James Hardie suspends dividend
Building products manufacturer James Hardie has suspended dividend payments due to the coronavirus pandemic and has tightened its profit guidance to $US350 million to $US355 million ($A546 million-$A554 million).
In a trading update, management said dividends for the full year 2020 were suspended to help liquidity and manage market volatility.
The decision follows a raft of companies doing likewise since the onset of the pandemic.
James Hardie’s shares were worth $20.81 after ASX trading finished on Monday and have slipped 25 per cent in value since January 1 amid a wider market downturn.
Profit guidance was revised from the broader range of $US350 million to $US370 million in view of fourth-quarter results.
James Hardie on Tuesday said it had achieved double-digit volume growth in North America, strong revenue growth in Europe and Asia-Pacific results were in line with expectations.
However, there were higher-than-expected costs in Europe and unplanned costs at manufacturing plants in Spain, New Zealand and the Philippines due to COVID-19.
Management will give details of the fourth-quarter results on May 19.
Management also announced the closure of a number of sites which it said would improve global operations.
These include its manufacturing plants in Summerville in the United States, Cooroy in Queensland and the temporary closure of its plant at Siglingen, Germany.
At Cooroy, the formwork business James Hardie Systems will also close.
Manufacturing in New Zealand will also stop. This work will be moved to plants in Australia.
The decisions will mean 375 fewer workers.
The changes will contribute to about $US90 million in impairment expenses in the fourth quarter.
The company also aims to improve its financial position by making quarterly payments to the Asbestos Injuries Compensation Fund, rather than one lump sum.
The business is still compensating the many workers and their families who suffered from its manufacture of asbestos products.