Landscape products group, Marshalls plc, has revealed it could make up to 400 employees redundant, as it makes a series of restructuring proposals following a fall in sales
In its latest trading update, Marshalls unveiled its strategy for coping with the Covid-19 crisis.
Restructuring plans selective site closures, changes in shift patterns and proposed changes to the size of and structure of support functions.
There are potentially up to 400 positions representing 15% of Marshalls total workforce, that may be impacted as a result of these proposed changes.
The paving specialist also revealed it would reopen its plants as demand returns. It said: “The nature of the concrete manufacturing process means our facilities have low re-start time and cost requirements.
“This flexibility and our improved efficiency means that capacity will not be materially reduced by the proposed changes and we will continue to satisfy our customers’ requirements.”
Previous action taken by Marshalls to soften the Covid-19 blow include:
- Board and executive management agreed to a 20% reduction in remuneration.
- Senior managers in the business also agreed a 15% reduction in their remuneration.
- Utilising the government’s scheme which allows the deferral of tax payments that would normally have been payable in the period to 30 June 2020
- Utilise the furlough arrangements.
The group has also signed final agreements with each of NatWest, Lloyds and HSBC for an additional £30, 12-month committed revolving credit facility with each, with a 12-month extension option. These additional facilities comprise £90m. Including these additional facilities, Marshalls now has total bank facilities of £255m of which £230m are committed.
As at 30 April the group had net debt of £69m, on a pre-IFRS 16 basis.
Sales in the first four months through to 30 April were down 27% at £131m when compared with the £180m in 2019.
Marshalls said: “Our operational planning continues to be dynamic and capable of reacting to the changing environment.
“We are closely monitoring cash flows to ensure that the business is in a strong position for eventual recovery.
“The combined effect of the cost reductions, the restructuring programme and the new bank facilities will leave the group stronger and well placed to meet the current challenges and also well positioned for eventual future opportunities.”
