LONDON (Thomson Financial) - Landscape products group Marshalls Plc. said it
plans to close its concrete manufacturing operations at Cannock and Sawley,
leading to an expected charge of about 8 million pounds, and added that
acquisitions helped first-half sales grow slightly year-on-year.
The charge includes asset write-downs of about 4.5 million pounds and cash
costs of some 3.5 million pounds, and Marshalls expects the cash payback to be
less than a year.
"We will retain Sawley as a regional distribution centre. These proposed
actions should enable us to realise the productivity gains from our investments
in automation over recent years, reduce our fixed cost base, reduce stock
volumes and release cash," the group said.
The group intends to maintain its full-year dividend of 13.85 pence, saying
its cash generation gives it confidence with regard to future dividends.
In a trading update for the six months to June 30, 2008, it said revenue
from operations came in at 211 million pounds compared with 210 million a year
earlier. Acquisitions contributed 1 million pounds to group revenue. Sales to
the public sector and commercial market, which represent about 55 percent of
Marshalls' sales, rose 9 percent and sales to the domestic market fell 10
percent.
"Based on contract awarded data, the outlook for 2008 in the public sector
and commercial market remains positive," Marshalls said.
It added its balance sheet remains strong, with borrowings to end 2008 seen
at a similar level to the end of 2007 and expected to reduce in 2009.
The group will publish its interim results on Aug. 29.
TFN.newsdesk@thomson.com
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