Australia's Adbri extends drop after higher costs dent HY profit

Adbri

01/03/2023 01:19

** Shares of Adbri Ltd  ABC.AX  fall as much as 6.1% to
A$1.605, extending losses fuelled by lower annual profit 
    ** Construction materials maker on Tuesday posted FY net
profit of A$102.6 mln ($68.72 mln), down over 12% y/y
    ** Jefferies downgrades stock to "underperform" from "hold"
on increased spending at Kwinana project in Western Australia,
lack of FY23 forecast and residential slowdown faced by broader
business
    ** Adbri stock hits its lowest since Jan. 3
    ** Morgan Stanley says operating costs, particularly energy,
and wet weather events outstrip price increases by co
    ** "We remain concerned about elevated gearing, particularly
in light of further Kwinana cost increases" - MS
    ** Adbri did not declare a dividend for second half, and MS
assumes dividends will remain suspended through FY23
    ** MS retains "equal-weight" rating on stock
    ** As of last close, Adbri stock down 3% YTD


($1 = 1.4930 Australian dollars)

 (Reporting by Savyata Mishra in Bengaluru)
 ((Savyata.Mishra@thomsonreuters.com))