Building products group Boral says performance during the first quarter is in line with expectations, and it sees growth continuing through the current financial year.
Chief executive Mike Kane says prices are stronger for its construction materials and cement business in metro NSW areas and southeast Queensland but steady elsewhere.
The group's building products division improved its performance during the September quarter, with residential activity at strong levels, he told shareholders at Boral's annual general meeting on Thursday.
"Our objective is to strengthen the construction materials and cement division by growing margins and continuing to develop major project capability, as well as maximising returns from our building products business," he said.
Boral in August reported a near 50 per cent rise in full year net profit to $257 million, but delivered a flat outlook for earnings in 2015/16.
The company experienced lower demand from roads, engineering and major infrastructure projects this year, but has responded by taking costs out, and pushing a number of surplus property sales.
"We expect FY 2016 will be a transition year for the construction materials and cement division before an expected lift in our largest market segment next year," Mr Kane said.
Boral derives more than a third of its revenue from the segment.
On Wednesday, rival building products maker CSR, with whom Boral operates a brickmaking joint venture, posted strong half year earnings and an upbeat outlook on demand, helped by a continuing housing construction boom.
Boral's shares were down 8.00 cents, or 1.45 per cent, at $5.43 at 1020 AEDT.