Fletcher Building exceeds forecasts in year to June

Building products firm Fletcher Building today announced its June year operating earnings rose 30 per cent to $596 million.

That bettered expectations which were between $560m and $580m after the market darling upgraded guidance on its earnings three times during the year.

The company reported its bottom line net profit rose 38 per cent to $330 million.

The company lifted its final dividend to 17cps from 14c lifting the total dividend to a fully imputed 32cps from 25c.

Fletcher Building shares closed up 5c at $7.18 yesterday. They have risen from $4.60 last June 30 and $1.77c in November 2000.

The dividend, together with the share price rise, meant investors had a total shareholder return of 61 per cent for the 12 months to June 30.

Operating revenue rose 18 per cent to $4.66 billion while the tax bill rose 35 per cent to $167m.

Earnings per share rose 32 per cent to 73.8c.

"The result reflected continued strong demand, along with the benefits of acquisitions and ongoing productivity improvements," chief executive Ralph Waters said.

All divisions lifted earnings. Building Products' earnings before interest and tax rose to $222m from $164m; distribution rose to $81m (previously $73m); Infrastructure to $196m (previously $136m) and Laminates & Panels to $103m (previously $95m.

Mr Waters said the results reflected continuing benefits from the reshaping of the company since its split from the Fletcher Challenge conglomerate four years ago.

"Acquisitions and internal performance improvements have been key contributions to the latest year's earnings growth," he said.

Australian company Amatek bought during the year for $582m and it contributed $30m to operating earnings.

Mr Waters said Fletcher Building's business profile had changed and it had reduced its reliance on the new housing market in New Zealand, increasing its revenue from Australia and from the infrastructure sector.

"These changes, along with the internal improvements, should stand the group in good stead during the current year," he said.

Cashflow from operations rose from $424m to $479m.

The company estimated that economic value added $190m.

- NZPA