2022 06:39

Marshalls is today hosting a Capital Markets Day for investors and analysts at its Marley site in Burton upon Trent.

The day is intended to provide an update on Marshalls strategy and opportunities for future growth, following the acquisition of Marley earlier this year.

The presentation materials will be available under the investor relations section of the Marshalls website: www.marshalls.co.uk/investor/results-reports-and-presentations

No new material trading information will be disclosed.

[wskill] 12/9/2022 18:15

Might have had something to do with Avonside going into administration this fall in the share price unsure if MSLH insure against this,or even if Marley supply roofing products to them.

[wskill] 12/9/2022 09:34

Happy that I topped up a few this morning far too cheap at this level results on 18.08.22 were very good , is there an overhang still I wonder cannot see a reason for the fall.

[r2oo] 08/9/2022 07:55

Nearly a 5 percent div yield now too while you wait for the recovery in the sp

[bigbertie1] 07/9/2022 15:37

There has been a surge in private solar panel installations - this could benefit MSLH as Marley supply them.