More land and bricklayers are urgently needed to meet the surging housing demand, says building products group Brickworks.
Brickworks managing director Lindsay Partridge says there's a wait of up to a year for new housing in some markets because of a lack of land releases and tradespeople to build new homes.
And that is helping to push up prices.
"Despite surging demand, Sydney still has the lowest number of lots being released for housing development of all major capitals," Mr Partridge said on Thursday.
"This is rapidly pushing up prices and reducing the average lot size.
"There has been good progress in NSW to increase the release of land, but more land is required quickly.
"What we need are cheaper and larger lots that are readily available."
Mr Partridge said the bricklayer shortage had become critical with the national industry also struggling to find more than 200 apprentices.
Brickworks said its Austral Bricks business in NSW had the most orders since the leadup to the 2000 Olympic Games and the upturn in housing activity showed no signs of easing, Mr Partridge said.
Consequently, Austral Bricks will restart production at its Horsley Park Plant 2 in April, and prepare its second kiln in South Australia so it's ready for production by mid-2015.
Despite the demand, Brickworks on Thursday reported a 25 per cent fall in interim net profit to $42.2 million, with the result hit by nearly $17 million in impairment charges.
But underlying profit, which excludes one-off items, rose 17.6 per cent to $62.8 million.
Brickworks said the impairment charges reflected a delay and risk in achieving planned operational efficiencies at the Austral Precast and Auswest Timbers businesses.
Chairman Robert Millner said all three of Brickworks' divisions - building products, land and development, and investmants - had generated higher earnings.
Sales revenue in the building products division rose to a record $340.6 million. Earnings before interest, taxes and significant items rose 35.9 per cent to $26.1 million.
Brickworks said the continued increase in sales volume and the implementation of cost-cutting measures had put the company in a strong position to deliver significantly improved earnings in the second half, compared to the same period last year.
Shares in Brickworks closed 25 cents higher at $13.81.
BRICKWORKS GENERATES RECORD BUILDING PRODUCT SALES
* Interim net profit of $42.2m, down 25 pct from $56.3m in 2013/14
* Underlying net profit of $62.8m, up 17.6 pct from $53.4m
* Revenue of $349.6m, up 7.4 pct from $325.6m
* Interim dividend of 15 cents, fully-franked, up 7.1 pct from 14 cents
Share
