Building products group CSR (ASX: CSR) has reported a modest sales growth and a group profit fall on the back of a weak construction sector and a significant rise in electricity costs which hit its aluminium business.
Managing director, Rob Sindel reported building products revenue up one per cent to $1.7 billion and earnings before interest and tax (EBIT) down four per cent to $206.5 million.
Sindel said: “The building products business performed well this year despite the residential construction market slowing during the last few months.
“CSR has invested heavily in its portfolio of building products businesses during the last few years to increase diversity of earnings and build a wider addressable market.”
More than $14 million was invested in the year on a digital platform for the business and new facade systems.
Property continued to perform well contributing $38.8 million in EBIT.
However the wider CSR group delivered an EBIT of $265 million, down 17 per cent.
“This lower result was expected due to higher electricity costs in aluminium which delivered $36.6 million in EBIT down from $79.5 million last year.”
The company is in a strong financial position with $188 million in cash proceeds from the sale of Viridian glass and other transactions boosting the balance sheet.
The company has begun a $100 million share buyback and signalled investment in new building systems and ongoing property projects.
As previously announced a search is underway to find a successor to CEO Sindel.
Picture: CSR/PGH Bricks
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