True but not everything is. Infact the manufacturers within the group have Supply Chain difficulties..
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True but not everything is. Infact the manufacturers within the group have Supply Chain difficulties..
I was getting excited in anticipation of a great announcement today
Read the announcement wrong - bugger it’s not out until 17th Feb
Must be confused with something else due 20th Jan .....better check waygu best by date.
Builders and developers operating with just-in-time deliveries of supplies in trouble.
https://www.newshub.co.nz/home/new-z...ng-delays.html
And it's all happening at a time of record demand for new homes.
"A few years ago it would take a while for a subdivision to even fill and now there are just houses going everywhere. It's crazy," builder Tim Hayde told Newshub.
Hope the wagyu is okay, W69 - now do you know that if you age beef in properly vacuum sealed air-tight packs in the fridge, they can age & keep for 90 days. Tender & enhanced full flavor too!
Meantime, note that FBU sp has powered onto another high following the 3rd profit downgrade in late 2018?
Might be any day now that FBU would have to announce yet another profit upgrade, now that we are into the multiple upgrade cycle?
Hardly surprising imo as the building boom looks like it is going to go on for at least another 2 years or even longer.
https://www.newshub.co.nz/home/new-z...on-sector.html
Excerpt : "For residential customers wanting to do some refurbishing, demand is outstripping worker supply.
"That meant people who are looking for a builder of choice are perhaps having to wait until 2022," Florence says."
Way things are going, might expect to see another upgrade announcement soon...
Cool, that might see sp push towards previous highs of close to $8 mark. I tall depends on HY results, outlook commentary and of course dividends.
They may have another go at STU, which is cheap as chips at current market cap of around $150mln. Got a bite of that too just keep all basis covered.
Jeez that was a BIG day today ...up 5%
And closing days high is good
Must be an interesting candle for today’s action.
When Ralph Waters took over the reins at FBU, he admitted that he underestimated the underlying strengths of Fletcher Building's major profit earners.
He was able to use those strong underlying profits to restructure the group and FBU as a whole became very profitable. That’s how W69 got his $12 per share!
PlaceMakers having best year ever they say
Only a small part of the business but the building parts must be going gangbusters as well
Fascinating quid pro quo?
https://www.nzherald.co.nz/business/...AQYJA3S6CTYEI/
New Zealand's biggest listed construction business has won state consent to buy rural land on Auckland's north-west fringes for a vast new housing estate.
The Overseas Investment Office said last week consent had been granted to Fletcher Building subsidiary Fletcher Residential to buy 20ha from a vendor whose name was suppressed and for an amount also suppressed.
The consent came the same month as the business sold a controversial site in Mangere for $30m after an agreement with the Government to buy the disputed Ihumātao land.
the profits will disappear into manage performance options...
at least thats how we would structure it . 25% of it making it way to the bottom line if that.
Likewise.
Means FBU is very well positioned in NZ's biggest & most profitable residential housing market - Auckland.
"Fletcher Residential lists locations where it is planning to build, building and/or selling homes all being in Auckland: Beachlands, Glen Innes, Hobsonville Point, Karaka, Ormiston Panmure, Red Beach, Stonefields, Swanson, Te Atatū Peninsula, Waiata Shores and Whenuapai." And now add, Riverhead.
There is latent value to be released from all the sections FBU already owns in Auckland and around NZ.
Total land bank value once developed? OCA hasnt made money on this yet and FBU has no track record of big profits from building houses has it?
We used to trade this one under 5 to range 9.
on Balance ....well time to take some notice again.
Looks like momentum is back here...
Building consents give an idea of the future ...it’s all good for FBU
Awesome numbers from Stats NZ re December consents
Westpac say:
December was another strong month for consent issuance, capping off what’s turned out to be a massive year.
On the residential side, issuance was up 4.9% in December (prev. +1.2%). Over the past 12 months, 39,420 new dwellings were consented. That’s the highest level since 1974 and even more impressive given the disruptions associated with the lockdowns in the middle of the year.
Much of the strength in issuance has been centred on Auckland, where just under 16,700 new dwellings were consented over the past year (up 10% vs 2019). That’s more than enough to keep up with population growth, and if that pace can be sustained it will erode the shortage of houses in the region. Underlying this strength in Auckland has been a massive lift in the number of medium density dwellings that are being consented (i.e. townhouses), the rate of which has surged higher in recent months.
We’re also seeing solid issuance in Canterbury, while numbers in other parts of the country have remained firm.
Today’s result reinforces our expectations for a significant rise in residential construction over the coming year. That’s being underpinned by the low level of interest rates and strong gains in house prices, which are boosting developers’ confidence. Yesterday’s labour market data signalled that this is already boosting employment in the construction sector.
