Adelaide Brighton admits difficulties but still upbeat on growth
Construction materials supplier Adelaide Brighton Ltd has admitted Wednesday that it is facing numerous challenges on multiple fronts which include the volatile foreign exchange issues, high cost pressures and brewing stiff competition from imported limes.
Company managing director Mark Chellew informed shareholders in a general meeting that Adelaide is still in a good position for growth amidst the difficulties the company is dealing with now.
He said that as the company approaches contract renewal negotiations with major cement and lime customers, the constantly moving foreign exchange is becoming a significant consideration with side considerations being brought by the threat of lime imports.
Mr Chellew pointed to the emergence of opportunistic import in lime, specifically looking in Western Australia where a small scale lime import development has been happening for some time.
He quickly added that Adelaide has yet to be significantly affected by the apparent competition, though they are keeping their watch for further developments.
Mr Chellew said that more pressing concerns has been brought by spiralling cost pressures in the business, most especially for the energy sector as he lamented that recent policy changes from the government could only further complicate the already uncertain outlook of most resource companies.
He was obviously referring to the impending resources super profits tax set to be implemented by the federal government and would start imposing 40 percent tax by mid-part of 2012.
At present, Adelaide Brighton is the country's biggest producer of lime and the second biggest provider of cement to the construction and resource industries.
As of 1308 AEST, Adelaide shares were trading at $2.72, incurring a loss of 3 cents or 1.09 percent.