Fletcher Building Announces HY25 Results
Fletcher Building Limited, 810 Great South Road, Penrose, Auckland 1061, New Zealand
19 February 2025
Fletcher Building announces HY25 Results
Fletcher Building today announced its financial results for the first half of FY25.
• Revenue from continuing operations of $3,583 million, down 7% from $3,860
million in HY24
• EBIT before significant items from continuing operations of $167 million, $96
million lower than HY24
• Net Loss After Tax of $134 million, compared to Net Loss After Tax of $120 million
in HY24
• $700 million capital raise applied to repay $511 million bank debt and reduce
USPP by $169 million
• Cost-out programme ahead of plan
Fletcher Building Managing Director & CEO Andrew Reding said: “The first half of the
2025 financial year continued to be a challenging period for our businesses as very
difficult trading conditions continued across all our segments. This included a broad-
based slowing of demand, intense competitive forces and persistent inflationary
pressures. Our businesses navigated these obstacles by focusing on optimising
operational performance and tightly managing the things within our control. We are
pleased with the progress achieved to date on our key priorities which have been:
resetting governance and leadership roles of the Group; the ongoing strategic review; the
Group-wide cost reduction programme; cash; being prudent with capital expenditure;
and progressing the resolution of outstanding legacy issues.”
Overall, Group revenue from continuing operations was $3,583 million in HY25, down 7%
versus $3,860 million in the prior period. Market volumes continued to decline in the half,
particularly in businesses more heavily exposed to the residential sector. In the New
Zealand Materials and Distribution divisions, volumes were down 5-10% half year on half
year, but some businesses benefitted from major projects like the Auckland Airport
expansion. In Australia, market activity continued to decline, down 15% half year on half
year.
Andrew Reding said: “Performance in the Residential and Development division reflected
the overall housing market in New Zealand, with 115 fewer units contracted and sold
versus the prior period, with average market prices also down approximately 2% on the
prior period. However, some tentative signs of improvement began to appear post the
first OCR cut late in 2024, with sales up 17% between September-December 2024, as
compared to July-August 2024.
“Pleasingly, the Construction division performed well with revenue up 16%, with higher
work volumes arising from key infrastructure projects.”
Earnings before interest and tax (EBIT) from continuing operations and before significant
items was $167 million, down from $263 million in the prior period. The lower market
volumes for the Materials and Distribution divisions were the most significant driver of
the earnings reduction, contributing $80 million lower EBIT before significant items.
However, Construction EBIT before significant items was up $21 million half on half.
Fletcher Building has remained focused on improving cash flows. Overall cash flows
from operating activities were an outflow of $5 million, impacted by lower earnings in the
current half, $134 million legacy outflows, and the normal seasonal investment in working
capital during the period. Trading cash flows from continuing operations (excluding
legacy and significant items) were $138 million, compared to $225 million in the prior
period.
Andrew Reding said: ”Beyond our financial performance, we continue to enhance the
sustainability of our operations, reaching key milestones along the way. One standout
achievement is the ongoing reduction of coal usage at our Golden Bay cement plant in
Northland, which now exceeds 55% substitution as of HY25. This has been driven by the
increased use of wood waste and end-of-life tyres, alongside the disposal of unused
COVID PPE and biomass-based industrial sludges. As a result, we diverted 46,000 tonnes
of waste from landfills during the period and reduced process CO2 emissions by
approximately 50,000 tonnes as compared to traditional coal use at Golden Bay®. At a
Group level, our greenhouse gas emissions continue to decline, with a 21% reduction
since FY18.
“We are also making progress in resolving our remaining Construction legacy projects.
The New Zealand International Convention Centre project is now in its final stages, with
major construction works substantially completed. Our focus has shifted to finishing,
testing, and commissioning, and we remain committed to delivering the project, with
handover scheduled by 30 June 2025.
“Macroeconomic pressures are expected to persist and economic activity to remain
subdued at below mid-cycle levels for the remainder of the financial year. Despite this,
we remain focused on what we can control: delivering operational excellence, tightly
managing costs, prioritising safety, and providing the best possible service to our
customers. I look forward to sharing further details on our strategic review prior to our
upcoming Investor Day in June 2025.”
ENDS
Authorised for release to the market by Haydn Wong, Company Secretary.
_____________________________________________________________________________________________________________
For further information please contact:
INVESTORS Aleida White, Head of Investor Relations +64 21 155 8837 Aleida.White@fbu.com
MEDIA Christian May, Chief Corporate Affairs Officer +64 21 305 398 Christian.May@fbu.com
For information on Fletcher Building visit fletcherbuilding.com
---
Half Year Results
to 31 December
2024
19 FEBRUARY 2025
Important Information
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
2
This presentation has been prepared by Fletcher Building Limited and its group of companies (“Fletcher Building”) for informational purposes. This disclaimer applies to this
document and the verbal or written comments of any person presenting it.
This presentation provides additional comment on the 2025 Interim Financial Results dated 19 February 2025. As such, it should be read in conjunction with and subject to the
explanations and views given in that document. Unless otherwise specified, all information is for the six months ended 31 December 2024.
In certain sections of this presentation, Fletcher Building has chosen to present certain financial information exclusive of the impact of significant items. A number of non-
GAAP financial measures, such as measures before significant items, are used in this presentation which are used by management to assess the performance of the business
and have been derived from Fletcher Building’s financial statements for the six months ended 31 December 2024. You should not consider any of these statements in isolation
from, or as a substitute for, the information provided in the financial statements for the six months ended 31 December 2024, which are available at
www.fletcherbuilding.com. Details of significant items can be found in note 2.1 of those interim financial statements.
The information in this presentation has been prepared by Fletcher Building with due care and attention; however, neither Fletcher Building nor any of its related companies,
directors, employees, shareholders nor any other person gives any representations or warranties (either express or implied) as to the accuracy or completeness of the
information and, to the maximum extent permitted by law, no such person shall have any liability whatsoever to any person for any loss (including, without limitation, arising
from any fault or negligence) arising from this presentation or any information supplied in connection with it, or any reliance thereon.
This presentation may contain forward looking statements, that is statements related to future events or other matters. Forward looking statements may include statements
regarding our intent, belief or current expectations in connection with our future operating or financial performance, or market conditions. Such forward looking statements
are based on current expectations, estimates and assumptions and are subject to a number of risks and uncertainties, including material adverse events, significant one-off
expenses and other unforeseeable circumstances. There is no assurance that results contemplated in any of these forward looking statements will be realised. Actual results
may differ materially from those projected. Except as required by law, or the rules of any relevant stock exchange or listing authority, no person is under any obligation to
correct this presentation at any time after its release or to provide further information about Fletcher Building.
The information in this presentation does not constitute financial product, legal, financial, investment, tax or any other advice or any recommendation.
Agenda
1.OverviewAndrew Reding, Managing Director & CEO
2.Financial ResultsWill Wright, CFO
3.OutlookAndrew Reding, Managing Director & CEO
3
HY25 Results
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
HY25 Overall highlights
▪Governance reset complete with appointment of permanent Chair
and new directors
▪Continued business improvement initiatives in challenging market:
▪New WWB plant A-grade recovery rate exceeding 95% target
earlier than planned
▪Golden Bay® coal substitution >55% with wood waste, end-of-
life tyres & other end-of-life material to reduce CO
2
▪Excellent safety performance, TRIFR 2.8
▪Customer focus driving market share gains in a number of
businesses including Laminex® NZ, Mico®, Fletcher Insulation®;
NPS 57, above NPS ≥ 55 target
▪Improved sustainability, 21% lower carbon emissions than FY18,
eg better than expected carbon reduction in PCC electric ovens
▪Improved employee engagement to eNPS of 39
▪Cost-out programme ahead of plan
▪Balance sheet reset underway; successful capital raise of $700m
reducing leverage from 2.0x (FY24) to 1.4x (HY25); successful
Tradelink® divestment
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
4
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
5
HY25 Financial summary
1. Continuing operations 2. Before significant items; 3. Excluding legacy, significant items and discontinued items
Very tough macro conditions across all sectors; all levers being pulled to navigate current market & set up for market upturn
Revenue
1
$3.6b
7% lower than HY24
EBIT
1,2
$167m
$96m lower than HY24
Trading cash
flows
3
$138m
vs $225m in HY24
$700m
capital raise
applied to repay $511m
bank debt & reduce
USPP by $169m
Net debt
$1.1b
vs $1.8b at FY24
1.4x
Leverage
ratio
vs 2.0 at FY24
EBIT
1,2
Margin 4.7%
vs 6.8% in HY24
Net loss
$134m
vs $120m in HY24
Continued progress on critical strategic areas of focus
Execution of strategic
priorities
•Strategic review includes shape of the portfolio, where FB will generate organic growth above the cycle
•Reviewing appropriate operating model for FB to deliver on its strategic objectives
•Capital structure review to determine the underlying financial settings that we need to deliver on our strategy
•Progressing resolution of legacy projects
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
6
Actively managing
through-the-cycle BU
performance in the
challenging market
•Key appointments made at Board & Executive level, reduced Executive Team. Board reset completed, new Chair and three
new Non-Executive Directors. New CEO, CFO, Chief People Officer, Group General Counsel and CE Concrete. CIO role
disestablished from Executive Team
Governance &
Leadership reset
•Successfully completed $700m capital raising, reduced leverage to 1.4x and improved financial stability and resilience
•Achieved significant cost reductions to manage profitability in the current operating environment. ~$90m (before impact of
inflation) gross cost out in HY25; targeting ~$180 million of total gross cost savings in FY25
•All ERP projects are on hold, conducting a review of future requirements
•Reviewed capital expenditure projects, decisions made to delay, pause or accelerate
•Our core manufacturing and concrete operations are being well-managed, with efficient & appropriately capitalised sites
•Steel lower volumes & compressed margins but businesses performing in the challenging market
•PlaceMakers® operating structure including expanding JV’s and hub model is currently under review; renewed focus on
performance in areas that are important to our customers
•Customer and pricing focus
•We maintain our strong safety culture, with robust systems across the business. Progress continues in delivering front line
safety programmes
Derisking, driving reset and through-the-cycle performance
1
3
2
Update on near-term priorities
Good progress made against near-term priorities presented in September capital raise
ONGOING COST REDUCTION INITIATIVES TO MANAGE
PROFITABILITY
WESTERN AUSTRALIAN PLUMBING INDUSTRY RESPONSE
FOCUS ON EFFECTIVE EXECUTION OF INFLIGHT GROWTH
INITIATIVES
CONTINUED FOCUS ON CASH GENERATION
COMPLETE TRADELINK® DIVESTMENT
COMPLETE REMAINING LEGACY PROJECTS
PERMANENT CHAIR APPOINTMENT
MEASURED ASSESSMENT OF PORTFOLIO CHOICES
On-track
▪Significant cost reductions achieved to manage profitability in current operating
environment, ~$90m (before impact of inflation) gross cost out delivered HY25;
targeting ~$180m gross cost savings in FY25
Response
Actioned
On-track
On-track
Completed
On-track
Completed
On-track
▪Industry Response to WA plumbing issues finalised and signed; A$155m (NZ$170m)
provision taken in HY25
▪Laminex Taupō – flexible production capability & raw material flexibility; new board
product for NZ market with superior features
▪New Firth® flagship ready mix concrete plant in Auckland
▪Frame & Truss – project paused, options under review
▪FY25F Base capex ~$140m vs $200-250m historical run rate; ~$200m on key initiatives;
~$15m Vivid; FY25F total capex ~$355m; continued focus on cash & working cap.
▪Sale completed; A$160m received in HY25
▪NZICC: building work substantially completed, complex commissioning process
underway. Expected handover in 2H25
▪P2W: arbitration process for claims continues
▪WIAL: remedial works for WIAL carpark awaiting client approval for solution
▪Permanent Chair and three NED’s appointed; Board refresh completed
▪Update to be provided at Investor Day in June 2025
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
7
OTHER
On-track
▪WWB defence to ComCom lodged; we have a strong case
Sustainability
8
1. Carbon Emissions are ‘000 Tonnes Combined Scope 1 and Scope 2 emissions for the Group; Carbon Emissions Intensity = FBU CO
2
Tonnes for every $1m of revenue. ISO 14064-1
2. Revenue for sustainably certified products as a % of total revenue from products made/sold by our manufacturing businesses. Excludes revenue from Distribution, Resi. & Development and Construction
SUSTAINABILITY
CARBON (CO2) EMISSIONS & INTENSITY
1
1,199
950
162
129
0
20
40
60
80
100
120
140
160
180
0
100
200
300
400
500
600
700
800
900
1000
1100
1200
1300
1400
1500
FY1812MTHS
TO NOV'24
EmissionsIntensity
▪21% lower carbon and 20% lower
carbon intensity since FY18; targeting
Net Zero by 2050
▪76% of product revenue from
products with sustainability
certifications
2
▪2024 Climate Statements published
▪CDP rating of B indicating good
management of GHG emissions
▪Dow Jones Best-in-Class Index
(Australia) member: within Building
Products sector, FB is 1 of only 10
companies globally that are members
of any of the DJ Best-in-Class indexes
& the only NZ or Australian company
that is a member
▪Member of S&P Sustainability
Yearbook (top 15% of companies
globally)
Improvements being delivered
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
Coal substitution >55% (wood waste,
tyres, unused Covid PPE, industrial
sludges) & CO
2
emissions reduction at
Golden Bay
Winstone Aggregates® biodiversity
pest control (Northland, Auckland,
Waikato) & replanting initiatives
Laminex® Toolara (Australia) have
started generation from their new
roof solar installation
Better than expected carbon
reduction (82%) in PCC electric ovens
Our People and Community
9
Reconciliation Action Plan in Australia now moved from initial Reflect stage to the
Innovate phase
Community – PlaceMakers®
Olympics sponsorship
Back Country Trust partnership to restore 30 iconic
huts (photo: Poutaki Hut in Ruahine Forest Park)
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
Higgins® new bitumen tankers “my whanau (family)
works at Higgins®”: our people, safety & improved
sustainability
Women to Leadership programme
Continued good progress on Safety, Customer and Engagement
SAFETY
TOTAL RECORDABLE INJURY FREQUENCY RATE
1
10
3.4
3.1
3.3
2.8
FY22FY23FY24HY25
1. TRIFR = Total no. of recorded injuries per million hours worked. Does not include Restricted Work Injuries. Excludes Tradelink & Wood Products
2. Net Promoter Score (NPS) measures customer performance and is an indication of how satisfied our customers are with our business. Our Group NPS excludes Construction and Joint Ventures
Safety improved
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
CUSTOMER
NET PROMOTER SCORE
36
40
48
57
FY22FY23FY24HY25
NPS target ≥ 55 achieved
ENGAGEMENT
EMPLOYEE ENGAGEMENT RATING
Strong engagement
23
26
35
39
FY22FY23FY24HY25
▪Improving TRIFR
▪Five BU’s injury-free for past 12 months; 2
serious injuries in Construction & Concrete
reminding us of the importance of our focus
on Critical Risks
▪>2,000 Risk Containment Sweeps and
>9,000 Critical Control Verifications in HY25
▪Focus on Safety Leadership Programme
‘Healthy Work’ for leaders & Power Up
‘Healthy Work’ for frontline
▪Strong HY25 NPS of 57, uplift of 9pts from
FY24; ahead of our target NPS ≥ 55, with
improved scores from Woodproducts &
Apartments
▪Continued focus on customer service, product
range & DIFOT to deliver a strong customer
experience
▪Ongoing competitive benchmarking NPS
programme (customers and non-customers)
to re-commence in 2H25
▪Continued upward trend with eNPS of 39,
close to reaching our target eNPS > 40 (global
upper quartile)
▪Our people feel a greater sense of
achievement in delivering to customer needs
and overall satisfaction in roles
▪Launch of new Employee Action Group,
Lōkahi, welcoming all our employees to a
community where we can talanoa (discuss),
connect, and learn about Pasifika culture
(Global industry sector leaders average)
7.4
AUS DWELLINGS COMMENCED (‘000s) | ROLLING 12 MONTH
0
20
40
60
80
NSWVICQLDRest of AU
NZ RESIDENTIAL SQUARE METERAGE CONSENTED (‘000s) | ROLLING 12 MONTH
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
11
4,000
5,000
6,000
7,000
8,000
FLETCHER BUILDING HY25 REVENUE BY MARKET (%)
NZ ResidentialAU ResidentialNZ InfrastructureAU InfrastructureNZ CommercialAU Commercial
Peak to Dec-24
39%
35%15%23%3%17%7%
Market backdrop remains challenging
•NZ annual average GDP growth –1.0% in Sep-24 quarter
•NZ OCR 4.25%, mortgage interest rates lowering, yet to flow through to activity
•REINZ house price index -1.1% YoY, with Auckland -1.9%
•NZ ready-mix concrete production 19% lower than Sep-22 peak, -10% YoY
•AU annual average GDP growth 0.3% in Sep-24 quarter
•AU OCR 4.35%
•Australian national house prices increased 5.1% in the 12 months to Dec-24
quarter
NSW ↓ 42% to peak
VIC ↓ 30% to peak
QLD ↓ 18% to peak
ROA ↓ 27% to peak
Source: Stats NZ Infoshare, Australian Bureau of Statistics, RBNZ, REINZ, RBA, Prop Track Australia
HY25 Results at a glance
12
1. Group Revenue is external revenue from continuing operations; 2. Before significant items from continuing operations 3. Return on Funds Employed (ROFE) is
EBIT excluding significant items to average funds (net debt and equity less deferred tax asset (excl. deferred tax liability on brands))
HY25 trading highlights
•Group revenue
1
7% lower vs HY24:
•Materials & Dist. revenue ~$240m lower due to significantly
more difficult trading conditions across all sectors with activity
below mid-cycle (NZ vols down 5-10% HY25 vs HY24, AU vols
down 15% HY25 vs HY24)
•Resi & Devt revenue $112m lower, due to lower unit sales (304
units in HY25 vs 419 units in HY24)
•Construction revenue up $73m due to higher work on key
Auckland airport, Eastern busway & roading projects
•EBIT $96m lower vs HY24 with ~$80m EBIT impact from lower NZ &
AU Materials & Dist. vols, $12m additional costs in Concrete, partly
offset by cost out & significantly improved Construction performance
•EBIT margin reflects volume & operating deleverage, esp. in
Distribution
•Lower Group ROFE
3
from lower EBIT
Market activity below mid-cycle in Materials & Dist., lower Resi house sales, partly offset by improved Construction
3.9
3.6
HY24HY25
REVENUE
1
$b
263
167
HY24HY25
EBIT
2
$m
6.8%
4.7%
HY24HY25
EBIT MARGIN
2
%
13.8%
8.4%
HY24HY25
ROFE
3
%
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
HY25 Divisional performance
13
1. Before significant items 2. Continuing operations
HY25 trading highlights
•Building Products resilient in tough trading conditions, revenue down 6%.
