Boral to push on with project

COMPLETION of a $130m project in Geelong remains a priority for Boral Australia despite cutting back on capital expenditure as it manages the impacts of COVID-19.

But the project at the Port of Geelong has been hit by delays that will push back its opening of the clinker and slag grinding plant into next year.

Australia’s largest building and construction materials supplier has warned ongoing restrictions in Victoria due to the pandemic are extending the uncertainty around when Australia’s economic recovery will happen.

In announcing a statutory net loss of $1.1bn for the 12 months to June 30, largely due to writedowns in the value of its assets, the company said the onset of COVID-19 was an additional stress after financial challenges of a lower than expected first-half year result in its North American business and bushfires and floods in Australia causing higher costs and denting volumes.

Boral chief executive Zlatko Todorcevski said second-half margins were substantially down, as flagged in the company’s market update in May, due to lower sales and even lower production volumes together with an unfavourable shift in the sales mix and costs.

In light of the impacts of COVID-19, the company said it continued to take strong actions to preserve cash and manage cash flow and working capital while reducing its capex from $453m in FY19 to $346m in FY20.

“Construction of the

1.3 million tonne clinker and slag grinding plant and cementitious storage facility at the Port of Geelong remains a key priority,” Boral said.

“However, there have been some delays in delivery of key components from overseas and capex has been slowed.

“The facility is now expected to be operation by the end FY21.”

When announced two years ago, the project was pegged for completion this year.

Involving a 25-year deal with GeelongPort, it will service demand for construction materials in Victoria.