Sydney - Wednesday - Feb 18: (RWE Australian Business News) -...

Sydney - Wednesday - Feb 18: (RWE Australian Business News) -
CSR Ltd (ASX:CSR) today warned that earnings for the year ending March
31 would be lower than previously expected.
On November 17 CSR indicated that earnings before interest and
tax (EBIT) before significant items for the year were expected to be in
line with the previous year.
In light of further market deterioration since then and CSR's
current assessment of market conditions, it now expects EBIT before
significant items to be in the range of $310m to $330m, compared with
$386.3m last year.
Net profit before significant items is expected to be between
$125m and $140m, against $192.8m last year.
In the past three months, the Australian and New Zealand
residential and non-residential construction markets have declined more
quickly and further than previously anticipated.
Over that same period the price of aluminium has also dropped
very sharply to levels not seen in real terms for more than 25 years.
"While market conditions for our Building Products and Aluminium
businesses have deteriorated further than expected in the past three
months, we remain very focused not only on short-term mitigation, but
also on the company's strategic goals," managing director Mr Jerry
Maycock said.
"With our reinforced balance sheet, CSR is well-positioned to
emerge from the tough period ahead with excellent prospects for the
cyclical upturn," he said.

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CSR's product liability provision is affected not only by the
routine re-estimate of the underlying liabilities, but also by the
$A/$US exchange rate with regard to US liabilities.
The board will review the accounting provision at year-end but
the current exchange rate alone would result in an increase in the
provision of an additional $50m at March 31.
The final provision will depend on the updated projections of
future liabilities, exchange rate and the board's decision on the
appropriate prudential margin given the circumstances prevailing at
year-end.
As previously advised, costs associated with the closure of the
Viridian automotive glass facilities of $13m will be treated as a
significant item.
Other costs associated with the integration of Viridian glass
totalling $23m will be included as significant items.
In light of current and anticipated trading conditions the board
will be reviewing asset carrying values at year-end.
CSR is scheduled to release its results for the year ending
March 31 on May 13.