Boral profit forecast by one third

Boral profit forecast by one third
Published: 28 January 2009

Weaker construction markets in the USA, Asia and Australia has led to Boral reducing its profit guidance for the year to the end of June from Aus$200m to Aus$120m. 

The main reason for the reduction is the sharper than expected fall in housebuilding activity, notably in the United States, but also in Australia.

Boral has reduced its forecast for US housing starts for 2008/09 by almost 20% to around 625,000, while Australian starts are now expected to be around 135,000, a 13% reduction from the numbers achieved in 2007/08. 

Capital expenditure is being cut back by approximately 50%, while preliminary figures suggest a gearing level of about 80% at the end of December.