Fletcher Building (FBU) H1 2025 earnings summary

Executive summary

• Governance and board reset completed with new Chair, CEO, and executive appointments, strengthening leadership and oversight amid challenging market conditions.

• Business improvements achieved in factory operations, safety, sustainability, and employee engagement, with 21% lower carbon emissions than FY18 and 76% of product revenue from certified products.

• $700 million capital raise completed, reducing leverage from 2.0x to 1.4x and strengthening the balance sheet; Tradelink® divestment completed.

• Strategic review underway, focusing on portfolio shape, operating model, and capital structure, with further details to be shared at Investor Day in June 2025.

• Progress made on cost reduction, sustainability, and legacy project resolution.

Financial highlights

• Revenue for HY25 was $3.6 billion, down 7% year-over-year, driven by lower volumes across most divisions.

• EBIT before significant items was $167 million, $96 million lower than the prior period; EBIT margin declined to 4.7% from 6.8%.

• Net loss after tax was $134 million, impacted by a $170 million provision for WA plumbing and a $58 million non-cash loss from Tradelink® disposal.

• Trading cash flow (excluding legacy and significant items) was $138 million, down from $225 million last year; operating cash flow was an outflow of $5 million due to lower earnings and legacy outflows.

• Basic EPS was negative 14.3 cents; no interim dividend declared.

Outlook and guidance

• FY25 market volumes in Materials and Distribution expected to be 10%-15% lower than FY24; earnings remain sensitive to market conditions.

• FY25 EBIT (before significant items) expected to be 60% weighted to the second half, driven by cost savings, higher house sales, and absence of one-off costs.

• Macroeconomic pressures and subdued activity expected to persist for the remainder of FY25.

• No specific EBIT guidance range provided due to market volatility.

• Further details on strategic review to be shared at Investor Day in June 2025.