Marshalls Plc · LSE:MSLH
Marshalls — Investor Day (June 2019)
102 slides from Marshalls's investor day presentation, Jun 6, 2019
Slide 1: Marshalls
Marshalls Reed Qerter Sences
Slide 2: Capital Markets Event – Mells, Somerset
Marshalls plc Capital Markets Event – Mells, Somerset Thursday 6 June 2019
Slide 3: Capital Markets Event
Capital Markets Event Tea/coffee 0945-1030 Introduction and Agenda Trading Update Martyn Coffey 1030-1045 2020 Strategy Next 5 year Strategy
Slide 4: Capital Markets Event - Agenda
Capital Markets Event - Agenda 1. Specification Selling Pete Hallitt 1045-1055 2. NPD Chris Harrop 1055-1105 3. Delivery Model Simon Bourne 1105-1115 4. Self Help Network Review Simon Bourne 1115-1125 5. Digital Jack Clarke 1125-1135 1045-1215 6. Customer Centricity Pete Hallitt 1135-1145 7. Emergin
Slide 5: Martyn Coffey, Chief Executive
Martyn Coffey Chief Executive
Slide 6: Marshalls 5 Year Strategy to 2020
Marshalls 5 Year Strategy to 2020 Our Values Our purpose is to create better spaces for everyone; Our Purpose socially, environmentally and economically. Leadership Our continuing mission is to deliver sustainable growth through a brand that drives Our Mission customer specification of innovative pr
Slide 7: Delivering long-term sustainable growth
Delivering long-term sustainable growth • Capital allocation policy 1 2 3 4 5 R&D Organic Ordinary Selective Supplementary growth NPD dividends acquisitions dividends Capital investment Increase research Maintain dividend Target selective Supplementary in growth projects. and development cover of 2
Slide 8: The Marshalls 5 Year Business Strategy
The Marshalls 5 Year Business Strategy T Our vision is to Create Better Spaces and Futures for Everyone; h Our Vision Socially, Environmentally and Economically. e Our Continuing Mission is to Deliver Sustainable Growth through a Brand that Our Mission Drives Customer Specification of Innovative Pro
Slide 9: Pete Hallitt, Group Trading Director
Pete Hallitt Group Trading Director Specification Selling Make the spec, keep the Spec!
Slide 10: Specification Strategy
Specification Strategy Make the spec, keep the spec! Pete Hallitt
Slide 11: Commercial Strategy: Merchant Involvement
Commercial Strategy Strategy: • Make the spec, keep the spec! • Direct links with our customers’ customer Specifiers How • Strong digital presence / strategy • Excellent literature and reference data • In field commercial and technical support • Strong trading policy Merchant Involvement • Good rang
Slide 12: RIBA plan of works
RIBA plan of works: Two years minimum from project creation to product on site!
Slide 13: Pipeline Management Process
Pipeline Management Process DATA SOURCE DATA MANAGEMENT PROJECT FOCUS & REVIEW Budget Must Major Architects Project Wins (Not everything) Managers ABI (D&B) Major Contractors CRM Projects Project Owner Mgt Involvement / Team Merchant UP TO £50k Projects Project/ managed by Quote/ Regional Clients in
Slide 14: Marshalls Team
Marshalls Team PROJECT PHASE Design Build Sales Project Engineers Regional Commercial Manager Design Consultants Trading Account Premier Team Managers Managers Merchants Key Design Specialist Internal Contractor Space Teams Sales Teams Managers Total 158 Service Specialist People Centres Teams
Slide 15: Enhancements to our Specification Offer
Enhancements to our Specification Offer An updated and refreshed London Design Space to offer specifiers, designers and clients an enhanced specification experience. A new Marshalls Design Space opening in the heart of Birmingham to support the major redevelopment of the city. Continual development
Slide 16: Enhancements to our Specification Offer
Enhancements to our Specification Offer Development of a market leading digital and virtual reality experience to bring the designers aspirations to life with Marshalls products. Further development of our digital web based design tools allowing designers to seamlessly work with us directly through
Slide 17: Birmingham Big City Plan
