Fletcher Building full year net profit up 4 pct

NZPA

Wednesday 17th August 2011

Fletcher Building reported a 4 percent rise in full year net profit to $283 million, with the results including three months of operating earnings from Crane Group which was bought during the year.

Operating earnings -- before interest and tax and unusual items -- were up 14 percent to $596m in the 12 months to June, while revenue lifted 9 percent to $7.42 billion.

Net earnings before unusual items rose to $359m from $301m the year before, with the company to pay a final dividend of 17c per share, up from 15cps a year earlier.

Chief executive Jonathan Ling said the result reflected mixed trading conditions seen in the key markets in which Fletcher Building operated.

The result was driven by strong performances in the infrastructure and laminates and panels divisions, together with the initial contribution from Crane, Ling said.

Most divisions reported stronger trading performances from Australian operations. Formica also reported good growth from its Asia operations and a strong improvement in North American earnings despite flat volumes in that market.

Businesses exposed to the New Zealand market generally reported flat or lower earnings, as a consequence of a slowdown in construction activity seen during the course of the year and also as a result of the significant disruption from earthquakes in Canterbury, Ling said.

"Market conditions have been tougher than we anticipated at the start of the year, with no recovery evident in New Zealand, and Australia showing clear signs of having slowed in the second half.

"Looking ahead, we remain uncertain around the timing and pace of a recovery in the New Zealand construction industry, but are well positioned for the upturn when it comes."

Fletcher Building said that unusual items after tax totalled $76m, relating to costs associated with the acquisition and restructuring of Crane, inventory and goodwill write-downs in the Australian insulation business, and adjustments to the carrying value of other assets.

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