Building products company CSR Limited (ASX: CSR) confirmed that it may sell its Viridian glass business “in response to a number of queries”.
CSR is a $2 billion Australian industrials business, providing products for a variety of industries, including construction. Viridian is Australia’s largest glass company.
Is It Worth It?
CSR’s Viridian announcement comes as investors question whether or not it is worth the company continuing to own the business.
CSR bought the Viridian glass business for $1.2 billion more than a decade ago yet it earned just $3.5 million in profit in its 2018 financial year, down from $7 million in 2017. In addition, CSR has reported write-downs on the struggling business unit.
“Nobody’s happy about the performance today,” CSR Chair John Gillam was reported as saying at the group’s shareholder meeting earlier this year. Gillam joined CSR from Wesfarmers Ltd (ASX: WES).
So far this year, CSR says Viridian is showing signs of improved performance.
“Viridian’s performance in Australia and New Zealand is improving and the business remains on track to increase earnings this year,” CSR’s announcement read.
CSR said it has not made a decision to sell Viridian but will assess its options in coming months.
