Two of Australasia’s largest building products companies, Boral and Fletcher Building, have reported huge profit downturns and job layoffs in the face of deteriorating building activity.
Boral, Australia’s largest yesterday announced a 42 per cent fall in profit, blamed on the downturn in construction activity and confirmed it was cutting nearly a quarter of its Australian building products workforce.
Fletcher Building, New Zealand’s biggest construction and building products company, derives almost half its business from Australia. It reported a 12 per cent fall in profits and is also cutting jobs. The company employs about 8000 people in Australia and has had up to 3000 redundancies in its global operations since 2009.
The Australian reports that both companies are facing uncertain times, and ‘consider it too difficult to predict earnings for the 2013 financial year’.
Boral chief executive Ross Batstone said on SBS that conditions in the Australian housing industry have been at their worst in two decades
"Earnings from our Australian business in the six months to June were hit by very weak housing and non-residential building activity, combined with delays and disruption from sustained rainfall across the east coast," Batstone said.
"I have been in this industry and with this company for 21 years and I have not seen such a combination in that 21 years."
