Recovery in housing market lifts Marley profit

RECOVERY in the UK and US housing markets pushed profits at Marley, the concrete, flooring and plastics group, sharply higher in the first half, although the company warned that maintenance and do-it-yourself markets remained weak, writes Tom Stevenson.

David Trapnell, chief executive, said concrete block production in the UK was working at full capacity. But he added there would be no early expansion of capacity because some of the demand was temporary overstocking. Price rises had been attempted last month, although it was too early to tell how well the increases would stick.

Marley hopes to spend up to pounds 150m on acquisitions, especially in plastics, having reduced gearing from 64 to 41 per cent. Pre-tax profits of pounds 26m were flattered by a pounds 6.5m surplus from the disposal of Bisch, the French roof-tile business. Underlying profits rose from pounds 13.2m to pounds 19.5m.

Earnings per share more than doubled to 6.8p (3p). The dividend was maintained at 2.1p, although analysts believe the final, which was cut two years ago, will start to rise this year.

Concrete and clay products showed the strongest growth, with profits increasing from pounds 1.8m to pounds 6.1m after a 15 per cent rise in sales.

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