We’re also seeing firmness on the non-residential side. While not roaring away like residential activity, spending on commercial buildings has retraced its lockdown-related fall and is holding at a solid level. We think that businesses will remain cautious about capex over the coming year. However, investor demand for commercial property has been resilient and the ongoing recovery in the economy is likely to support increases in commercial building activity over the coming year.
https://www.stuff.co.nz/life-style/h...r-1970s-heyday
Bit more colour to the December building consent numbers.
Major issue for the building & construction activity will be availability of resources to meet the construction demand.
So expect the boom to spread out way into 2022 and beyond.
Extremely positive for STU & FBU.
No wonder Milford is back buying into the sector after selling down and out 2 years ago!
https://www.nzherald.co.nz/business/...DN3XAYI5D5IMY/
paywalled
What to expect this earnings season when NZX companies report next week?
Jarden's reporting season preview report picks Fletcher Building, Spark and Ebos as having the potential for upside.
Allbon said this time last year Fletcher Building was shutting down its operations but was now benefiting from a booming housing market.
"That is one where it is in this Goldilocks period where they had trimmed the cost base much more dramatically down to a Covid-impacted activity level, and actually the activity level has been much stronger than anyone expected."
He said seven or eight months ago everyone hated the stock at $3.50 and now it had the potential for further upgrades.
All set for big reveal tomorrow, that should give us general handle around construction activity and will also set the tone for STU and other related companies...
Result. Paying a divvie..Very nice. https://www.nzx.com/announcements/367686
Said $309m to $320m and achieved $323m
That’s pretty good
And full year looking good at $610m to $660m
Full year forecast above market consensus forecasts
Suppose we call that a profit upgrade
Very nice:
Summary:
- Revenue of $3,987 million, up 1% from $3,961 million in HY20
- EBIT before significant items of $323 million, up 47% from $219 million in HY20
- Net Profit After Tax of $121 million, up 48% from $82 million in HY20
- Strong cash flows from operating activities of $428 million; strong balance sheet
- Interim dividend of 12 cents per share declared, to be paid on 24 March 2021
- FY21 EBIT before significant items guidance range $610 million to $660 million
For me the interim dividend is a BIG surprise ... one of this mornings business reports had even said they could not resume just yet. Good on FBU leadership for agreeing the changes to banking covenant
The $30 mill from Ihumatao included? jazzes it up somewhat.
Like the bit about them saying improving market conditions contributed just 15 percent of its greatly improved first-half results and that its own "strategic improvements in operating efficiency" contributed 85 percent.
Not just a building boom ....but a better managed company
Solid presentation both by Ross and Bevan. Very impressed with their disciplinary approach around all divisions and kudos to Bevan and team.
EBITDA margin of 8.1% is a vast inprovement on the 5.5 % in pcp
Says margins are "sustainable." and aiming for 10% plus in 2023
Each 1% margin increase about $85m more profit
yet market says ? fully priced?
12.0 cps UNIMPUTED again - FBU still not paying Corporate Taxes to attach to pay outs ? ;)
Okay so how has the Latest Profit been polished up to account for that scenario ? ;)
Jeez BusinessDesk report some analysts on the company's conference call said Fletcher will "struggle" to get to the bottom of what is a particularly wide range (full year guidance)
Even use phrases like ‘sizzle than frizzle’
Oh well, guru analysts and commentators are a bit like that and suppose they have some short term influence but at the end of the day it’s how Fletcher’s perform that will drive the share price
Expect a profit upgrade in a few months methinks
Same analysts who were busy recommending against FBU in the last 2 years, I wonder.
https://www.interest.co.nz/property/...nz-residential
The Residential and Development division reported gross revenue of $356 million, which was $132 million or 59% higher than the prior period.
And there's more of the same expected in the second half.
"Demand for new houses in New Zealand is expected to remain robust," the company said.
It said in the first half the market environment for housing sales "remained positive, with good levels of demand and supportive pricing in both Auckland and Christchurch".
Wow pretty disappointed to get a negative reputation on such a harmless comment...”quite disgusting choice of words to label other posters ...”
I can only say this: That comment should not upset anyone unless they were called a hater and mentioned specifically.. that comment was made in context of the general negativity about Fletcher Building over the years and I’m really not sure how someone can get that upset about it. Sorry if you were offended by a pretty harmless word that wasn’t directed at you.
Maybe my post didn’t add a lot of value to the thread, but it wasn’t directed at any posters on this thread.
Just wanted to voice my opinion.
I am sure there would have been better ways to voice your opinion other than calling an unspecified number of posters "haters", just because you disagreed with their views on the company - wouldn't there?
One of the main rules in using any forum is to hit the ball, not the player.
Labelling the other team as "haters" is a disgusting way to behave.
