In spite of the cautionary stance, Fletcher confirmed it is looking at "acquisition targets", predominantly in Australia, but is unlikely to be making any purchases before the second quarter of next year at the earliest.
Fletcher, founded in Dunedin a century ago, is the country's largest listed company, with a $4.8 billion market capitalisation, 16,500 employees worldwide, sales last year of $7.1 billion and forward orders in New Zealand of $1.2 billion.
At its annual meeting in Dunedin yesterday, attended by almost 200 shareholders, chairman Roderick Deane outlined to shareholders the "turbulence" of the past year and "the significant deterioration in the major economies around the world".
"We have felt the impact through all parts of our operations in some shape or form."
Commercial work had sharply declined while new housing markets fell significantly around the world, the latter "alleviated in part" by increased infrastructure spending by the governments of New Zealand and Australia.
"Coupled with a constrained banking sector, the effect has been a sharply constricted construction sector," he said.
Following the annual meeting, Fletcher shares were down slightly, about 1.4%, to trade around $7.94.
While its shares wavered, shareholders ratified its raising of $526 million in equity earlier in the year, based on postal and proxy votes yesterday, which, while not a legal requirement, allows it to seek to raise potentially about $500 million again between now and April next year, without having to seek shareholder ratification again.
Craigs Investment Partners broker Peter McIntyre said the ratification outcome was no surprise and highlighted the earlier $526 million equity raising, used largely to pay debt, was well timed and the shoring up of finances had kept the company out of trouble - and maintained shareholder satisfaction.
"Fletcher's remains very conservative in its outlook and is concerned most at the timing of [global] recovery," Mr McIntyre said.
In spite of several opportunities, shareholders raised no questions during the meeting.
Fletcher paid a 38c dividend for the past full year, down 10c on the previous year, and yesterday signalled the likelihood of a 28c dividend for the present financial year, but dependent on trading.
Mr McIntyre said Mr Deane's prediction of coming in at the bottom end of the analysts' range was typical of Fletcher's conservative guidance, noting the company had in previous years repeatedly performed better than its initial guidance, making it a sharemarket darling for many investors.
Fletcher's full-year result to the end of June saw it book a $46 million after-tax loss - compared with analysts' predictions of a $64 million loss - but greatly in contrast to its previous year's $467 million profit.
However, Dr Deane yesterday said he believed Fletcher had delivered in three priority areas by maintaining a strong operating cash flow, down-sizing the business to align with future work volumes and had strengthened its balance sheet, having successfully raised $526 million in new equity during the year.
"Based on current trading performance, and assuming no further deterioration in key markets, net earnings should fall within this [$261 million to $340 million] range," which was excluding any unusual items, Dr Deane said.
However, he sounded a cautionary note to shareholders that without a sustained recovery in volumes, the net earnings would be at the lower end of the analysts' range - $261 million.
"We have yet to see any significant signs of recovery in any of our markets . . . we believe any recovery will be gradual rather than rapid," Mr Deane said.
Mr McIntyre said Craigs maintained its expectation of a forecast of $293 million, incorporating a "flat" first-half trading for 2010 and a "gentle" second-half recovery.
Similar to Dr Deane's outlook, chief executive Jonathan Ling outlined an "exceptionally difficult" past year, highlighting a 40% fall in New Zealand building consents, a 19% fall in Australia, a 34% fall in the United States, a 49% drop in England and a 54% fall in Spain.
After the meeting, Mr Ling told the Otago Daily Times Fletcher was looking mainly to Australian companies as "acquisition targets".
"We are always looking at a number of targets, predominantly Australian. But there's nothing imminent and really only a small chance of going back to the market for more [equity]" before April next year, Mr Ling said.
While clearly outlining a host of downturns in several divisions, Mr Ling said Fletcher's restructuring and manufacturing capacity reduction to date was "largely completed", including the loss of 2500 jobs, but the balance sheet was in a strong position and, aside from working capital bank facilities, the company had more than $1 billion in undrawn bank facilities.
"The next imperative is to prepare for the upturn when it comes . . . addressing how manufacturing volumes could be ramped up [in all six Fletcher divisions] when demand improves," he said.
Australia remained its key area for pursuit of growth, while in Asia Mr Ling hoped to see continued growth from its Formica business, which lost 50% in volume, after Fletcher bought it for almost $1 billion.
