CSR Returns to Profit in First Half as Building Product Earnings Increase

CSR Ltd., the Australian building products and aluminum company that’s selling its sugar division for A$1.75 billion （$1.75 billion）, returned to first-half profit as earnings increased at its building unit.

Net income was A$63 million in the six months ended Sept. 30 compared with a loss of A$155.6 million a year earlier, the Sydney-based company said today in a statement. The year-earlier result included a A$250 million writedown on the value of its Viridian glass business.

CSR is selling the sugar operations to Wilmar International Ltd. to focus on building products operations, which include supplying insulation, bricks, plasterboard and roof tiles. The company, which also has interests in property, said today it would reveal what it will do with the money from selling the sugar unit once the sale is complete.

“We do expect to complete the sale later this month and that announcement will enable us to proceed to the next stage, which is to talk about our capital management initiatives,” Chief Executive Officer Jeremy Sutcliffe told an analyst briefing.

CSR fell 1.1 percent to A$1.78 on the Australian stock exchange at 10:26 a.m. Sydney time.

Earnings from continuing operations in its building products business should be “slightly higher” for the 12 months ending March 31 compared with a year earlier, the company said.

Residential Construction

Residential construction activity is expected to moderate after improving in the year ended June 30, while non-residential construction remains weak, the company said.

Building product earnings before interest and tax rose to A$57.7 million in the half from A$48.5 million a year earlier while sugar earnings dropped to A$66.7 million from A$114.2 million as rain delayed cane crushing, the statement said.

Wilmar’s offer for the Sucrogen sugar division includes A$1.35 billion in cash and A$403 million in assumed net debt, the Singapore-based company said in a statement July 5. The deal is subject to approval from Australia’s Foreign Investment Review Board, which has extended its review period to Nov. 9.