Marshalls plc, the Elland, West Yorkshire-based stone and landscaping firm, said its revenue rose 2% to £354.1 million for the six months ended June 30, 2023.

This included the contribution of four additional months of revenue from recent acquisition Marley.

“On a like-for-like basis, group revenue contracted by 13 per cent, with lower revenues in all reporting segments and a particularly weak performance from Marshalls Landscape Products,” said the firm.

Adjusted profit before tax fell 26% to £33.2 million.

Marshalls declared an interim dividend of 2.6p per share, a cut of 54%.

“This reflects the weaker financial performance of the business and the application of the group’s dividend policy to maintain two times cover of adjusted profit after taxation and pay one third of the expected full year dividend at the interim stage,” said the company.

Marshalls is solely focused on the UK construction market. Around 40% of the group’s revenues are derived from new build housing, 40% from commercial and infrastructure end markets, and 20% from private housing repair, maintenance and improvement (RMI).

“Consumer confidence has improved from the low point reported in the second half of 2022, but it remains weak with the benefit of material reductions in inflation and energy bills yet to be felt in household budgets,” said the firm.

“The prospect of higher mortgage rates when borrowers move onto new deals is also a factor for concern.”

Marshalls CEO Martyn Coffey said: “Market conditions in new house building and private housing RMI were challenging in the first half of the year, which led to a material reduction in volumes across all three of our reporting segments.

“This resulted in a significant decline in group profitability compared to the first half of 2022.

“We have responded by taking action to improve our agility, reduce capacity, take cost out of the business, and manage cash.

“Regrettably, these actions necessitated in a reduction of approximately 250 roles across the organisation.

“However, we have been careful to ensure that we have sufficient latent manufacturing capacity that will allow us to respond quickly when there is an improvement in market conditions.

“Our refreshed strategy is underpinned by our strong market positions, established brands and focused investment plans to drive ongoing operational improvement.

“Notwithstanding short-term challenges, the board remains confident that the long-term market growth drivers and a focus on executing key strategic initiatives, will underpin a material improvement in profitability when market conditions normalise.”