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Boral lifts first-half profit by 13pc

Prashant Mehra  |  13 Feb 2018Text size  Decrease  Increase  |  
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SYDNEY - [AAP] Building materials supplier Boral (ASX: BLD) has lifted its first-half profit but the growth was capped by significant items including $41 million in integration costs for its US acquisition.

Net profit for the six months to December was up 12.8 per cent to $173 million.

Excluding the significant items, however, profit for the half-year jumped 43.6 per cent to $213.9 million as the group benefited from continuing strong growth at the Australian operations as well as the acquisition of building products supplier Headwaters last year.

Revenue for the period also rose, by 40.3 per cent to $2.94 billion.

Chief executive Mike Kane says the results confirm that Boral's transformation strategy is on track.

"It is very clear that we are seeing synchronised global growth benefiting all three divisions," he said referring to the company's segments Boral Australia, USG Boral and Boral North America.

Earnings in the company's largest division, Boral Australia, rose 12 per cent to $294 million, while the USG Boral joint venture fell one per cent to $149 million as a result of one-off costs.

The newly formed North America division, which includes Boral USA as well as Headwaters, delivered earnings of $184 million compared to just $41 million a year ago.

The division is expected to see significant EBIT growth for the full year to reflect the acquisition, synergy benefits and underlying market growth, with most of the gains skewed to the second half of the year, Mr Kane said.

Profits from USG Boral are expected to grow at a mid-single digit rate in FY2018, while Boral Australia is expected to deliver high single-digit earnings growth in the full year.

Strong growth in infrastructure and non-residential activity is expected to underpin volume growth in FY2018, Mr Kane said.

Boral will pay a 50-per cent franked interim dividend of 12.5 cents per share, up from a fully-franked 12 cents a year ago.

BORAL'S HALF-YEAR PROFIT RISES

* Net profit up 13pc to $173m

* Revenue up 40pc to $2.9bn

* Interim 50pc franked dividend 12.5 cents a share, vs 12cps fully franked

 

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