On 27 November 2018, Brickworks Limited (ASX: BKW) held its Annual General Meeting in which the company informed that the first half earnings from Property division of the company are expected to be similar to the prior full year, positioning the Company to deliver another strong result in FY2019. Following the AGM, the share price of the company increased by 3.20 percent as on 27 November 2018.
While discussing the financial performance of 2018 at the AGM, the company’s chairman informed that due to increased underlying earnings within Building Products, Property and Investments, the company earned total EBITDA of $309 million in FY 2018. Further, the company reported an underlying profit of $224 million which was 14% higher than the prior year. The statutory NPAT was $175 million in FY 2018 which was 6 percent less than the last year. The chairman also informed that over the past 50 years Brickworks has delivered average shareholder returns of just over 12% per annum. The Company’s board declared a fully franked final dividend of 36 cents per share which takes the full year dividend for 2018 to 54 cents, up 5.9% on the last year. Due to increase in the Company’s share price and dividend payments, the total shareholder's wealth grew by $433 million in FY 2018.
In 2018, the Property Division of the company delivered EBIT of $94 million which was 4 percent higher in the last year. The improved result was mainly because of the significantly higher earnings from the Property Trust, following the development of assets at Oakdale Central and Oakdale South in New South Wales, and Rochedale in Queensland. In 2018 the revenue from Building Products increased by 7% to a record $820 million. The EBIT from Building Products increased by 17% to $76 million as compared to the previous corresponding year. In 2018, the Austral Bricks delivered a 13% increase in earnings, and its sales revenues were 8 percent higher than the last year.
As per the company’s FY 2019 Outlook, the Property earnings in 1H2019 are expected to be similar to FY2018. Building Products earnings were materially lower in Q12019, compared to the previous corresponding period. As per Company’s Managing Director, despite the challenging first quarter, market fundamentals are looking supportive for new housing construction, with employment levels healthy, low-interest rates and high immigration levels.
Recently, the company acquired Glen-Gery and as per Managing Director Mr. Partridge this acquisition represents a significant milestone in the history of Brickworks, as it is company’s first major investment into an overseas market. He further added that the United States is an attractive country to invest and grow company’s business, with tax policies that are supportive of business, proactive energy policy that is placing downward pressure on prices, and efficient transport infrastructure.
In the last six months, the share price of the company decreased by 5.00 percent as on 26 November 2018. BKW’s shares traded at $15.480 with a market capitalization of circa $2.24 billion as on 27 November 2018 (AEST 3:04 PM).
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