The Wagner brothers (L to R): Neill, John, Denis and Joe. Picture: Annette Dew.
The Wagner brothers (L to R): Neill, John, Denis and Joe. Picture: Annette Dew.

Profit warning dents Wagner family wealth

THE value of the Wagner family's stake in their construction company slumped by $22 million on Tuesday as shares in the construction firm hit an all-time low on the back of a profit warning.

Toowoomba-based Wagners Holding Company has lowered its full-year earnings guidance, citing the "substantial investment" required in the business to prepare it for future growth.

The news sent its shares 25¢ or 8.4 per cent lower to $2.73 on Tuesday. The stock briefly touched an all-time low of $2.69 on Tuesday, 2¢ below the company's issue price of $2.71 in December 2017.

Chairman Denis Wagner and his brothers John, Neill and Joe, together control 55 per cent of the company, representing 88.7 million shares. The value of that stake tumbled by $22.2 million to $242.3 million on Tuesday.

Wagners said its unaudited first-half earnings before interest and tax (EBIT) would be $15.9 million, in line with its prior guidance and below the previous first half's $23.6 million result.

But it has lowered its target for full year EBIT to a range of $35 million to $38 million. At its annual meeting, Wagners flagged full year EBIT for this financial year of $39.5 million, the same as last year.

The company said downgrade reflected substantial investment in the business in readiness for domestic and international growth, as well as the timing of major projects which are yet to commence.

"The capital investment since listing has resulted in increased depreciation year on year," the company said. "The corporate infrastructure has also been significantly upgraded in terms of systems and key personnel to prepare for such growth."

Wagners chief executive Cameron Coleman said the company was "well prepared" to capitalise on new opportunities in domestic and international markets for its composite fibre products, Earth Friendly Concrete and major construction projects.