Winstone Wallboards® maintained a strong market position, while Waipapa Pine
& Laminex® delivered good market share growth momentum
Trading conditions remained challenging, esp. in businesses more heavily exposed to the residential sector
DIVISION
GROSS REVENUE
EBIT
1
BUILDING
PRODUCTS
DISTRIBUTION
CONCRETE
AUSTRALIA
2
RESIDENTIAL &
DEVELOPMENT
CONSTRUCTION
$663m
HY24: $703m
$780m
HY24: $836m
$536m
HY24: $567m
$924m
HY24: $1,054m
$240m
HY24: $351m
$814m
HY24: $699m
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
$62m
HY24: $78m
$4m
HY24: $35m
$49m
HY24: $70m
$47m
HY24: $77m
$14m
HY24: $41m
$20m
HY24: $(1)m
•Distribution result disappointing, price/margin ceded to retain share in highly
competitive environment, esp in Frame & Truss; highly fixed cost structure
significantly impacted EBIT result
•Concrete solid top line in challenging market, continued focus on more robust
comm. & infra segments, re-entry into cement export market. EBIT included
$12m costs from Golden Bay®’s cement ship outage, elevated spot electricity
pricing in 1Q25 & restructuring costs
•Good Construction performance, esp Higgins® NZ & BPC, focus on lower risk,
smaller self-perform work; national & local road maintenance contracts; and
alliance infrastructure projects delivering benefits
•Australia volume declines of ~13% compared to HY24, partially mitigated with
good pricing disciplines offsetting cost increases; gross margin improvement of
70 bps in HY25
•Economic conditions & wider resi market lack of liquidity impacted Residential
unit sales, but sales improved post first OCR cut: +17% Sep-Dec 2024 vs Jul-Aug
2024. 114 units contracted into 2H25. No land Development transactions in HY25
or HY24
($29)m
HY24: $(37)m
CORPORATE
•Reduction in Corporate costs from pause of Digital@Fletcher
HY25 Results at a glance
14
1. Continuing operations and before significant items
HY25 trading highlights
•Group trading cash impacted by lower earnings, and Construction
legacy outflows of $134m ($161m lower than HY24)
•Trading cash from continuing ops excl. legacy & sig items:
•Materials & Dist. trading cash of $165m (vs $301m in HY24) mainly
from lower earnings
•Resi & Devt. trading cash outflow of $55m, mainly from committed
land purchases
•Construction strong trading cash flows of $54m
•Base and above base capex reduced as previously communicated
•Net debt reduced following equity raise during HY25
Improved balance sheet following debt reduction
(148)
(40)
HY24HY25
TRADING CASH
$m
225
138
HY24HY25
111
47
72
114
HY24HY25
GROUP CAPEX
$m
BaseAbove base (growth)
1,766
1,127
FY24HY25
NET DEBT
$m
TRADING CASH EX LEGACY
1
$m
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
Leverage 2.0x 1.4x
HY25 Results at a glance
15
HY25 trading highlights
•Net Loss of $134m impacted by $170m WA plumbing industry
response provision as flagged. HY25 vs HY24 movement related to
$96m lower EBIT partly offset by $39m better tax benefit &
discontinued operations loss of $52m vs $106m in HY24
•In line with the Company’s dividend policy and lender agreements,
the Board has not declared an interim dividend for HY25
Lower earnings from lower market activity and signalled $170m WA plumbing solution provision
(120)
(134)
HY24HY25
(14.7)
(14.3)
HY24HY25
BASIC EPS
1
cps
NET EARNINGS
$m
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
1. The Group has restated HY24 earnings per share metrics to reflect the slight dilution resulting from the “bonus share” element of the capital raise completed
during the period. See note 2.3 of the Financial Statement for further details
FINANCIAL
RESULTS
Will Wright, CFO
Income Statement
INCOME STATEMENT
NZ$m
DEC 2023
6 MONTHS
DEC 2024
6 MONTHSVAR
Revenue3,8603,583(7%)
EBITDA before significant items429346(19%)
EBIT before significant items (continuing operations)263167(37%)
Significant items(186)(193)(4%)
EBIT77(26)NM
Lease interest expense(28)(34)(21%)
Funding costs(62)(63)(2%)
Tax benefit241NM
Non-controlling interests(3)0NM
Net loss from continuing operations(14)(82)NM
Net loss from discontinued operation(106)(52)51%
Net loss(120)(134)(12%)
Net earnings before sig items from continuing ops
2
11953(55%)
Basic EPS from continuing ops before sig items (cents)
2
14.55.6NM
Group Basic earnings per share (cents)
2
(14.7)(14.3)3%
1. Continuing operations and before significant items. 2. The Group has restated HY24 earnings per share metrics to reflect the slight dilution resulting from the
“bonus share” element of the capital raise completed during the period. See note 2.3 of the Interim Financial Statement for further details
HY25 income statement
•EBIT
1
decline reflects volume & operating deleverage in
bottom-of-cycle operating environment, esp. across NZ
•Continued cost reduction programme across Group to
resize to market
•Significant items of $193m mainly relate to WA
plumbing as flagged
•Funding costs of $63m, slightly higher than HY24
•Effective tax rate
1
of 24.3% in HY25 (vs 29.2% in HY24)
•Net loss from discontinued operation relates mainly to
Tradelink® FCTR reclassification when business was sold
Volume declines & lower house sales, partly offset by cost-out & significantly improved Construction performance
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
17
HY24 to HY25 EBIT bridge
EBIT
1
: HY24 TO HY25
$M
263
167
(80)
(8)
(54)
(28)
(28)
(13)
30
22
61
2
HY24Market
Volume
Market
Share
Price vs
Variable COGS
COGS
reduction
Resi & Dev'tConstructionOverhead
Inflation
Overhead Cost
Reduction
Restructuring
Costs
OtherHY25
Market Impacts - Materials &
Distribution
Overheads – All Divisions
1. Continuing operations and before significant items 2. Compared to HY24
M&D Market Volumes
2
NZ: 5-10%
AU: ~15%
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
18
~$90m gross cost-out benefit from operational savings in COGS and overheads
Cash flows
CASH FLOWS
NZ$M
DEC 2023
6 MONTHS
DEC 2024
6 MONTHS
EBIT before significant items from continuing operations263167
Depreciation and amortisation166179
Lease principal payments and lease interest paid(109)(123)
Provisions and other3(11)
Trad. cash flow before working capital mvmts from cont. ops
323212
Residential and Development(72)(67)
Construction excluding legacy projects(18)29
Materials and Distribution Divisions: Debtors13866
Materials and Distribution Divisions: Inventories19(14)
Materials and Distribution Divisions: Creditors(165)(88)
Working capital movements excl. legacy projects(98)(74)
Trading cash flow from cont. ops excl legacy & sig. items
225138
Discontinued operations(48)(19)
Legacy projects cash flow(295)(134)
Significant items cash flow(29)(25)
Trading cash flow(148)(40)
Add: lease principal payments10099
Less: cash tax paid(21)(2)
Less: funding costs paid(57)(62)
Reported cash flows from operating activities(126)(5)
HY25 cash flows
•Resi & Devt. includes committed land purchases of $40m
•Good working capital from Construction, mainly from BPC &
Higgins®, benefiting from advances in new work won
•Materials & Dist. divisions working capital subject to
seasonal movements:
•Tight management of receivables with debtor days
improved vs HY24 in context of increased liquidations
and insolvencies in the market; strong collections & credit
controls in Building Products & Australia
•Inventories included stock build in Laminex® AU in
readiness for extended shutdown in early 2H25
•Lower volumes toward the end of HY25 lead to unwind of
working capital positions, esp in payable days
•Legacy projects cash outflows of $134m mainly from NZICC
project, slightly lower than flagged
•Sig. items cash outflows primarily related to WA plumbing
•Cash tax payments lower due to legacy project losses
•Funding costs broadly in line with prior period
Cash flows suppressed by lower earnings; working capital well-controlled
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
19
Capex
GROUP CAPEX AND INVESTMENTS
NZ$M
DEC 2023
6 MONTHS
DEC 2024
6 MONTHS
Base capex11147
Above Base: growth capex and investments
1
48111
Above Base: WWB new plant313
Less: Proceeds on disposal of PPE(3)(53)
Net Capex187108
Other capex: Vivid Living®126
Total Capex and Investments199114
1. Includes capitalised interest
HY25 capex and investments
•Base capex on maintenance, digital/ERP, sustainability &
efficiency capex
•Growth capex on in-flight organic growth projects:
•New Laminex® Taupō wood panels plant ($74m):
tracking well to planned slower programme of
works; new plant gives a highly flexible production
capability; new board product has superior
strength, moisture resistance and surface finish to
existing particleboard offer; raw material flexibility
•New Firth® flagship ready mix concrete plant in
Penrose ($13m)
•PlaceMakers®’ automated Frame & Truss Auckland
plant ($11m); project now paused
•$53m proceeds on disposal of property, plant &
equipment, mainly from the sale & leaseback of Steel’s
Papakura land
•Vivid Living® retirement village developments $6m
investment
Continued reduction in capex spend in response to market
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
20
Net Debt
NET DEBT: JUN24 TO DEC24
$M
1,766
1,127
( 49 )
( 67 )
( 105 )
( 62 )
( 167 )
( 2 )
( 4 )
679
235
181
Net Debt
Jun 24
Shares
Issued
DivestmentsM&D and
Corporate
Working Cap
Resi & Dev't
Working
Capital
Construction
Working
Capital
Funding
Costs
Net
Capex &
Investments
Tax paidOtherTrading
Cash
Net Debt
Dec 24
1. Includes $182m Tradelink & 50% FCC Fiji sales and $53m Steel Papakura site PP&E sale (from site sale & leaseback) 2. Includes legacy outflows of $134m
3. Relates to $10m loss from close out of the USPP related CCIRS hedges (in sig items) offset by a net $6m inflow from non-controlling interests. 4. Excludes working capital
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
21
Capital raise applied to debt reduction
2
13
4
Leverage
2.0x
1.4x
Leases
1.8x
Leases
2.0x
FY24HY25
3.8x
2.4x
1.6x
FY24HY25
3.2x
3.4x
FY24HY25
3.5x
3.9x
FY24HY25
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
22
COVENANT (EXISTING) <3.25x
COVENANT (AMENDED)
3
<3.5x
COVENANT
(EXISTING)
>2.0x
(NO
AMENDMENT
APPLIED)
COVENANT
(EXISTING)
>3.0x
COVENANT
(AMENDED)
4
>2.25x
TOTAL INTEREST COVER (PRE-
IFRS16 EBIT
2
/TOTAL INTEREST)
LEVERAGE (NET DEBT/EBITDA
1
)
SENIOR LEVERAGE (SENIOR NET
DEBT/PRE-IFRS16 EBITDA
2
)
SENIOR INTEREST COVER (PRE-
IFRS16 EBIT
2
/SNR INTEREST)
BANKING COVENANTS
1. Full shaded metrics: Net debt excluding leases / EBITDA pre-significant items; Dotted line metrics: Net debt including leases / EBITDA pre-significant items
2. Before significant items; 3. As at Dec-24 through to Jun-25 the covenant level is <3.5x; 4. As at Jun-24. the amended covenant level was >2.5x
Lower debt levels from capital raise partially offset set by the impact of lower earnings during HY25
3.4x
Funding
DEBT MATURITY PROFILE
$M
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
23
80
55
90
40
33
147
143
325
957
276
4
FY25FY26FY27FY28FY29+
Capital NotesUSPPBank LoansOther
1. Excluding line fees
DEBT FACILITIES AND DRAWINGS
NZ$M
FACILITIES
31 DEC 24
DRAWINGS
31 DEC 24
Bank Loans1,558737
USPP290290
Capital Notes298298
Other44
Total2,1501,329
Successful equity raise generated ~$680m net cash proceeds used to repay and cancel external borrowing facilities
•Undrawn credit lines of $821m and cash on hand of $202m as at 31
Dec 24; total liquidity of $1.0b
•~$680m net cash proceeds from equity raise used to repay bank debt
of $511m and USPP of $169m
•Average maturity of debt 2.7 years; average interest rate on debt is
6.1%
1
•Group gearing after hedging 22.3% at 31 Dec 24 (34.7% at Jun 24)
•Subsequent to HY25, redemption notice issued for $80m capital notes
84
55
562
997
452
OUTLOOK
Andrew Reding, Managing
Director and Group CEO
FY25 Outlook
▪Continue to expect FY25 market volumes in our Materials & Distribution
1
businesses to be ~10-15% lower vs FY24
▪Consistent with our expectations in September & October
▪In line with decline in market volumes in 1Q25
▪Expect FY25 EBIT
2
to be ~60% weighted to 2H25 given:
▪Gross overhead costs savings in FY25 of at least $180m ~60% weighted to 2H25
▪Seasonality in Resi & Devt, with ~170 – 180 additional settlements expected in 2H25 vs. 1H25
▪Non-repeat of ~$20m NZ electricity, MVAC ship outage & restructuring costs incurred in 1H25
▪FY25 earnings remain sensitive to market conditions
▪Materials & Distribution: an additional +/-5% change in market volumes is estimated to equate to +/- $80 – 90 million in
annualised EBIT
2
impact
▪Resi & Devt: an additional +/- 100 settlements per year is equivalent to +/- ~$15m in annualised EBIT
2
impact
1. Materials & Distribution comprises the Building Products, Distribution, Concrete, and Australia divisions; 2. EBIT is before significant items
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
25
Expect FY25 EBIT
2
to be ~60% weighted to 2H25 primarily due to cost savings, housing settlements & non-repeat costs
Long term fundamentals solid
WE OPERATE IN ATTRACTIVE
MARKETS...
