CSR - CSR Limited

[Trav.]

CSR has been interesting lately.

I can't believe that a stock at this price is swinging so much. It makes me wonder what is happening and who is playing games, but I am happy to hold (in at $4.39) for a bit longer to see if it can hold a break > $5

 

[Dona Ferentes]

CSR has quietly become a property powerhouse, revealing on Thursday it will make an estimated $230 million pre-tax profit from the staged sale of a 52-hectare former brickworks site at Horsley Park in western Sydney.

The announcement came as ASX-listed CSR, better known as a building products manufacturer and part-owner of an aluminum smelter, sold the final 12.4 hectare parcel to data centre company NextDC for $124 million.

CSR has owned the Horsley Park land for five years.

“The site came in as part acquisition of the Boral business when we concluded our joint venture of our two bricks business,” a spokesman said. “One of the benefits of being in a business that’s 160 years old is your manufacturing footprint is pretty old.”

Profits from the site, where remediation and civil works on two of the six tranches are already complete and occupied by the buyers, will flow through to the CSR bottom line over the next four years. CSR will net $408 million from the site sales, spending around $178 million on development costs.

CSR said it still controls more than 300 hectares of development land in western Sydney, including 200 hectares in the Western Sydney Airport precinct rezoned industrial last September,, the value of which has almost doubled in two years.


- sugar hit to the balance sheet

 

[divs4ever]

CSR Limited delivers half year net profit after tax (before significant items) of $86.6 million, up 30%

CSR Limited (ASX:CSR) announces net profit after tax (NPAT before significant items) for the half year ended 30 September 2021 of $86.6 million, up 30% from the prior comparable period. Statutory net profit after tax of $156.6 million included a significant item relating to the recognition of $71.2 million in carry forward capital tax losses.
This result compares to statutory net profit of $58.7 million in the prior comparable period. Trading revenue of $1.1 billion was up 6% with earnings before interest and tax (EBIT before significant items) of $132.6 million, up 41% which included the following results:
• Building Products – EBIT of $120.6 million, up 25% reflecting positive conditions in the detached market, strong operational execution, manufacturing performance and good cost control in a COVID constrained environment.
• Property – EBIT of $6.6 million was delivered following the Moss Vale site sale. The final transaction at Horsley Park was secured in July 2021. In total, this project is expected to generate proceeds of $408 million by the year ending 31 March 2025 (YEM25).
• Aluminium – EBIT increased to $18.3 million, up from $6.2 million in the prior comparable period with performance reflecting improved spot pricing and hedged position.
Interim dividend of 13.5 cents per share (fully franked) declared which is at the top end of CSR’s dividend policy. Consistent with CSR’s Property strategy which is actively unlocking value from its property assets, CSR has also secured the sale of the 41 hectare site at Warner, QLD with EBIT of ~$30 million expected to be completed in YEM23. Maximising the current market opportunity with strong execution, while progressing strategy and managing COVID disruption Commenting on the result, CSR Managing Director & CEO Julie Coates said, “CSR’s businesses have performed very well despite the ongoing impacts of COVID on our operations. In Building Products, we made the most of the positive conditions in the detached market. The team executed well to deliver a strong result underpinned by good manufacturing performance and ongoing cost discipline.
Our first priority was to keep our people safe and minimise COVID disruptions at our sites and for our customers.” 2 / 3 “We have also made good progress across a number of key strategic initiatives. We continue to develop our customer solutions and supply chain opportunities in Building Products. And we are unlocking further value from our property assets and development capabilities, securing the final tranche at Horsley Park with expected proceeds in excess of $400 million from the 52 hectare site over a six year period.” “CSR continues to deliver strong cash generation to invest in growth opportunities in the business as well as returns for shareholders with the interim dividend at the top end of our dividend policy.”

Outlook for the financial year ending 31 March 2022 Building activity during the period grew in line with expectations going into the year. Declines in high density and commercial construction partly offset the strong detached market.
We expect activity in the second half which has fewer trading days than the first half to reflect the traditional seasonality of the building industry. Completion times for projects continue to lengthen, reflecting supply chain congestion, cost pressures and labour constraints which are impacting the broader industry. The diversified nature of Building Products across product, geography and end markets positions the business well for the second half and beyond.
This is supported by continued focus on maximising market opportunity, executing strategy and maintaining cost and operational discipline while returning to more normalised levels of investment. In Property, EBIT for YEM22 is expected to be ~$34 million which includes completion of the next tranche of Horsley Park Stage 2 project which is on track to deliver EBIT of $18 million. In addition, EBIT of ~$11 million is forecast to be realised from smaller transactions at Chirnside Park, VIC and Thornton, QLD. In Aluminum, based on significant hedge positions, EBIT for YEM22 is expected to be in the range of $35 to $41 million, assuming all other revenue and cost areas (including coal costs) are unchanged. As aluminium prices have improved, CSR has significantly increased its hedge position for the next four years to provide more certainty of future earnings. In summary, CSR’s largest business, Building Products is performing well in the current market and progressing its strategy to diversify and grow the business for the future. Group earnings will also be supported over coming years by contracted transactions from Property and a strong hedge position in Aluminium.
3 / 3 Half year results webcast details CSR will present its results for the half year ended 30 September 2021 at 10.00am AEDT time today, Thursday 4 November 2021, via webcast.

