Fletcher Building share price lifts on 40% profit boost

The construction company delivered solid FY22 numbers to the market today.

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Key points

  • The Fletcher Building share price is well into the green after the company revealed a 42% lift in profit in FY22 
  • Fletcher Building is sharing its success with shareholders, who will receive a 33% boost in dividends for the year 
  • Fletcher is aiming for a more than $100 million improvement on its FY22 EBIT in the next financial year

The Fletcher Building Limited (ASX: FBU) share price is well into the green after the company revealed a 42% lift in profit in its FY22 full-year results.

The Fletcher Building share price opened today's session at $5.14, up 4.26% on yesterday's close of $4.93.

Shares in the ASX-listed New Zealand company are currently swapping hands for $5.11, up 3.65% for the day so far.

Let's take a look at the numbers.

Fletcher Building share price up on positive FY22 report

Fletcher Building said it achieved its forecasts for FY22. Here are the key metrics:

  • Revenue NZ$8,498 million, up 5% from the prior corresponding period (pcp)
  • Net profit after tax (NPAT) of NZ$432 million, up 42% from pcp
  • EBIT before significant items of NZ$756 million, up 13% from pcp
  • Return on Funds Employed (ROFE) before significant items of 19.3%, compared to 18.8% pcp
  • Cash flows from operations of NZ$592 million, compared to NZ$879 million pcp
  • Fully imputed final dividend of 22 NZ cents per share to be paid on 6 October. ASX shareholders will receive a dividend of 25.882353 NZ cents.

Fletcher Building says it has a strong balance sheet with "solid cash flows partly offset by some inventory rebuild and housing investment".

The profit increase will result in a 33% bump in total annual dividends to 40 cents per share.

What else happened in FY22?

Over the year, Fletcher Building also completed an NZ$274 million share buyback program.

The buyback was announced on 26 May 2021.

What did management say?

Fletcher Building CEO Ross Taylor said:

Fletcher Building delivered strong results in FY22 across all key metrics. Our performance highlighted our ability to deal with a dynamic operating environment, while remaining focused on delivering long term, sustainable growth.

Our balance sheet remains robust with $1.1 billion liquidity and net debt of $670 million at year end. This positions us well as we move into the new financial year and continue to invest in the growth of the business.

What's next?

Fletcher Building said it was "well positioned to deliver strong growth in FY23 at present market levels".

It is targeting a more than $100 million improvement on its FY22 EBIT in the next financial year.

Fletcher Building share price snapshot

The Fletcher Building share price is down 27% over the year to date.

This compares to a 6% dip in the S&P/ASX 200 Index (ASX: XJO).

Motley Fool contributor Bronwyn Allen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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