The Adelaide-based company made the announcement this morning to the Australian Securities Exchange, despite all its sites still being fully operational.
Adelaide Brighton operates 44 quarries, 95 concrete plants and 16 cement and lime facilities and is Australia’s leading concrete products manufacturer and lime producer.
Chief Executive Officer Nick Miller said the group’s balance sheet remained robust and the company was well positioned with in more than $450 million of cash and committed and undrawn bank facilities.
The group completed a refinancing of its major debt facilities in November 2019 and has no debt facilities maturing until November 2024.
“While we face uncertain times as to the effect and impact of COVID-19 to our business, we are carefully implementing measures across the Adelaide Brighton Group to protect both our employees and stakeholders. The safety, health and wellbeing of our employees, customers, suppliers and contractors is our highest priority,” Miller said.
“To date, all of our sites have been fully operational and, since our full year results release in late February, our business has continued to trade largely in line with our expectations.
“However, we are unable to predict the future impact of COVID-19 on our operations and earnings and consider it prudent to withdraw our FY20 guidance. We continue to progress our cost-out programme and to review our capital expenditure plans.”
Adelaide Brighton blamed increased competition and soft demand for construction materials on Australia’s eastern seaboard for a significant fall in profits in the 2019 calendar year.
In February company reported an attributable net profit for the year of $47.3 million, well down on its 2018 profit of $185.3 million. At the time it forecast its net profit in 2020 to be 10 per cent lower than in 2019 based on early assessment of markets.
The 2019 profit downturn was matched by a $113m dip in revenue to $1.517 billion.
The company has embarked on a cost cutting program, which aims to deliver savings of $30 million this year but it is also expecting “cost headwinds” in 2020.
Adelaide Brighton’s share price reached $3.93 in late January before tumbling to $1.83 on March 23. It has recovered slightly to be $2.17 at the opening of trade this morning.
The construction materials and lime producer, established in 1882, has about 1400 employees and operations in every state and territory in Australia.
It was ranked No.6 in InDaily‘s South Australian Business Index 2019, which showcases the state’s top 100 local companies.
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