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9 February 2005   |   Financial Results

Fletcher Building Limited Results for the Six Months Ended 31 Dec 2004

Directors today announced the unaudited interim results for the six months ended 31 December 2004. Net earnings were $161 million, compared to $111 million in the previous corresponding period.  There were no unusual items.

Fletcher Building achieved operating earnings, that is earnings before interest and tax, of $288 million in the six months to 31 December 2004 - 33  percent ahead of the same period in 2003. The result reflected strong demand throughout the period, and ongoing benefits of operational improvements, together with an extra 3 months of earnings from Tasman Building Products, acquired on 30 September 2003.

The lift in earnings has enabled a further increase in dividends.  The interim dividend will increase to 15.0 cents per share from 11.0 cents per share in the previous year.  Total shareholder return was 50 percent for the 6 month period.

All divisions improved their operating earnings for the third successive year on a continuing operations basis.   Building Products' operating earnings were $121 million (previously $74 million). Distribution earned $42 million (previously $36 million). Infrastructure, a combination of the Concrete and Construction divisions, earned $77 million (previously $62 million).  Laminates & Panels earned $56 million (previously $48 million).

The Chief Executive Officer, Mr Ralph Waters, said "the results are evidence of the good progress the company has made in achieving an enhanced earnings performance and growing the business through capacity expansion and acquisitions where our strategic objectives can be met".

Mr Waters said the outlook for the next six months remained positive.  Despite a slowing in residential markets in Australia and imminently in New Zealand, non-residential building and infrastructure markets remain strong.  This, coupled with further margin improvements, has allowed directors to again upgrade the outlook for earnings, which they now expect to be in the range of $525-545 million before interest and taxation for the full year.

Key Points

  • Operating earnings up 33 percent to $288 million.
  • Group net earnings up 45 percent to $161 million.
  • Cashflow from operations was $224 million.
  • Annualised return on average funds employed increased from 23.9 percent to 30.3 percent.
  • Earnings per share increased from 25.9 cents to 36.7 cents for the half year.
  • Interim dividend increased to 15 cents per share with full New Zealand tax credits plus 40 percent Australian franking credits.

Contact:

Ralph Waters
Chief Executive Officer
Phone: +64 9 525 9169
Fax: +61 9 525 9032

Bill Roest
Chief Financial Officer
Phone: +64 9 525 9165
Fax: +64 9 525 9032