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Construction giant Fletcher Building expects to sell about 650 dwelling units in the nearly-finished financial year to June - which compares with targets a year ago of over 1000

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Construction giant Fletcher Building expects to sell about 650 dwelling units in the nearly-finished financial year to June - which compares with targets a year ago of over 1000

Construction giant Fletcher Building (FBU) says it's likely to sell about 650 dwelling units in the nearly finished financial year. A year ago the company was forecasting sales would be in excess of 1000.

The company principally develops dwellings in Auckland, but also Christchurch.

And the company told an 'Investor Day' briefing on Wednesday that its group-wide earnings before interest and tax (EBIT) would be about $800 million before "significant items" for the year to June 30, 2023, which compares with an earlier forecast of "$855 million or better". In the 2022 financial year the company reported EBIT of $756 million.  

The company's chief executive Ross Taylor said house sales for the full financial year  "will be around 650 units, below our previous target but proving some resilience in a slow New Zealand housing market".

He said for the forthcoming 2024 full financial year the company is are targeting 700-800 house sales.

In the 2022 financial year Fletcher Building sold 670 dwellings - a performance it said at the time had been hit by the Covid pandemic. In 2021 the company sold 836 units.

In a detailed divisional presentation during the briefing the company said the "current market supports" about 700-800 unit sales "without cannibalising price", but the company "can scale" to over 1000 units a year "once the market returns".

At the same investor briefing a year ago the company had forecast over 1000 unit sales during the 2023 financial year and had produced further forecasts suggesting sales may be approaching 1500 annually by 2025.

In the latest presentation, the company said its development business "continues to consent already secured locations for when the market returns".

Fletcher says it has a "land bank" for around 5,000 units.

The company says in the past year a key to its success has been its careful management of development and building work in progress "to maintain robust margins" and returns on funds employed.

This had seen the company slow/delay some development works and house/apartment building, "but continue to get builds ready for when the market returns".

Taylor said in respect to the $800 million earnings before interest and tax: "This represents a solid performance as we have seen market activity soften in the second half, along with the ongoing impact of wet weather."

Taylor said Fletcher's major construction "legacy projects" are nearing completion, "with some risk still to manage as we close out claims, but our go-forward business is well-positioned with a more focused and lower-risk order book".

The presentation materials for the briefing say that work on Auckland's International Convention Centre - extensively damaged by a fire in 2019 - was continuing on track to the target completion date of "late 2024". The building is expected to be "weather-tight" by November 2023. 

The company said "cost risk" on the project was now reducing and was estimated at anywhere from zero to $50 million. This assumes Fletcher will secure the remaining insurance proceeds of around $150 million, plus about $50 million client revenues (i.e. for work that was still to complete at time of fire).

Fletcher says as completion nears, "dispute" with the convention centre operator SkyCity is "possible". But it says no claims have been received to date and the project forecast does not allow for any.

Speaking of the Fletcher's future prospects, Taylor said the company had been actively investing capital in growth opportunities from within the business as well as "making sensible bolt-on acquisitions".

"Progress on safety and sustainability continues to be strong, and we are focused on driving greater improvements in the customer, innovation and people areas of our strategy.

"With the fundamentals of the Australian and New Zealand building sectors being supported by long-term by macro tailwinds, and with a strong balance sheet, Fletcher Building is well positioned for growth over the medium term," Taylor said.

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Fletcher houses are just so low quality made. They look shiny and new but underneath are just that low quality kiwi construction which needs a big refresh every 10 years.

Why can't we build good quality that would last at least a generation anymore? 


That's never happened. Old houses, while built well, still require maintenance at least every 10 years. Which most people will hold off doing until things rot.


We no longer have the resources to use: Rimu, Matai, Kauri. We already ripped a large proportion of it out and build the good houses.


Next financial year will be even worse for their residential sales.


How dreamy must it be running this business - full control of materials, huge financial backing, if you fail Gov will bail you out. Too easy. How much do you reckon he gets paid to tell the people below him "Let's build 1000 homes, but who cares if not"....  


interesting how a lot of economists are predicting a pickup in house sales and prices because of the number of migrants coming to NZ - needing both rentals as well as houses, however we seem a long way away from this becoming true when you consider 

1. There are a large number of new builds on the market that don't seem to be moving

2. Investors buying a new property are able to use the interest deductibility rules and are exempt from the brightline test. 

if migration was a factor in house price increases - wouldn't we be seeing these new builds flying out the door (literally) 


That's because they are all living five to a room in Flat Bush. Just count the cars.


It won't be much of an impact now, but in _____ amount of time when they can all apply for residency then we may see an uptick in demand. By then things will have dropped further and it's likely the cycle will start an upswing again, but who knows at present, too much noise and turbulence in the economy and house price cycles take years to eventuate.


Fletchers is the closest NZ has to owning military stocks. The cost-layer/squeeze they put on the ChCh rebuild was one of the greatest rorts in our financial history and will play out over a generation of future building failures.

The organization is a parasite based on vested interests and blacklists. 


"Construction giant Fletcher Building (FBU) says it's likely to sell about 650 dwelling units in the nearly finished financial year. A year ago the company was forecasting sales would be in excess of 1000."

If there is a shortage of residential housing,
1) why is this residential property developer unable to meets it sales forecasts?
2) where are the new immigrants and why are they not buying these units currently available for sale by Fletchers?



1. Because immigrant numbers are lower than commonly thought. Further a large proportion of immigrants are on low to moderate wages and can’t afford to buy. And finally, buying investment property to rent out to immigrants (and others) generally doesn’t stack up very well at all.


Passenger statistics for all New Zealand airports Jan 23 -20th June 23. There were almost 35800  more departures than arrivals.

For all of 2022 there were 46700 more arrivals than departures. So net gain of  only 10900 Jan 22 - June 23.

Who is spinning this 100k net migration gain for the year? Scratch the statistical surface and it is pure BS.


"Who is spinning this 100k net migration gain for the year?"

BNZ head of research Stephen Toplis. 
On the currently "soaring" net migration, Toplis says on an annual basis, New Zealand reported a net inflow of more than 72,000 people in the year ended April 2023. A year earlier it was an outflow of 19,000.

"We think the annual inflow will peak at around 100,000

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