Brickworks Limited (ASX:BKW) announced full year results today which showed a 24% decline in NPAT due to non-cash impairment charges. Underlying net profit after tax rose 18.8% to $120.3m, the best result the company has ever achieved.
Brickworks Ltd is an Australian building product, land and development company which owns Australia’s largest brick producer Austral Bricks. Brickworks also has a 42.75% interest in Washington H. Soul Pattinson & Company.
Underlying earnings per share (EPS) rose 18.5% to 81.1 cents which puts BKW on a price to earnings ratio of ~19.
Brickworks Managing Director Lindsay Partridge commented on the results saying the result is “outstanding” and that Brickworks’ balance sheet is “healthy with gearing continue to fall, which will facilitate growth initiatives across the group.”
Furthermore he continues: “The outlook for Building Products is very positive. With a long pipeline of work and prices rises successfully implemented in our major markets, earnings are expected to improve in 2016.”
Demand in most divisions is strong with orders in Queensland and New South Wales rising “rapidly”. The company expects Land and Development earnings for 2016 to be in line with 2015.
Only recently BKW was included in the S&P ASX 300 reflecting the strong gains of the past few years, especially since January 2015. As of 24 September 2015 BKW has advanced ~27% year-to-date.
Directors have declared a final dividend of 30 cents per share, following an interim dividend of 15 cents earlier this year. Brickworks listed on the ASX in and has paid a dividend in every year of operations.
However, Brickworks’ Chairman Mr Robert Miller also criticises the government for inflexible workplace regulations which restrict future growth. He says the “payroll tax is a fine for employing people and should be abolished.”
Author: Simon Herrmann
Sep 24, 2015
Simon is a financial analyst at independent research firm Wise-owl specialised in small-mid cap growth opportunities and ethical investment opportunities. Simon's aim is to disrupt the cliché approach to investment decision making as he believes that socially and environmentally responsible behaviour is a necessity to long-term wealth creation. Simon has a deep fundamental understanding of the global financial landscape and has compiled 300+ research reports, valuations and corporate appraisals. Simon is commonly featured in major media outlets and his research is published weekly in The Australian.