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WELLINGTON, Aug 17 (Reuters) - Fletcher Building Ltd FBU.NZ reported sharply higher net earnings, bolstered by a rise in operating earnings in Australia and strong growth in New Zealand.
The building materials supplier said its reported net earnings for the year to June 30 were NZ$462 million ($336.01 million) versus NZ$270 million in the prior year. Its operating earnings or earnings before interest, tax and significant items, were NZ$719 million versus NZ$503 million in the prior year.
Fletcher Building Chief Executive Officer Mark Adamson said the result was driven by a 29 percent uplift in operating earnings from Fletcher Building's Australian businesses, coupled with strong growth in operating earnings in New Zealand in the distribution, residential and construction divisions.
"While the macro-economic environment in Australia was mixed, we delivered strong earnings growth from our Australian business portfolio, which was the result of our focus on improving the performance and capability of our businesses in that market," Adamson said in a statement
Revenue was NZ$9.0 billion compared with NZ$8.66 billion in the prior year.
The company said it would pay a final dividend of 20 NZ cents a share.
Looking ahead, Fletcher Building said its operating earnings or Ebit are expected to be in range of NZ$720 million to NZ$760 million in the current financial year. Consistent with this growth, it expects operating earnings in the first half to be higher than the prior period.
New Zealand residential construction activity is expected to peak in 2018 and then gradually return to 2014 levels over the next three years, the company said.
Non-residential activity is forecast to remain relatively steady at elevated levels compared to the historic average.
It also expects Australian residential activity to gradually decline over the next three years following its peak in 2016. Little growth is forecast in non-residential activity.
In Asia, the China market is expected to grow moderately but at lower rates than in recent years. Taiwan and Southeast Asian markets are expected to show modest growth. ($1 = 1.3749 New Zealand dollars)