Building materials company Boral has lifted its full-year profit by nearly 50 per cent to $441 million, boosted by a strong construction market in Australia and its Headwaters acquisition in the US.
The company’s revenue for the year to June 30 was up 33.7 per cent at $5.87 billion.
The strong results drove up shares in the company. BY 1055 AEST, Boral shares were up 8.3 per cent to $6.95 in a firm Australian market.
“While our business is not immune to unfavourable weather impacts and operational disruptions, the full year results confirm that our transformation strategy is progressing well, and that Boral can deliver significant earnings with highly attractive margins,” chief executive Mike Kane said.
Earnings in the company’s largest division, Boral Australia, rose 15 per cent to $634 million, but those from the USG Boral joint venture fell six per cent to $268 million as a result of higher costs and soft results in several overseas markets.
Boral’s North America division delivered full-year earnings of $368 million, more than three times the $111 million recorded last year, mainly because of the Headwaters acquisition.
Mr Kane said the first year delivered synergies of $US39 million, exceeding the initial $US30-$US35 million target.
“We have increased our initial year-four synergy target by 15 per cent to $US115 million, as a result,” he said in a statement on Wednesday.
Mr Kane said Boral’s earnings growth is expected to continue in the coming years, predicting near-double digit growth without including gains from property.
“Volumes from commercial, infrastructure and major projects activity, and margin improvements are expected to more than offset the impacts of a moderating residential construction sector,” he said.
Boral has forecast earnings from the Australian business to be at least in line with the previous year, while earnings from North America will rise by around 20 per cent.
Boral will pay a 50-per cent franked final dividend of 14 cents per share, up 2.0 cents from a year earlier.
BORAL’S BUMPER FULL-YEAR RESULT
* Net profit up 48.5pct to $441m
* Revenue up 33.7pct to $5.87m
* Final 50-per cent franked dividend 14 cents a share, up one cent