BKW - Brickworks Limited

[rcw1]

@DrBourse appreciate if you could run you ruler across BKW please.

Kind regards
rcw1

 

[DrBourse]

?

 

[DrBourse]

@DrBourse appreciate if you could run you ruler across BKW please.

Kind regards
rcw1

Hi rcw,

Most Valuation models put BKW’s IV in the range of $25.00 to $30.00……

However, A Roger Montgomery style Valuation produces a range just above $30.00…..

And a Buffett style Valuation comes up even higher at just above $40.00…..

Remember that there is a Cross Holding between BKL, CLV, LAU, NHC & SOL…..

As usual remember the DYOR Thing....
Cheers M8.

 

[rcw1]

thanks m8.

kind regards
rcw1

 

[rcw1]

Good morning

Brickworks' Australia and US building products general manager Mark Ellenor will
be its chief operating officer from the start of next month.

Reporting to managing director Lindsay Partridge, the appointment is part of the building products giant's executive management succession.

Mr Ellenor started within the Austral Bricks business under its graduate program in
1999 and has been in his current role since last year.

Have a very nice week.
Not holding

Kind regards
rcw1

 

[divs4ever]

the results are out

and some data looks UGLY

but let's see how the market reacts

i hold BKW , i doubt it will drop enough to tempt me to add more , but i have been wrong before

i guess we can now see the benefit of the SOL cross-holding

 

[Dona Ferentes]

“Despite increasing interest rates, we are continuing to experience strong demand for medium and large sized prime industrial property. Sydney has the tightest logistics property market of any major city in the world, with a vacancy rate of just 0.2%”
-Lindsay Partridge, MD, Brickworks Ltd​

 

[finicky]

Crap - missed out on the div's post yesterday when it could have been bought at book value. Thinking about dipping the toe even now with $2 tacked onto the sp. Sold on the desirability of this company long ago with the SOL cross holding, the conversion of brick producing land to industrial estate and big box internet logistics and the alliance with GMG.

Not Held

 

[divs4ever]

Crap - missed out on the div's post yesterday when it could have been bought at book value. Thinking about dipping the toe even now with $2 tacked onto the sp. Sold on the desirability of this company long ago with the SOL cross holding, the conversion of brick producing land to industrial estate and big box internet logistics and the alliance with GMG.

Not Held

i bought SOL first , and after going through the shareholder newsletter ( ahead of the AGM ) decided to buy into BKW about 15-18 months after i bought into SOL , the BKW entry price was just over $10 including brokerage

i was intrigued to see the disposal of the Austral Bricks business in WA ( because it was a loss-maker ) i would have thought that would have been 'turned around ' for a future growth story

IMO Australia is going to a very dark place if WA has lost it's growth potential ( over the mid-term

am still holding both SOL and BKW but will be watching and thinking ( and in no hurry to add to either holding )

if SOL/BKW is genuine about internet logistics watch to see if they increase their stake in TPG ( rather than TUA )

 

[finicky]

@divs4ever, increase their holding in TPG? - what would that imply about internet warehousing?
Rob Millner comments about BKW at 13.09

Long-term compounding with Robert Millner

As part of Livewire Live 2023, Centennial Asset Management's Matthew Kidman sat down for an in-depth discussion with WHSP's Rob Millner.

www.livewiremarkets.com

 

[divs4ever]

well, many years back ( more than 10 ) i was a member of a computer hobbyist club , and the subject of Sol Pattison came up about how they were a pharmacy chain back then , and by necessity became very computer tech ( and internet ) savvy , partly to continue to operate their pharmacy empire efficiently .
moving further into 'the internet realm ' would not be a totally new adventure for them and also considering the long relationship with David Teoh and TPM ( now TPG without David Teoh ) they would have some solid contacts to seek advice from ( if needed )

 

[Dona Ferentes]

March 21, 2024

Tenth dividend increase in a row for Brickworks​

By Glenn Dyer

The usual one cent a share lift in Brickworks' (ASX:BKW) interim dividend tells us the statutory and underlying losses for the six months to January 31 were just all numbers and accounting moves.

Brickworks’ real business of building materials production and sales in Australia (mostly in NSW and WA) and in parts of the US, the increasingly important property operations and its huge investment portfolio did well in the six months, notwithstanding the red ink.

Directors did warn of a softening in demand for bricks and tiles over the rest of 2023-24; it has started maintenance at some plants to cut production (and inventories), restructured other parts to save $15 million a year and cut 100 jobs.

Interim dividend is 24 cents a share, the tenth increase in a row and a record the company keeps producing half after half. A lurch into the red was not going to stop the rise.

Brickworks on Thursday revealed a Statutory Net Loss After Tax of $52 million for the January 31 half year while the Underlying Loss After Tax from continuing operations was $37 million.
"Earnings were adversely impacted by a non-cash property devaluation of $233 million (vs. $114 million gain in 1H23) and a $16 million loss on property sales (vs. $263 million profit in 1H23), as announced to the market on 22 December 2023."

Brickworks said its group Underlying Earnings Before Interest, Tax, Depreciation and Amortisation was a loss of $40 million for the half, compared to a gain of $607 million in the prior corresponding period. Excluding the impact of the property revaluations and property sales, EBITDA was $210 million, down 9 per cent, which was reflective of the state of the building and property markets here and in the US.

