FLLYR: FBU: Fletcher Building confirms FY20 annual results |
08:31a.m. |
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FBU |
19/08/2020 08:31 |
FLLYR |
PRICE SENSITIVE |
REL: 0831 HRS Fletcher Building Limited |
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FLLYR: FBU: Fletcher Building confirms FY20 annual results |
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Fletcher Building confirms FY20 annual results |
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Auckland, 19 August 2020: Fletcher Building today announced its audited |
annual results, confirming a net earnings loss for the year ended 30 June |
2020 (FY20) of $196 million compared to a profit of $164 million in the year |
ended 30 June 2019 (FY19). The Group also confirmed strong operating cash |
flows of $410 million and ended the year with a strong balance sheet with |
liquidity of $1.6 billion. |
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Summary: |
- Final results in line with market announcement of 11 August 2020 |
- Revenue of $7,309 million |
- EBIT before significant items $160 million |
- Net Loss After Tax of $196 million, compared to a profit of $164 million in |
FY19 |
- Strong cash flows of $410 million |
- Balance sheet strong with liquidity of $1.6 billion and net debt of $0.5 |
billion |
- Nil dividend |
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Fletcher Building CEO Ross Taylor said: "Fletcher Building's FY20 performance |
was characterised by the impacts of COVID-19 and the actions we took to |
ensure we were well positioned to successfully navigate the market |
uncertainty in FY21 and beyond. Prior to March 2020, the business was trading |
in line with expectations and making good progress with operating |
efficiencies. The subsequent lockdown in New Zealand and restrictions in |
Australia had a significant impact on our FY20 revenues and profitability. |
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"Our focus through this period has been on three key areas: the health and |
safety of our people; enhancing the resilience of our business by managing |
our costs, cash flows and balance sheet; and ensuring we stay focused on |
strong customer performance and delivering our strategy. |
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"We have been unwavering in our commitment to health and safety. We are |
driving positive change in our safety culture through our company values and |
a genuine belief that all workplace injuries are preventable. In FY20 serious |
injuries reduced from 15 to 8 and we had no fatalities. While our Total |
Recordable Injury Frequency Rate (TRIFR) 5-year trend continues downward, our |
FY20 rate was slightly up from last year. This only strengthens our |
commitment and focus on preventing all injuries. |
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"Anticipating lower market activity ahead, we have taken some difficult but |
decisive actions to reset the cost base of the business. We expect these |
actions to deliver a permanent reduction in our cost base in FY21 of |
approximately $300 million per annum. Significant items in respect of this |
restructuring, along with one-off charges in our Rocla business and from the |
early repayment of our USPP debt, have totalled $276 million in FY20. We have |
sized our business for a market downturn of around 25 percent in New Zealand |
and around 20 percent in Australia, although there is a high degree of |
uncertainty over the outlook. We will be looking hard at the trends in |
activity over the next few months and will be ready to adapt and respond if |
needed. |
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"As already announced, we decided to raise a further $150 million provisions |
against our historical construction projects. While this was disappointing, |
Fletcher Construction, through a reset of bid margins and disciplines now has |
a $2.4 billion forward-order book of new work with a materially better margin |
outlook and lower-risk profile. |
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"Pleasingly, our operating cash flows in FY20 have remained robust at $410 |
million, supported by effective working capital management in a disrupted |
period. We have also preserved strong liquidity and funding lines. Our |
leverage ratio remains below the bottom end of our target range, we have |
total available funding of $2.1 billion as at 30 June 2020, and liquidity for |
the Group was $1.6 billion. In addition, we pre-emptively renegotiated |
covenants with our lenders to enable us to rely on more favourable terms for |
covenant testing through to the end of 2021, should we need to. |
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"As a result of the actions we have taken, our business is well-positioned to |
continue to drive its strategy and performance improvement. We will continue |
key investments in our digital and innovation strategies, while also taking |
opportunities to grow our market share either in our existing product lines |
or in logical adjacencies. With our strong balance sheet, we expect the |
tougher market will present better opportunities to achieve our aspirations |
and overall strategies." |
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In line with the Company's Dividend Policy, the Board has not declared a |
final dividend for FY20. |
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#Ends |
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Authorised by: |
Andrew Clarke |
Company Secretary |
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