Adelaide Brighton (ABC) manufactures and distributes lime, ready mixed concrete and concrete products and materials to the construction, engineering, infrastructure and resource industry sectors in Australia.
ABC is also the market leader in the Western Australian, Northern Territory and South Australian cement and lime markets, and its underlying strength has seen it as one of the shares to buy in recent months..
However, on 9 November, ABC warned it may not renew some of its major cement and lime supply agreements expiring at the end of 2010 and during 2011.
The group is cautiously confident of retaining around 50% of a supply contract with Cement Australia, in addition to other major supply agreements.
The threat of losing its contracts was a major reason behind an 11.4% plunge in ABC’s share price on the day. This made it one of the worst performers in the Australian stock market.
Receive free daily advice on ABC and all ASX stocks with an Australian Stock Report free trial.