16/05/2008 - Adelaide Brighton Ltd has forecast full year profit growth of nearly 10 per cent as infrastructure and engineering projects spur demand for construction materials.
The rosy outlook for 9.7 per cent earnings growth sent shares in the cement and lime supplier more than four per cent higher to its strongest level in a month.
Adelaide Brighton closed up 15 cents, or 4.2 per cent, at $3.72, the highest level since April 7.
Managing director Mark Chellew said the company expected earnings this calendar year to improve to between $118 million and $125 million, compared with $113.9 million in 2007.
"Cement demand has continued to increase overall," Chellew told the company's annual general meeting on Thursday.
"Any weakness in the residential sector is expected to be offset by continued growth in engineering and infrastructure sectors."
The company has forecast a five per cent increase in cement volumes and three per cent gain in lime volumes this year and cement prices were likely to rise by the inflation rate or above, Chellew said.
Interest on debt would rise by $8 million because of higher borrowings and interest rates.
Adelaide Brighton had received approval from its three major banks to roll over $480 million of senior debt that would have expired in March 2009 into two- and three-year tranches.
Chellew said demand in New South Wales would be weak while Queensland, Victoria and South Australia would experience stronger demand.
Chairman Malcolm Kinnaird said analyst Link Market Services ranked Adelaide Brighton first among S&P/ASX200 companies for total returns to shareholders over a seven-year period.
Source: AAP NewsWire