DYOR

i hold CSR ( inherited , but added to and reduced as opportunities arrived )

the family acquired these when CSR took over Maryborough Sugar Refinery

 

[divs4ever]

Property update – sale of 4.6 hectares of land at Badgerys Creek CSR Limited (ASX:CSR) today announced the sale of 4.6 hectares of land at its site at Badgerys Creek, NSW for total proceeds of $20.7 million ($450 per sqm). CSR’s Badgerys Creek site includes 200 hectares of land adjacent to the new Western Sydney Airport.
Industrial zoning of the area was confirmed in September 2020 with CSR currently undertaking rehabilitation of the former quarries at the site. The 4.6 hectare site being sold is on the outer edge of CSR’s 200 hectare property and is adjacent to industrial projects proposed on other sites.
CSR will not be required to complete any site works prior to completing this sale, which will not impact future planning for the wider area. CSR Managing Director and CEO Julie Coates noted, “CSR’s Badgerys Creek site is one of the largest properties adjacent to the new Western Sydney Airport which will bring significant growth to the region.” CSR’s Chief Financial Officer and EGM Property, David Fallu added, “With approximately 140 hectares of developable land at Badgerys Creek, we are continuing to invest in the extensive rehabilitation and reconstruction of the former quarries at Badgerys Creek, which will be continuing over the next few years.” The 4.6 hectare land sale is expected to be completed prior to CSR’s current financial year ending on 31 March 2022 (YEM22).
CSR has previously advised that it expects Property EBIT for YEM22 of approximately $34 million. Following completion of this transaction and additional costs to be recorded relating to another Property site, YEM22 Property EBIT is now expected to be approximately $46 million. This announcement has been authorised for release by the Chair of CSR Limited.

DYOR

i hold CSR ( inherited , but added to and reduced as opportunities arrived )

 

[divs4ever]

CSR Limited delivers 20% increase in net profit after tax (before sig. items)
24% growth in Building Products earnings reflecting strong operational execution
and high demand
CSR Limited (ASX:CSR) announces net profit after tax (NPAT before significant items) for the
year ended 31 March 2022 of $193 million, up 20% from the previous year.
Statutory net profit after tax of $271 million included significant items relating to the recognition
of $86 million in carry forward capital tax losses. This result compares to statutory net profit
after tax of $146 million in the previous year.
Trading revenue of $2.3 billion was up 9% with earnings before interest and tax (EBIT before
significant items) of $291 million, up 22% which included the following results:
• Building Products – Record EBIT of $228 million, up 24%, reflecting strong detached
housing activity driving higher volumes, improved factory performance and operational
execution and continued cost discipline across all businesses. Return on funds employed
increased to 27% from 21%.
• Property - EBIT of $47 million, down from $54 million, which included the next stage at
Horsley Park and the sale of 4.6ha of land at Badgerys Creek.
• Aluminium - EBIT of $40 million, up from $23 million, reflecting higher aluminium pricing
partly offset by higher production costs.
Final dividend of 18.0 cents per share (fully franked) declared. This brings the full year
dividend to 31.5 cents per share (fully franked) which is at the top end of CSR’s policy of 60-
80% of net profit after tax (before significant items).
Strong execution in disrupted market with continued progress on strategy
Commenting on the result, CSR Managing Director & CEO Julie Coates said,
“All of CSR’s businesses have performed very well during the year. In Building Products,
our team worked hard to support the demand in residential housing with strong operational
execution. The organisational change we have made streamlining the business over the last
18 months along with the initiatives aligned to our supply chain strategy have supported our
ability to deliver for CSR’s customers against a challenging backdrop.
“We will continue to implement our strategy this year with increased investment at key sites
to further improve productivity and optimise operations, as well as enhancing workplace
safety and sustainability.
2 / 3
“Investing in our Property assets and our development capability is also a core part of our
results with contracted sales secured for all stages at Horsley Park to deliver $408 million in
proceeds over six years. Remediation work is also progressing on the 196 hectare site at
Badgerys Creek adjacent to the new Western Sydney Airport.
“CSR has also continued to deliver strong cash generation and returns for shareholders with
the full year dividend at the top end of our dividend policy.”
Outlook for the financial year ending 31 March 2023 (YEM23)
The strong pipeline of detached housing projects is expected to continue in the year ahead
as completion times lengthen with supply chain and trade capacity impacting the broader
industry.
Activity in the apartment and non-residential markets has improved after an extended
slowdown in the last few years.
Building Products is well positioned to continue to grow, with a clear strategy to drive
improved performance from a strong portfolio of brands and customer solutions. In YEM23,
the business expects to return to more normal levels of investment to support the delivery of
its strategy.
In Property, EBIT for YEM23 is expected to be ~$52 million which includes completion of the
next tranche at Horsley Park as well as completion of the sale of the Warner, QLD site.
In Aluminium, CSR has a significant hedge position for YEM23. At this early point in the
year, an indicative earnings range for YEM23 of $33 million to $49 million is based on
current pricing and cost scenarios. Significant aluminium price and cost volatility (in
particular carbon based inputs) will impact the final result.
In summary, CSR’s largest business, Building Products is performing well with the team
working hard to meet high levels of demand in residential construction which is expected to
continue in the year ahead. Group earnings will be supported by contracted transactions in
Property over the next three years and an increased hedge position in Aluminium which
extends to 2027.
Full year results webcast details
CSR will present its results for the year ended 31 March 2022 at 10.00am AEST time today,
Wednesday 11 May 2022, via webcast.
The webcast is available from CSR’s website at www.csr.com.au or Click here.
This announcement has been authorised for release by the Board of Directors

