Shares of Brickworks Limited (AU:BKW) gained over 7% as of writing after the company announced a higher dividend despite a dip in its profits. Brickworks raised its fully franked final dividend by 2% to AU$0.43 per share, bringing the total annual dividend to AU$0.67 for FY24. This also marked a year-on-year increase of 3% in the annual dividend.
Brickworks is a building products manufacturer, catering to residential and commercial markets.
Brickworks Reports Annual Results
For FY24, Brickworks reported a total revenue decrease of 8% year-over-year to AU$1.1 billion. Among its segments, Building Products Australia registered a 12% drop in its revenue, while Building Products North America remained stable at AU$442 million.
The company also stated that both businesses have faced challenges in the past six months due to a decline in building activity across major markets. In response to the reduced demand, production has been cut back, causing delays in realizing efficiency gains from recent significant investments.
Meanwhile, the company reported an 88% drop in underlying NPAT (net profit after tax) to AU$61 million, while posting a statutory loss of AU$119 million. The profits were mainly impacted by a previously announced AU$135 million (post-tax) non-cash impairment related to Austral Masonry and Brickworks North America.
Is Brickworks a Buy or Sell?
Following the results, Citi analyst Suraj Nebhani reiterated a Buy rating on the stock. He predicts an upside of 31% in the share price.
Overall, according to TipRanks consensus, BKW stock has received a Hold rating backed by five recommendations. The Brickworks share price forecast stands at AU$29.00, which shows a modest upside potential of 1.33% in the shares.
