REPORTING SEASON: Boral Limited (BLD)
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Figure 1: Boral Limited 12 month chart
Boral (BLD) a smaller smarter business reaps a solid reward
· Building materials manufacturer, Boral Limited (BLD) went through a massive transition this year. Boral’s FY14 numbers beat market expectations with a strong uplift in earnings and net profit up to $173.3Million. The result was boosted by its Fix, Execute, Transform strategy and improved market conditions. Stay-in-Business CAPEX lifted while full CAPEX was controlled and gearing fell
· BLD’s Construction Materials & Cement benefited from both the large restructure in FY13 and favourable weather conditions but the returns were hit by a lower contribution from property sales down $20Million, while revenue increased by 5%
· Building products EBIT rose after the restructure in FY13 and improved housing construction in NSW & WA. Revenue also increased by 5% with earnings hitting $8Million
· Boral USA saw signs of improvement in FY14, helped by the US housing market recovery. Return on Funds Employed (ROFE) did improve but still behind other units, and revenue lifted by 23%
· Boral Gypsum reported a strong underlying business performance in Australia & Asia but the company did warn that it will see the Boral Gypsum earnings contribution fall in FY15 due to its reduction in total ownership to 50% for a full year rather than only 8Months this year.
· Boral will pay out a 2H dividend to shareholders of $0.08 on the 26th of September 2014, beating market expectations of a $0.07.