Boral Ltd announced that it expects net profits after tax for 1HFY19 to be around AUD200m (US$142.6m) and EBITDA to be approximately AUD483m.
Excluding the impact of lower earnings due to the sale of Denver Construction Materials (in July 2018) and Texas Block (in November 2018), EBITDA for the 1HFY19 is expected to be broadly steady. EBITDA growth from Boral North America is likely to be offset by lower earnings in Australia and a lower contribution from USG Boral.
Boral's FY19 EBITDA is expected to be higher than FY18. FY19 EBITDA growth from Boral North America is forecast at approximately 15 per cent in US dollars, excluding discontinued operations. EBITDA from Boral Australia excluding property to be similar to the prior year, and property earnings of around AUD30m. Slightly lower profits will come from USG Boral, which releases FY19 results on 25 February 2019.
Boral Australia reports that underlying demand remains strong and the business is delivering good returns. However, first-half earnings have been impacted by volume lags and delays to major projects and infrastructure, extreme rainfall on the east coast in October and a less-favourable product and geographic mix shift.
Meanwhile, Boral North America says delivery of the Headwaters acquisition synergies is progressing well. The 1HFY19 was impacted by above average rainfalls in key US states, which slowed volumes in most businesses. Underlying demand growth is moderate while growth rates are mixed geographically, with roofing benefitting from strong growth.
In addition, USG Boral reports strong results from Australia. However, South Korea has been heavily impacted by a cyclical market decline and intensifying competition, and was also affected by Typhoon Soulik in the September quarter.
