Australian building materials company, Brickworks Ltd
(ASX:BKW) is considering moving its manufacturing activities overseas to avoid passing on higher prices to its customers.
The company’s Chairman, Robert Millner, has criticised the Australian government for its part in what he calls “the energy crisis” – in particular, soaring energy prices, and failing to develop an effective policy to address domestic energy supply.
Mr Millner says that recent gas contract negotiations will see his company pay a 76% increase across its east coast operations. Brickworks estimates it will pay an additional $20 million per year in energy costs by 2019 – which is over 25% of its Building Products earnings last year.
Robert Millner also commented that exporting Australia’s gas supply will put at risk the jobs 2,000 -3,000 brick maker jobs and over 25 ,000 bricklayer jobs, and called for immediate government intervention.
Brickworks will release its half year results on 23 March 2017. This morning, its shares are tracking 4.36% higher at $13.65.
