Fletcher Building chief executive Andrew Reding. Photo: Supplied
Fletcher Building has reported an even bigger first half net loss of $134 million reflecting difficult trading conditions across all its business units.
New Zealand's largest building company's revenue for the six months ended December was down 7 percent with an underlying profit slightly ahead of market consensus.
Fletcher Building said the first half continued to be a challenging period for its business units with difficult trading conditions and a broad-based slowing in demand, alongside intense competition and persistent inflation pressures.
It expected economic pressures to persist for the remainder of the year.
Key numbers for the six months ended December compared with 2023:
- Net loss ($134m) vs ($120m)
- Revenue $3.58b vs $3.86b
- Underlying loss ($26m) (includes significant items of $197m) vs $77m profit
- Expenses $156m vs $159m
- Gross margin 32.1 percent vs 33.1 percent
- Interim dividend nil vs nil
"Performance in the residential and development division reflected the overall housing market in New Zealand, with 115 fewer units contracted and sold versus the prior period, with average market prices also down approximately 2 percent on the prior period," chief executive Andrew Reding said.
"However, some tentative signs of improvement began to appear post the first OCR cut late in 2024, with sales up 17 percent between September-December 2024, as compared to July-August 2024."
He said the construction division had performed well with revenue up 16 percent, while making progress on legacy projects.
Reding said the company's cost-out programme was ahead of plan, while its $700m capital raising had been used to reduce debt.
The company reaffirmed its guidance for the full year, with an update to the market on its strategic review expected ahead of the financial result in August.
