BUILDING products group Boral, which has tipped another difficult year, is looking to a strategic review to identify cost cuts.
Due to the global economic downturn, Boral's US plants are operating at 15 to 30 per cent capacity and 10 of its 23 brick plants are mothballed pending a recovery. Others are operating intermittently.
New chief executive Mark Selway said the US housing market had bottomed at 570,000 starts in the half-year, which was more than 60 per cent below the 50-year average of 1.5 million starts. The tough US conditions, together with a slowdown in non-residential activity in Australia, lowered Boral's first-half profit to $68 million, a 9 per cent decline on the same period the year before.
Sales revenue for the December half was $2.3 billion, down about 10 per cent, but cash flow was up 39 per cent to $196 million. Gearing fell to 44 per cent - the lower end of Boral's target range - from 55 per cent at June 30 last year.
Directors declared an interim fully franked dividend of 7¢ a share, payable on March 23.
Mr Selway said Boral's full-year profit would be broadly in line with expectations at $123.5 million.
