Fletcher Building reports FY23 results

by | Sep 25, 2023

Fletcher Building LogoFletcher Building has announced its audited financial results for the year ended 30 June 2023 (FY23). The company also announced a fully imputed final dividend of 16.0 cents per share.

The report revealed revenue of $8,469 million, compared to $8,498 million in the financial year 2022 (FY22).

Fletcher Building Chief Executive Ross Taylor said, “Fletcher Building’s FY23 financial result continues to build on the progress we have made in both EBIT levels and EBIT margins over the last several years.”

Despite softer residential markets in New Zealand and Australia, and the major New Zealand weather events in the second half, Group EBIT before significant items grew by six per cent in FY23 to $798 million. Group EBIT margin of 9.4 per cent in FY23 also lifted from 8.9 per cent in FY22 – a good performance in a slowing market. Fletcher Building’s return on funds employed (ROFE) remained ahead of target at 17.1 per cent.

“Net profit after tax was $235 million, impacted by significant items charges of $301 million. The significant items related mainly to additional provisions of $255 million on the New Zealand International Convention Centre and Hobson Street Hotel (‘NZICC’) project,” Mr Taylor said.

Cash flows from operating activities were $388 million, compared to $592 million in FY22. Adjusting for tax, funding costs and lease principal repayments, Fletcher Building businesses generated trading cash flows of $475 million compared to $462 million in FY22. Resulting in the company’s balance sheet remaining strong with $1.4 billion in liquidity.

“The Board has approved a fully imputed and unfranked final dividend for the year ended 30 June 2023 of 16.0 cents per share to be paid on 5 October 2023. Combined with the 18.0 cents per share interim dividend, this brings the total dividend to 34.0 cents per share for the FY23 year.”

“Looking forward to FY24, we expect some further tightening in our overall volumes, so our focus remains on strong customer performance, cost control and pricing disciplines across our businesses. We have shown we are well equipped to continue performing solidly through the cycle,” Mr Taylor said.

“We also continue to look beyond the cycle and are now well into our $800 million growth investment programme for the period FY23-FY26. Identified opportunities have been assessed against robust criteria including exceeding our ROFE target rates of 15 per cent. These include the Laminex Taupo wood panels plant, Comfortech insulation, a new Frame & Truss plant, and the acquisitions of Tumu and Waipapa Timber. These will progressively mature over the coming couple of years and by FY27 we would expect to see a full run-rate EBIT uplift of approximately $120 million to our underlying earnings base,” Mr Taylor said.

Fletcher Building’s $400 million investment in Winstone Wallboards GIB® plasterboard manufacturing and distribution facility in Tauranga has now commenced production and will be fully operational by the end of October 2023. The new plant’s state-of-the-art technology delivers more production capacity allowing for product innovation and future growth.

“Reflecting on all we have accomplished over the past year, I am pleased with the way our people have continued to show their resilience, innovative spirit and commitment to supporting our customers and each other. I also wish to acknowledge and thank our shareholders, customers, and suppliers for their continued support,” Mr Taylor concluded.