Marshalls’ 2025: revenue up, profits down, and solar still shining
Marshalls has reported a mixed set of full-year numbers for 2025. Group revenue edged up 2% to £632.1 million, but profitability slipped as the company reset its core Landscaping division and absorbed a weaker product mix. Adjusted profit before tax landed at £43.7 million – in line with market expectations – while reported profit before tax fell 55% to £17.7 million after restructuring and other adjusting items.
The strategic narrative is clear: fix Landscaping, lean into regulation-led growth (solar and water) and keep cash tight. There’s evidence of progress, but also plenty still to prove.
Headline numbers investors should know
| Metric | 2025 | 2024 | Change |
|---|---|---|---|
| Revenue | £632.1m | £619.2m | +2% |
| Adjusted EBITDA | £85.0m | £97.8m | -13% |
| Adjusted operating profit | £56.4m | £66.7m | -15% |
| Adjusted profit before tax | £43.7m | £52.2m | -16% |
| Reported profit before tax | £17.7m | £39.4m | -55% |
| Adjusted basic EPS | 13.4p | 16.0p | -16% |
| Basic EPS (reported) | 5.7p | 12.3p | -54% |
| Total dividend (proposed) | 6.7p | 8.0p | -16% |
| Pre-IFRS 16 net debt | £137.9m | £133.9m | +3% |
| Leverage (pre-IFRS 16) | 1.8x | 1.5x | +0.3x |
| Operating cash conversion | 88% | 106% | -18 ppts |
What moved the dial in 2025
- Landscaping Products went backwards on profit: operating profit collapsed 94% to £0.6 million, with a margin of just 0.2% (2024: 4.0%). Volumes rose 4% in a flat market – a sign of share gains – but that was more than offset by targeted price investment (-1%) and a 4% negative mix as customers traded down to lower-margin lines. Restructuring and capacity right-sizing are underway, with £11 million of annualised savings targeted by end-2026 (£3 million delivered in-year).
- Roofing Products held up thanks to Viridian Solar: segment revenue rose 4% to £194.3 million, and operating profit nudged up 2% to £50.2 million (25.8% margin). Viridian Solar delivered about 32% revenue growth on the back of 2021 Part L energy-efficiency regulations. Marley was softer amid competitive concrete tiles and some operational disruption from manufacturing upgrades.
- Building Products grew revenue but not profit: revenue up 4% to £172.0 million; operating profit down 8% to £13.0 million (7.6% margin). Water Management and Mortars did well; Bricks & Masonry struggled in a competitive new-build market.
- Adjusting items weighed on statutory earnings: £26.0 million in total, including £10.3 million non-cash amortisation, £14.1 million of restructuring and impairment charges, and a £1.6 million non-cash write-off of bank fees on refinancing.
Strategy in practice: ‘Transform & Grow’ gets sharper
Management is doubling down on execution. In Landscaping, the aim is to rebuild margins to at least 12% over the medium term by simplifying the portfolio (SKU count down 30%), exiting UK-quarried natural stone processing, tightening discounting, and better aligning capacity with demand. New product launches in H1 2026 are aimed at improving mid-range mix.
In Roofing, Marley is protecting margins while upgrading concrete tile lines for efficiency and resilience. Viridian Solar remains the growth engine, albeit with growth expected to “moderate” through 2026 as the Part L ramp nears completion. Longer term, the Future Homes Standard could expand the addressable UK market, but timing and specifics are not disclosed.
Water Management is positioning for AMP8 – a step-change in regulated water investment – with framework agreements and added design capability. Management expects the 2025 design pipeline to convert to orders with despatches weighted to H2 2026. Capital investment will fit within the existing £20 million to £30 million annual Group capex range.
Balance sheet, funding and dividend
Pre-IFRS 16 net debt rose slightly to £137.9 million, with leverage at 1.8x pre-IFRS 16 adjusted EBITDA. The Group refinanced its £270 million facility in November with no change in commercial terms and an undrawn £125 million at year end. Cash generation remains a plus: adjusted operating cash conversion was 88%, supported by disciplined working capital.
The proposed total dividend is 6.7p (2024: 8.0p), consistent with the policy of 2x cover by adjusted earnings. Adjusted ROCE slipped to 7.0% (2024: 8.2%), with a medium-term ambition of around 15% once margins rebuild and volumes recover.
Segment deep dive: where the opportunities and risks sit
Landscaping Products – growth in share, not yet in profit
Revenue was £265.8 million (-1%), with operating profit at £0.6 million. The self-help plan is sensible and already delivering cost savings, but the numbers show how much mix and price discipline matter at current demand levels. The margin recovery path is the key swing factor for Group returns.
Roofing Products – Viridian Solar offsets Marley softness
Revenue rose to £194.3 million (+4%) with a 25.8% margin. Viridian’s strong 2025 growth is regulation-led. Management expects a slowdown in 2026 as the Part L transition matures. Marley should benefit from in-flight efficiency capex, but competition in concrete tiles remains intense.
Building Products – Water Management and Mortars carry the load
Revenue of £172.0 million (+4%), operating profit £13.0 million (-8%). Water Management is the bright spot with a clear AMP8 pipeline. Mortars benefitted from ready-to-use demand on modest build rates. Bricks & Masonry is biding its time, leaning on lower-carbon credentials while new-build remains subdued.
Outlook: steady markets, tighter execution
Trading in the first two months of 2026 mirrors late 2025, with persistent rainfall noted. Despite geopolitical caution around the Middle East, full-year expectations are unchanged. The priority is disciplined delivery of ‘Transform & Grow’ to improve margins, cash and service. Management is aiming for a material increase in profitability and returns over the medium term.
My take: cautious optimism, with plenty still to do
- Positives: revenue growth resumed; strong cash discipline; refinancing secured to 2029; clear cost-out plan in Landscaping; regulation-led engines (solar and water) are working; leverage remains manageable at 1.8x.
- Negatives: Landscaping’s margin near zero is the headline worry; adjusted ROCE at 7.0% is well below the medium-term goal; Marley’s operational disruption and concrete tile competition need watching; adjusted items are sizeable this year.
In plain terms, Marshalls is not waiting for the cycle to do the heavy lifting. The self-help is real, and if Landscaping’s mix improves even modestly while AMP8 and solar continue to contribute, earnings should rebuild. But until the Landscaping margin recovery shows through, the share will likely trade on execution risk.
Key watchpoints for 2026
- Delivery of £11 million annualised Landscaping cost savings by end-2026 and evidence of margin uplift from 0.2% toward management’s “at least 12%” medium-term ambition.
- Conversion of Water Management’s AMP8 design pipeline into H2 2026 despatches.
- Marley manufacturing upgrades translating into better availability, efficiency and stable margins despite competitive supply conditions.
- Viridian Solar growth moderating as expected, but market share held and ArcBox expansion in the UK and Europe.
- Cash discipline maintained: working capital, capex within £20 million to £30 million, and leverage trending down.
Bottom line
This is a classic transition year: painful in places, but with green shoots. If Marshalls executes on cost, mix and disciplined commercial focus, the operational gearing could be meaningful when volumes improve. For now, it is a show-me story – with Viridian Solar and Water Management doing a lot of the heavy lifting while Landscaping gets back into fighting shape.
