Fletcher Building's boss says he is not keen to 'get greedy' on Gib prices this year, while Ryman Healthcare's boss explains what led to its surprise $900m capital raise.
Video / NZ Herald
Fletcher Building chief executive Ross Taylor does not plan to materially increase margins on products like Gib this year, despite the residential building market slowing down by as much as 20 per cent.
Speaking on Markets with Madison, Taylor said the margin across all its building products was currently sittingat 14 per cent, which was competitively priced against imported products.
“I think around the margin levels we’re at, now is pretty good and I don’t see a lot of upside to that. We’re not looking to get greedy with it.”
The construction company posted a 46 per cent drop in its half year profit this week, with earnings expected to slow in the second half, in part due to bad weather conditions halting building projects in the past two months.
It had also recently increased provisions on the cost to finish its last remaining vertical project, SkyCity’s International Convention Centre project, which was damaged by a fire in 2019.
Taylor was confident the cost wouldn’t blow out further but conceded there was “always a risk”.
There was always a risk the cost to build the International Convention Centre for SkyCity could blow out further, Fletcher Building chief executive Ross Taylor told Markets with Madison.
And in a big week for news on the New Zealand Stock Exchange, retirement village operator Ryman Healthcare announced a $902 million capital raise to help pay down some of its $3 billion net debt position.
Following heat from analysts, Ryman chief executive Richard Umbers agreed its 45 per cent gearing ratio was uncomfortable and it would need to ease off its village development pipeline.
