Search by ticker code:
Generic filters

Search by ticker code:
Generic filters

Search by ticker code:
Generic filters

FY21 report: Brickworks (ASX:BKW) share price in focus

The Brickworks Limited (ASX: BKW) share price is in focus this week after delivering its FY21 report to investors.

Brickworks’ FY21 report

There are a few different divisions within the business.

Australia

The building products Australia segment, which includes brickmaking, roofing and masonry, saw EBITDA (EBITDA explained) increase by 7% to $97 million. EBIT increased 36% to $44 million. This profit growth was down to a reduction of operating costs, which helped margins across all business units and regions. There was strong demand, though lockdowns in Sydney and Melbourne meant sales were stifled a bit.

US

The building products North America EBITDA increased 10% to US$20 million. However, EBIT dropped 6% to US$6 million. Building activity was lower with restrictions for some periods. COVID also led to manufacturing disruptions. However, management said that the business is rapidly growing. Brickworks pointed to the acquisition of IBC which will increase the scale of its distribution network and lead to higher sales volume.

Property trust

Its property trust delivered EBIT of $253 million, primarily due to earnings from the 50/50 joint venture with Goodman Group (ASX: GMG).

The property trust assets were revalued during the year and this led to a revaluation gain of $149 million. Total assets within the property trust now stands at around $2.7 billion. After including debt, Brickworks’ share of net assets was $911 million. The net rental profit increased 3% to $31 million.

Management said that unprecedented customer demand for industrial property has resulted in lease pre-commitments ending the year at a record level.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

Brickworks will own 26.1% of WHSP after the merger with Milton Corporation Limited (ASX: MLT).

The company noted that this expansion will provide WHSP with increased scale, diversification and liquidity to go after more investment opportunities.

It’s expecting WHSP to deliver superior long-term returns and consistent dividend growth well into the future. The value of its WHSP stake increased $1.2 billion during the year, the value of the shares was $3.4 billion when Brickworks released its result.

Brickworks dividend

The board decided to pay a full year dividend of $0.61 per share, which was an increase of 3%. That currently represents a fully franked dividend yield of 2.4%.

Final thoughts on the Brickworks share price

The Brickworks share price has been a solid performer over the last year – rising by 34%.

It’s not as good value as it was a year ago. But, let’s just look at a couple of the asset values. The WHSP shares were worth $3.4 billion and Brickworks’ share of the property trust assets were $911 million. Combined, these assets are worth more than $4.3 billion. According to the ASX, its market capitalisation is $3.8 billion. So there’s a discount there (not including the building products business or net debt).

Brickworks says that its current inferred net assets per share is worth $31.7.

I’d be happy to buy a parcel of shares for the long-term, though there may be some volatility over time. I think it’s one of the leading ASX dividend shares.

$50,000 per year in passive income from shares? Yes, please!

With interest rates UP, now could be one of the best times to start earning passive income from a portfolio. Imagine earning 4%, 5% — or more — in dividend passive income from the best shares, LICs, or ETFs… it’s like magic.

So how do the best investors do it?

Chief Investment Officer Owen Rask has just released his brand new passive income report. Owen has outlined 10 of his favourite ETFs and shares to watch, his rules for passive income investing, why he would buy ETFs before LICs and more.

You can INSTANTLY access Owen’s report — or get it emailed to you — for FREE by CLICKING HERE NOW or the button below.

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian owned.

Information warning: The information on this website is published by The Rask Group Pty Ltd (ABN: 36 622 810 995) is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169.

At the time of publishing, Jaz owns shares of WHSP.
Skip to content