Marshalls PLC (LSE:MSLH) has told investors it is assuming no material recovery in its end markets during the second half of 2026, even as internal cost actions lifted first-half profit.
The FTSE 250 building products manufacturer, which makes paving, bricks, mortars and roof tiles, left full-year profitability expectations unchanged.
Simon Bourne, chief executive, said the group was focused on what it could control, listing service, cost, cash, working capital and disciplined capital allocation.
Adjusted operating profit rose 8.1% to £30.7 million in the six months to 30 June, on revenue of £317.8 million, down 0.5%.
The gain came almost entirely from a recovery in landscaping, the division whose deterioration forced a profit guidance cut in late 2025 and triggered a turnaround programme.
That plan remains on track to deliver £11 million of annualised cost savings by the end of the financial year.
Water Management, which supplies drainage products, is building a pipeline tied to the AMP8 investment cycle now under way at the privatised water companies.
Marley Roofing took market share in a competitive concrete tile market, while Viridian Solar continued to benefit from building regulations requiring lower carbon emissions in new homes.
Bricks and masonry remained the weak spot, squeezed by subdued demand from housebuilders, though mortars and screeds held up.
Adjusted profit before tax climbed 13.2% to £24.9 million, helped by lower finance costs and a reduced effective tax rate.
Adjusted earnings per share rose 14.4% to 7.6p and the interim dividend was raised 13.6% to 2.5p.
On a reported basis, pre-tax profit jumped 68.4% to £19.7 million as adjusting items roughly halved year on year.
Net debt before lease liabilities fell to £136.8 million from £151.6 million, leaving leverage at 1.7 times, with operating cash conversion of 98%.
Returns lagged, with adjusted annualised return on capital employed edging down to 7.2%.
