Net profit (pre significant items) of $90.7 million - slight increase on prior year 1 2
Statutory net profit of $76.3 million
CSR Limited (“CSR”) announced today group net profit (pre significant items) of $90.7 million for the year ended 31 March 2012 (“YEM12”), slightly improved from the prior year ($90.2m) and ahead of guidance provided at the half year result.
Despite the challenges of very weak residential and commercial construction markets, a significant appreciation in the Australian dollar and a lower A$ realised aluminium price, net profit (pre significant items) increased slightly from the previous year.
The net profit result was assisted by a strong performance in the GyprockTM, CemintelTM and Hebel® businesses, improved earnings from the Property division and significantly reduced net finance costs following the repayment of outstanding debt after the sale of Sucrogen in the prior year. CSR also benefited from a lower effective tax rate.
CSR managing director, Rob Sindel, said: “This is a pleasing result in the context of a significant deterioration in the key external drivers of our businesses.
“The record high Australian dollar, which averaged over 10 per cent higher than the previous year, had a pronounced effect on our trade exposed businesses: ViridianTM glass, Aluminium and to a lesser extent, BradfordTM Insulation.
“CSR’s other businesses performed better by comparison. In particular, we managed to increase earnings in most of our Lightweight Systems businesses despite the reduced levels of construction activity. This improved performance also demonstrates the strength of our plasterboard business which has been augmented by prudent acquisitions to our trade retail and distribution network. Our fibre cement, lightweight concrete and commercial interiors businesses are also benefiting from our more focused business structure.
“More broadly across our portfolio, our key focus over the past year has been to ensure our businesses are equipped to meet the very challenging markets in construction without compromising our ability to strengthen our position as markets improve.
“That has required decisive effort by management to reduce overhead costs, align production to meet levels of current demand and improve operational efficiency. Some of these cost savings have been reinvested in product innovation and people development in line with our core business improvement strategy.
“As a result of these initiatives, CSR remains well placed to meet the current difficult market conditions with strong operating leverage as markets start to recover.
“Meanwhile, our strong financial position provides a solid platform to complement our market-leading position in Building Products with sensible acquisitions and other business development opportunities,” he said.
CSR’s full year results have been lodged separately with Australian Securities Exchange today.
1 Refers to continuing operations which for the previous corresponding period exclude the Sucrogen and Asian Insulation businesses which were sold on 22 December 2010.
2 Net profit (pre significant items) is a non-IFRS measure and is used internally by management to assess the performance of the business and has been extracted or derived from CSR’s audited financial statements for the year ended 31 March 2012.