16 Feb 2011

Profit lift for NZ's biggest listed company

9:45 pm on 16 February 2011

New Zealand's largest listed company Fletcher Building has boosted its half year profit by 8%.

The construction and building products firm made $166 million in the six months to the end of December compared with $154 million in the same period the previous year.

Sales rose 2% to $3.5 billion, largely due to a pick-up in its Australian businesses.

Fletcher Building chief executive Jonathan Ling says the result is a strong one in a mixed market.

Mr Ling says the recovery in residential house building has stalled but more infrastructure work and good cost control have helped to grow earnings.

He says the stronger Australian economy has also helped to boost its businesses across the Tasman.

Fletcher Building says it expects a full year profit in line with analysts' expectations, which average $355 million.

Fletcher boss optimistic

Mr Ling says recent building consent data has been worrying but is optimistic things will improve in coming months.

He says building consent figures for December and January are typically volatile and it is clear that many builders and clients took an extended break over Christmas.

Mr Ling believes the crucial time will be from March to May, which are usually strong months, and expects them to be reasonably strong this year compared with 2010.

However, he predicts new house sales to be patchy for the next two or three years.