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Big River is a building block in the construction boom

June 2, 2021
Cat McLean

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Big River is a building block in the construction boom

After a 3-year slump in construction, the industry is gearing up for boom-time thanks to government stimulus and infrastructure projects. As one of Australia’s leading manufacturers and distributors of building products, Big River Industries (ASX: BRI) stands to benefit from the upswing.

After a 3-year slump in construction, the industry is gearing up for boom-time thanks to government stimulus and infrastructure projects. As one of Australia’s leading manufacturers and distributors of building products, Big River Industries (ASX: BRI) stands to benefit from the upswing.

“Q2 was almost like a switch that was flicked. We’re seeing growth in our addressable market again. Our view is we’re about to move into a 4-year upturn in the construction cycle,” said CEO and Managing Director, Jim Bindon, on our fortnightly webcast series The Insider: Meet the CEO. 

Big River is a national merchant of timber and associated building products to local trade, and is one of the favourite stocks of funds manager Robert Miller from NAOS Asset Management.

“We’ve had some hard yards over the 3-year decline of the construction cycle but we’ve grown the business quite strongly in that period anyway. There are certainly better times ahead. Most analysts are expecting good, strong growth in the construction cycle over the coming 3 to 4 years,” said Jim Bindon.

 

Working with over 8000 trade accounts across a number of industry segments, Big River has strengthened its business by diversifying products. Although traditionally a plywood manufacturer, Big River has actively moved into producing other products such as frames, trusses and formwork. 

The company also has a diverse customer base with its strongest markets in civil and infrastructure, renovations, detached housing and remanufacturing.

“Our largest customer is only about 3% of our revenue. The top 10 trading accounts only account for about 13% of our sales so we’ve got a good diverse ledger there,” explained Jim.

“We’ve got good diversity amongst products, geography, construction types and customers,” he summarised. 

According to Jim, the procurement of Big River’s local supply chain has been critical to the company’s growth, particularly through the COVID-19 pandemic when disruptions to international freight have proved troublesome for other companies.

“Our direct relationships with mills and our local manufacturers has been beneficial for our margins. It has diversified our business as well as expanded our network,” said Jim.

Since listing on the ASX four years ago, Big River has doubled the size of its business through acquisitions and sales revenue, the latter of which currently sits at $320 million. 

“The upturn of the cycle and the broad base of our business puts us in a really strong position to capitalise on that market upswing that we’re experiencing,” Jim concluded. 

Jim Bindon recently joined us for our fortnightly webcast ‘The Insider: Meet the CEOs’. This article summarises some of the information he shared with us during the session. You can watch a full recording below, or you can click here to book into our next session.

‘The Insider’ is a great way to hear directly from the CEOs of fast growing Australian businesses. You will get valuable insights to their industries and companies future prospects.

 

The Insider: Meet the CEOs – Event Details:
Date: Wednesday, 9th June
Time: 12pm AEST
Format: Online, 3 x 15 minute presentations

This is a free event. Click here to book your spot.

 

 

Reach does not assume responsibility for the accuracy or completeness of any information provided, and the views expressed are not reflective of Reach Markets position. Any advice contained within this presentation is general advice and does not consider your personal circumstance, you should consider whether it’s appropriate for you. 

 

 


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