Construction materials supplier Adelaide Brighton Ltd has posted record half-year revenue off the back of housing and infrastructure activity interstate, offsetting poor local conditions.
Adelaide Brighton’s underlying net profit for the half year to June 2014 was $61.2 million.
The record revenue was “supported by improved prices, recovering east coast housing demand and resilient major project activity,” the company said in a statement on Thursday.
Chief executive officer of Adelaide Brighton, Martin Brydon, said “record half year sales is highly encouraging and reflects the benefits of our exposure to a diverse range of markets”.
“Despite overall sales volumes declining slightly, the east coast housing recovery generally offset softness in some local markets while rising prices lifted revenues,” he said.
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“Our aggregates, concrete and masonry operations enjoyed solid earnings growth from strengthening demand and prices, augmented by our business improvement program and highlighting the value of our integrated strategy.
“The lime business was held back in the first half by short term industry pressures in the minerals sector.
“The demand and return outlook for the business remains positive.”
Earlier this month Adelaide Brighton announced three key acquisitions that bolstered its presence in aggregates, concrete and logistics in South Australia and Queensland.
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It acquired one of its customers Direct Mix Concrete and integrated Southern Quarries in Adelaide and Queensland-based BM Webb Construction Materials into its business.
It followed the company’s recent purchase of beleaguered chemicals manufacturer Penrice’s limestone quarry at Angaston.
Brydon said the acquisitions gave the company better national exposure.
“The acquisitions provide unique long term assets that will enhance Adelaide Brighton’s competitive position and lift our national annual aggregates production to more than 6 million tonnes per annum, placing us at No.4 in the Australian aggregates market.”
While the company’s outlook for the remainder of the financial year was positive, local conditions remained difficult.
“Projects in Western Australia and the Northern Territory and a residential recovery (on the east coast) are anticipated to offset weakness in the non-residential sector and a decline in infrastructure and health activity in South Australia.”
The company declared an interim dividend of 7.5 cents per share and reinstated its dividend reinvestment plan.
