FBU - Fletcher Building

[winner69]

No chance of acquiring STU.

But read commentary on their steel division to give a good steer on how STU will be doing as well.

Share buyback to resume after results.

Bluescope reported NZ Steel had a boomer of a year ….sales up about 14% and ebit margin 15% (made a loss lastbyear)

[Sideshow Bob]

Fletcher Building strong FY21 result, final dividend 18cps - NZX, New Zealand’s Exchange

Fletcher Building strong FY21 result, final dividend 18cps

18/8/2021, 8:31 amFLLYRFletcher Building delivers strong FY21 result, final dividend of 18 cps
Auckland, 18 August 2021: Fletcher Building today announced its audited financial results for the year ended 30 June 2021 (FY21).

Summary:
- Revenue of $8,120 million, up from $7,309 million in FY20
- Net Profit After Tax of $305 million, compared to a loss of $196 million in FY20
- EBIT before significant items of $669 million
- Return on Funds Employed before significant items of 18.6%
- Cash flows from operations of $889 million
- Strong balance sheet with net debt of $173 million and liquidity of $1.6 billion
- Final dividend 18 cents per share, bringing full-year FY21 dividend to 30 cps
- On-market share buyback programme of up to NZ$300 million through to Jun-22

Chief executive Ross Taylor said: “Fletcher Building’s strong FY21 financial result reflects the significant work carried out over the past three years to reset and simplify the business. We are confident we have a sustainable base from which we can drive further performance improvements and growth.

“FY21 saw increases across all our key financial metrics. EBIT before significant items of $669 million was ahead of our full-year guidance. EBIT margin of 8.2% and Return on Funds Employed of 18.6% were both materially higher than FY19 (our most recent comparable year). Cash flows from operating activities were very strong at $889 million, partially benefitting from low stock levels in our manufacturing and housing businesses, which we expect to rebuild through FY22. Our balance sheet finished the year in a strong position, with net debt of $173 million and $1.6 billion liquidity at 30 June 2021. Just after year end, we were pleased to reach an agreement to sell Rocla for AU$55 million.

“Having delivered a strong earnings and cash flow result, the Board has approved a final dividend for the year ended 30 June 2021 of 18 cents per share (unimputed and unfranked) to be paid on 17 September 2021. Combined with the 12.0 cents per share interim dividend, this brings the total dividend to 30 cents per share for the FY21 year. Our share buyback programme of up to $300 million started in June and will continue through FY22.

“We continue to make targeted investments to deliver on our strategy. This includes a mix of capital and operating spend, and remains focused in three areas: key maintenance investments, such as the new Winstone Wallboards plasterboard facility; initiatives which support our sustainability ambition, such as the waste tyre recycling facility at our cement plant; and growth investments in product adjacencies and digital capabilities. Our focus on digital includes an acceleration of our programme to create a backbone system environment that is fit-for-purpose.

“As we look ahead, we believe that the economic trends in our key markets remain supportive for further growth. In New Zealand, the activity pipeline continues to look ‘stronger for longer,’ especially in the residential sector. With ongoing supply chain and labour constraints having the effect of smoothing the recent sharp rises in building consents over a longer period, this is likely to mean an extended period of solid building activity through FY22 and beyond. In Australia, the residential outlook also remains resilient, particularly across detached housing and renovations, while the apartments, commercial and key civil sectors are likely to stabilise at current levels.

“There does remain some uncertainty around the impact of COVID-19 on activity in our markets. We will continue to monitor and manage this closely.
“Overall, the combination of a clear strategy, a favourable market outlook and a strong balance sheet means Fletcher Building is well-positioned to deliver future performance and growth.

“Finally, there’s no doubt that the past year has seen many challenges and disruptions resulting from the global pandemic. Against this backdrop, I would like to thank our more than 14,500 people who have delivered this performance while remaining focused on supporting our customers and each other.”

#Ends

[Greekwatchdog]

FY22 outlook
Continue to drive performance and growth
Page 41 | Fletcher Building Limited Full Year Results Presentation | © August 2021
➔ New Zealand: activity pipeline continues to look “stronger for longer,” especially in Residential; supply chain and labour constraints mean
Residential sector is currently at or near capacity, likely to mean extended period of building activity in FY22 and beyond
➔ Australia: macro backdrop supportive for growth; Residential outlook strong, detached housing and renovations supportive offset by apartments
sector; Commercial and key civil sectors stabilising at current levels
➔ Input cost inflation and supply chain disruption remain key features of the NZ and AU operating environment; businesses well set up to recover
costs through price
➔ COVID-19 outbreaks/lockdowns remain a risk. Sharp operational focus, strong response disciplines embedded
➔ We have a strong balance sheet, a favourable market outlook, and remain well-positioned to drive performance and growth
➔ Further update on trading and outlook to be provided at Annual Shareholders Meeting in October 2021

[Balance]

Results pretty much bang on with consensus forecast except for positive upside of :

1. Cashflow so net debt is now down to all of $173m,

2. Final dividend of 18cps is 3 cps better than expected.

All in all an excellent result.

[BlackPeter]

Revenue slightly above analyst predictions, earnings slightly below (37cps vs 39cps expected).

Return on Equity not outrageous - a tired 6.1%, but hey, much better than last year (which delivered a loss) and good that they managed to reduce their debt load (liabilities to assets to something like 52%.

NTA is $3.30 per share - hmm.

forward PE (3 year average) is now 16.7, however predicted forward earnings growth (based on pre-result predictions) is 10%. Backward earnings growth however is zilch, so can they really do it? Not a good company in boom times ...

Maybe ok-ish priced (if the earning predictions hold) but in my view not a cheap stock - but one never knows to which heights hype can drive a stock ...

[peat]

Look at this Long term tho.
FBULTPerf.JPG

[BlackPeter]

Look at this Long term tho.
FBULTPerf.JPG

Yes?

Hardly any move in long term revenue. Actually - 10 year revenue CAGR is negative 0.2%. Not a pretty picture.

Earnings per share jumping around a lot every year, but the overall CAGR looks still worse than the revenue: 10 year CAGR negative 1.9%;

Lets hope that their future looks better than their past, shall we?

"this time it will be different" ... ?

But again ... nobody can predict where hype drives the SP in the short term ...

[winner69]

BP - you got lockdown blues already?

I'm a bit concerned about you state of mind

[RTM]

With respect to Revenue BP...didnt they withdraw from...how did they describe it...vertical projects ?
Wouldn't you expect this to affect revenue ?

[Greekwatchdog]

They are back quoting and winning vertical projects with better margins and tighter control. Also retentions are looked at very closely as FBU Lawyers get involved checking contracts to ensure FBU are covered..