Birmingham Big City Plan: • Smithfield Regen | Festival Square: £1bn | Mixed Use & Public Realm • New Garden Square £300m | Mixed Use/Public Realm | In Design • Paradise Circus Regen: £250m | Mixed Use & Public Realm • Arena Central: £250m | Mixed Use & Public Realm • Southside Square & Hill Street:
Slide 18: HS2 Birmingham
HS2 Birmingham Enabling: • WP05 Coleshill: £500m | Major road realignment • EW North Remediation Contracts: £4m | Varied works • EW North Site Clearance Works: £2m | Varied works • EW North Construction Works: £3m | Varied works • EW North L/Itchington Tunnel Roads: £4m | Road construction • EW Nort
Slide 19: Summary
Summary • Added value sales are very valuable to us • We make the spec and hold the spec, early involvement is critical • The barrier to entry for spec is high • Investment in facilities • Investment in people Minimum 2 year lead in! • Digital capability • We have made excellent progress to date • D
Slide 20: Chris Harrop OBE, New Product Development
Chris Harrop OBE Group Marketing & Sustainability Director New Product Development
Slide 21: Market Indicators & Drivers
Market Indicators & Drivers Finance The Need Confidence MAT Value of Flexible Payments from Pensions Over (Lables are growth on Same Qtr Previous year) 9,000 £1,400 4 Quarter Value £ Millions Capacity 8,000 £1,200 16% Normalised Value £millions 20% 7,000 13% £1,000 8% 44% 34% 15% 3% 6,000 49% £800 5
Slide 22: Future Spaces
1 = FUT|URE lat Ate = = = erging themes that will change the'hature,of our bui
Slide 23: Increase in interest since the project began
M9] INCREASE IN INTEREST SINCE THE PROJECT BEGAN . ~FUT URE = ~ SPA Water Management Future Goncrete Biophillic Design Source: Google Trends - Averag Scoring search terms Pre FS = September 20 3- December 20 15 | Post FS = January 206 - September 208
Slide 24: ——Y ay
——Y ay D mm
Slide 25: 'Super Landlords': Pedestals
‘Super Landlords’: Pedestals Our Future Spaces research project revealed that people are moving to cities in their droves. Rising costs for land and lack of space means that in order to accommodate these people, developers need to build up instead of building out: “There are currently just over 270
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Slide 27: 'POPS': Modal Paving
‘POPS’: Modal Paving • Available in both smooth and textured finishes • 10 contemporary colours to choose from • 12 plan sizes available, all in 80mm thickness • Many are available in a permeable paving • Suitable for both trafficked and pedestrian areas
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Slide 29: Placemaking: Vietnamese Granite Range
Placemaking: Vietnamese Granite Range The Marshalls Ethical Risk is the next step on the journey towards full supply chain transparency in the Natural Stone sector. Using a bespoke, independently reviewed scoring framework, customers are given a genuine insight into the ethical challenges facing sto
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Slide 31: Water Management & Climate Change
Water Management & Climate Change
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Slide 33: 'Circular Economy': SPT
‘Circular Economy’: SPT Driveline 50 Red Standard Block Paving Red • Aesthetic – Enhanced colour vibrancy, reduced fading and efflorescence, variety of colour blends • Functionality & Performance – Longer lasting performance at more affordable pricing • Life cost – SPT benefits mean reduced life cos
Slide 34: NE ey =
NE ey = |
Slide 35: Building in Resilience: The Super Shallow 100 Bollard
Building in Resilience: The Super Shallow 100 Bollard
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Slide 37: Low Maintenance: Vitrified Paving & Always Green
Low Maintenance: Vitrified Paving & Always Green
Slide 38: Simon Bourne, Group Operations Director
Simon Bourne Group Operations Director Delivery Model
Slide 39: Logistics Delivery Model - Operations
Logistics Delivery Model - Operations • Marshalls is running an efficient, well thought out hub & spoke logistics model reaching 95% of customers in the UK within 2hrs. • Logistics efficiencies improving on YOY basis with the ability to flex up and down as demand fluctuates.
