Building products group CSR Limited, its balance sheet swollen by the housing boom, announced a return of surplus cash to shareholders in an on-market share buy-back of up to $150 million.
“The hard work over the past few years to improve our operations and invest in new product development has delivered increased returns to CSR,” says managing director Rob Sindel.
“This has positioned us well, with a strong balance sheet and operating cash flows.”
In the latest half year, underlying profit was up 32% to $92.4 million and revenue 14% to $1.1 billion. Building Products earnings jumped 42% to of $89.9 million.
Sindel says the group, whose products include plaster board Gyprock, is committed to its strategy of investing in internal growth opportunities and targeted acquisitions while retaining a strong balance sheet.
The buy-back will complement CSR’s ongoing capital management program, including the payment of dividends of between 60% and 80% of underlying profit.
The last dividend was up 35% to 11.5 cents a share.
CSR says it expects robust demand for its key products over the medium term, bolstered by improving activity in the alterations and additions market.
Its shares last traded at $2.93, up from a 2016 low of $2.41 in January.