Fletcher Building expects to do far better this year than last year and make $305m to $320m in operating earnings in the first six months of the current financial year to December, chief executive Ross Taylor says.
That would be nearly $100m ahead of the previous half-year, the company says.
Fletcher released speeches ahead of today's annual shareholder meeting outlining how well it had done lately.
"Guidance for 1H21 EBIT before significant items which is expected to be in the range of $305m to $320m. In 1H20, EBIT before significant items was $219m," the statement said.
Taylor said the latest half-year result "compares favourably to the $219m we made in the first half of last year. We will also continue to keep a tighter rein on capex through this year, and as such, we continue to expect the full-year capex to be around $200m," he said.
The earnings are forecast for the period from July 1 through to December 31.
Taylor said sales volumes for the first half-year remained "very resilient and continue in line with the strong trading we have seen so far through full-year 2021. The second half remains less certain but from what we can tell from our present quote activity, and order books, we expect a reasonable start."
The company's year finishes on June 30, 2021.
Bruce Hassall, chairman, said 2020 had been a tough year. Two weeks ago, the company had given a trading update until the end of October.
"We are very pleased to see that strong trading performance as evidence of the success of the strategy being delivered," Hassall said.
"We are financially sound with a strong balance sheet, good cash flows and liquidity. The strength and resilience this gives our business has never been more important than in today's uncertain environment, he said.
The board also expects to resume paying dividends in this 2021 financial year.
"Shareholders will recall that earlier this year, in response to Covid-19, we moved proactively to agree covenant relief with our lenders, which ensured that we had additional protection for our funding lines until the end of 2021. Part of this agreement was that if we paid a dividend during that period then our additional protection would come to an end," he said.
But an interim dividend was unlikely, he said, and instead, it could be a year-end dividend.
A shareholder asked about Ihumātao and Fletcher land where it hopes to build 480 houses. The investor also wanted to know if the company had been realistic about time frames and the price it expected to get for that land.
Hassall said: "We are working with the Government to ensure a resolution is in hand. We expect that to happen within a short period of time. With the holding costs, there's no magical profit."
Another shareholder asked why Fletcher had not won the Deloitte Top 200 award but Hassall said the company had won many other awards including for Puhoi-Warkworth motorway work and Kōwhai Ridge housing estate.
Another investor accused directors of being "lazy" for not attending meetings and demanded fees reductions but Hassall said fees had already been cut 30 per cent for six months and more meetings were held due to Covid.
Taylor answered questions about a nine-day week for Fletcher Australian staff. He said that was only done with their agreement or consent.
Asked if Fletcher was benefitting from New Zealand's housing crisis, Hassall told the meeting the company wanted to upscale home-building capacity, hoping to build 500 homes a year at a prefab plant in Auckland.
Taylor said earlier Fletcher hoped to increasing house-building capacity from 750 places a year to around 1000.