Key Points:

Fletcher Building today reported a net profit of $235 million in the six months to December, up 22 per cent on the year ago profit.

The company increased its fully imputed interim dividend to 24 cents per share from 22 cents - the 12th consecutive dividend increase.

The NZX-50 index was up half a per cent early on the back of the news, but later retrenched and was flat by 11.30am.

Chief executive Jonathan Ling said Fletcher was comfortable with earnings prospects for the full year.

Last year, it purchased Formica Corp for US$700m ($890m).

Fletcher shares have been hit hard this year by the global fall in equities together with the slump in the US housing market, closing yesterday at $9.15, down 20 per cent from the start of the year.

Operating revenue rose 19 per cent to $3.55 billion and earnings per share rose 14 per cent to 47 cents.

Operating earnings (earnings before interest and tax) and after Formica restructuring costs of $16m were $394m, compared to $340m a year earlier.

The increased earnings were due to the Formica acquisition, operational improvements and some small acquisitions, Mr Ling said.

He said total shareholder return was negative 4 per cent for the half-year, "influenced heavily by the uncertainty in equity markets internationally".

The increase in net earnings reflected strong operating performance, with all divisions recording higher earnings than in the previous corresponding period, he said.

Laminates & Panels' earnings increased on a like-for-like basis, and also benefited from the acquisition of Formica in July.

"This is a pleasing performance, which reflects the group's ability to deal with variable and sometimes difficult operating conditions," Mr Ling said.

"Across our businesses, commercial and infrastructure markets are still strong, which is best exemplified in New Zealand with a construction backlog of over $1 billion.

"While there is some weakness in residential markets and provided there is no significant change in economic conditions, we remain comfortable with our earnings prospects for this financial year."

- NZPA