...WHERE WE HAVE STRONG
BUSINESSES...
...WELL-POSITIONED ONCE
MARKET VOLUMES RECOVER
Population dynamics,
infrastructure and housing deficits
underpin long term sector demand
Long term economic and political
stability support strong pipeline of
residential, non-residential &
infrastructure construction
Significant operating leverage
expected to position the Company
to capitalise once market returns
Balance sheet strengthening
allows us to focus on executing
operational and strategic
initiatives
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
26
Our markets offer other benefits, such as the requirement for quality
infrastructure and large housing footprints
SIGNIFICANT SPENDING IS REQUIRED TO IMPROVE
INFRASTRUCTURE QUALITY
WE BUILD BIG HOUSES, ESPECIALLY IN AUSTRALIA, DRIVING
DEMAND
50
60
70
80
90
100
Infrastructure Quality Index
OECD Average
83.5
0
50
100
150
200
250
Average floor area of new homes (m
2
)
Average
~144m
2
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
27
1. Canada average floor area is the average of British Columbia, Ontario and Nova Scotia homes
Source: 2. NZ Infrastructure Commission (2021); 3. US Census, 4. ABS; 5. Stats NZ; 6. Statistics Canada; 7. Statistics Netherlands; 8. Statistics Denmark; 9. BBC
APPENDIX
HY25 Results: Building Products
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
29
1. Before significant items
HY25 trading performance
•Revenue 6% lower than HY24 driven by reduced resi activity & highly
competitive pricing environment. Winstone Wallboards® strong market
position & market share gains in Waipapa Pine & Laminex®
•GM held steady at 32.1% with good pricing disciplines, effective margin
management & cost-out initiatives (leaner organisational framework with
lower headcount, site rationalisation & freight optimisation)
•Lower EBIT
1
and EBIT
1
margin: inflationary pressures from raw materials
(esp. gypsum, paper & LPG) & very high electricity prices in 1QFY25. $3m
steel stock devaluation & ~10% reduction in selling prices
•Trading cash flow affected by lower earnings. Debtor management
strategies in place, minimal impacts from any customer liquidations
•Customer service focus & new product offerings: launch of Laminex NZ®
new product range Seratone Aqua Plus® (a new evolution pre-finished
wet & dry area wall panel); new pole shed design at Cyclone® Buildings
(for agricultural market); and Dimond® relaunched ‘warm roof’ advanced
roofing systems products
•Winstone Wallboards’ new plasterboard plant now at desired
performance efficiency; Dimond® new structural manufacturing plant at
Papakura opened, with improved output & efficiencies from new purlin
mill
703
663
HY24HY25
GROSS REVENUE
$m
78
62
HY24HY25
EBIT
1
$m
11.1%
9.4%
HY24HY25
EBIT
1
MARGIN
%
95
66
HY24HY25
TRADING CASHFLOW
$m
HY25 Results: Distribution
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
30
HY25 trading performance
•Revenue 7% lower than HY24: sustained challenges given ~80% exposure
to resi. sector. PlaceMakers® intense pricing competition (esp. in F&T)
necessitated strategic price concessions to defend market share. Pricing
efforts maintained stability in Auckland & Northland, with market share
gains in the Waikato, Bay of Plenty & Lower NI regions. Market share
declined in the SI. Market share growth at Mico® through strong
competitive positioning
•GM of 24.7% reduced by 210 basis points compared to HY24 from price
concessions & unfavourable product mix shifts
•Lower EBIT and EBIT
margin than HY24 mainly from lower volumes & GM
compression. Inflation ~4%, mainly in labour, property & technology.
Employee costs (significant portion of overheads) carefully managed
through selective rehiring. Shift patterns across branches &
manufacturing facilities revised and reductions in discretionary spend.
Overheads 30 basis points lower than HY24
•Trading cash flow reflected lower earnings. Positive working capital cash
flow, supported by improved inventory mgmt. (2.3 days lower YoY).
Customer cash collections remained strong, some customer defaults, but
credit risk carefully managed to minimise exposure
•Tumu® integration into PlaceMakers® successfully completed, fully
aligning people, systems, processes & branding
836
780
HY24HY25
GROSS REVENUE
$m
35
4
HY24HY25
EBIT
$m
4.2%
0.5%
HY24HY25
EBIT MARGIN
%
42
8
HY24HY25
TRADING CASHFLOW
$m
HY25 Results: Concrete
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
31
1. Before significant items
HY25 trading performance
•Revenue 5% lower than HY24: market share held in challenging market
conditions. Continued focus on the more robust comm. & infra. segments
& re-entry into cement export market to offset declining NZ market
volumes
•GM of 26.7% was 160bps lower than HY24. Cost base continued to align
to the current market environment. In Firth®, continued reduction in
production & truck resources aligning to volume reduction. In Golden
Bay®, coal substitution with alternative fuels >55% & manufacturing
labour cost base right-sized. In Humes® & Winstone Aggregates®,
debottlenecking & operational improvements
•EBIT
1
and EBIT
1
margin lower than HY24: higher revenue mix from comm.
& infra segments and continued input cost inflation. The result includes
$12m costs from Golden Bay®’s cement carrier outage in Jul-24,
significantly elevated electricity pricing in 1Q25 and restructuring costs
•Trading cashflow decline vs HY24 broadly in line with lower earnings,
working capital tightly managed
•New Firth® readymix concrete plant at Auckland Airport commissioned to
support its large programme of future capital investment
567
536
HY24HY25
GROSS REVENUE
$m
70
49
HY24HY25
EBIT
1
$m
12.3%
9.1%
HY24HY25
EBIT
1
MARGIN
%
87
64
HY24HY25
TRADING CASHFLOW
$m
HY25 Results: Australia (continuing operations)
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
32
Note: Tradelink classified as a discontinued operation in the Financial Statements
1. Before significant items
HY25 trading performance
•Revenue 12% lower than HY24: volume declines of ~13%, softer resi &
comm markets impacting all businesses. Reduced civil project activity
large driver of top line decline in Iplex®. Stramit® impacted by slowing
detached housing markets. Market share mixed, with gains in Fletcher
Insulation® (from Rockwool® & Pink® Batts range extension) and Oliveri®
bathroom category, share held in Laminex® and Iplex® and selective
commercial project selection in Stramit®
•GM improved by 80bps vs HY24 with strong pricing disciplines & new
products. Restructuring programme initiatives benefits weighted to 2H25
•EBIT
1
and EBIT
1
margin down on HY24. Oliveri®, Laminex® & Fletcher
Insulation® performed well in the lower trading environment, while
Stramit® and Iplex® results were more challenged
•Trading cash flow (incl. sig items) lower from reduced earnings & WA
plumbing matter costs. Debtor collections remained strong & credit risk
from heightened construction insolvencies continued to be well managed
•Continued customer focus produced positive outcomes from the
attention to efficiency rates in DIFOT (Delivery in Full On Time), growth in
digital sales and bringing new products to market. >50% of Laminex®
revenue is now from online, attracting more customers & improved
margins
1,054
924
HY24HY25
GROSS REVENUE
$m
77
47
HY24HY25
EBIT
1
$m
7.3%
5.1%
HY24HY25
EBIT
1
MARGIN
%
59
9
HY24HY25
TRADING CASHFLOW
$m
HY25 Results: Residential and Development
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
33
HY25 trading performance
•Revenue reduced 32% vs HY24: 304 unit sales incl. 21 apartments (vs 419
unit sales incl. 47 apartments in HY24). Lower than historic average
contracted units at start of FY25 from challenging housing market &
economy. Continued to negatively impact buyer sentiment & urgency -
conditional contract signup volume for Jul & Aug 2024 ~30% lower than
the same period in the prior year. Market outlook & buyer confidence
has started to show tentative signs of recovery, assisted by OCR
reduction, with average weekly signups up 17% across Sep-Dec 2024,
compared to Jul-Aug 2024. ~114 will settle in 2H25. Average market price
~2% lower than HY24
•Residential EBIT was $14m, down from $41m in HY24 (HY25 included
$2m reval gain to Vivid Living vs $1m in HY24), nil Industrial Development
EBIT in either half
•Funds employed of $901m up $60m vs FY24 with settlement of
committed land purchases & usual seasonal stock build. Continue to
actively manage funds base in line with market activity, incl. pausing
some apartment projects until better market conditions resume. Rezone
& resource consent land continues in existing portfolio as part of value-
add proposition
•Land pipeline ~4,200 lots (~2,700 residential lots & two rural properties
on balance sheet, ~905 units under unconditional contracts & ~539 units
under conditional contracts)
351
240
HY24HY25
GROSS REVENUE
$m
41
14
HY24HY25
EBIT
$m
11.7%
5.8%
HY24HY25
EBIT MARGIN
%
841
901
60
FY24Land &
Housing WIP
HY25
FUNDS EMPLOYED
$m
HY25 Results: Construction
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
34
1. Before significant items
HY25 trading performance
•Revenue 16% higher than HY24: higher work volumes in Brian Perry Civil®
& Major Projects businesses, with work continuing on key infrastructure
projects at Auckland Airport, Eastern Busway and the State Highway
•GM (excl. vertical buildings), was 10.0% vs 7.7% in HY24: continued focus
on lower risk, smaller self-perform work; national and local road
maintenance contracts; and alliance infrastructure projects
•EBIT
1
$20m vs $1m loss in HY24: strong BPC & Higgins
•Trading cash outflow of $80m: excl. legacy projects, trading cash inflows
were $54m driven by strong earnings driven cash inflows & working
capital management, incl. advances on new projects & the finalisation of
variation claims and accounts. Legacy outflows of $134m mainly driven
by the NZICC project
•Solid orderbook of $1.5b, balanced to lower risk projects
•Sale of 50% of the Higgins® Fiji business completed in Jul 2024
699
814
HY24HY25
GROSS REVENUE
$m
(1)
20
HY24HY25
EBIT
1
$m
(0.1)%
2.5%
HY24HY25
EBIT
1
MARGIN
%
(313)
(80)
HY24HY25
TRADING CASHFLOW
$m
Divisional revenue exposure and Fletcher Building revenue by market
35%
17%
23%
15%
7%
3%
TOTAL FLETCHER BUILDING REVENUE BY MARKET
%
MATERIALS & DISTRIBUTION DIVISIONAL REVENUE EXPOSURE BY SECTOR
BUILDING PRODUCTS
DISTRIBUTION
CONCRETE
AUSTRALIA
RESI
63%
COM
25%
INFRA
12%
RESI
38%
COM
26%
INFRA
36%
RESI
51%
COM
33%
INFRA
16%
RESI
78%
COM
22%
| Half Year Results Presentation | February 2025 | Fletcher Building Limited
35
NZ
RESIDENTIAL
NZ
COMMERCIAL
NZ
INFRASTRUCTURE
AU
RESIDENTIAL
AU COMMERCIAL
AU INFRASTRUCTURE
Status of other matters
▪WA Plumbing:
▪Industry Response to WA Plumbing issues agreed and signed; NZ$170m (A$155m) provision taken in 1H25
▪All major builders of homes other than BGC have signed up and have begun attending to the agreed work programme
▪While in the early stages, the Industry Response is working to plan
▪A$5m (NZ$6m) spent to date mainly on roll out of the leak detector units
▪Cash outflow for FY25 expected to be ~A$15m, reflecting part year and a slower start by builders due to summer break
▪Litigation risk remains. Evidence points to installation; we continue to defend our position
▪Silicosis:
▪Laminex® Australia (together with other engineered stone manufacturers, distributors, and fabricators in Australia is subject to a number
of silica related personal injury claims in Australia. Laminex® Australia has settled the majority of claims that have been brought against
it to date. Estimating the number and cost of future silica related personal injury claims is subject to uncertainties and assumptions, as
further detailed in the FY24 Annual Report.
▪During HY25, there has been no material change in the approach taken by the regulators in QLD and NSW, with each continuing to
pursue an increased contribution with the supplier cohort. As a result, we have seen a reduction in the number of claims that have
settled over the period. This has resulted in a reduced utilisation of the provision but we may see a temporary uplift in claims settled to
clear the backlog. Of the claims that have settled, final amounts are in line with previous estimates provided.
---
Interim Financial Results 2025
Fletcher Building Limited
Contents
03 Chair and Managing Director & CEO’s Review
05 Building Products
06 Distribution
07 Concrete
08 Australia
09 Residential and Development
10 Construction
11 Consolidated Interim Financial Statements
16 Notes to the Consolidated Interim Financial Statements
30 Independent Auditor’s Review Report
When used in these Interim Financial Results, references to the ‘Company’
are references to Fletcher Building Limited. References to ‘Fletcher Building’
or the ‘Group’ are to Fletcher Building Limited, together with its subsidiaries
and its interests in associates and joint ventures. References to $ and NZ$
are to New Zealand dollars unless otherwise stated.
Welcome to the interactive PDF. For the best experience, use Adobe
Acrobat Reader. Click on the sections above to go to the desired
pages. To go back to the contents, click on the
CONTENTS
menu
button on the top right of each page. The financial statements, notes
and references are also clickable for your convenience.
02
Fletcher Building Limited Interim Financial Results 2025
Chair and Managing Director
& CEO’s Review
We are pleased to report Fletcher Building’s
financial results for the six months ended
31 December 2024 (HY25).
The first half of the 2025 financial year (HY25) continued to be
a challenging period for our Fletcher Building businesses as very
difficult trading conditions continued across all our segments.
This included a broad-based slowing of demand, intense
competitive forces and persistent inflationary pressures.
Our businesses navigated these obstacles by focusing on
optimising operational performance and tightly managing the
things within our control. We are pleased with the progress
achieved to date on our key priorities which have been: resetting
governance and leadership roles of the Group; the ongoing
strategic review; the Group-wide cost reduction programme;
cash; being prudent with capital expenditure; and progressing
the resolution of outstanding legacy issues.
With an eye to the future, we also remain focused on our
customers, our people, safety and sustainability.
Governance and Leadership reset
We were pleased to complete our Board renewal process with
the appointment in early February 2025 of Peter Crowley as
Chair and Jacqui Coombes as an independent, non-executive
director. With our new Managing Director & CEO, Andrew Reding,
firmly in place, the appointments of non-executive directors,
Tony Dragicevich and James Miller, alongside the appointments
of Peter and Jacqui, we now have a strong, diverse and
refreshed Board.
New Executive Team appointments in HY25 included Will
Wright as CFO, Kylie Eagle as Chief People Officer, Haydn Wong
as Group General Counsel and Thornton Williams as Chief
Executive, Concrete. The CIO role was disestablished from
the Executive Team.
Financial Performance Overview
Overall, Group revenue from continuing operations was $3,583
million in HY25, down 7% versus $3,860 million in prior period.
Market volumes continued to decline in the half, particularly
in businesses more heavily exposed to the residential sector.
In the New Zealand Materials and Distribution divisions, volumes
were down 5 to 10% half year on half year, but some businesses
benefitted from major projects like the Auckland Airport
expansion. In Australia, market activity continued to decline
(down 15% half year on half year).
Performance in the Residential and Development division
reflected the overall housing market in New Zealand, with
115 fewer units contracted and sold versus the prior period,
with average market prices also down approximately 2% on the
prior period. However, some tentative signs of improvement
began to appear post the first OCR cut late in 2024, with sales
up 17% between September-December 2024, as compared
to July–August 2024.
Pleasingly, the Construction division performed well with
revenue up 16%, with higher work volumes arising from key
infrastructure projects.
Reducing costs has been a key priority. Gross cost reductions
for the period were $91 million across the Group, of which
$61 million was in gross overhead costs (which mitigated
overhead inflation in the period of $28 million). The benefits of
cost-out reductions continue to be weighted to the second half,
with the Group targeting total gross cost reductions of more
than $200 million in the 2025 financial year.
Earnings before interest and tax (EBIT) from continuing
operations and before significant items, was $167 million,
down from $263 million in the prior period. The lower market
volumes for the Materials and Distribution divisions were the
most significant driver of the earnings reduction, contributing
$80 million lower EBIT before significant items. However,
Construction EBIT before significant items was up $21 million half
on half. The Group EBIT margin from continuing operations and
before significant items was softer in the half at 4.7%, compared
to 6.8% in the prior period.