Slide 40: Logistics Delivery Model – Equipment & Process
Logistics Delivery Model – Equipment & Process • Well balanced fleet to cater for changing customer demands. • Effective use of 3rd party logistics partners. • Introduction of e-pod to reduce paperwork and increase order confirmation/receipt accuracy. • Continued use of telematics to track customer
Slide 41: Logistics Delivery Model – Further Opportunities
Logistics Delivery Model – Further Opportunities • Continue to increase our flexibility on deliveries. • Reduction in empty running. • Reduction in 3PL partners. • Introduction of WMS to our yards. • Further utilisation of our NPS to drive customer service & engagement. • Reduction in internal RPL’s
Slide 42: Simon Bourne, Self Help Network Review
Simon Bourne Group Operations Director Self Help Network Review
Slide 43: Self Help Network Review - Drivers
Self Help Network Review - Drivers FIT FOR THE FUTURE VOLUME LEVERAGE AND CAPACITIES, DEMAND PROFITABILITY AND TRANSPORT We need to ensure that we Understand how to achieve Transport costs will only invest appropriately in the efficiencies by maximising increase in the future and we right areas to p
Slide 44: Self Help Network Review - Approach
Self Help Network Review - Approach Complete in depth review of current network & capabilities IT IS • A strategy of investment & supply for the growth of manufactured products IT IS NOT • A strategic review of all that is Marshalls Resulted in 3 guiding principles. • A fixed solution
Slide 45: Self Help Network Review – Equipment Blueprint
Self Help Network Review – Equipment Blueprint
Slide 46: Self Help Network Review – Progress So Far
Self Help Network Review – Progress So Far 2018 2019 2020 2021 2022 All 6 enabling 5 projects 5 planned. 3 planned. 2 planned. projects planned for 2019. completed 1 complete. successfully. 2 commenced. 2 for later in year. 1. North 2nd pack line and facemix upgrade. 2. South additio
Slide 47: Self Help Network Review – What Does It All Mean?
Self Help Network Review – What Does It All Mean?
Slide 48: Jack Clarke, Digital
Jack Clarke Group Finance Director Digital
Slide 49: Digital: Approach, Platform and AI
Our Approach Our Digital Platform Artificial Intelligence Machine Learning - Pricing Language Processing - Voice / Chatbot Computer Vision - Visualisers Digital Disruption Future Customer Journey
Slide 50: Our Approach
Our Approach RIGHT DATA RIGHT TIME RIGHT FORMAT £ START FINISH TRADITIONAL DIGITAL BUSINESS BUSINESS SUPPORT CUSTOMERS JOURNEY STEP 3 CUSTOMER TOUCHPOINTS 25% COMPLETED £ STEP 2 DATA & SYSTEMS 60% COMPLETED STEP 1 INFRASTRUCTURE 75% COMPLETED I N V E S T M E N T I N T O T H E D I G I TA L P L AT F O
Slide 51: Artificial Intelligence – Disciplines
Artificial Intelligence – 3 Disciplines MACHINE LEARNING PRICING NATURAL LANGUAGE PROCESSING CHATBOT Ai VISUALISERS COMPUTER VISION
Slide 52: ML Pricing - Architecture
ML Pricing - Architecture QUOTE ORDER PRICING PRICING CUSTOMER TOUCHPOINTS REALTIME DASHBOARD Ai MODELS BACKBONE INTERFACES CONTROL BACKBONE DATA & SYSTEMS D ATA LAKE INFRASTRUCTURE
Slide 53: ML – Roadmap
ML – Roadmap PRICING PRODUCTION STOCK LOGISTICS MARKETING 2019 FUTURE FUTURE FUTURE FUTURE TIMELINE MODEL LEARNING & IMPROVEMENTS DEVELOPING INTERNAL CAPABILITIES
Slide 54: NLP – Overview
NLP – Overview NOT JUST VOICE Rise of smart Changing use of speaker / digital web (click to assistants SMART DISPLAYS, SPEAKER & voice) PHONES £ £ EMAIL 365 24/7 Secure customer invocation assistance phrase £ £ MOBILE ASSISTANCE & CHATBOT IT’S TEXT TOO
Slide 55: NLP Architecture
NLP Architecture SMART C H AT B OT EMAIL SPEAKER CUSTOMER TOUCHPOINTS M.A.R NLU BACKBONE BACKBONE BRAIN DATA & SYSTEMS PIM DAM FAQ STOCK INFRASTRUCTURE
Slide 56: Visualisation - Architecture
Visualisation - Architecture VR AR 360˙ CUSTOMER TOUCHPOINTS M.A.R VISUAL BACKBONE BRAIN SERVICE BACKBONE DATA & SYSTEMS BIM PIM DAM MODELS INFRASTRUCTURE
Slide 57: Visualisation – Web Demo
Visualisation – Web Demo
Slide 58: Preventing Disruption
Preventing Disruption TECHNOLOGY TECHNOLOGY TECHNOLOGY DISRUPTOR DISRUPTOR DISRUPTOR MANUFACTURERS MERCHANT INSTALLER CONSUMER 1 2 3 4 MARSHALLS DISRUPTION RESPONSE SMART CHATBOT Ai VR AR SPEAKER
Slide 59: Future Customer Journey
Future Customer Journey VISUALISATION INSPIRE VOICE / WEB PERSONALISED CONTENT SEARCH PRICE ENQUIRY AUTOMATED MANUAL AGENT ORDERS AGENT SELECT / DELIVER DELIVERY COMMS RE-ENGAGE AFTERCARE
Slide 60: Pete Hallitt, Customer Experience
Pete Hallitt Group Trading Director Customer Experience
Slide 61: The Marshalls Customer Experience Vision
The Marshalls Customer Experience Vision Understand the Customer Journey Culture Fully Best practice customer centric To grow the business by providing an outstanding customer experience at Challenge/ Embedded Continuous into business every step in the customer improvement strategy journey so that M
Slide 62: How do we measure Customer Experience at Marshalls?
