Australia's Boral climbs to record high on upbeat annual forecast

Boral

09/02/2024 02:54

By Rishav Chatterjee
       Feb 9 (Reuters) - Shares of Boral  BLD.AX  scaled a
record high on Friday as the integrated construction material
maker forecast stronger annual earnings after posting a higher
half-year interim profit on the back of improved price
realisation and volumes.
    The Australian company upgraded its forecast for full-year
earnings before interest and tax (EBIT) to the range of A$330
million ($214.24 million) to A$350 million, from previous
outlook of A$300 million-A$330 million.
    Shares of Boral, a building products giant controlled by
Australian business tycoon Kerry Stokes, surged as much as 12.8%
to an all time-high of A$6.1.
    The first-half result was positive, driven by a combination
of pricing and improved cost control, UBS analyst Lee Power said
in a note.
    "We are still surprised how rapidly management have been
able to control costs while still participating in industry
pricing."
     Boral lifted prices of quarry products such as gravel and
aggregates by 9%, with concrete up 5% as well. 
    "The combined improvements in price and cost efficiencies,
together with a mix in volumes that were flat to slightly
higher, enabled an EBIT margin of 10.9%, almost double pcp," CEO
Vik Bansal said. 
    The firm said it would maintain a "strong discipline" on
product pricing and underlying costs as it recorded an
improvement in first-half revenue and margins.
    Boral's first-half net profit after tax jumped over twofold
to A$138.6 million.


    ($1 = 1.5404 Australian dollars)

 (Reporting by Rishav Chatterjee in Bengaluru; Editing by Sherry
Jacob-Phillips)
 ((Rishav.Chatterjee@thomsonreuters.com;))