Across the Group, significant item charges in the period
totalled $251 million. Of this, $193 million was from continuing
operations, including $170 million from the Industry Response to
address the plumbing failures which are impacting some Western
Australia homes constructed using Typlex Pro-Fit pipe which we
announced in August 2024. In addition, Tradelink®, reported as
a discontinued operation, reflected a $58 million loss, $53 million
of which was due to the reclassification of the foreign currency
translation reserve through earnings when the business was sold.
After factoring in Tradelink®, the Group recorded a net loss after
tax of $134 million, compared to a net loss of $120 million in
the prior period. Our return on funds employed (ROFE) before
significant items was 8.4%, compared to 10.0% at 30 June 2024.
Basic earnings per share was a loss of 14.3 cents for the period,
compared to a loss of 14.7 cents in the prior period.
Fletcher Building has remained focused on improving cash
flows. Overall cash flows from operating activities were an
outflow of $5 million, impacted by lower earnings in the current
half, $134 million legacy outflows, and the normal seasonal
investment in working capital during the period. Trading
cash flows from continuing operations (excluding legacy and
significant items) were $138 million, compared to $225 million
in the prior period.
We also reviewed the implementation of our capital expenditure
programme against the current market environment, delaying,
cancelling or accelerating projects where it was sensible to
do so. We invested $167 million during the period, of which
$74 million related to the new Laminex® Taupō wood
panels plant.
03
Fletcher Building Limited Interim Financial Results 2025
CONTENTS
During the period, we raised $700 million equity (gross of
transaction costs) comprising of a fully underwritten ~$282
million institutional placement (Placement) and ~$418 million pro
rata accelerated non-renounceable entitlement offer (Entitlement
Offer). A total of 291.85 million new shares were issued at an
offer price of $2.40 per share as part of the capital raise, with
proceeds of $679 million raised, net of transaction costs.
The new equity has bolstered the Group’s financial position,
reducing the Group’s leverage and net debt. The Group’s
leverage ratio (net debt / EBITDA before significant items) at
31 December 2024 was 1.4 times, with net debt of $1.1 billion.
Given the current market conditions and in line with the dividend
policy and banking covenant agreements, the Board has not
declared an interim dividend.
Our People, Customers, and Communities
Beyond our financial performance, we continue to make
significant progress in fulfilling our commitments to our
people, customers, and communities.
The safety of our people remains our highest priority; our
commitment to both personal and team safety is unwavering.
Our strong workplace safety culture continues to evolve and
improve, which is borne out in improved safety statistics across
the business. At the half year mark, we achieved our lowest-ever
Total Recordable Injury Frequency Rate (TRIFR) of 2.8, placing
us near the global top quartile. This milestone reflects what we
can accomplish when we work together with a shared sense
of purpose.
We are dedicated to fostering an inclusive environment where
everyone belongs. Over the half year period, our Women to
Leadership programme supported 55 women in their leadership
journeys, pairing them with male and female mentors from
across the business. This initiative not only strengthens
leadership pipelines but also builds meaningful connections
across our organisation.
We take pride in the diverse ways we contribute to our
communities. During the half year, our Concrete division
commenced a partnership with the Back Country Huts Trust to
restore 30 iconic huts, enhancing outdoor experiences across
New Zealand. In addition, PlaceMakers® supported New Zealand’s
Olympic Team in their campaign for Paris, and we provided work
experience opportunities for seven First Foundation scholars and
two TupuToa interns.
Meanwhile, our Australian team completed the actions outlined
in their Reflect Reconciliation Action Plan (RAP) and submitted
their Innovate RAP to Reconciliation Australia. This marks a
major milestone in their reconciliation journey and reinforces
their commitment to strengthening and deepening relationships
with First Nations communities.
Despite a challenging market, our commitment to customer
focused service excellence has led to strong outcomes.
We exceeded our Net Promoter Score (NPS) target of over
55 with a score of 57 in the half year. This customer-centric
mindset is also driving positive change within our workforce,
as our people experience a greater sense of achievement
in meeting customer needs. As a result, overall employee
engagement has improved to 39 and is approaching our
global upper quartile target score of 40.
Sustainability
We continue to enhance the sustainability of our operations,
reaching key milestones along the way. One standout
achievement is the ongoing reduction of coal usage at our
Golden Bay® cement plant in Northland, which now exceeds
55% substitution as of HY25. This has been driven by the
increased use of wood waste and end-of-life tyres, alongside
the disposal of unused COVID personal protective equipment
and biomass based industrial sludges. As a result, we diverted
46,000 tonnes of waste from landfills during the period and
reduced process CO
2
emissions by approximately 50,000 tonnes
as compared to traditional coal use at Golden Bay®.
At a Group level, our greenhouse gas emissions continue to
decline, with a 21% reduction since FY18, though lower volumes
have contributed to this to some extent, and carbon intensity
reduced by 20% over the same timeframe. We continue to
explore ways to further reduce our environmental impact.
Progress on Legacy Issues
Progress continues in resolving our remaining Construction
legacy projects. The New Zealand International Convention
Centre (NZICC) project is now in its final stages, with major
construction works substantially completed. Our focus has
shifted to finishing, testing, and commissioning, and we remain
committed to delivering the project, with handover scheduled
by 30 June 2025.
In Australia, we reached an agreement in November 2024 with
the Western Australian Government and participating builders
to address the plumbing failures in Western Australia associated
with the installation of Typlex Pro-Fit pipe. This agreed Industry
Response plan provides affected homeowners with a clear and
practical solution, demonstrating our commitment to resolving
the issue responsibly and effectively.
Outlook
Macroeconomic pressures are expected to persist and economic
activity to remain subdued at below mid-cycle levels for the
remainder of the financial year. Despite this, we remain focused
on what we can control: delivering operational excellence,
tightly managing costs, prioritising safety, and providing the
best possible service to our customers.
On behalf of everyone at Fletcher Building, we sincerely thank
our shareholders for your continued trust and support. We look
forward to sharing further details on our strategic review prior
to our upcoming Investor Day in June 2025.
Chair and Managing Director & CEO’s Review (Continued)
Peter Crowley
Chair
Andrew Reding
Managing Director & CEO
04
Fletcher Building Limited Interim Financial Results 2025
CONTENTS
Building Products
Financial Summary
Six months ended 31 December
2024
NZ$M
2023
NZ$M
Gross revenue663703
External revenue533570
Gross margin32.1%33.1%
Overheads156159
EBIT before significant items
(1)
Light Building Products5767
Metals714
Wood Products-2
Divisional costs(2)(5)
Total6278
EBIT margin before significant items
(1)
9.4%11.1%
Significant items
(2)
-(6)
Funds1,3361,256
Trading cash flow6695
Capital expenditure8575
(1) EBIT before significant items is a non-GAAP measure used by management to
assess the performance of the business and has been derived from Fletcher
Building Limited’s consolidated interim financial statements for the period ended
31 December 2024.
(2) Details of Significant items can be found in note 2.1 of the consolidated interim
financial statements.
Light Building Products
Winstone Wallboards®
Laminex® New Zealand
Comfortech®
Iplex® New Zealand
Metals
Fletcher Steel®
Altus® (JV)
Wood Products
Waipapa Pine
The Building Products division generated gross revenue of
$663 million, a 6% decrease compared to the previous period.
EBIT before significant items was $62 million compared to
$78 million reported in the prior period. Trading cash flow
of $66 million was $29 million lower than the prior period.
The Building Products division delivered a resilient trading
performance in the period. The decline in revenue compared
to the prior period reflected the market reduction in residential
activity (new builds (6%) and additions and alterations (5%)).
This, along with a highly competitive pricing environment,
exerted pressure on earnings. Notwithstanding the recessionary
market environment, Winstone Wallboards® maintained a strong
market position, while Waipapa Pine and Laminex® demonstrated
good market share growth.
Despite the heightened pricing competition, overall gross margin
held relatively steady at 32.1% with good pricing disciplines and
delivery of cost-out initiatives across the division.
The division’s initiatives aimed at mitigating the impact of the
ongoing market downturn included the implementation of a
leaner organisational framework and cost structure, resulting in
benefits from reduced headcount, site rationalisation and freight
optimisation. These cost-saving measures collectively led to a
gross reduction of $14 million. However, inflationary pressures
affected the costs of raw materials, particularly gypsum,
paper and LPG. While electricity prices spiked in Q1, they were
mitigated by lower pricing later in the half. In Steel, the continued
decline in steel prices resulted in a $3 million stock devaluation
and an approximate 10% reduction in selling prices. Despite
gaining market share and operational efficiency improvements,
Wood Products’ earnings were negatively impacted by significant
pressure on timber prices within a persistently soft market.
EBIT before significant items of $62 million was $16 million below
the prior period.
Trading cash flow in HY25 was $66 million, $29 million lower
than the prior period, driven principally by reduced earnings.
Comprehensive debtor management strategies are in place
across all of the divisions’ businesses, with minimal impacts
from any customer liquidations.
Capital expenditure was $85 million, largely comprising
$74 million for the new Laminex® Taupō wood panels plant.
The division’s focus on customer service and new product
offerings continued. Laminex® New Zealand successfully
launched its new product range Seratone Aqua Plus®, a new
evolution pre-finished wet and dry area wall panel. The newly
rebranded Cyclone® Buildings product range has successfully
introduced a new pole shed design, expected to meet the needs
of the agricultural market. At Dimond®, the formal relaunch of
the advanced roofing systems ‘warm roof’ products, a range
of solutions optimised for appearance, thermal and acoustic
performance has been well-received by the market.
The division has achieved several operational milestones in
the period. Winstone Wallboards®’ new plasterboard plant in
Tauranga has now achieved its desired performance efficiency.
Dimond® has opened its structural manufacturing plant at South
Auckland’s Papakura, delivering improved output and efficiencies
with its new purlin mill, with two new folders expected to further
unlock new opportunities in the coming months.
05
Fletcher Building Limited Interim Financial Results 2025
CONTENTS
Distribution
Divisional Overview
PlaceMakers®
Mico®
PlaceMakers® F&T
The Distribution division reported gross revenue of $780
million, 7% lower than the prior period. EBIT before significant
items was $4 million, compared to $35 million in the prior
period. Trading cash flow was $8 million, compared to
$42 million in the prior period.
With approximately 80% exposure to New Zealand’s residential
construction market, the Distribution division faced sustained
challenges in HY25, as trade merchant revenues declined
year-on-year – by an estimated 3% in building materials and
7% in plumbing.
Mico® achieved steady market share growth, reinforcing
its leadership in the plumbing sector through strong
competitive positioning.
PlaceMakers® continued to face intense price competition,
particularly in frame and truss, necessitating select price
concessions to defend market share. All regions experienced
some level of contraction, however the pricing efforts maintained
stability in Auckland and Northland. Market share gains were
achieved in the Waikato, Bay of Plenty and Lower North Island
regions. However, market share declined in the South Island.
Gross margin reduced by 210 basis points compared to the prior
period due to the price concessions along with unfavourable
shifts in product mix.
Inflationary pressures in labour, property and technology
persisted throughout the half. Cost efficiency measures included
revised shift patterns across branches and manufacturing
facilities, careful management of employee hires and significant
reductions in discretionary expenses. Despite inflation running
at approximately 4%, overheads were reduced by 0.3% compared
to the prior period.
The division’s EBIT fell to $4 million (HY24: $35 million), with EBIT
margin declining to 0.5% from the prior period’s 4.2%.
Trading cash flow was $8 million reflecting lower earnings in
the period. Working capital cash flow was positive, supported by
improved inventory management, which reduced inventory days
by 2.3 days year-on-year. Customer cash collections remained
strong. While some customer defaults were experienced, credit
risk was managed through proactive measures to minimise the
division’s overall exposure.
The division maintained disciplined capital management
while prioritising key strategic investments. In this regard the
capital expenditure of $13 million primarily reflected milestone
payments for the relocation of PlaceMakers®’ Auckland frame
and truss facility. This project has temporarily been paused with
future options under review.
The integration of Tumu® into PlaceMakers® was successfully
completed during HY25.
Financial Summary
Six months ended 31 December
2024
NZ$M
2023
NZ$M
Gross revenue780836
External revenue767817
Gross margin24.7%26.8%
Overheads188190
EBIT435
EBIT margin0.5%4.2%
Funds306308
Trading cash flow842
Capital expenditure1310
06
Fletcher Building Limited Interim Financial Results 2025
CONTENTS
Concrete
The Concrete division reported gross revenue of $536
million, which was 5% lower than the prior period. EBIT before
significant items was $49 million, compared to $70 million in
the prior period. Trading cash flow of $64 million compared
to $87 million in the prior period.
The division delivered a strong top-line result in the period
despite challenging market conditions, particularly in the
residential segment. In this environment, the division has
performed well to improve market share – this has been achieved
through a continued focus on a differentiated product and
service offering.
The Concrete division continued to focus on the more
stable commercial and infrastructure segments, as well as
re-entry into the cement export market to offset the declining
New Zealand market volume. This resulted in stable revenues
compared to the second half of the 2024 financial year.
Additionally the division continued to align its cost base to
the current market environment. In Firth®, this has involved a
continued reduction in production and truck resources aligning
to volume reduction. In Golden Bay®, the focus has been on
increasing coal substitution with alternative fuels to over 55% and
right-sizing of its manufacturing labour cost base. In Humes® and
Winstone Aggregates®, the focus has been on delivering benefits
from recent investments in debottlenecking and operational
improvements.
The division’s gross margin of 26.7% was 160 basis points
lower than the prior period, whilst EBIT before significant
items of $49 million was $21 million lower than the prior
period. This reflected the higher proportion of revenue from the
commercial and infrastructure segments and continued input
cost inflationary pressures. The result includes one-off costs of
$12 million reflecting the outage of Golden Bay®’s cement carrier
the MV Aotearoa Chief in July 2024, significantly elevated spot
electricity pricing in the first quarter and restructuring costs
associated with right-sizing initiatives.
Trading cash flow for the division was solid at $64 million,
with the decline of $23 million compared to the prior period
in line with the lower earnings. Working capital remains tightly
managed, with divisional debtor days in line with June 2024.
Capital expenditure in the period of $36 million was focused on
critical asset renewal, quarry resource extension and key in-flight
initiatives – comprising the development of Firth®’s new flagship
ready mix concrete plant in Auckland, and continued investment
in alternative fuels capability to increase coal substitution at
Golden Bay®.
The key highlight for the period was the successful commissioning
of the new Firth® ready mix concrete plant at Auckland Airport.
This new concrete plant allows Firth® to support the Auckland
Airport which has a large programme of future capital investment
that Firth® is now well positioned to deliver.
Financial Summary
Six months ended 31 December
2024
NZ$M
2023
NZ$M
Gross revenue536567
External revenue381412
Gross margin26.7%28.3%
Overheads8993
EBIT before significant items
(1)
4970
EBIT margin before significant items
(1)
9.1%12.3%
Significant items
(2)
-2
Funds850810
Trading cash flow6487
Capital expenditure3634
Investments-7
(1) EBIT before significant items is a non-GAAP measure used by management
to assess the performance of the business and has been derived from Fletcher
Building Limited’s consolidated interim financial statements for the period ended
31 December 2024.
(2) Details of Significant items can be found in note 2.1 of the consolidated interim
financial statements.
Heavy Materials
Golden Bay®
Winstone Aggregates®
Products and Solutions
Firth® Industries
Humes®
Dricon®
07
Fletcher Building Limited Interim Financial Results 2025
CONTENTS
Australia
Building Products Australia
Laminex® Australia
Iplex® Australia
Fletcher Insulation®
Steel Australia
Stramit®
Distribution Australia
Oliveri® Solutions
The Australia division reported gross revenue from continued
operations of $924 million, 12% lower than the prior period.
EBIT before significant items was $47 million, compared with
$77 million in the prior period. Trading cash flow was $9 million,
compared to $59 million in the prior period.
The Australia division saw volume declines of circa 13%
compared to the prior period. Residential and commercial
markets were both softer compared to the prior period,
impacting performance in all businesses. The reduced level of
civil project activity continued to be a large driver of the top line
decline in Iplex® Australia, and Stramit® was further impacted by
slowing in the detached housing markets.