How do we measure Customer Experience at Marshalls? 1. Independent Survey By External Experts B2B • Twice yearly - detailed survey • Merchant and contractor/installer customers • Generates Net Promoter (NPS), Customer Satisfaction and Customer Ease/Effort scores 2. Transactional Satisfaction Surveys
Slide 63: How is Marshalls performing currently?
How is Marshalls performing currently? • Our Commercial NPS score is GOOD • Our Domestic NPS score is GREAT • Marshalls significantly outperforms its peer group NPS in Landscaping • However, Marshalls is striving to be OUTSTANDING in all measures
Slide 64: What do customers love about Marshalls?
What do customers love about Marshalls?
Slide 65: What do we do with the data?
What do we do with the data? • Dedicated Customer Experience Team and Customer Experience Champions in each function across the group. • Regular data reviews involving all internal stakeholders • Investigate pain points identified • Risks, Actions, Issues and Decisions log for project management • W
Slide 66: Current key focus areas
Current key focus areas • Speed of issue resolution • Delivery communications • Quality and service ALWAYS consistent with our brand promise • Availability of stock
Slide 67: Customer Experience Improvements Implemented
Customer Experience Improvements Implemented Delivery Communications Text order confirmation to site Driver Site Instructions To avoid failed deliveries Installation Instructions & Product Data Hyperlinks on orders Issue Resolution Improvements Forms - Team assisting account holders
Slide 68: Customer Experience Improvements Currently In Trial
Examples of Customer Experience Improvements Currently In Trial Add-on supplementary items System automatically calculates and adds complementary items To reduce human error and omissions. Electronic Proof of Delivery EPOD To confirm delivery and reduce invoice reconciliations/queries. Screen
Slide 69: Creating a Customer Centric Culture in Marshalls
Creating a Customer Centric Culture in Marshalls • World Class Training Programme • Customer Service Training on-going programme • Internal communications programme • Infographic newsletters on latest research results and improvements • Screen savers • Booklet for all staff • Customer Experience Tea
Slide 70: Meet the Customer Personas!
Meet the Customer Personas! We also share our research results and our improvement updates with our customers twice yearly.
Slide 71: Tom Poole, MD Emerging Businesses
Tom Poole MD Emerging Businesses
Slide 72: Emerging Businesses
Emerging Businesses o CPM o Landscape Protection o Minerals o Marshalls Premier Mortars & Screeds
Slide 73: CPM - Two Manufacturing Sites: Pollington
CPM - Two Manufacturing Sites of Similar Outputs Pollington – East Yorkshire
Slide 74: CPM - Two Manufacturing Sites: Mells
CPM - Two Manufacturing Sites of Similar Output Mells - Somerset
Slide 75: Water Management Products to Convey, Store, Control & Treat
Water Management Products to Convey, Store, Control & Treat Manhole/Pipe Combination
Slide 76: Mells – 2018 New Precast Factory
Mells – 2018 New Precast Factory Increasing Bespoke Products Capability
Slide 77: Strong Growth in Special Products
Strong Growth in Special Products The Perfect Manhole System Bespoke Precast Water Management – Offsite Solutions Redi-Rock™ Modular Walling System • Flood Defence • Smart Motorways • Rail • New Build Housing
Slide 78: Marshalls CPM - Key Highlights
Marshalls CPM - Key Highlights o Integration has gone to plan o Business is performing well o Strong experienced Management Team o Successful capital investment in new production facility at Mells o Growth in specialist water management products remains a key focus and opportunity o New Product Deve
Slide 79: Marshalls Landscape Protection
Marshalls Landscape Protection Defend Deter Deflect Crash tested products, Non-crash tested street furniture PAS 170 certified bollards and certified to PAS68 and IWA.14.1 products that offer a visual bollards for areas that do not deterrent solution require crash tested solutions Creating Landscape
Slide 80: The Future of Protective Street Furniture
The Future of Protective Street Furniture • Enhancing public spaces • Inherent strength • Including Hostile Vehicle Mitigation (HVM) performance • International traction being attained
Slide 81: Marshalls Super Shallow 100 Bollard Test
Marshalls Super Shallow 100 Bollard Test To view video please follow the link: https://www.youtube.com/watch?v=WWo_JkTyACs
