Australian building supply company Adbri hit by $300m loss

One of Australia’s largest cement and building materials makers has taken a 16.6 percent hit to its share price, wiping almost $300 million off its market value.

A combination of factors led to Adbri’s terrible downfall, including operational challenges posed by wet weather, lower volumes of lime material, and high costs for power, fuel, shipping and transportation.

On Monday, Adbri’s share price hit a low of $2.14, before bouncing slightly to close at $2.21. This was a drop of 16.6 percent, after Adbri closed the week at $2.65. Year over year, its share price posted a 40.75 percent drop, Yahoo Finance reported.

In response, Adbri CEO and CEO Nick Miller said it was now up to the company to “control the controllables” and weather current market factors. He said the company would also implement its third off-cycle price increase for 2022 from September, in a bid to boost the company’s profit margins.

“There is a lag in our industry in terms of price increases,” Miller said, via the financial review. “Companies in our sector are facing unprecedented external shocks at a level we have not seen for many years.

“There is a lag in our sector in terms of price increases.”

According to the company’s first half 2022 earnings release, Adbri increased revenue by 8% to $812.4 million, compared to first half 2021 results.

This was driven by “strong demand from the construction and mining sectors and improving prices in most products,” they said.

However, its after-tax net profit fell 1.3 percent to $54.3 million.

The report reiterated that this was due to “operational challenges associated with extreme wet weather events off the east coast of Australia, lower anticipated lime volumes, higher raw material, shipping, transport, power and fuel costs”.

Adbri’s share price decline follows the ASX’s biggest decline in six weeks, with commodity stocks hardest hit. The ASX 200 closed down 1 percent, or 68 points, at 7,047 at the end of trading on Monday. has contacted Adbri for comment.

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