Morningstar flags uncertainty for Australia's Brickworks over holdings, property sector

Washington H. Soul Pattinson and

22/09/2022 01:41

** Morningstar sees material uncertainty to brick maker
Brickworks Ltd's  BKW.AX  fair value from its investments, and
property segment where brokerage sees potential for market share
loss to competitors
    ** Brokerage sees a risk to fair value from Brickworks'
26.1% stake in Washington H Soul Pattinson (WHSP)  SOL.AX ,
which also owns a 43.3% stake in BKW
    ** Adds that uncertainty in WHSP's units: New Hope Corp
 NHC.AX  - 39.8% owned by WHSP - and telecom firm TPG Telecom
 TPG.AX  - 12.6% owned by WHSP - translate into uncertainty for
BKW 
    ** Adds it does not see "economic moat" protecting BKW's
profitability, with its three segments: building products,
property and investments - "lacking durable competitive
advantages"
    ** Brokerage maintains fair value estimates of A$26.10 for
BKW on better-than-expected results and for WHSP at A$26.90     
    ** BKW logs revenue from cont ops of A$1.09 bln ($723.32
mln) for FY22, up 28%; net profit attributable of A$854.4 mln vs
A$239.2 mln  urn:newsml:reuters.com:*:nASXFmNLp
    ** Brokerage forecasts revenue of A$916.4 mln for FY23 and
gross profit of A$285.8 mln for FY23 for BKW

    ($1 = 1.5069 Australian dollars)

 (Reporting by John Biju in Bengaluru)
 ((john.biju@thomsonreuters.com))