Brickworks profit up, warns on energy cost

Brickworks has recorded an 18.1 per cent increase in first-half profit to $114.6 million.

Brickworks managing director Lindsay Partridge says energy costs threaten Australian manufacturing. (AAP)

Brickworks says high energy costs are forcing the building products supplier to consider overseas opportunities even as its first-half profit rose 18.1 per cent to $114.6 million.

The company said total revenue for the six months to January 31 rose 16.3 per cent to $459.1 million, and it declared a fully franked interim dividend of 19 cents, up one cent from the previous corresponding period.

Managing director Lindsay Partridge said he feared for the long-term future of Australian manufacturing and that "ultimately, business investment will be driven offshore" because of "exorbitant energy price increases".

Earnings before interest and tax from Brickworks' Building Products Australia division fell 35 per cent for the half-year in a slump that Mr Partridge blamed on rising power costs and a decline in home building in NSW, factors that clouded the outlook for the company.

"Higher energy prices will add approximately $12 million to our cost base for the full year and will adversely impact the full year result," Mr Partridge said.

"This coincides with a period of softening demand, with a decline in east coast house construction anticipated in the last quarter of financial year 2019, as the existing pipeline is built out."

Mr Partridge said Brickworks - one of the largest brick makers in the world - was looking to North America for more acquisitions in a market where the outlook for construction activity was relatively positive in the short term.

"We consider the United States to be an attractive country to invest, with pro-business policies that support investment, efficient building approval processes and well-established transport infrastructure," he said.

Brickworks bought US business Glen-Gery, which operates nine brick plants, in November 2018.

The company said it was planning to sell off the hardwood operations of its Auswest Timbers division in Greenbushes, Western Australia, and East Gippsland in Victoria but hold on to its Fyshwick softwood mill in the ACT.

BRICKWORKS H1 PROFIT UP

* Half-year net profit up 18.1 pct to $114.6m

* Revenue up 16.3 pct to $459.1m

* Interim dividend up one cent to 19 cents, fully franked