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DYOR

i hold CSR ( inherited , but added to and reduced as opportunities arrived ) ( and i participate in the DRP )

the family acquired these when CSR took over Maryborough Sugar Refinery

 

[KevinBB]

Down from about $6 to about $4.50 during the month of May. Goodish annual report.

is there any reason for this largish price drop? Can't see anything in the announcements.

Thanks,
KH

 

[divs4ever]

Down from about $6 to about $4.50 during the month of May. Goodish annual report.

is there any reason for this largish price drop? Can't see anything in the announcements.

Thanks,
KH

probably seen as a likely victim in a housing construction downturn ( and general property construction as well )

but am just guessing

i think it also is the main competitor to BKW in bricks ( in Australia ) so how is BKW going that might be a hint

 

[KevinBB]

ok, thanks.

 

[Dona Ferentes]

Down from about $6 to about $4.50 during the month of May. Goodish annual report.

is there any reason for this largish price drop?

Input costs, including energy, plus supply chain disruptions are the usual reasons trotted out.

Divs is right as BKW has also been knocked down.

Latest Announcement:

• strong pipeline of work in the detached housing market
• apartments coming back after an extended slowdown
• non-residential construction was improving.
• labour shortages and supply chain congestion are a handbrake in the industry, causing house building and renovation projects to take up to 50 per cent longer than usual.

 

[divs4ever]

ok, thanks.

now if you wanted an interesting GAMBLE , what about BLD , betting on ONE , that SVW/Kerry Stokes puts in a compulsory acquisition move ( since it is already a majority shareholder ) OR TWO as majority share-holder starts kicking enough butt to get BLD back to a solid company

i hold CSR , BKW , and SVW
( i have held BLD in the past , and am weighing the possibility of a return as a possible side-door entry into extra SVW )

but i DO except more pain in the building/construction industry in the near future

 

[KevinBB]

now if you wanted an interesting GAMBLE , what about BLD ,

Gamble? Never!

Actually, I am one step ahead of you. I have BLD in the annual tipping comp, based on your first thesis. See this post.

KH
(p.s. I hold neither BLD or CSR, but they are both on my watchlist)

 

[Dona Ferentes]

Gamble? Never!

Actually, I am one step ahead of you. I have BLD in the annual tipping comp, based on your first thesis. See this post.

Now BLD is 70% owned by Stokes n Co ,,, expect volatility. Don't forget to check the calculation in the comp as there was a large cap return for Boral in Feb !!

 

[KevinBB]

Don't forget to check the calculation in the comp

On top of it. @peter2 has already adjusted price for the capital return, but has not yet accounted for the large dividend. I expect he will do that on 31 December this year, when I win the competition.


KH

 

[peter2]

The BLD div was 0.07, is that a large one. The cap return was 2.65 and the year's open price has been adjusted for it.

