Dulux profit rises nearly 29pc to $64m

Tuesday, 17 May 2016 10:08:24 | Stephen Letts

Dulux sales revenue grew by 1.7 per cent, with a 2.3 per cent rise in paints. (ABC News: Kendall O'Connor)

Paint and building products manufacturer Dulux Group has reported a solid first-half profit increase of 28.7 per cent to $63.7 million.

While demand for paints and coatings in the Australian business grew, a large part of the profit rise was a $12 million uplift relating to non-recurring costs which hit the bottom line in the previous corresponding period.

On an underlying basis, with one-offs stripped out, profit was up a more modest 3.7 per cent for the half.

Sales revenue grew by 1.7 per cent to $851.1 million largely due to a 2.3 per cent increase in the Australian paint division which accounts for around 90 per cent of the business.

Earnings in consumer and construction products - which include the Selley's brand - came unstuck, down 6.8 per cent, while the New Zealand division also was down after exiting Mitre 10 shelves there.

The troubled B&D Garage Door operation continued to show signs of a turnaround, with increased sales supporting earnings which were held flat by restructuring costs.

Dulux chief executive Patrick Houlihan described the result as solid.

"Our businesses have responded well to variable market conditions and effectively managed the anticipated 'wash through' of destocking in some of our retail customer channels," Mr Houlihan said.

"We highlighted there would be challenges in this first half, and the business has stood up well and delivered sound results."

Mr Houlihan said the company was on track for a full year profit of $124.7 million.

The interim dividend was raised 4.5 per cent to 11.5 cents per share.

The result did not impress investors with Dulux share tumbling around 3 per cent to $6.22 on opening.

AustraliaPlus

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Dulux profit rises nearly 29pc to $64m

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