20 Feb 2014

Rebuild boosts Fletcher Building profit

8:01 pm on 20 February 2014

Fletcher Building, which is undertaking much of the Canterbury rebuild work, has reported a rise in first-half net profit driven by further activity in this country and improved conditions in America.

Australasia's biggest building products company reported a net profit of $154 million, up by 5 percent compared with last year, when it made $146 million.

It says it has benefitted from strong momentum in earthquake rebuild work, as well as from rising domestic housing construction and strong demand for houses in Auckland.

The company, which makes building products, formica and laminates, roof tiles and insulation, reported a 2 percent decline in total sales, to $4.2 billion. It says the strong New Zealand dollar more than offset its underlying sales growth.

Conditions in the Australian market were mixed, with improved residential building in New South Wales, flat commercial construction and depressed mining. The US market experienced improved activity, but the European market was flat.

The New Zealand market accounted for nearly half of the company's sales and Australia for about 40 percent.

Fletcher Building will pay a first-half dividend of 18c a share, up by 6 percent on last year.

The company is forecasting full-year operating earnings of $610-$650 million.