Fletcher Building (FBU) H1 2026 earnings summary

Executive summary

• Performance was mixed, with a challenging Q1 followed by Q2 improvements; core businesses showed resilience despite subdued markets in New Zealand and Australia.

• Significant progress on portfolio simplification, including the announced divestment of the Construction division for NZD 315.6 million, with proceeds to reduce debt.

• Cost reduction initiatives and disciplined capital allocation are underway, with further benefits expected in H2.

• Operating cash flow improved to NZD 156 million, up from NZD 87 million in the prior period.

• No interim dividend was declared for 1H FY26 due to market and capital structure priorities.

Financial highlights

• Revenue from continuing operations was NZD 2.9 billion, down 0.5% year-on-year.

• EBIT from continuing operations was NZD 145 million, nearly flat year-on-year; EBIT margin at 5.1%.

• Net profit from continuing operations was NZD 45 million, the first positive result since June 2023.

• Net debt increased to NZD 1.16 billion, mainly due to residential land purchases.

• Cash flows from operating activities improved to NZD 156 million from NZD 87 million in the prior period.

Outlook and guidance

• New Zealand volumes expected to remain soft, with meaningful improvement not anticipated until 2027.

• Australian trends are more positive, especially in Laminex and Fletcher Insulation, but conditions remain mixed.

• Margin compression will persist, but cost out programs are expected to offset pressures.

• Portfolio simplification and further asset sales are ongoing, with Construction divestment to complete in Q1 FY27.

• Benefits from cost actions and capital discipline expected to support future performance.