Slide 82: Marshalls Premier Mortars & Screeds
Marshalls Premier Mortars & Screeds • Ready to Use mortars & screeds • Residential and commercial markets • Still opportunities for geographical expansion • Top line growth positive • Differentiate on service • Ability to use infrastructure to launch new products • Liquid screeds opportunity Traditi
Slide 83: Minerals Business - Enhance Margins Through Efficiencies
Minerals Business - Enhance Margins Through Efficiencies Capital investments driving costs down
Slide 84: Andy Cotton, Managing Director Edenhall
Andy Cotton Managing Director Edenhall
Slide 85: Edenhall
EDENHALL |
Slide 86: Products & Brands
Products & Brands Bricks Cast Stone Darlstone Walling Wallingstone 80% 8% 12% 2018 Sales revenue £33 Million
Slide 87: Customers
Customers Builders Merchants Housebuilders / Developers
Slide 88: Sales Revenue by Product
Sales Revenue by Product 2012 - £13.5 Million 2018 - £33 Million Other Brick Facing Brick Other Brick Facing Brick Cast Stone Wallingstone Cast Stone
Slide 89: Edenhall Bricks
Edenhall Bricks • Large selection of colours and textures • Extensive investments in R&D • Competitive rates and availability • Technical performance • Resistance and objections to overcome BUT “not all concrete bricks are the same” and we need to differentiate Edenhall.
Slide 90: Case Study – Former Nestle Factory Site in Hayes
Case Study – 2016 December – First Meeting with Barratt London and their commissioned architects 2017 January – Meeting with Barratt London Head of Design Former Nestle Factory Site in 2017 February – Barratt London visited two Edenhall plants as part of their due Hayes diligence. 2017 March – Edenh
Slide 91: Edenhall New Factory
Edenhall New Factory • New plant commissioned in 2019 at Grove site, near Bridgend, South Wales • £6 million investment between July 2018 and Feb 2019 • Capacity of 100 million brick equivalents per annum • Products include Facing Brick, Engineering Brick and Blocks
Slide 92: Factors Driving the Investment
Factors Driving the Investment • Current & future market demand in housebuilding sector • Modern low-cost plant to future proof the business • Creates a barrier for entry to potential competitors • Highly automated, safe & efficient manufacturing process • Located next to sustainable raw material so
Slide 93: Marshalls and Edenhall – "A Good Fit?"
Marshalls and Edenhall– “A Good Fit?” • Similar culture • Background in concrete products • Focus on manufacturing • Overlap in customers and markets • Complimentary product offering • “Expansion” into the vertical masonry façade of buildings • UK based
Slide 94: Opportunities for Growth
Opportunities for Growth • Focus on housing market • Walling stone – link up the 3 current brands and market • Facing bricks – remove barriers and increase awareness • Engineering bricks • Other bricks and blocks – via the strong existing networks • Architectural Cast Stone • Utilise the assets in t
Slide 95: Louise Furness, Group HR Director
Louise Furness Group HR Director People & Talent Development
Slide 96: People
People Successful business Focussing on improving Leading the way on engagement recruitment and diversity Investing in talent and People are the only true development differentiating asset
Slide 97: People Change: Why?
People Change: Why? • Informed and driven by the next strategy evolution and direction • Huge people potential to be realised • Appetite and emphasis on changing / people agenda is growing • People will be the differentiator to future business performance • Priorities now clear • People Essentials •
Slide 98: Changing: But How?
Changing: But How? 01 Talent and recruitment 02 Engagement and communications 03 Colleague development and training 04 Reward and recognition £
Slide 99: Talent and Recruitment
Talent and Recruitment Candidate In-house Talent moves: Value proposition: experience that recruitment model internal mobility sell! lasts
Slide 100: Reward and Recognition
Reward and Recognition £ Pay and benefits Extend Formal recognition Data and strategy governance processes analytics
Slide 101: Following The Marshalls' Way
Following The Marshalls' Way We have the right people with the right skills. We have the We do business They demonstrate Right Products in the our values and made in the Right Way behaviours, putting Right Way employee safety first We get our We exceed We have products customer & user a brand that s
Slide 102: Questions & Answers
Questions & Answers