Brickworks says it has started its new financial year in a positive fashion with its core Australian building products (bricks and tiles) boosting earnings for the first quarter well ahead o the same period in 2019-20.
The company’s AGM was told yesterday that while its North American business is still facing disruptions to sales activity and manufacturing operations because of COVID-19, the rest of the business appears to be performing well, led by the Australian Building Products business.
“Within Building Products Australia, we have made an encouraging start to the year and our customers are reporting a strong pipeline of work in place. However, in North America conditions are more challenging, due to the ongoing impact of COVID-19. Of course, until a vaccine becomes widely available, there remains considerable uncertainty in both markets.” CEO Lindsay Partridge said in an update delivered to the meeting.
“Our home builder customers have a solid pipeline of work for the remainder of the financial year, underpinned by the various government stimulus measures currently in place in each state.”
Mr Partridge said the company’s significant capital program is expected to strengthen its competitive position in a number of key markets.
Part of this is the construction of its $75 million Austral Masonry plant in Sydney, which is well on track for commissioning next year.
The problems in North America are due to the pandemic with short term uncertainty flowing from the recent surge in infections causing ongoing disruptions to sales activity and manufacturing operations.
Looking ahead, Brickworks said it is confident that once conditions normalise, its North American operations will deliver improved earnings and growth.
“Another strong half is expected for Property, and WHSP (Washington H Soul Pattinson) is expected to deliver a stable and growing stream of earnings and dividends over the long term,” he concluded.
Brickworks shares rose nearly 4% to $19.48.