The company said its building products EBITDA was higher in both Australia and North America.
"A period of significant investment and portfolio rationalisation has been completed over the past five years, and this is now supporting higher margins, despite the impact of inflationary pressures and lower building activity in some key markets. Property earnings were lower, due primarily to the devaluations within the Property Trusts."

Outside of this impact, it was another strong period of growth. Within the Industrial JV Trust, net trust income continued to increase, despite the impact of higher borrowing costs. And, although Investment earnings were lower, the market value of Brickworks’ listed investments increased by $140 million during the period, to $3.261 billion.

CEO Lindsay Partridge was a bit more upbeat that he has been of late, saying in the statement that although "we continue to see a decline in building activity, performance within the Australian Building Products business was more resilient than expected in the first half."We are benefiting from a more focussed portfolio, following the exit of underperforming business units in recent years. A range of additional initiatives were implemented at the end of the first half to further streamline operations."

This included the consolidation of Austral Bricks and Austral Masonry into one operating division, a restructure of Bristile Roofing and a rationalisation of divisional support functions.
"In total, these initiatives are expected to deliver annualised savings of $15 million (from 2H24), through a reduction in headcount of approximately 100 staff.
"Despite the positive first half, order intake is softening, and we expect conditions to become more challenging for the remainder of FY24. In response to the short-term weakness, we are taking the opportunity to carry out maintenance activities at our plants, in preparation for the years ahead."

 

[houtman]

I bought into these yesterday/today as a replacement for the soon to be gone CSR.

Boral and CSR both disappearing, there’s not much building supplier companies left.

Not that BKW’s main play is Bricks.

Their mcap is about $4.1B.
A 26% holding in SOL accounts for approximately $3B.

Then they have an ongoing JV with Goodman to develop their old brickworks land, plus plenty of land in their own name.

They also have brickworks.

BKW looks to be asset rich but temporarily cash flow poor as they wait for-

- rent increases on existing properties and rent from new property,
- home building approvals uplift for brick demand
- development approval from councils to develop their land.

SOL has an over 40% holding in BKW, so no takeover premium in the BKW price.

 

[finicky]

A stock I'd like to get into some day and often check it out. Very diversified when including their SOL shareholding as well. A worthy place for your CSL cash imo.

Brickworks Investments​

Investments consists primarily of a 26.1% interest in ASX-listed Washington H. Soul Pattinson (‘WHSP’) (ASX: SOL), which had a market capitalisation of $11.894 billion as at 31 July 2023. The market value of Brickworks stake in WHSP was $3.108 billion at this date.

Not Held

 

[divs4ever]

`the key was 'a leap of faith ' back in August 2012 @ $10

now if you weren't reading the SOL annual reports to shareholders ( i hold SOL ) , taking that leap might have been much harder

back in those days i also held BLD ( since sold ) and CSR ( not for much longer ) so watching the three large players in bricks made BKW a mandatory 'safety play exposure to construction/housing

12 years later that prudence paid off

 

[finicky]

'Market matters' morning report discusses their positive outlook for the U.S building industry and mentions three related ASX stocks with U.S exposure: JHX, REH and BKW.

Not Held

Brickworks Ltd (BKW) $27.19

In March, BKW reported an underlying loss for the half of -$37m, which was better than the consensus of -$49m. The outlook commentary was upbeat and, in hindsight, premature, but when inflation is finally put to bed and rate cuts can unfold, this building products business should be well positioned – in 2023, the business generated ~25% of its revenue from North America. Recent weakness in BKW is starting to look interesting as a contrarian play.

 

[Dona Ferentes]

Brickworks is feeling the pinch from a slowdown in high-rise apartment and commercial building activity in Australia and the US, flagging hefty writedowns ahead of the its full-year results.

Australia’s biggest brickmaker confirmed to the market on Thursday that it would recognise a $123.5m post-tax impairment when it releases its results later this month, including a $54.7m reduction in the value of its Austral Masonry business and a $68.8m charge against its North American unit.

In a statement to the ASX, Brickworks blamed a deterioration in multi-residential building activity in the second half of 2023-24 for the hit to its local masonry operation, with the decline in high-rise projects in Sydney and Brisbane described as “particularly severe”.

... dropped $0.50 to $25.57 yesterday

 

[houtman]

... dropped $0.50 to $25.57 yesterday

Yes, BKW has been disappointing so far, plenty of assets, need more cash flow.


From their May/June presentations -

the total inferred asset
backing was around $5.6 billion at the end of the half.
On a per share basis, this equates to almost $37 per share.

with the decline in high-rise projects in Sydney and Brisbane described as “particularly severe”.

Strong words from BKW, Brisbane was supposed to be pumping by now in the lead up to the Olympics.

I may have to go long-tents, there was plenty of them starting to pop up in Brisbane city parks when I was last there.

 

[divs4ever]

maybe my SUL ( owner of BCF ) is looking better

i hold BKW and SUL

remember nobody else even bid for the Brisbane Olympics

the Olympics Games might be a total circus by then , maybe even the Commonwealth Games will be taken more seriously ( but i wouldn't bet a finger on that )

not Commiefornia South yet , but you can see the trend ( rising crime figure manipulation , is just a start )

 

[Dona Ferentes]

meds playing up?