Today the Fletcher Building share price has decreased over 2%.
Fletcher Building Limited is one of the largest construction firms in Australia and New Zealand.
At the time of writing, Fletcher Building has a market capitalisation of $5 billion and the share price is $5.87.
Why did the Fletcher Building share price drop today?
Fletcher Building confirmed today that it has sold international roofing products manufacturer Roof Tile Group (RTG) for $59.8 million.
Fletcher Building CEO Ross Taylor said:
‘We are pleased to complete the RTG divestment in a timely way. The sale is in-line with Fletcher Building’s five year strategy to divest our international operations to focus our capital and capability behind our New Zealand and Australian businesses, with building products and distribution at our core. The divestment process for the Formica business is progressing well and we remain confident that the sale will be completed in FY19.’
But investors appear to be responding negatively to the news, resulting in the share price drop today.
So where could Fletcher shares go from here?
No decision has currently been made as to how the proceeds from the RTG and Formica sales will be put to use.
This decision could impact where the share price goes, but currently the outlook does not seem positive.
It has been a turbulent year for Fletcher Building shareholders and the share price has dropped 11.27% in the past 52 weeks. We might see this downward trend continue.
Editor, Money Morning New Zealand