Boral report 45% increase in profit after tax

Improved performance reflects portfolio realignment, reduction in costs and response to changes in market

BORAL Ltd have reported a 45% increase in net profit after tax, before significant items, to A$249 million, for the year ended 30 June 2015. After significant items, the company reported a net profit after tax of A$257 million, up 48% on the previous year.

Sales revenue from continuing operations of A$4.3 billion was in line with the previous year, while earnings before interest and tax (EBIT), before significant items, increased 21% to A$357 million. Net debt increased by A$99 million to A$817 million.

Boral’s CEO and managing director, Mike Kane (pictured), said the improved performance reflected significant efforts to realign the company’s portfolio, reduce costs and strengthen its responsiveness to changes in market conditions.

‘We’ve now firmly moved to the Execute and Transform phases of our Fix, Execute, Transform programme, and this is reflected in Boral’s performance,’ he commented.

‘We’ve improved the company’s cost base, strengthened the balance sheet and we are managing our portfolio of businesses more efficiently. We’re delivering on our promises, which begins with our commitment to ensure a safe and healthy work environment, and we are strengthening Boral’s competitiveness.

‘Our businesses are more responsive to changes in market dynamics and external drivers than they have been in the past. During the year we took advantage of growth in some of our markets and we undertook dedicated cost-reduction programmes and delivered higher land sales to offset volume shortfalls in other markets.

‘We also continued to pursue improvement programmes within each of our businesses to offset inflationary cost pressures. This all helped us to deliver a significantly improved financial result.

‘Further portfolio realignment is also strengthening Boral’s ability to deliver improved performance over the longer term. This includes the sale of our Western Landfill business in Melbourne and the formation of the Boral CSR Bricks joint venture during the year.’

Mr Kane added that after a protracted period of depressed market activity in the US following the global financial crisis, Boral USA had returned to profitability in FY2015 with a positive A$6 million of EBIT. ‘The pleasing A$45 million turnaround was underpinned by a 10% year-on-year increase in housing starts…together with US$20 million of benefits from a cost-reduction initiative,’ he said.