No wonder CSR chairman, John Gillam was waxing lyrical about rising electricity and gas costs and the dangers they pose to Australian manufacturing at yesterday’s annual meeting of the building products maker.
CSR has finally found a buyer for its underperforming Viridian Glass business in the shape of local private equity group, Crescent Capital Partners for a total cash consideration of around $155 million, which could top $200 million once all property associated with the group is sold next year.
FY19 results were in line with Morgan Stanley's expectations, helped by -$12m in restructuring costs taken below the line. Otherwise, the broker suggests weakness in Australian housing and cost pressures from aluminium are creating headwinds.
The CSR share price has fallen -22% since the results in May which, in Morgan Stanley’s view, has been prompted by increased costs in the aluminium business. The valuation now appears more appropriate.