Market share remained mixed, with gains achieved in Fletcher
Insulation® and Oliveri®, while share held in Laminex® Australia
and Iplex® Australia, with focused commercial project selection
in Stramit®.
The division continued its restructuring programme to right size
the businesses through the current downturn, with benefits from
these initiatives weighted to the second half. However, continued
strong pricing disciplines and new products brought to market
assisted the delivery of gross margin improvements of 80 basis
points in the period.
EBIT before significant items of $47 million and an EBIT margin
of 5.1% were both down on the prior period. At a business unit
level, Oliveri®, Laminex® Australia and Fletcher Insulation® all
performed well in the lower trading environment, while the
Stramit® and Iplex® Australia results were more challenged.
Significant items of $177 million were recognised during the
period, which related to costs and provisions in relation to the
Iplex® Australia pipes matter and the agreed Industry Response
in Western Australia.
The division’s continued commitment to the customer produced
positive outcomes, with customer NPS, broadly in line with the
prior period and top quartile performance in Fletcher Insulation®.
This was the result of the attention to efficiency rates in DIFOT
(Delivery in Full On Time), growth in digital sales and bringing
new products to market. Over 50% of Laminex® Australia
revenue is now from online sales, attracting more customers
and delivering improved margins. Market share was also gained
in higher-margin segments, which include, Laminex® Australia
decorative products, Fletcher Insulation®’s extension to its
Rockwool® and Pink® Batts® ranges, and further growth in the
Oliveri® bathroom category.
Trading cash flow for the division was $9 million, down on the
$59 million in the prior period. Lower earnings and additional
costs related to the Iplex® Australia pipe matter were the main
drivers of the movement. Debtor collections remained strong
and the credit risk from heightened construction insolvencies
continued to be well managed.
Capital expenditure in the period was $15 million, with ongoing
investments in the areas of new product development and
manufacturing automation.
Financial Summary
Six months ended 31 December
2024
NZ$M
2023
(1)
NZ$M
Gross revenue9241,054
External revenue9061,026
Gross margin35.1%34.3%
Overheads274287
EBIT before significant items
(2)
Building Products Australia5272
Steel Australia(1)9
Distribution Australia--
Divisional costs(4)(4)
Total4777
EBIT margin before significant items
(2)
5.1%7.3%
Significant items
(3)
(177)(3)
Funds1,0081,160
Trading cash flow959
Capital expenditure1522
(1) The comparatives have been restated to exclude discontinued operation.
Further details of the change can be found in note 2.4 of the consolidated
interim financial statements.
(2) EBIT before significant items is a non-GAAP measure used by management to
assess the performance of the business and has been derived from Fletcher
Building Limited’s consolidated interim financial statements for the period ended
31 December 2024.
(3) Details of Significant items can be found in note 2.1 of the consolidated interim
financial statements.
08
Fletcher Building Limited Interim Financial Results 2025
CONTENTS
Residential and Development
Fletcher Residential
Fletcher Living®
Vivid Living®
Fletcher Apartments
Clever Core®
Industrial Development
Industrial Development
The Residential and Development division reported gross
revenue of $240 million, a $111 million and a 32% reduction on
the prior period. EBIT for the division was $14 million, compared
with $41 million in the prior period. Trading cash flow was an
outflow of $55 million compared to an outflow of $31 million
in the prior period.
The challenging New Zealand housing market and broader
economic conditions present in the second half of FY24 resulted
in the division entering FY25 with significantly lower contracted
volume than historical averages. This adversely impacted the
volume of homes taken to profit in the first quarter of the current
year by circa 130 units, compared to the prior period. The difficult
market conditions persisted into the start of FY25, negatively
impacting buyer sentiment and urgency, resulting in conditional
contract sign-up volume for July and August 2024 being circa
30% lower than the same period in the prior year. Market outlook
and buyer confidence has however started to show tentative
signs of recovery, with average weekly signups increasing 17%
across the period September-December 2024, compared to
July-August 2024. A high proportion of these executed contracts
however are settling, and expected to be taken to profit in the
second half. The most active part of the Residential housing
market continued to be in the lower price point, first-home buyer
segment, an area of strength for Fletcher Residential. This was
supported by the introduction of promotions such as a $10,000
First Home Buyer Grant, providing strong market differentiation.
As a result, 304 units (including 21 apartments) were taken to
profit compared to 419 units (including 47 apartments) in the
prior period, with 114 contracts already executed to settle in
the second half of FY25.
Average market price has decreased by circa 2% compared
to the same period last year. Whilst this has been partly mitigated
through cost control, gross margin in Fletcher Residential
has seen a reduction of 120 basis points compared to the
prior period.
Clever Core®, the division’s panelisation business, has been
significantly impacted by the prolonged industry downturn,
delivering 51 units in the period compared to 90 in the prior
period. Whilst internal demand for Clever Core® continues to be
strong, external demand has slowed, reflecting broader market
dynamics and a significant reduction in orders from Kāinga Ora.
Vivid Living® completed 12 settlements during the period at
Red Beach, its first retirement development, with the village
now ~60% occupied, and secured 5 contracts at the next village
in Karaka, South Auckland, opening to first residents later this
financial year.
In Industrial Development, there were no sales in the period,
consistent with H1 FY24.
Trading cash flow including the settlement of $40 million of
committed land purchases, was an outflow of $55 million,
compared to an outflow of $31 million in the prior period. This
was a strong result given the reduced number of units taken to
profit compared to the prior period. An outflow in the first half
of the year is normal as the division builds homes for settlement
in the second half and is exacerbated by new development home
building to deliver projects at The Hill in Ellerslie, Three Kings
and Stonefields.
As at 31 December 2024, divisional funds employed were $901
million, an increase of $60 million compared to 30 June 2024,
owing to the settlement of committed land purchases and the
seasonal stock build. The division continues to actively manage
its funds base in line with market activity.
Financial Summary
Six months ended 31 December
2024
NZ$M
2023
NZ$M
Gross revenue240351
External revenue228340
Gross margin21.1%22.5%
Overheads3939
EBIT
(1)
Fletcher Residential1944
Clever Core®(5)(3)
Vivid Living®--
Industrial Development- -
Total1441
EBIT margin
(1)
5.8%11.7%
Funds901985
Trading cash flow(55)(31)
Capital expenditure
(2)
612
(1) The EBIT result includes a $2 million gain on revaluation of Vivid Living® investment
property (2023: $1 million).
(2) Capex includes investment property development.
09
Fletcher Building Limited Interim Financial Results 2025
CONTENTS
Construction
The Construction division reported gross revenue of $814
million, which was $115 million or 16% higher than the prior
period. EBIT before significant items was a profit of $20 million,
compared to a loss of $1 million in the prior period. Trading cash
flow was an outflow of $80 million compared to a $313 million
outflow in the prior period. Excluding legacy projects, trading
cash flow resulted in an inflow of $54 million compared to
a $18 million outflow in the prior period.
Revenue performance, excluding vertical buildings, was
15% higher compared to the prior period driven by higher work
volumes in Brian Perry Civil® and Major Projects businesses,
with work continuing on key infrastructure projects at Auckland
Airport, Eastern Busway and the Ngāruawāhia and Rangiriri
roading projects. Gross margin, excluding vertical buildings,
was 10.0%, compared to 7.7% in the prior period as the division
continues to focus on lower risk, smaller self-perform work;
national and local road maintenance contracts; and alliance
infrastructure projects. Project margins were also supported
by strong product sales in Higgins®’ asphalt and bitumen
importation and supply via Napier, with Higgins®’ new import
terminal at Marsden Point, in conjunction with Channel
Infrastructure NZ, expected to be operational in FY27.
Overheads as percentage of revenue were 6.6%, compared
to 7.6% in the prior period with tight cost control measures.
Significant items for the period were a loss of $6 million in
the period, primarily relating to legal fees incurred as part of
its preparation and defence of claims in the vertical buildings
operations currently being wound down.
Trading cash flow for the division was an outflow of $80 million.
Excluding legacy cash, trading cash flow was a $54 million inflow.
This was driven by strong earnings cash inflows and working
capital management, including advances on new projects and
the finalisation of variation claims and accounts.
Legacy outflows of $134m were principally driven by the NZICC
project which is forecast to reach practical completion by end
of June 2025.
The orderbook as at December 2024 was $1.5 billion, down from
$1.8 billion at June 2024. The reduction was largely driven by a
$0.6 billion adjustment for the division’s share of the Transport
Rebuild East Coast programme which has been de-scaled
by NZTA.
The division completed the sale of 50% of the Higgins® Fiji
business in July 2024.
Divisional Overview
Major Projects
Brian Perry Civil®
Higgins®
Buildings
South Pacific
Financial Summary
Six months ended 31 December
2024
NZ$M
2023
NZ$M
Gross revenue814699
External revenue768695
Gross margin9.2%7.2%
Overheads5453
EBIT before significant items
(1)
20(1)
EBIT margin before significant items
(1)
2.5%(0.1)%
Significant items
(2)
(6)(179)
Funds216216
Trading cash flow(80)(313)
Capital expenditure54
(1) EBIT before significant items is a non-GAAP measure used by management to
assess the performance of the business and has been derived from Fletcher
Building Limited’s consolidated interim financial statements for the period
ended 31 December 2024.
(2) Details of Significant items can be found in note 2.1 of the consolidated interim
financial statements.
Note: External revenue includes income from the Group’s vertical buildings business
(December 2024: $69 million; December 2023: $51 million), which the Group is in the
process of exiting. The New Zealand International Convention Centre and Hobson
Street Hotel (NZICC) projects represent the largest projects in this business. EBIT
before significant items, however, excludes any earnings or losses from these projects
that are reported separately as Significant Items.
10
Fletcher Building Limited Interim Financial Results 2025
CONTENTS
Continuing operationsNote
Unaudited
Six months
Dec 2024
NZ$M
Unaudited
Six months
Dec 2023*
NZ$M
Audited
Year ended
Jun 2024
NZ$M
Revenue3,583 3,860 7,683
Cost of goods sold(2,584)(2,750)(5,521)
Gross margin999 1,110 2,162
Selling, general and administration expenses(836)(853)(1,665)
Share of profits of associates and joint ventures2 5 10
Revaluation gain on investment property2 1 2
Significant items2.1(193)(186)(333)
(Losses)/earnings before interest and taxation (EBIT)(26)77 176
Lease interest expense(34)(28)(58)
Funding costs(63)(62)(142)
Losses before taxation(123)(13)(24)
Taxation benefit/(expense)641 2 (55)
Losses after taxation from continuing operations(82)(11)(79)
Losses attributable to non-controlling interests- (3)(7)
Net losses from continuing operations(82)(14)(86)
Net losses from discontinued operation net of tax(52)(106)(141)
Net losses attributable to the shareholders(134)(120)(227)
* The comparative interim results have been represented for Tradelink® being classified as a discontinued operation in FY24. Further details of discontinued operation can be found
in note 2.4.
Net losses per share (cents)2.3
Basic (14.3) (14.7) (27.7)
Diluted (14.3) (14.7) (27.7)
Net losses per share from continuing operations (cents)2.3
Basic (8.7) (1.7) (10.5)
Diluted (8.7) (1.7) (10.5)
Weighted average number of shares outstanding (millions of shares)2.3
Basic 940 819 819
Diluted 940 819 819
Dividends declared per share (cents)---
The accompanying notes form part of and are to be read in conjunction with these consolidated interim financial statements.
On behalf of the Board, 19 February 2025
Peter Crowley
Chair
Sandra Dodds
Director
Consolidated Income Statement
For the six months ended 31 December 2024
11
Fletcher Building Limited Interim Financial Results 2025
CONTENTS
Unaudited
Six months
Dec 2024
NZ$M
Unaudited
Six months
Dec 2023*
NZ$M
Audited
Year ended
Jun 2024
NZ$M
Net losses attributable to shareholders(134)(120)(227)
Net losses attributable to non-controlling interests- 3 7
Net losses after tax(134)(117)(220)
Other comprehensive income/(loss)
Items that do not subsequently get reclassified
to Consolidated Income Statement:
Movement in pension reserve(3)-21
(3)- 21
Items that may be reclassified subsequently to Consolidated Income Statement
in the future:
Movement in cash flow hedge reserve(3)(17)(7)
Movement in currency translation reserve12 (17)(1)
Reclassification of foreign currency reserve to Consolidated Income Statement53 --
62 (34)(8)
Other comprehensive income/(loss)59 (34)13
Total comprehensive loss for the period(75)(151)(207)
Total comprehensive income/(loss) for the year arises from:
Continuing operations(76)(45)(66)
Discontinued operation1 (106)(141)
Total comprehensive loss for the period(75)(151)(207)
* The comparative interim results have been represented for Tradelink® being classified as a discontinued operation in FY24. Further details of discontinued operation can be found
in note 2.4.
The accompanying notes form part of and are to be read in conjunction with these consolidated interim financial statements.
Consolidated Statement of Comprehensive Income
For the six months ended 31 December 2024
12
Fletcher Building Limited Interim Financial Results 2025
CONTENTS
NZ$MNoteShare capitalRetained earningsShare-based payments reserveCash flow hedge reserveCurrency translation reservePension reserveTotalNon-controlling interestsTotal equity
Total equity at 30 June 2023 (audited)2,993 634 28 10 (78)63 3,650 27 3,677
Total comprehensive income/(loss) for the period-(120)-(17)(17)-(154)3 (151)
Movement in non-controlling interests-------(7)(7)
Dividends paid to shareholders of the parent-(124)----(124)-(124)
Movement in share-based payment reserve-4 2 ---6 -6
Total equity at 31 December 2023 (unaudited)2,993 394 30 (7)(95)63 3,378 23 3,401
Total comprehensive income/(loss) for the period-(107)-10 16 21 (60)4 (56)
Movement in non-controlling interests-------(16)(16)
Movement in share-based payment reserve2 1 (4)---(1)-(1)
Total equity at 30 June 2024 (audited)2,995 288 26 3 (79)84 3,317 11 3,328
Total comprehensive income/(loss) for the period- (134)-(3)65 (3)(75)-(75)
Movement in non-controlling interests------- (7)(7)
Movement in share-based payment reserve54(11)---(2)-(2)
Issue of shares2.5679-----679-679
Total equity at 31 December 2024 (unaudited)3,679 158 15 0 (14)81 3,919 4 3,923
The accompanying notes form part of and are to be read in conjunction with these consolidated interim financial statements.
Consolidated Statement of Movements in Equity
For the six months ended 31 December 2024
13
Fletcher Building Limited Interim Financial Results 2025
CONTENTS
Consolidated Balance Sheet
As at 31 December 2024
AssetsNote
Unaudited
Dec 2024
NZ$M
Unaudited
Dec 2023
NZ$M
Audited
Jun 2024
NZ$M
Current assets:
Cash and cash equivalents 202 215 311
Current tax assets 31 11 28
Contract assets 146 178 142
Derivatives 13 7 10
Debtors 770 978 914
Inventories 1,352 1,772 1,276
Total current assets before held for sale
2,514 3,161 2,681
Assets classified as held for sale2.4 5 - 507
Total current assets 2,519 3,161 3,188
Non-current assets:
Property, plant and equipment 2,251 2,122 2,191
Investment property 107 71 100
Intangible assets 1,026 1,170 1,055
Right-of-use assets 1,279 1,322 1,191
Investments in associates and joint ventures 240 222 221
Inventories 601 467 594
Retirement plan assets 151 126 152
Derivatives 52 28 46
Deferred tax assets 182 236 136
Total non-current assets 5,889 5,764 5,686
Total assets 8,408 8,925 8,874
Liabilities
Current liabilities:
Creditors, accruals and other liabilities 1,122 1,166 1,147
Provisions5 283 340 171
Lease liabilities 167 190 164
Derivatives 11 23 18
Contract liabilities 87 71 166
Borrowings7 85 84 86
Total current liabilities before held for sale 1,755 1,874 1,752
Liabilities associated with assets held for sale2.4 3 - 336
Total current liabilities 1,758 1,874 2,088
Non-current liabilities:
Creditors, accruals and other liabilities 25 102 134
Provisions5 34 39 28
Lease liabilities 1,373 1,401 1,272
Derivatives 7 8 2
Borrowings7 1,288 2,100 2,022
Total non-current liabilities 2,727 3,650 3,458
Total liabilities 4,485 5,524 5,546
Equity
Share capital 3,679 2,993 2,995
Reserves 240 385 322
Shareholders' funds 3,919 3,378 3,317
Non-controlling interests 4 23 11
Total equity 3,923 3,401 3,328
Total liabilities and equity 8,408 8,925 8,874
The accompanying notes form part of and are to be read in conjunction with these consolidated interim financial statements.
