Fletcher Building (ASX:FBU) will undertake a capital return to shareholders of up to NZ$300 million through an on-market share buyback.
Its dividend policy remains unchanged, with a targeted pay-out ratio of 50 per cent to 75 per cent of NPAT, before significant items.
Fletcher Building also confirms FY19 guidance of EBIT (before significant items) of NZ$620 million to NZ$650 million.
The buyback will start after the release of the Company’s full year results.
Fletcher Building CEO Ross Taylor says: "Following the completion of the Formica sale for NZ$1.2 billion, we have considered a few key factors for allocation of the sale proceeds. The Company is well below its target leverage range, and better than previously forecast".
They have around NZ$600 million of debt that we will repay over the next 12 months.
Shares Fletcher Building (ASX:FBU) are trading 0.1 per cent lower at $5.08.