CSR announces full year net profit (pre significant items)1 of $72.0 million, up 143% Statutory net profit of $88.1 million
- Trading revenue of $1,746.6 million, up 4% for the year ended 31 March 2014
- EBITDA1 of $202.5 million, up 29% reflecting higher earnings across all divisions
- EBIT1 of $125.7 million, up 85%
- Building Products EBIT of $92.6 million, up 20% with higher volumes from increasing construction activity and improved operational efficiencies
- Viridian recorded an EBIT loss of $14.9 million, a $23.9 million improvement on the prior year following significant progress in restructuring the business
- Aluminium EBIT of $51.9 million, up 3% due to higher realised aluminium prices
- Property EBIT of $17.3 million compared to a break-even result (before interest and tax) in the prior year
- Net profit1 of $72.0 million, up 143% with earnings per share1 of 14.2 cents up from 5.8 cents
- Significant items include a $33.0 million reduction in the asbestos provision, as a result of lower actuarial estimates in the United States
- Statutory net profit attributable to shareholders of $88.1 million compared to a statutory net loss of $150.0 million in the prior year
- Full year dividend of 10.0 cents per share (unfranked) up 96%, representing a payout ratio of 70% of net profit1
CSR Limited (CSR) reported a 143% increase in net profit after tax (pre significant items) of $72.0 million reflecting higher earnings across all divisions.
In announcing the result, CSR Managing Director Rob Sindel said: “The significant restructuring initiatives completed over the past few years greatly assisted CSR’s performance.
“Building Products earnings increased by 20% with growth across most businesses while the turnaround of Viridian is on track leading to a significant improvement in earnings. Property’s contribution returned to more traditional levels and, despite pressure on aluminium prices, our ongoing hedging program resulted in a higher Aluminium result.
“We have also made progress on our strategy to deliver faster and less complex building solutions for multi-residential projects with the recent acquisition of the AFS Group, which provides exposure to the structural walling market.
“The proposed east coast brick joint venture with Boral announced in April is a critical initiative to deliver efficiencies through the combined businesses, while at the same time reinvesting in the brick industry and releasing high-value land assets for future development.
“All of these initiatives, together with ongoing work across our network to lower energy use, invest in product development and reduce manufacturing costs, ensure we are well positioned to take advantage of the construction market’s expected growth over the next few years,” Mr Sindel said.
Group outlook for the year ending 31 March 2015 (YEM15)
Building approvals for both detached and multi-residential housing continue to grow strongly. This is expected to lead to increased demand for CSR’s products over the next few years as multi-residential projects near completion.
In the year ahead, Building Products should also benefit from expansion into new markets through its recent acquisitions, including AFS.
Viridian will benefit from the full year effect of cost reduction initiatives and remains on track to exit the financial year with a breakeven EBIT run-rate. Additional longer-term opportunities exist to improve performance to return the business to profitability in future years
In Aluminium, GAF continues to lock-in returns in its hedge book when opportunities arise with 58% of net sales hedged for the first half of YEM15. The overall position for YEM15 is that 50% of net sales are currently hedged at an average price of A$2,176 per tonne (before premiums).
Property earnings are always subject to timing with a targeted range of $15-$20 million per year on average, with a solid pipeline of transactions currently under negotiation.
1EBITDA, EBIT, net profit and earnings per share are all pre significant items. Theyare non-IFRS measures used by management to assess the performance of the business and have been extracted or derived from CSR’s financial statements for theyear ended 31March 2014.