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Divisional restructuring at Boral

The construction materials producer announced on 10 June that effective from 1 July the two arms will join to form the new Boral Australia.

Mike Kane, Boral’s CEO and managing director, said that bringing the smaller Australian Building Products into Construction Materials & Cement would reduce costs and improve efficiencies.

“This is a sensible and logical next step for Boral, as portfolio realignment has seen the building products division substantially reduce in size over recent years,” Kane said.

Joe Goss, the current divisional managing director of Construction Materials & Cement, will become the divisional chief executive of Boral Australia.

David Mariner, currently executive general manager of Building Products in Australia, will return to the United States to replace Al Borm in the role of president and CEO of Boral USA.

Borm, who has had a long career in the building products industry, will continue to be a member of the joint venture board of USG Boral and will work in an advisory capacity for a transition period.

{{image2-a:r-w:200}}“We will have three well defined operating divisions,” Kane said. “In Australia, our strategy continues to be about protecting and strengthening our leading integrated positions and continuing to optimise assets to deliver strong returns.

“In the USA, it’s about significant growth through market recovery and strategic portfolio realignment and expansion.

“And in our USG Boral plasterboard joint venture throughout Asia, Australasia and the Middle East, it’s about long term growth through innovation, product penetration and market growth.”

It comes shortly after Boral announced its half-year results ended 31 December, where the company recorded a net profit after tax of $AUD137 million, a 31 per cent increase compared to the previous corresponding period.

In February, the supplier said it was expecting to see further growth and predicted a period of increased demand, including a pick up from road and infrastructure projects, is on the horizon.

A spokesperson for the company told Quarry the amalgamation will deliver some “modest” cost savings at the divisional head office but said it will have “no impact on Boral’s continued ability to meet demand”.

“The respective businesses within the division will continue to be run by the same team of general managers and supply to our customers will not be impacted by the divisional head office change,” the spokesperson added.

There will be no changes to the company’s divisional reporting for the two outgoing divisions for the year ended 30 June.

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