Boral launches capital raising, Australia

Boral launches capital raising, Australia
Published: 06 July 2010

Boral chief executive Mark Selway said the review had identified core investment priorities for Boral as cement and construction materials in Australia, plasterboard in Australia and Asia, and bricks, roof tiles and masonry both in Australia and the US.
"The review has been very comprehensive and has crystallised the markets and geographies where the group has the potential to achieve long term growth and deliver sector-best returns," Mr Selway said in the statement.
The fully underwritten one-for-five accelerated renounceable entitlement offer (AREO) will be at $4.10 per share, lower than Boral’s closing price on Monday of $4.89.
Net proceeds from the raising will be used to acquire the residual MonierLifetile stake in the US and to fund a significant investment in the Melbourne plasterboard operation.
The proceeds will also be used to develop the Peppertree quarry in NSW.
The company also revised its full year profit guidance. At the time of its interim results in February,
Boral said it expected fiscal 2010 net profit to be broadly in line with the then prevailing market consensus of $123.5 million.
Based on unaudited management accounts, Boral said it now expected full year net profit, excluding the impairment charges, to in the range of $123.5 million to $132 million.
Mr Selway said Boral was ideally placed to accelerate growth, as it moved into the new year with its new strategic direction.
"While the uncertain economic climate will have an impact, particularly in the first half of the FY2011 year, Boral is well positioned even in these difficult market conditions," he said.
"The actions taken from the strategic review provide a strong platform for increased growth and earnings when external conditions improve."