AAP

Building products maker Boral Ltd says calendar 2009 will be the bottom of the housing cycle in the United States and Australia and financial 2010 will be another tough year.

Outgoing chief executive Rod Pearse told Boral's annual general meeting it was still too early to issue earnings guidance for the year.

Investors sent the company's share price down as a result, with Boral stocks closing down 29 cents, or 4.75 per cent, at $5.81.

"While the future looks bright for Boral, the 2010 financial year will be another tough year," Mr Pearse said.

"Whilst September quarter earnings were above our expectations, market conditions remain uncertain and it is too early to project earnings outcomes for financial year 2010."

Boral posted a 42 per cent fall in net profit to $142 million for the 2008/09 financial year after it was hit by a housing downturn in Australia and the worst housing slump in the US in decades.

Both markets has now reached a bottom, Mr Pearse said.

US activity levels had stabilised in the three months since June, while approvals for residential dwellings were 20 per cent stronger than the previous six months, he said.

"Whilst we are currently seeing flat levels of demand at the bottom of the cycle, we continue to expect that demand will lift in the second half of the 2010 financial year," Mr Pearse said.

Dwelling approvals data in Australia had also improved in the first quarter, which boded well for a domestic housing recovery in the second half of the year, Mr Pearse said.

A lag between finance and building approvals was a concern, but it was hoped finance approvals would pick up as the financial year progressed, he said.

Domestic non-dwelling activity remains weak, and a reduction of activity had begun to affect Boral's construction materials businesses.

Boral's concrete volumes in the September quarter were down 13 per cent on the same period last year.

Mr Pearse said it was hoped the federal government's stimulus packages would spark increased activity this year.

While pricing outcomes in the first three months of the current financial year had been positive, the appreciating Australian dollar was putting pressure on cement import prices, Mr Pearse said.

Shareholders at the meeting approved Boral's remuneration report, which included a $4.5 million end-of-service restraint payment to Mr Pearse.

Chairman Ken Moss said the board had taken the message of last year's shareholder opposition to its pay policy.

Mr Pearse's restraint payment was a contractual obligation approved by shareholders five years ago, Mr Moss said.

Mr Pearse had decided to forego payments worth up to about $3 million in his final pay packet, a move that should be applauded, Mr Moss said.

Incoming chief executive Mark Selway will have a lower base for his salary package and a higher proportion of at risk remuneration than his predecessor, Mr Moss said.

"I think I can safely say we got the message," Mr Moss told shareholders.