14
Fletcher Building Limited Interim Financial Results 2025
CONTENTS
Consolidated Statement of Cash Flows
For the six months ended 31 December 2024
Note
Unaudited
Six months
Dec 2024
NZ$M
Unaudited
Six months
Dec 2023
NZ$M
Audited
Year ended
Jun 2024
NZ$M
Cash flow from operating activities
Receipts from customers3,950 4,406 8,667
Dividends received5 5 10
Payments to suppliers, employees and other(3,861)(4,427)(8,064)
Interest paid(97)(89)(200)
Income tax paid(2)(21)(15)
Net cash from operating activities
9
(5)(126)398
Cash flow from investing activities
Sale of property, plant and equipment53 3 7
Sale of subsidiaries182 --
Purchase of subsidiaries- (7)(11)
Purchase of property, plant and equipment and intangible assets(161)(183)(402)
Payments for investment property and investment property
under development
(6)(12)(20)
Net cash from investing activities68 (199)(426)
Cash flow from financing activities
Issue of capital notes-- 32
Repurchase of capital notes-- (78)
Issue of shares2.5679 --
Drawdown of borrowings-700 920
Repayment of borrowings(762)(301)(568)
Principal elements of lease payments(99)(100)(206)
Contributions from non-controlling interests11 11 15
Distribution to non-controlling interests(5)(7)(17)
Dividends paid to shareholders of the parent- (124)(124)
Net cash from financing activities(176)179 (26)
Net movement in cash held(113)(146)(54)
Add: opening cash and cash equivalents311 365 365
Effect of exchange rate changes on net cash4 (4)-
Closing cash and cash equivalents202 215 311
The accompanying notes form part of and are to be read in conjunction with these consolidated interim financial statements.
15
Fletcher Building Limited Interim Financial Results 2025
CONTENTS
Fletcher Building Interim Financial Statements
Significant changes in the current reporting period
The financial position and performance of the Group were particularly affected by the following events and transactions during the
reporting period:
–The Group completed the sale of 50% of its Fiji construction business to the Fiji National Provident Fund and Fijian Holdings Limited
on 31 July 2024 for NZ$21 million. Refer to note 2.4.
–The Group completed the sale of Tradelink®, its Australian plumbing supplies and distribution business, to Metal Manufactures Pty
Limited on 30 September 2024. The sale price of A$170 million comprises a cash payment of A$160 million paid on settlement, with
the remaining A$10 million cash payment based on achieving separation milestones. Transaction and separation costs are expected
to total c.A$30 million over a period of up to 24 months from completion. A $53 million loss was reclassified from the foreign
currency translation reserve (FCTR) on disposal of Tradelink®. Refer to note 2.4.
–The Group and its subsidiary, Iplex® Pipelines Australia, together with the Western Australian (WA) Government and key industry
stakeholders, have finalised the Industry Response (the IR) to address the plumbing failures which are impacting some WA homes
constructed using Typlex Pro-Fit pipe. As a result, the Group recorded a pre-tax provision of $170 million (A$155 million) in relation
to its net obligations under the IR, classified as a Significant Item. Refer to note 2.1 and note 5.
–The Group completed a $700 million equity raise, as announced on 23 September 2024, comprising a fully underwritten c.$282
million institutional placement and c.$418 million pro rata accelerated non-renounceable entitlement offer, with 291,853,776
additional ordinary shares issued. A total of $679 million of proceeds was raised, net of transaction costs. Refer to note 2.5.
–The Group repaid and cancelled $680 million of its outstanding borrowings on a pro-rated basis, including full repayment of the
Group’s Club Loan ($400 million) and partial repayment of the amounts outstanding under its syndicated facility ($111 million)
and USPP notes ($169 million). A $10 million loss from the close-out of the CCRIS hedge instruments that was related to the early
redemption of USPP notes has been classified as a Significant Item in note 2.1. The repayment of the loan, and partial repayment
of syndicated facilities and USPP notes were funded using the proceeds from the equity raise during the period. Refer to note 7.
Notes to the Consolidated Interim Financial Statements
Statement of accounting policies
1. GENERAL INFORMATION
The consolidated condensed interim financial statements presented are those of Fletcher Building Limited (the Company) and its
subsidiaries (the Group). The Group is primarily involved in the manufacturing and distribution of building materials and residential,
commercial and infrastructure construction. Fletcher Building Limited is domiciled in New Zealand. The registered office of the
Company is 810 Great South Road, Penrose, Auckland.
The Company is registered under the Companies Act 1993 and is a Financial Markets Conduct Act (FMCA) 2013 reporting entity in terms
of the Financial Reporting Act 2013. The Group is a for-profit entity.
Basis of presentation
These consolidated interim financial statements have been prepared in accordance with Generally Accepted Accounting Practice
in New Zealand and the requirements of the Financial Markets Conduct Act 2013. Generally Accepted Accounting Practice are the
New Zealand equivalent to International Financial Reporting Standards (NZ IFRS).
These financial statements are presented in New Zealand dollars ($), which is the Group’s presentation currency, and rounded to the
nearest million unless otherwise stated.
The consolidated interim financial statements comply with NZ IAS 34 Interim Financial Reporting and do not include all the information
and disclosures required in the annual consolidated financial statements, and should be read in conjunction with the Group’s annual
consolidated financial statements as at 30 June 2024. In complying with NZ IAS 34, these financial statements comply with International
Accounting Standard 34 Interim Financial Reporting.
The accounting policies adopted are consistent with those of the previous financial year and corresponding interim reporting period.
The estimates and judgements that are critical to the determination of the amounts reported in the consolidated interim financial statements
have been disclosed with the relevant notes in the consolidated interim financial statements and are marked with this colour.
The following key exchange rates were applied in the preparation of the consolidated interim financial statements:
NZD/AUD
Unaudited
Six months
Dec 2024
Unaudited
Six months
Dec 2023
Audited
Year ended
Jun 2024
Average rates0.91110.92310.9228
Closing rates0.90630.92640.9150
16
Fletcher Building Limited Interim Financial Results 2025
CONTENTS
Notes to the Consolidated Interim Financial Statements (Continued)
2. KEY ESTIMATES, JUDGEMENTS AND OTHER FINANCIAL INFORMATION
2.1 SIGNIFICANT ITEMS
In reporting financial information, the Group presents non-GAAP performance measures (i.e. EBIT before Significant Items), which is not
defined or specified under the requirements of NZ IFRS. The Group believes that these non-GAAP measures, which are not considered
to be a substitute for or superior to NZ IFRS measures, provide stakeholders with additional useful information on the performance of
the business. The non-GAAP measures are consistent with how the business performance is planned and reported to the Board and
Audit and Risk Committee.
As at 31 December 2024, Significant Items from continuing operations totalled $193 million (31 December 2023: $186 million), this
amount captures both gains and losses from transactions or events outside of the Group’s ongoing operations that have had significant
impact on the Group’s reported profit and loss in the period.
Dec 2024Dec 2023
NZ$MEBIT
Significant
items
EBIT before
significant
itemsEBIT
Significant
items
EBIT before
significant
items
Building Products 62 - 62 72 (6) 78
Distribution 4 - 4 35 - 35
Concrete 49 - 49 72 2 70
Australia (130) (177) 47 74 (3) 77
Materials and Distribution divisions (15) (177) 162 253 (7) 260
Residential and Development 14 - 14 41 - 41
Construction 14 (6) 20 (180) (179) (1)
Corporate and other (39) (10) (29) (37) - (37)
Continuing operations (26) (193) 167 77 (186) 263
Discontinued operation (52) (58) 6 (121) (122) 1
Group (78) (251) 173 (44) (308) 264
Significant items from continuing operations include:
Iplex® Australia Western Australia pipes matter ($177 million)
Iplex® Pipelines Australia (Iplex® Australia), in collaboration with the Western Australian (WA) Government and key industry stakeholders,
finalised the Industry Response (the IR) to address plumbing failures impacting some WA homes using Typlex Pro-Fit pipe. As a result,
Iplex® Australia recognised a pre-tax net provision of A$155 million (NZ$170 million) during the period. The interim investigation fund
was extended up to the finalisation of the IR response being agreed, at an additional cost of A$2.5 million (NZ$3 million). Both have
been classified as Significant Items, refer to note 5.
Additionally, Iplex® Australia incurred A$4 million in legal costs associated with defending claims related to the matter during the period,
which have also been classified as a Significant Item.
Capital and funding restructure ($10 million)
Fletcher Building raised net proceeds of NZ$679 million in the equity raise carried out during the period (refer to note 2.5), with the
net proceeds subsequently being applied to repay and cancel existing debt facilities, including the partial early redemption of USPP
notes that were scheduled to mature in 2026 (see note 7). This early redemption of USPP notes led to a $10 million loss from the partial
close-out of the related CCIRS hedge instruments, which would otherwise be considered ineffective, being recognised in the income
statement. The loss on close-out has been classified as a Significant Item incurred as part of the Group’s capital restructuring activities.
Other ($6 million)
Other Significant Items primarily comprise $6 million of legal costs incurred by the Construction division as part of its preparation and
defence of claims in the vertical building business currently being wound down.
Significant items from discontinued operation include:
Tradelink® disposal ($58 million)
On 30 September 2024, the Group completed the sale of Tradelink®, its Australian plumbing supplies business, and recorded a
$58 million loss, classified as a Significant Item. This loss includes a $53 million reclassification of the foreign currency translation
reserve to the income statement and a further $5 million impairment due to working capital and net debt adjustments on disposal,
see note 2.4.
CONTENTS
17
Fletcher Building Limited Interim Financial Results 2025
Notes to the Consolidated Interim Financial Statements (Continued)
2.2 INTANGIBLE ASSET IMPAIRMENT TESTING
The Group performs an annual impairment test for assets with an indefinite useful life (i.e. Goodwill and Brands) in June or at the end
of a reporting period when there is an indication that an asset may be impaired. The Group’s impairment test for goodwill and intangible
assets with indefinite lives is based on value-in-use calculations. The key assumptions used to determine the recoverable amount for
the different cash generating units were disclosed in the annual consolidated financial statements for the year ended 30 June 2024.
The Group considered the cyclical nature of the construction and building industry, the current economic environment and the historic
and forecast performance of businesses in a mid-cycle environment, and concluded that no indicators of impairment existed that
required an impairment to be recognised as at 31 December 2024.
2.3 SUPPLEMENTARY DISCLOSURES: EARNINGS PER SHARE
The Group has restated the prior year earnings per share metrics to reflect the slight dilution resulting from the “bonus share”
element of the capital raise completed during the period. The new shares, issued at $2.40 under the share placement, were priced
at a theoretical 17.0% discount to the $2.89 closing price on the NZX on 20 September 2024, before the equity raise was announced.
The additional shares issued due to the discount, compared to the number required without a discount, are considered the “bonus
share” element. The prior year’s comparative weighted average number of ordinary shares of 783 million shares has been adjusted to
reflect these “bonus shares”, equating to 819 million shares. Similarly, the current year’s weighted average number of ordinary shares
has been increased as if these “bonus shares” had been in place for the entire financial year, rather than just from the date of issue.
The disclosure below has been included to provide additional useful information by removing the impact of Significant Items in the
current and prior year, and the resulting impact on the earnings per share measure.
The effect of Significant Items on earnings per share
is as follows:
Unaudited
Six months
Dec 2024
NZ$M
Unaudited
Six months
Dec 2023
NZ$M
Audited
Year ended
Jun 2024
NZ$M
Net losses after taxation from continuing operations
(as per Consolidated Income Statement)
(82)(14)(86)
Add back: Significant Items before taxation193 186 333
Less: tax benefit on Significant Items(58)(53)(64)
Net earnings from continuing operations
before Significant Items
53 119 183
Net earnings from continuing operations per share
before Significant Items (cents)
5.6 14.5 22.3
Net losses per share – as reported per
Consolidated Income Statement (cents)
(8.7)(1.7)(10.5)
2.4 DISCONTINUED OPERATION AND ASSETS HELD FOR SALE
On 14 February 2024 the Group announced its intention to divest the Tradelink® business and initiated an active programme to locate
a buyer. The associated assets and liabilities were consequently presented as held for sale from 1 April 2024 when the criteria to be
classified as held for sale were met, with Tradelink® being classified as a discontinued operation.
Tradelink® was sold on 30 September 2024 with effect from 1 October 2024.
Financial performance and cash flow information of Tradelink®, represented as a discontinued operation
The financial performance and cash flow information presented for the period ended 31 December 2024 includes the results from
1 July 2024 and up to the date of disposal of 30 September 2024.
Unaudited
Six months
Dec 2024
NZ$M
Unaudited
Six months
Dec 2023
NZ$M
Audited
Year ended
Jun 2024
NZ$M
Revenue202 388 758
Cost of goods sold(145)(274)(529)
Gross Margin57 114 229
Selling, general and administration expenses(51)(113)(222)
Significant Items(58)(122)(155)
Losses before interest and taxation (EBIT)(52)(121)(148)
Lease interest expense(2)(4)(7)
Income tax benefit2 19 14
Net losses from discontinued operation net of tax(52)(106)(141)
CONTENTS
18
Fletcher Building Limited Interim Financial Results 2025
Notes to the Consolidated Interim Financial Statements (Continued)
Unaudited
Six months
Dec 2024
NZ$M
Unaudited
Six months
Dec 2023
NZ$M
Audited
Year ended
Jun 2024
NZ$M
Other comprehensive income - reclassification of foreign currency
translation reserve on disposal
53 --
Total comprehensive income/(loss) from discontinued operation1 (106)(141)
Net losses per share from discontinued operation (cents)
Basic(5.6)(13.0)(17.2)
Diluted(5.6)(13.0)(17.2)
Net cash (outflow)/inflow from operating activities(9)(29)20
Net cash outflow from investing activities(2)(5)(10)
Net cash outflow from financing activities*(10)(19)(38)
Net decrease in cash generated by the subsidiary(21) (53) (28)
* Excludes the benefit of intercompany funding.
Details of the sale of Tradelink® business
30 September 2024
NZ$M
Consideration received or receivable186
Separation and transaction costs(33)
Total disposal consideration153
Carrying amount of net assets sold(158)
Loss on sale before reclassification of foreign currency translation reserve(5)
Reclassification of foreign currency translation reserve(53)
Loss on disposal(58)
The consideration payable by the acquirer is the aggregate of the completion payment ($175 million) and the milestone payment
($11 million). The milestone amounts are payable upon delivery of transitional services by the Group to the acquirer, expected to occur
over a period of up to 24 months from completion. The obligation to deliver separation infrastructure has been recognised in other
provisions (see note 5). The loss of $58 million is presented as a Significant Item from discontinued operation.
The final loss on disposal remains subject to agreement of completion statements, which are currently under review. This process
is expected to be finalised before the end of the financial year 2025.
The carrying amounts of assets and liabilities as at the date of sale
30 September 2024
NZ$M
Cash4
Property, plant and equipment29
Intangible assets12
Tax asset15
Right-of-use assets105
Debtors110
Inventories160
Total assets435
CONTENTS
19
Fletcher Building Limited Interim Financial Results 2025
Notes to the Consolidated Interim Financial Statements (Continued)
30 September 2024
NZ$M
Creditors, accruals and other liabilities126
Lease liabilities132
Provisions19
Total liabilities277
Net assets
158
Other disposals
On 31 July 2024, following receipt of regulatory approvals, the Group successfully completed the transaction to divest 50% of its Fiji
construction business. The transaction valued the Fiji business, comprising Fletcher Construction and Higgins® branded operations,
at NZ$42 million, with NZ$21 million received for the sale of the 50% stake in the business, and 50% retained by the Group to be
accounted for as an equity accounted investment going forward. The Group had recorded a non-cash impairment of NZ$17 million
on the business in the FY24 Financial Statements. The Fiji construction business sold was not classified as a discontinued operation
for reporting purposes.
