The chief executive of building products group CSR says the large backlog of housing construction projects which are still waiting to commence will help underpin demand well into calendar 2023 evenJulie Coates said the group’s stable of building products including Gyprock plasterboard, PGH bricks, Monier roofing, Hebel lightweight building blocks and Bradford insulation are generally only needed when a house is well on the way to being finished.
She also foreshadowed that price rises at the PGH bricks business would likely be higher than any of the other products because the brick-making plant uses much higher levelswhere prices are escalating. “We have to pass on what our cost increases are,” she said. Chief financial officer David Fallu indicated there would “double-digit” increases in brick prices to “maintain margins in that space”.
CSR lifted its first-half dividend by 22 per cent to 16.5¢ after its building products arm generated a 15 per cent rise in earnings before interest and tax to $139 million for the six months ended September 30.Revenues in building products were up 11 per cent, with the bulk of it coming from price increases on its products. “The majority of that is actually price,” she said.
Bottomline net profit after tax was down 34 per cent to $104 million for the first half because of one-offs. CSR was able to lift prices for its products to combat raw materials inflation, and has also been disciplined on costs. Revenue in the first half was 14 per cent higher at $1.296 billion.