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CSR Limited (ASX:CSR) manufactures and supplies buildings products. The Company's products include plasterboard, insulation, glass, fibre cement, bricks and roof tiles used in residential and commercial construction.
The company has recently stated that it will initiate with an on-market buy-back of its ordinary shares of up to $100 million. This share buyback represents a return of excessive capital back to its shareholders who are expected to be generated by the company. This includes the completion of the disposal of the Viridian Glass business for a sum of $155 million and the proceeds generated from the sale of the commercial property at Ingleburn, New South Wales which commands an anticipated market valuation exceeding a sum of $60 million. Besides this, cash settlements of approximately $110 million from two erstwhile announced property transactions will be received over the period of the next twelve months. However, the companyâs MD Mr Rob Sindel has already confirmed that the company is focussed towards its strategy to invest in the organic business growth opportunities as well as the potential targeted acquisitions.
CSR has appointed UBS AG Australia Branch to act as a broker on its behalf. The companyâ management has stated that its Ongoing capital management program, is the prime reason behind this buy-back.
The company also provided the guidance for the Net Profit After Tax guidance for the year ending 31 March 2019, the management expects that the group net profit after tax to be within the current range of analystsâ forecasts of $180 million to $187 million. This is estimated considering an assumption that the trading in the companyâs core Building Products businesses will remain within expectations drawn. In the case of Aluminium, the Australian dollars London Metal Exchange aluminium prices, also including ingot premiums have fallen by ~15% since early October 2018. As a result, the Earnings Before Interest & Tax for Aluminium for Year Ending March 2019 is expected to be in the ranging from $35-$38 million, as compared to the previously stated guidance of ~$45 million.
In case of properties, $31 million of earnings were registered for the month of December 2018 from the sale of a Ten-hectare industrial site at Horsley Park, New South Wales. As earlier advised, the property Earnings Before Interest & Tax for the full year is anticipated to be ~$35-$40 million, subject to the timing of transactions.
Now, letâs have a glance at the companyâs stock performance and the return it has posted over the last few months. The stock is currently trading at a price of $3.37, trading up by 1.506 % during the dayâs trade with a market capitalisation of ~$ 1.67 Bn. The counter opened the day at $ 3.350, reached the dayâs high of $ 3.410 and touched the dayâs low of $ 3.290 with a daily volume of ~4,002,138. The stock has provided a Year Till Date return of 19.86% & also posted returns of -22.43%, 16.08% & 15.28% over the past six months, three & one-months period respectively. It had a 52-week high price of $ 5.905 and touched 52 weeks low of $ 2.620, with an average volume of 3,872,031 approximately.
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