Assets and liabilities of disposal group classified as held for sale
As at 31 December 2024, the Group continued to hold the New Zealand Ceiling and Drywall (NZCDS) business assets and liabilities
as held for sale.
2.5 CAPITAL
On 23 September 2024, Fletcher Building Limited announced a NZ$700 million equity raise comprising a fully underwritten
c.NZ$282 million institutional placement (“Placement”) and c.NZ$418 million pro rata accelerated non-renounceable entitlement
offer (“Entitlement Offer”). The Placement and Entitlement Offer were fully underwritten.
A total of 291,853,776 new shares were issued at an offer price of NZ$2.40 per share as part of the capital raise, with proceeds
of $679 million raised, net of transaction costs. All new shares issued rank equally in all respects with Fletcher Building’s existing
ordinary shares.
Unaudited
Six months
Dec 2024
NZ$M
Audited
Year ended
Jun 2024
NZ$M
Reported capital at the beginning of the period excluding treasury stock2,9952,993
Issue of shares679 -
Vested share-based payment5 2
Reported capital at the end of the period excluding treasury stock3,6792,995
All ordinary shares are issued and fully paid and carry equal rights in respect of voting, dividend payments and distribution upon
winding up.
Unaudited
Six months
Dec 2024
NZ$M
Audited
Year ended
Jun 2024
NZ$M
Number of ordinary shares issued and fully paid
Number of shares on issue at the beginning of the period783,043,596 783,043,596
Issue of shares291,853,776 -
Total number of shares on issue1,074,897,372 783,043,596
Less shares accounted for as treasury stock(4,741,564)(6,322,384)
Number of shares on issue at the end of the period1,070,155,808 776,721,212
CONTENTS
20
Fletcher Building Limited Interim Financial Results 2025
Notes to the Consolidated Interim Financial Statements (Continued)
3. CONSTRUCTION ACCOUNTING
The Group’s Construction division is engaged with a wide variety of customers to construct and maintain building and infrastructure
projects across New Zealand and the South Pacific. Services provided by the division include construction contract works, engineering
and maintenance services. Each project has a different risk profile based on its individual contractual and delivery characteristics.
The Group’s policies for accounting for such projects are outlined in the Group’s Consolidated Financial Statements for the year
ended 30 June 2024 and should be read in conjunction with the disclosures below, including related estimate and judgements
made by management.
Revenue backlog
Revenue backlog, as disclosed below, refers to the level of construction work the Group is contracted to but is not yet complete
as at period end. This represents the performance obligations that are yet to be completed for the construction contracts active
as at 31 December 2024. The long-term nature of the contracts held by the Buildings, Infrastructure, Brian Perry Civil® and Higgins®
businesses will see these performance obligations completed over a period generally between one to five years, although some may
extend longer.
Revenue Backlog by Business Units as at 31 December 2024
Current Revenue Backlog
NZ$M
Top 5 projects as a %
of Revenue Backlog
Buildings 35 100%
Infrastructure 232 98%
Brian Perry Civil® 270 63%
Higgins® 916 46%
South Pacific 19 100%
1,472 N /A
Legacy construction projects update
A summary of the major construction projects, including their approximate stage of completion and other relevant information
is disclosed to demonstrate the uncertainty that remains on these projects.
Status of legacy construction projects (> $200 million original contract value) as at 31 December 2024
Forecast
Percentage of
completion
Business unitcompletion*(% cost)
New Zealand International Convention Centre and Hobson Street
Hotel (NZICC) - Fixed price contract and fire reinstatement
Buildings
2025
98%
Pūhoi to Warkworth - Fixed price contract (Public Private Partnership)Infrastructure
2024
99%
* Calendar year
Pūhoi to Warkworth (P2W)
On the Pūhoi to Warkworth (P2W) project, there have been no material updates from the 30 June 2024 reported position.
The Construction JV continues to hold a material claim with NX2 and the NZTA for the impacts and delays arising from COVID-19 and
other weather events. If no variations or extension of time are agreed between the parties or ultimately determined under the contract, the
Construction JV will incur unrecoverable costs and liquidated damages (from 16 August 2022, being the current contractual Planned Service
Commencement Date to mid-June 2023). Unless the Construction JV and NZTA agree otherwise, that claim will be resolved through an
agreed dispute resolution process, unlikely to be earlier than 2026.
Separately, the Construction JV continues to hold material claims under the Contract Works Insurance policy for damage to the project
works caused by landslips and weather events during construction. For claims that have been notified, coverage has been confirmed under
the Contract Works Insurance policy. An assumed recovery for all events has been included in the determination of the final project position
and estimated final margin.
As the project nears finalisation, the Construction JV expects to make claims against some of its suppliers and may be subject to claims
against it by suppliers and subcontractors.
The Group has assessed the facts and circumstances known to it relating to the merits of Construction JV’s claims and likelihood of receipt
of further relief under the Project Agreement, quantification of any claims and costs under this relief, the expected recovery under insurance
policies, and concluded that no additional provision is required to be recognised as at 31 December 2024. There remains a risk that,
ultimately, the full amount of the Construction JV’s claims will not be recovered.
CONTENTS
21
Fletcher Building Limited Interim Financial Results 2025
Notes to the Consolidated Interim Financial Statements (Continued)
New Zealand International Convention Centre and Hobson Street Hotel (NZICC)
Good progress has been made on the NZICC project during the six months to 31 December 2024, with the major construction works now
finished and the focus moving to finishing, testing and commissioning. The Group is focused on achieving practical completion and handing
over the NZICC to SkyCity by 30 June 2025. The remaining forecast revenues to secure on the NZICC project solely relate to c.$15 million
in ‘BAU’ client revenues (i.e. for work that was still to be completed at the time of fire), following FCC’s settlement of all CWI claims with the
NZICC/HSH project insurers and SkyCity in June 2024.
The assessment of the net cost to complete the project continues to rely on the application of estimates and judgements (e.g. programme
to complete and cost estimates for certain trades) and, as such, may be subject to change as the project progresses. It is possible that the
final provision could be below or above the levels currently allowed for due to changes in costs to complete. As the project approaches
completion, there is also risk of dispute over delay and cost with SkyCity. No claims have been received to date and project forecast and
expected final margin does not allow for any.
The Group continues to pursue recoveries under the NZICC Third Party Liability (TPL) insurance policy of more than $100 million. While the
Company considers it has good grounds to recover material amounts under the TPL policy, it has determined that these proceeds are not
yet “virtually certain” in accordance with NZ IAS 37 Provisions, Contingent Liabilities and Contingent Assets to be recognised. As such, no
amount has been recognised to be recovered under the TPL policy in the project position. The Group will continue to pursue its rights to
recovery under the TPL policy, though this is not expected to be settled until calendar year 2026.
Wellington International Carpark (WIAL)
On the WIAL project, The Fletcher Construction Company Limited (FCC) completed a multi-level carpark for WIAL in October 2018. The client
had alleged there are a number of defects in the carpark and the adjacent storm water drainage. It is claiming the cost of remediation and
other related losses in the order of $40 million.
At 31 December 2024, the storm water drainage remediation works are nearing completion, and the cost of those remediation works are
materially in line with that assumed in FCC’s provision for the project. FCC continues to work with WIAL to agree a remediation solution
to quality issues identified on the carpark and to settle claims. These matters may take some time to be resolved.
Based on FCC’s assessment of the estimated remedial costs and expected recoveries, no additional provision is required to be recognised
on the WIAL carpark project as at 31 December 2024.
It is possible that the final provision could be below or above the levels currently allowed for and would ultimately depend on the solution
agreed and associated costs, and final claim settlements.
4. SEGMENTAL INFORMATION
The following tables present revenue, profit and balance sheet information for the Group’s operating segments for the six months
ended 31 December 2024 and 31 December 2023, and the year ended 30 June 2024. The financial results for the six months ended
31 December 2023 below have been represented to account for Tradelink® reported as a discontinued operation.
Description of industry segments
Building Products
The Building Products division is a manufacturer, distributor and marketer of building products used in the residential,
industrial and commercial markets in New Zealand.
Distribution
The Distribution division consists of building and plumbing product distribution businesses in New Zealand.
Concrete
The Concrete division includes the Group's interests in the concrete value chain, including extraction of aggregates,
and the production of cement, concrete and concrete products. The division operates in New Zealand.
Australia
The Australia division manufactures and sells building materials for a broad range of industries across Australia.
Residential and
Development
The Residential and Development division operates in both New Zealand and Australia. In New Zealand, the division’s
operations include building and sale of residential homes and apartments, development and sale of commercial and
residential land and management of retirement village assets. In Australia, the division’s operations include development
and sale of commercial and residential land. Development activity includes sale of land property which is surplus to the
Group’s operating requirements.
Construction
The Construction division is a supplier of building and maintenance services for infrastructure projects across New Zealand
and the South Pacific. The division is exiting the vertical building sector, with NZICC being the last project for the Group.
Discontinued
operation
Discontinued operation comprises the Tradelink® business classified as held for sale from 1 April 2024 and was previously
included in the Australia segment.
CONTENTS
22
Fletcher Building Limited Interim Financial Results 2025
Notes to the Consolidated Interim Financial Statements (Continued)
Industry segments
Gross Revenue
Unaudited
Six months
Dec 2024
NZ$M
Unaudited
Six months
Dec 2023
NZ$M
Audited
Year ended
Jun 2024
NZ$M
Building Products 663 703 1,345
Distribution 780 836 1,615
Concrete 536 567 1,082
Australia 924 1,054 1,979
Materials and Distribution 2,903 3,160 6,021
Residential and Development 240 351 796
Construction 814 699 1,614
Corporate and other 4 6 10
Continuing operations 3,961 4,216 8,441
Discontinued operation 211 390 762
Group 4,172 4,606 9,203
Less: intercompany revenue (387) (358) (762)
External revenue 3,785 4,248 8,441
External revenue
Building Products 533 570 1,093
Distribution 767 817 1,578
Concrete 381 412 782
Australia 906 1,026 1,925
Materials and Distribution 2,587 2,825 5,378
Residential and Development 228 340 739
Construction 768 695 1,566
Continuing operations 3,583 3,860 7,683
Discontinued operation 202 388 758
Group 3,785 4,248 8,441
Note: External revenue includes income from the Group’s vertical buildings business (December 2024: $69 million; December 2023: $51 million), which the Group is in the process
of exiting. The New Zealand International Convention Centre and Hobson Street Hotel (NZICC) projects represent the largest projects in this business. EBIT before Significant Items,
however, excludes any earnings or losses from these projects that are reported separately as Significant Items.
EBIT before Significant Items
Unaudited
Six months
Dec 2024
NZ$M
Unaudited
Six months
Dec 2023
NZ$M
Audited
Year ended
Jun 2024
NZ$M
Building Products 62 78 143
Distribution 4 35 49
Concrete 49 70 130
Australia 47 77 126
Materials and Distribution 162 260 448
Residential and Development 14 41 100
Construction 20 (1) 28
Corporate and other (29) (37) (67)
Continuing operations 167 263 509
Discontinued operation 6 1 7
Group 173 264 516
CONTENTS
23
Fletcher Building Limited Interim Financial Results 2025
Notes to the Consolidated Interim Financial Statements (Continued)
Funds*
Unaudited
Six months
Dec 2024
NZ$M
Unaudited
Six months
Dec 2023
NZ$M
Audited
Year ended
Jun 2024
NZ$M
Building Products 1,336 1,256 1,311
Distribution 306 308 305
Concrete 850 810 836
Australia 1,008 1,160 1,128
Materials and Distribution 3,500 3,534 3,580
Residential and Development 901 985 841
Construction 216 216 138
Corporate and other226 160 226
Continuing operations 4,843 4,895 4,785
Discontinued operation- 171 118
Group operating funds 4,843 5,066 4,903
Net debt (1,171) (1,969) (1,797)
Deferred tax (excl. deferred tax liability on brands) 251 304 222
Group total equity 3,923 3,401 3,328
Depreciation, depletion and amortisation expense
Building Products 35 32 64
Distribution 30 27 58
Concrete 38 37 75
Australia 45 40 81
Materials and Distribution 148 136 278
Residential and Development 2 2 4
Construction 22 20 42
Corporate and other 7 8 13
Continuing operations 179 166 337
Discontinued operation- 25 36
Group 179 191 373
Capital expenditure+
Building Products 85 75 178
Distribution 13 10 11
Concrete 36 34 89
Australia 15 22 53
Materials and Distribution 149 141 331
Residential and Development 6 12 20
Construction 5 4 20
Corporate and other (5) 26 48
Continuing operations 155 183 419
Discontinued operation 2 5 10
Group 157 188 429
* Funds is a Non-GAAP measure and represents the external assets and liabilities of the Group and divisions and is used for internal reporting purposes.
+ Capital expenditure represents additions to the balance sheet of property, plant and equipment and intangible assets, excluding the impacts of the investments/acquisitions
of companies or businesses.
CONTENTS
24
Fletcher Building Limited Interim Financial Results 2025
Notes to the Consolidated Interim Financial Statements (Continued)
External revenue
Unaudited
Six months
Dec 2024
NZ$M
Unaudited
Six months
Dec 2023
NZ$M
Audited
Year ended
Jun 2024
NZ$M
New Zealand 2,639 2,776 5,602
Australia 1,109 1,414 2,702
Other jurisdictions 37 58 137
Group 3,785 4,248 8,441
EBIT before Significant Items
New Zealand 121 188 383
Australia 53 75 132
Other jurisdictions (1) 1 1
Group 173 264 516
Funds*
New Zealand 3,807 3,654 3,613
Australia 978 1,344 1,229
Other jurisdictions (including debt and taxation) (862) (1,597) (1,514)
Group 3,923 3,401 3,328
Non-current assets +
New Zealand 4,237 3,898 4,137
Australia 1,265 1,428 1,212
Other jurisdictions 2 48 3
Group 5,504 5,374 5,352
* Funds is a Non-GAAP measure and represents the external assets and liabilities of the Group and divisions and is used for internal reporting purposes.
+ Non-current assets exclude deferred tax assets, retirement plan surplus and financial instruments.
5. PROVISIONS
Restructuring
NZ$M
Warranty &
environmental
NZ$M
Onerous
contracts
NZ$M
The Industry
Response
NZ$M
Other
NZ$M
Total
NZ$M
Carrying amount as at
30 June 2024
151878
-
88199
Charged to earnings 3 1 - 170 1 175
Settled or utilised (8) (5) (52) (6) (11) (82)
Released to earnings (3)---- (3)
Recognised on balance sheet---- 26 26
Currency translation--- 1 1 2
Carrying amount as at
31 December 2024
71426165105317
CONTENTS
25
Fletcher Building Limited Interim Financial Results 2025
Notes to the Consolidated Interim Financial Statements (Continued)
The Industry Response (the IR)
Fletcher Building Limited (the Group), through its subsidiary, Iplex® Pipelines Australia (Iplex® Australia), has been addressing claims raised
in respect of the hot and cold water polybutylene pipe product Iplex® Australia previously manufactured (under the name “Pro-fit”).
Iplex® Australia started manufacturing Pro-fit with Typlex resin from mid-2017 and those products represented the bulk of sales after that
time. Iplex® Australia ceased the sale of Pro-fit in mid-2022. The Pro-fit product was sold in other states of Australia but not New Zealand.
In response, Iplex® Australia established an interim investigation fund in April 2023 to support urgent repairs and undertake investigations.
Comprehensive testing confirmed that the pipes met manufacturing standards. Iplex® Australia also worked with builders, independent
experts and government regulators to assess and determine the root causes.
On 13 November 2024, the Group announced that its subsidiary, Iplex® Australia, together with the Western Australian Government and key
industry stakeholders, had finalised the Industry Response (the IR) to address the plumbing failures which are impacting some WA homes
constructed using Typlex Pro-Fit pipe. Among other matters, the IR provides participating builders with funding for the agreed work and
remediation programme. To date 29 WA builders have joined the IR.