Like most I've been bullish both CSR and BLD due to the enthusiasm for building infrastructure and housing but the market has sold them down the drain. They're not the only companies that have been sold off in this market. I think this is a craziest market I've seen in my meagre 17yrs trading. Plumbing suppliers REH, RWC and GWA, down down, down.

 

[peter2]

I'm interested in this reversal setup in CSR in the daily chart. The weekly chart needs more time and remains bearish.

 

[divs4ever]

CSR to acquire Woven Image to broaden commercial offering
CSR Limited (ASX:CSR) announces that it has entered into an agreement to acquire Woven Image, a
leader in sustainable, design-led acoustic finishes and textiles for $43 million. The acquisition is
subject to conditions and will be earnings accretive following completion in the next few months.
CSR has a long-standing customer relationship with Woven Image and has manufactured some of
its product range for 20 years.
Woven Image is highly complementary to CSR’s existing commercial interior ranges, and the
acquisition will enhance CSR’s commercial interior finishes offering in the Australian market and
exports to Europe and Asia.
The combined product range, commitment to innovation, sustainability, manufacturing capability
and sales and distribution channels positions the business to better serve customers and deliver
further growth in Australia and export markets.
As a consequence of this transaction, the on-market share buyback announced in June 2022 will
conclude in July 2023.
Commenting on the acquisition, CSR Managing Director & CEO Julie Coates said:
“The acquisition of Woven Image positions our interior systems business for further growth both
domestically and in export markets and follows the move to full ownership of Martini in 2020. The
commercial interior finishes segment is a highly attractive market and provides further opportunity
for growth and diversification across product, building sector and geography.”
About Woven Image
Since 1987, Woven Image has been supplying the built environment with sustainable, design-led
acoustic finishes and textiles. Woven Image products are extensively used in global commercial
projects across workplace, hospitality, education and healthcare sectors – ensuring spaces look,
feel and sound great.
www.wovenimage.com.au
This announcement has been authorised for release by the Chair of CSR Limited.


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( DYOR )

i hold CSR ( inherited )

 

[houtman]

I bought some CSR recently.

I'm trying to reach my diversity targets, I'm well overweight in the hydrocarbons atm.

Positives
- Solid divie
- Immigration
- Housing under supply
- Good brands
- Property division

Negatives
- slow permitting
- Ali division under performing.
- 2024 divie may not be fully franked ( see 23pg announcement 27/6/23)

I can't see too much sector specific downside during the next few years.

 

[divs4ever]

I bought some CSR recently.

I'm trying to reach my diversity targets, I'm well overweight in the hydrocarbons atm.

Positives
- Solid divie
- Immigration
- Housing under supply
- Good brands
- Property division

Negatives
- slow permitting
- Ali division under performing.
- 2024 divie may not be fully franked ( see 23pg announcement 27/6/23)

I can't see too much sector specific downside during the next few years.

i hold

as long as you don't expect stellar growth , has a track record of reinventing itself successfully ( from a sugar refiner to a major industrial company )

good luck

 

[finicky]

Just some vomit from me. Hope to look more closely at this one sometime. I know very little about it and nothing about its recent business.
But it looks quite good using a median ROE of 15% to roughly value it (based on CommSec summaries). Even though book value has gone next to nowhere over 9 years. ROE stronger for the last two years. It apparently has low debt and the shares quoted are actually declining (share buyback?). Dividends consistent except for the dreaded Wuhan Lab fy20 and it has made up for that with higher dividends in subsequent 3 years.
Anyway, beer coaster valuation for me would be closer to $7 than present price.
However, fwiw, the price chart is currently a stand aside for me as I see a chance of a pullback in the short term in a channel that can be visualised - maybe to ~5.25? Undecided whether it has another rally left in it after that.
The long term monthly chart shows volume mildly trailing off and RSI momentum not confirming higher highs. So I suspect the resistance area around ~6.50 will be hard to overcome before a more serious correction sweeps in. Just my notions.

Not Held

WEEKLY

MONTHLY

 

[houtman]

It apparently has low debt and the shares quoted are actually declining (share buyback?).

Thanks for the feedback.

Yes, about 8 million shares bought back last FY at between $4.11 and $5.05.

So they got them at a reasonable price, this may be why they are running out of franking credits for the 24FY, not sure.

However, fwiw, the price chart is currently a stand aside for me as I see a chance of a pullback in the short term in a channel that can be visualised - maybe to ~5.25?

Agree, I've got about 2/3rds of what I want, if it drops I'll add, otherwise so be it.

There may be some latent value in their property portfolio too.

Cheers