New Zealand's largest steel distribution company Steel & Tube has lifted first-half profit by 35 per cent aided by a surge in construction activity.
Net profit was $10.8 million in the six months ended December 31, up from $8.03 million a year earlier, it said. Sales rose 22 per cent to $258 million.
Chief executive David Taylor said the results were pleasing against a global backdrop of increasing geopolitical uncertainty, financial market volatility and intense domestic competition.
“Construction has underpinned much of our increased activity and though this is likely to plateau, those parts of our business aligned to the sector are expected to continue delivering strong results,” he said.
The company imports, distributes and manufactures around 58,000 steel products and its key industry sectors include commercial and residential construction, manufacturing, heavy and light engineering, energy, viticulture and rural.
It acquired Tata Steel (Australasia) for $28.1m last April and renamed it S&T Stainless.
Mr Taylor said the results show S&T’s ability to maintain earnings and revenue momentum while making significant investments in facilities, plant and connectivity.
In November the company opened new premises in Palmerston North, bringing processing, distribution and stainless operations under one roof.
It was the first of three purpose-built facilities underway as part of a $30m reinvestment programme while construction is under way on a building at Highbrook in Auckland and another is now being commissioned.
Earlier this month the company said it would appeal a court ruling against it following an around $1.75m claim brought by David Levene’s investment firm, holding it accountable for a subsidiary.