The market for construction materials totals over £76bn. 

This is fulfilled through a variety of channels but a significant proportion (over £60bn) comes through distribution and is therefore addressable by the Group.

UK addressable market size by business unit (£bn)

The exposure of the group is majority Domestic and RMI:

Domestic

Commercial & Industrial

Infrastructure

Total Group

Market

RMI

43%

11%

1%

55%

35%

New

23%

18%

4%

45%

65%

Total

66%

29%

5%

100%

100%

Market fundamentals are strong - showing a good recovery post Covid-19.

Construction output forecast: RMI

Construction output forecast: RMI

RMI markets are resilient and less cyclical

.

  • Robust domestic Repair, Maintenance and Improvement ("RMI") market as working patterns drive relocation

  • Carbon targets mean substantial investment is required to upgrade building stock

Construction output forecast: new work

Construction output forecast: new work

Strong new build prospects based on domestic and infrastructure markets

.

  • Average age of UK housing stock is c. 70 years

  • Aim to build 300,000 new homes each year

  • Average annual shortfall of 90,000 homes

  • Clear government intention to increase infrastructure spend

- Dependable end-markets driven by:

  • Housing transactions

  • Consumer confidence

  • Trade resilience vs. consumer

- RMI displays lower levels of cyclicality compared to new build

- Infrastructure is a significant area of potential for the Group

- Public sector exposure of 23% represents an opportunity given the Group's credentials and ambition.

Changes to the market are causing all parties to consider the way that they work - raising expectations and creating opportunities for partners that are able to respond.

Evolving Market

Macro factors

  • Digital and technology developments are having significant impacts across all industries

  • Customer expectations are increasing driven by the experiences enjoyed by consumers

  • ESG is highly relevant across the construction industry

Sector-specific factors

  • Modern methods of Construction ("MMC") are beginning to change the industry.

  • Labour and knowledge scarcity is driving change through the ageing of the construction industry workforce

  • The construction industry has not enjoyed the advances in productivity seen in other sectors