The IR is entered into on a no liability, no admissions basis. All participants in the IR have also agreed to a “no sue” provision as part of
the agreement.
As a result, Iplex® Australia has recorded a provision of A$155 million (NZ$170 million) pre-tax for the cost it has agreed to incur under the
IR, classified as a Significant Item. As of 31 December 2024, the provision had a carrying amount of A$150 million (NZ$165 million), with
approximately A$5 million (NZ$6 million) spent to date primarily on the rollout of the Leak Detector Unit (LDU) programme.
The IR commits Iplex® Australia to fund 80% of the direct costs incurred by participating builders, with the WA Government contributing
20% up to a capped amount of A$30 million (NZ$33 million) to Iplex® Australia. The provision assumes approximately A$120 million
(NZ$132 million) for repair costs (net of the A$30 million contribution receivable from the WA Government), A$20 million (NZ$22 million) for
the installation of leak detector units, and A$15 million (NZ$16 million) for expected administrative and overhead expenses. These costs are
expected to be incurred over at least five years, with higher expenditure anticipated in the initial stages to address urgent remediation work
and establish necessary infrastructure (i.e. leak detectors).
The provision:
–Assumes ~5,200 WA homes will experience one or more plumbing failures over time, which translates to ~35% of relevant WA homes
based on an estimate that 15,000 WA homes may have had Pro-Fit pipe installed with Typlex resin.
–Covers the direct costs of remediation and preventive measures, including pipe repairs, ceiling pipe replacements, and, for WA homes
with extensive failures, a full house re-pipe plus temporary accommodation where required.
–Excludes builders’ overheads or management costs or any margin or cost of expenses incurred directly by them in connection with
repairing, rectifying, or remediating of any defective workmanship.
–Excludes any legal costs, including litigation defence costs.
The IR also allows for funding of affected homes built by any builders in WA to be remediated, including the Buckeridge Group of Companies
(BGC). While most major builders have agreed to participate in the IR, BGC, which is responsible for constructing 50–60% of the affected
homes, has not joined. The provision includes allowances for homes built by BGC, as BGC has the option to participate in the IR at any time.
However, BGC has not ruled out joining in the future. To the extent that BGC remains outside the IR, the repair costs and associated cash
flows for Iplex® Australia are expected to be proportionally lower. However, this could increase the liability exposure that may arise due to
further disputes and claims from BGC. See note 8 for further details.
The total costs of the Group to perform under the IR remains subject to significant risks and uncertainties. In addition to the assumption
that BGC will join the IR, one of the key assumptions is the number of homes in Western Australia built with Typlex Pro-Fit pipes that will
experience leaks over time. A second is that not all homes that experience one failure will go on to experience subsequent failures. A third
is the cost for each plumbing failure in accordance with the agreed work programme and the timing of that expenditure. If the actual number
of affected homes, the extent of failures or their repair costs exceeds these estimates, the provision may need to be increased.
The IR accounts for a range of remediation measures, including minor repairs, replacement of ceiling pipes and full home re-piping for
severely affected homes. Temporary accommodation is also provided where full home re-piping is required. If the actual distribution of
repairs skews towards more extensive and expensive interventions, costs could exceed the current estimates.
The provision does not account for any risk from litigation or class action (see note 8 for further details). There are a number of claims
against Iplex® Australia outside the IR relating to plumbing failures, which seek recovery of a wide range of damages and losses on behalf of
all relevant homeowners and some builders, including the class action previously advised. The claims include: costs of removing, repairing,
replacing and disposing of the affected pipe; repair costs and/or possessions damaged by the affected pipe; reduction in property value,
vexation, distress and disappointment. If a current or future claim is successful, it may have a material adverse impact on the Group.
The IR ought to operate to some extent as a mitigant of those risks but does not dispose of them. Further, the IR does not affect the right of
homeowners or others with claims (e.g. home insurers) to take action. They are entitled to remain in the class action while taking up the work
programme on offer. A final outcome of a class action may replace the IR terms for the homes of class members and their successors.
The Group will monitor the provision and will reassess its adequacy if new and material information becomes available.
Provision for Interim Investigation Fund
Iplex® Australia’s interim investigation fund was closed to new claims on finalisation of the IR. The total amount disbursed under the fund
since its establishment in May 2023 was c.A$17.5 million (NZ$19 million). Of this, A$2.5 million (NZ$3 million) was recognised and classified
in FY25 as a Significant Item, given that A$15 million (NZ$16 million) had already been recognised in FY23.
CONTENTS
26
Fletcher Building Limited Interim Financial Results 2025
Notes to the Consolidated Interim Financial Statements (Continued)
6. TAXATION
The Group calculates the period income tax expense using the tax rate that would be applicable to the expected total earnings.
The calculation of the Group’s tax expense/(benefit) as well as its major components included in the consolidated interim financial
statements are:
Unaudited
Six months
Dec 2024
NZ$M
Unaudited
Six months
Dec 2023
NZ$M
Audited
Year ended
Jun 2024
NZ$M
Losses before taxation(123)(13)(24)
Taxation at 28 cents per dollar(34)(4)(7)
Adjusted for:
Difference in tax rates(3)--
Non-assessable income(6)(2)(5)
Non-deductible expenses2334
Utilisation of previous unrecognised tax losses--(1)
Tax in respect of prior years-134
Tax (benefit)/expense on earnings(41)(2)55
Income tax expense/(benefit) on continuing operations is attributable to:
Tax expense on earnings before Significant Items1751119
Tax benefit on Significant Items(58)(53)(64)
(41)(2)55
Income tax (benefit)/expense on discontinued operation is attributable to:
Tax expense/(benefit) on earnings before Significant Items-(1)1
Tax benefit on Significant Items(2)(18)(15)
(2)(19)(14)
Income tax expense/(benefit) is attributable to:
Total tax expense/(benefit) on earnings before Significant Items
17
50120
Total tax benefit on Significant Items
(60)
(71)(79)
(43)(21)41
The net deferred tax asset balance of $182 million at 31 December 2024 largely comprises New Zealand and Australia carried forward
tax losses incurred in the current and prior periods, timing differences on the Group’s provisions and net deferred tax asset on the
Group’s right-of-use assets/liabilities. It is expected that there will be sufficient future earnings in New Zealand and Australia to utilise
the deferred tax asset in each of these jurisdictions.
CONTENTS
27
Fletcher Building Limited Interim Financial Results 2025
Notes to the Consolidated Interim Financial Statements (Continued)
7. BORROWINGS
Unaudited
Six months
Dec 2024
NZ$M
Unaudited
Six months
Dec 2023
NZ$M
Audited
Year ended
Jun 2024
NZ$M
Private placements334 476 489
Bank loans737 1,344 1,302
Capital notes298 343 297
Other loans4 21 20
Carrying value of borrowings (as per Consolidated Balance Sheet)1,373 2,184 2,108
Less: value of derivatives used to manage changes in hedged risks
on debt instruments
(44)(20)(31)
Economic debt1,329 2,164 2,077
Less: Cash and cash equivalents(202)(215)(311)
Net debt1,127 1,949 1,766
Carrying value of borrowings included within the
Consolidated Balance Sheet as follows:
Current borrowings85 84 86
Non-current borrowings1,288 2,100 2,022
Carrying value of borrowings (as per Consolidated Balance Sheet)1,373 2,184 2,108
During November and December 2024, the Group repaid $680 million of its outstanding borrowings on a pro-rated basis, including full
repayment and cancellation of the Group’s Club Loan ($400 million) on 29th November 2024 and partial repayment and cancellation
of the amounts outstanding under its USPP facility ($169 million) and syndicated bank facility ($111 million), on 10th and 11th December
2024 respectively. The repayments were funded via proceeds from the equity capital raise during the period. In conjunction with
the partial repayment of USPP notes, the Group closed out corresponding interest rate swaps (notional value: NZ$200 million) and
partially closed out cross currency interest rate swaps (notional value: USD94.6 million, EUR20.3 million) that were used in hedging
the underlying borrowings repaid. A $10 million loss from the close-out of the CCRIS hedge instruments that was related to the early
redemption of USPP facility has been classified as a Significant Item in note 2.1.
As a result of the debt repayments the Group also agreed certain amendments with all of its lenders (SFA and USPP) which will enable
it to rely on more favourable terms for testing of its Senior Interest Cover covenant from December 2024 to September 2025. This
is in addition to the Senior Interest Cover and Senior Leverage covenant amendments previously agreed and disclosed, which are
continuing, for the period from June 2024 to December 2025 (inclusive) if required. Should the Group need to rely on the amended
covenant levels, it will not pay a dividend until it agrees to be tested by and complies with, its existing (original) covenant levels.
The Group was in compliance with all financial covenants during the period and at balance date.
8. CONTINGENT LIABILITIES
Class action proceedings: Western Australia plumbing failures
On 6 August 2024, the Group announced that a class action proceeding had been filed in the Federal Court of Australia against Iplex®
Pipelines Australia ( Iplex® Australia), on behalf of persons, Australia wide, who acquired polybutylene pipes manufactured by Iplex®
composed of a resin known as Typlex-1050. The class action alleges that the Pro-fit product was not of acceptable quality at the time of
supply and seeks a broad range of damages (unquantified), including: costs of removing, repairing, replacing and disposing of the affected
pipe; repair costs and/or possession damaged by the affected pipe; reduction in property value, vexation, distress and disappointment.
Iplex® is defending the action and has brought cross-claims against certain WA builders and plumbers.
On 27 August 2024, the Group announced that Western Australian home builder, BGC, had filed legal proceedings against Iplex® Australia
in relation to the Iplex® Pro-Fit Pipes issues, making similar allegations to those raised in the class action. Iplex® Australia is defending the
BGC proceedings.
The outcome of both these proceedings and any associated liabilities, if any, remains uncertain at the date of this report. Ultimately, if
Iplex® Australia is found to bear full or part responsibility for the amounts claimed, the cost to it in meeting any damages claims could have
a material impact on the Group’s financial position. It is not practicable as at 31 December 2024 to provide an estimate of the financial effect,
including any quantum of costs or any penalty, or the timing of their incurrence, and disclosure of any possible impact would be materially
prejudicial to the Group’s commercial interests.
CONTENTS
28
Fletcher Building Limited Interim Financial Results 2025
Notes to the Consolidated Interim Financial Statements (Continued)
Commerce Commission Winstone Wallboards® proceedings
On 1 November 2024, the Group announced that the New Zealand Commerce Commission had filed legal proceedings against Winstone
Wallboards®, seeking declarations that Winstone Wallboards® contravened the Commerce Act 1986 in relation to its historical use of volume
rebates, together with associated civil pecuniary penalties. The volume rebates were discontinued by Winstone Wallboards® in 2022.
Winstone Wallboards® does not believe that its previous use of volume rebates, which are widespread in the industry, breached the
Commerce Act and is defending the proceedings. The proceedings are at a relatively early stage and the claims made by the Commission
cannot be quantified at this time. Whilst Winstone Wallboards® does not consider it has breached the Commerce Act, it notes that even if
the New Zealand Commerce Commission was ultimately to be successful in the proceedings, it is not practicable as at 31 December 2024
to provide an estimate of the financial effect on Winstone Wallboards®, including any quantum of costs or any penalty, or the timing of
their incurrence.
9. RECONCILIATION OF NET LOSSES TO NET CASH FROM OPERATING ACTIVITIES
Unaudited
Six months
Dec 2024
NZ$M
Unaudited
Six months
Dec 2023
NZ$M
Audited
Year ended
Jun 2024
NZ$M
Net losses(134)(120)(227)
Losses attributable to minority interest -3 7
(134)(117)(220)
Add/(less) non-cash items:
Depreciation, depletions and amortisation179 191 373
Other non-cash items168 282 439
Taxation(45)(42)25
Net loss on disposal of businesses and property, plant and equipment48 3 3
350 434 840
Net working capital movements
Residential and Development(67)(72)67
Construction(105)(313)(346)
Other:
Debtors60 150 151
Inventories(9)3 64
Creditors(100)(211)(158)
(221)(443)(222)
Net cash from operating activities(5)(126)398
10. SUBSEQUENT EVENTS
Amendment to the conditions of Capital Notes and redemption of FBI190 capital notes
On 28 January 2025, the Group through its subsidiary Fletcher Building Industries Limited (FBI) announced that the trustee for the
noteholders of each series of Capital Notes has agreed to amend the conditions of the Capital Notes. This is to allow FBI to elect to
redeem all Capital Notes of a series on the applicable Election Date for that series, as an alternative to the procedure for rollover of the
Capital Notes on new terms. FBI has elected to redeem all of the FBI190 Capital Notes when they are due to rollover on 17 March 2025,
presented as current in the balance sheet.
CONTENTS
29
Fletcher Building Limited Interim Financial Results 2025
Independent Auditor's Review Report
Independent Auditor’s Review Report to the Shareholders of Fletcher Building Limited
Conclusion
We have reviewed the consolidated condensed interim financial statements of Fletcher Building Limited (“the Company”) and its
subsidiaries (together “the Group”) on pages 11 to 29 which comprise the consolidated balance sheet as at 31 December 2024, and
the consolidated income statement, consolidated statement of comprehensive income, consolidated statement of movements
in equity and consolidated statement of cash flows for the six months ended on that date, and explanatory notes. Based on
our review, nothing has come to our attention that causes us to believe that the accompanying interim financial statements on
pages 11 to 29 of the Group do not present fairly, in all material respects, the consolidated financial position of the Group as at
31 December 2024, and its consolidated financial performance and its consolidated cash flows for the six months ended on that
date, in accordance with New Zealand Equivalent to International Accounting Standard 34: Interim Financial Reporting (NZ IAS 34)
and International Accounting Standard 34: Interim Financial Reporting (IAS 34).
This report is made solely to the Company’s shareholders, as a body. Our review has been undertaken so that we might state to
the Company’s shareholders those matters we are required to state to them in a review report and for no other purpose. To the
fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company’s
shareholders, as a body, for our review procedures, for this report, or for the conclusion we have formed.
Basis for Conclusion
We conducted our review in accordance with NZ SRE 2410 (Revised) Review of Financial Statements Performed by the Independent
Auditor of the Entity. Our responsibilities are further described in the Auditor’s responsibilities for the review of the financial
statements section of our report. We are independent of the Group in accordance with the relevant ethical requirements in
New Zealand relating to the audit of the annual financial statements, and we have fulfilled our other ethical responsibilities
in accordance with these ethical requirements.
Ernst & Young provides agreed upon procedures, taxation compliance, financial statement preparation services and limited
financial due diligence to the Group. Partners and employees of our firm may deal with the Group on normal terms within the
ordinary course of trading activities of the business of the Group. We have no other relationship with, or interest in, the Group.
Directors’ Responsibility for the Interim Financial Statements
The directors are responsible, on behalf of the Entity, for the preparation and fair presentation of the interim financial statements
in accordance with NZ IAS 34 and IAS 34 and for such internal control as the directors determine is necessary to enable the
preparation and fair presentation of the interim financial statements that are free from material misstatement, whether due
to fraud or error.
Auditor’s Responsibilities for the Review of the Interim Financial Statements
Our responsibility is to express a conclusion on the interim financial statements based on our review. NZ SRE 2410 (Revised)
requires us to conclude whether anything has come to our attention that causes us to believe that the interim financial statements,
taken as a whole, are not prepared in all material respects, in accordance with NZ IAS 34 and IAS 34.
A review of interim financial statements in accordance with NZ SRE 2410 (Revised) is a limited assurance engagement. We perform
procedures, consisting of making enquiries, primarily of persons responsible for financial and accounting matters, and applying
analytical and other review procedures. The procedures performed in a review are substantially less than those performed in an
audit conducted in accordance with International Standards on Auditing (New Zealand) and consequently do not enable us to
obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do
not express an audit opinion on those interim financial statements.
The engagement partner on the review resulting in this independent auditor’s review report is Graeme Bennett.
Chartered Accountants
Auckland
19 February 2025
30
Fletcher Building Limited Interim Financial Results 2025
CONTENTS
Data sourced from publicly available filings. Our datasets may not be complete. Automated analysis can produce errors. If you believe any data on this page is incorrect, please contact us at hello@nzxplorer.co.nz. For informational purposes only. Not investment advice.