Fletcher Building has reported a narrowed loss of $NZ11 million for the half-year ending December, a significant improvement compared to the $NZ134 million loss recorded in the previous corresponding period. The company, which manufactures and distributes building products, and undertakes construction projects across New Zealand and Australia, faced headwinds from challenging market conditions in both countries which weighed on overall volumes. Reported revenue from continuing operations remained broadly stable at $NZ2.86 billion.
Earnings before interest and tax (BIT) before significant items reached $NZ145 million, maintaining a steady margin of 5.1 per cent. The company also saw a notable increase in net cash from operating activities, rising from $NZ87 million to $NZ156 million. These gains reflect the benefits of structural cost reduction programs implemented across the group.
According to Fletcher Building, lower residential and civil construction volumes in New Zealand, coupled with competitive pressures in its distribution business, were partially offset by stable performance in its core manufacturing operations and the aforementioned cost reductions. The company anticipates that market conditions will remain challenging in the short term, with New Zealand expected to remain subdued until a recovery materialises next year.
However, there are early indications of stabilisation in parts of Fletcher Building’s Australian portfolio, offering a potential bright spot amid the ongoing headwinds. The company will continue to focus on managing costs and optimising its operations to navigate the current market environment.
