The Brickworks Limited (ASX: BKW) share price is pushing higher on Tuesday.
In morning trade, the building products company's shares are up 1% to $21.10.
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Why is the Brickworks share price outperforming today?
Investors have been bidding the Brickworks share price today following the release of a trading update at the company's annual general meeting.
According to the release, the company has started the new financial year strongly.
It advised that following the higher earnings achieved in FY 2022, momentum across Building Products operations in Australia and North America continued in recent months. A strong order book has resulted in first quarter FY 2023 revenue and EBITDA being ahead of the prior corresponding period in both countries.
Brickworks managing director, Lindsay Partridge, also revealed that the company's joint venture with Goodman Group (ASX: GMG) is performing positively as well. He said:
As a result of the strong tenant demand, we are experiencing significant rental growth across our new developments and lease renewals. This is expected to offset the impact of higher interest rates.
Outlook
One slight negative that could be holding back the Brickworks share price was the company's expectation for a softer second half.
Commenting on the company's outlook, Partridge said:
Despite rising interest rates, the development pipeline within our Industrial JV Trust is strong. Across Building Products, we anticipate increasing headwinds in the second half, as the existing pipeline of construction work is built out. Meanwhile, WHSP is expected to continue to deliver a stable and growing stream of earnings and dividends over the long term.
Over the last 12 months we have built the asset base of the Company considerably, resulting in a conservative gearing level. This strong financial position, together with our diversified portfolio of high-quality assets, means that Brickworks is well-placed to meet any future challenges and continue to deliver strong performance for shareholders.
