Fletcher (NZX:FBU): What is COVID-19 impact on FY22?


  • Fletcher delivered a strong FY21, delivering a revenue of $8.1 billion.
  • The Group expects the trading conditions to remain above 2020 levels if NZ remains at current lockdown levels or above
  • FBU is targeting EBIT margins of nearly 10% by FY23.

Fletcher Building Limited (NZX:FBUASX:FBU), involved in manufacturing, distributing, retailing, as well as home building, posted strong financial results in FY21. FBU delivered a Group revenue of $8.1 billion and net earnings of $305 million for the financial year.

The Group’s profitability also persisted to show improvement and cash flows stood strong in the period.

FBU’s financial details

Image source: © 2021 Kalkine Media, Data source- Refinitiv

FBU Board also undertook a buyback programme to return capital to shareholders efficiently and paid a total dividend of 30cps for the financial year.

The balance sheet strength allowed FBU to support the share buyback, inventory rebuild, completion of the construction legacy projects while maintaining a strong balance sheet.

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As per FBU’s CEO, Fletcher stands in a great shape after FY21 and can bring in more operational improvements, and above market sales growth over the upcoming years.

COVID-19 impact on FY22

IN NZ, Fletcher was put in a situation in August and September that it had to shut nearly all business operations across NZ for 2 weeks and for 5 weeks in Auckland. The Group supported its staff and their health through many programs and initiatives throughout the lockdown.

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Trading stayed strong in either side of these lockdowns and at levels above the previous year. FBU expects the trading conditions to remain above 2020 levels if NZ remains at current lockdown levels or above.

In Australia, the Group expects trading levels to improve as both NSW and Victoria begin to open up with improving vaccination rates.


Fletcher anticipates a lower impact on its business from a full/partial lockdown amid strong vaccination rates in both Australia and NZ. This in turn would permit the current robust trading circumstances to run unbroken through businesses for the remaining FY22 and beyond.

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The Group is targeting EBIT margins of nearly 10% by FY23 and expects its margins to show good progress in attaining this target in the second-half of FY22.

FBU plans to attain this target by focusing on 4 key areas which are- lifting margins in Australia into the 5-7% range, boosting construction margins to above 3%, drive margin expansion across the NZ core businesses and grow FBU’s residential house sale volumes in the coming years.

On 2 December, at the time of writing, FBU was trading at $5.78, down 0.34%.

Bottom Line

Fletcher is well-placed for the future performance and will continue to make value-enhancing growth investments.

(NOTE: Currency is reported in NZ Dollar unless stated otherwise)



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