Asbestos Claims Catch Up With James Hardie
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James Hardie’s net profit for the year to March 31 has fallen 47% to $US146.1 million ($A192.6 million), primarily driven by asbestos adjustments, acquisition costs and debt.
The board declared a second half ordinary dividend of 30 US cents per security. That’s up 2 US cents a share, making a total for the year of 40 US cents, up from 38 US cents the year before.
Hardie shares reacted favourably, rising 4% to 23.35 in a market that fell all day.
And the company says it expects steady growth in the US housing market to continue in the year ahead, and said sales from its Australian business are expected to trend in line with the average growth of the housing market.
Asbestos adjustments for the quarter and full year primarily reflects the unfavourable movement in the actuarial adjustment of $US195.8 million recorded at year end," James Hardie said in a statement.
However, net sales grew about 7% to $US2.05 billion, from $US1.92 billion a year ago, helped by strong volume sales in the North American fibre cement business, with new US single-family homes sales in the western part of the United States surging to their highest level in more than 11 years in March.
James Hardie said US unit sales prices grew 5% over the course of the year.
The company said it expected its key North America fibre cement segment’s earnings before interest and tax margin for fiscal year 2019 to be in the top end of the 20% to 25% target range.
Hardie, which has a manufacturing presence in the United States, Australia, New Zealand and the Philippines, completed the purchase of the German holding company of fibre gypsum board maker Fermacell from Xella International in April. The deal, worth €473 million ($US735 million), was seen as a move by the company to diversify both its geographic exposure and product mix.
Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.
At the AFR he was a finance writer, Finance Editor, News Editor and Chief of Staff. At the Nine Network he was supervising producer of Business Sunday for more than 16 years. He has also written for other online and analogue print publications here and overseas.