Despite building products group James Hardie Industries NV posting a loss for the first quarter of its fiscal year, due to weakness in the US housing construction market and the general economy, early trading today has pushed the share value up almost 17
Despite building products group James Hardie Industries NV posting a loss for the first quarter of its fiscal year, due to weakness in the US housing construction market and the general economy, early trading today has pushed the share value up almost 17 per cent.
The net loss for the three months ended June 30 was $US77.9 million ($A93.93 million), and compared to a profit of $1.4 million in the previous corresponding quarter.
The result includes asbestos liabilities, legal expenses and tax adjustments.
Excluding those impacts, it made a net operating profit of $US41.6 million ($A50.16 million), up four per cent.
Trading this morning has pushed the share value up 16.78 per cent.
"While the US residential construction market appears to be nearing the bottom it remains too early to ascertain the timing, rate or extent of any potential recovery," James chief executive Louis Gries said on Tuesday.
The group said it expects to report a fiscal 2010 net operating profit, excluding asbestos and other impacts, around the top of the current range of analysts forecasts.
The range is for a profit between $US39 million and $US67 million ($A47.03 million and $A80.79 million) for the year ending March 30, 2010.
Factors such as a recent upturn in interest rates and deteriorating employment market are likely to combine to draw out any potential recovery of the US housing market, the company said.
In Australia, market forecasts are for a 14 per cent drop in housing starts in 2009/10, with James Hardie's strongest markets, Queensland and Western Australia, set to show the worst rate of decline, it said.
Government stimulus packages, the first homeowners' grant and improved affordability have reduced the severity of the cyclical downturn, but are not expected to drive improved demand for the company's products until the second half of 2009/10, James Hardie said.
New residential construction in New Zealand is anticipated to current historic low levels, the company said.
More to come...