I do agree that the description of the company you are citing (if it is a correct citation - I don't remember it) does not sound particularly mature. Clearly there have been highlights in FBU's past, and obviously - nobody can predict the future.
However - instead of labeling people as "haters" it clearly would have been better to discuss the statement you cited (if this was indeed the cause of the hater statement.
Play the ball, not the player ...
Looks someone must've just realised its the last day to be in to collect 12c divvy.
Nice spread of volume over past few days with new price range of 6.60+ and divvy has come and gone in between.
Markets gonna push us over the $7 mark soon.. :t_up:
BOOM...full house $7....:D
Does anyone here think that Fletcher will resume share buybacks any time soon? Or still under too much pressure to meet covenants and pay a dividend?
Banking covenants look ok to me as they were allowed to pay divvie. I cant see share buy back happening anytime soon.
On the rise again... up 22 cents, 3.28 percent yesterday
FBU a net beneficiary of the government’s first housing package :
https://www.nzherald.co.nz/business/...C4IHDHRE6X3TI/
Paywalled
Small win for Fletcher
On the flipside, they estimate Fletcher Building could see a small boost to its earnings through higher demand for new-build houses.
New-build investors may still be allowed to deduct mortgage interest.
The govt are still consulting about treatment of new builds... are they for real or is this a tactic to make them look like they are flexible. The 5 year BL seems pretty definite to stay but interest deductions simply a possibility. Property investors will not bother if just the BL only
Closed up 3c to $6.95.... we're knock, knock, knocking on sevens door.
Enjoy this cameo from Bob: "Bob Dylan- Knockin' on Heaven's Door "Original"" on YouTube
https://youtu.be/rnKbImRPhTE
Apparently Carter Holt running short of timber and have stopped supplying Bunnings, Mitre 10 and ITM
But Placemakers good customer and still getting timber
That’s good
I can confirm there are supply chain issues for Placemakers owned businesses as well. They are not immune.
Housing: Carter Holt Harvey cuts timber supplies to Mitre 10, Bunnings, ITM
Housing: Carter Holt Harvey cuts timber supplies to Mitre 10, Bunnings, ITM
https://www.nzherald.co.nz/business/...ectid=12431516
They say "However, Carter Holt Harvey (CHH) had reportedly maintained its supply relationships with its biggest clients - Placemakers and Carter Building Supplies "
Sounds good doesn't it? but they get other wood products elsewhere. Head winds coming up on supply chain. Bloody headaches
Wasn’t that long ago we were bemoaning collapsing log prices.
Mountains of logs sitting on the wharves and processing mills closing and hundreds out of jobs. (Napier Port IPO going to fail because of this blah blah)
Not very good at managing commodity cycles and thinking long term in NZ are we?
Not very good
Agree wholeheartedly, W69.
Lack of long term thinking is why almost all of private NZ forestry plantations are owned by foreign interests.
One of my forestry contacts (huge overseas investor) used to lament how NZers cut down plantation trees, ship it as logs and then, cannot be bothered to replant given the 20 to 30 years investment horizon.
BTW - FBU is now majority owned by Australian institutions with NZ investors making up less than 30% of its share register. What an indictment on short term thinking.
Covid screwed the market. So few suppliers world wide at the mo. China taking our logs and setting the price in NZ by doing so. I have 2 x 5% increases coming over the next 2 quarters. Can't recall last time I saw a decrease. Hopefully/maybe we will see a normal supply chain start this time next year. I did read the other day that Russia is stopping exporting so it can localize their own market and create more businesses.
I think it all started with sir rob offering election bribes and canning the retirement savings. We cant turn back the clock on that but we would have had a massive fund to buy banks and longterm forestry blocks. I also wonder at the logic of the nz super fund that invests its money offshore to 'diversify' when there are needs and opportunites here.
705 and powering on. Higher profits through rising materials prices perhaps
Just realised at less than 5 percent of portfolio I dont have enough of these... darn
BlackPeter's models and his love of 5 and 10 year CAGRs often paint the wrong picture - you need to think objectively about the future sometimes.
Somebody on here (not Balance) pleaded a great case about Fletchers future post getting the house in order - and made me forget the past and what a dinosaur (beagles term besides various types of dog) they were and think objectively about the future. Whoever it was I owe you a beer or two
Nothing wrong with the picture if you want to determine the value based on earnings and growth, assuming nothing unexpected happens. Obviously difficult to determine the future without being omniscient (which mortals tend not to be).
I didn't manage yet to fault Ben Grahams wisdom "nobody can predict future share prices". It sounds like some people on this thread think they can, but I think they might be wrong :p;
Except Balance you were talking this up when it was at 4 dollars before it dropped to 3 dollars.
Still worked out good.