Building products maker Boral has cut its earnings forecast for 2013 by $15 million, blaming poor weather, declining construction activity, and overseas competition for the downgrade.
In a market update yesterday the company said its construction materials and cement division had been hit by falling demand in Victoria and South Australia and poor weather in southeast Queensland.
“As a result of these factors, divisional third quarter earnings were $19m below forecast,” it said.
“It is anticipated, however, that increased revenues from the major LNG projects in QLD and WA and the ongoing overhead cost reduction programs will sustain an earnings improvement over the prior year.”
Boral said performance had also slipped in other parts of the business, with the building products division hit by the exchange rate and “import competition”.
The company said earnings had declined from both the timber operations and the WA brick and masonry operations.
Overall Boral said it expected its 2013 net profit after tax to be within the range of $90m-$105m, assuming it netted a further $10m from property sales that were yet to be finalised.