Wienerberger, the world's largest brickmaker and owner of Black Country-based manufacturer Baggeridge, has seen a 36 per cent rise in full year profits after tax to £231 million.
The figures were buoyed by continued strong growth in central and eastern Europe and a lower overall tax rate.
In its results statement yesterday, Wienerberger said it would be proposing a 12 per cent increase in its annual dividend to 1.45 euros (£1.13) per share, exactly in line with analyst expectations.
Adjusted to reflect minority interests and provisions for hybrid bond holders, the group's profit after tax rose 21 per cent to £204.2 million, beating average analyst forecasts of consensus of £201.1 million. Wienerberger said its full-year EBIT was up 18 per cent to £276 million, EBITDA rose 17 per cent to £430.6 million and revenues came in 11 per cent higher at £1.94 billion.
The group said its overall tax rate declined to 17.4 per cent from 21.3 per cent a year earlier, reflecting the higher share of earnings generated in eastern European countries, as well as tax breaks related to an issue of hybrid capital.
The group's return on capital employed (ROCE) reached 10.1 per cent in 2007, up from 9.4 per cent.
In its outlook for 2008, Wienerberger said it expects to outperform the building materials sector by posting an above-average growth rate of around 10 per cent in its operating earnings.
Growth in its European markets - especially in eastern Europe - would offset declines in weaker markets, the company said.
Chief executive Wolfgang Reithofer said: "At mid-year we raised our earnings targets to reflect the outstanding development of business in central-east Europe - and finally even exceeded these targets - although the downturn on the new residential construction markets in the US and Germany was much stronger than expected."
Within eastern Europe, demand was strongest in Poland, Slovakia, the Czech Republic, Bulgaria and Romania, while the company said it had also seen "sound growth" in established markets in Belgium, France and the Netherlands.
The company said its 2007 results were a clear confirmation of the success of its balanced global portfolio "which allowed the group to more than offset declines on the two largest individual markets - the US and Germany - and also minimise market fluctuations and risk".
The portfolio grew by more than 50 acquisitions, including Baggeridge, at a cost to the company of around £410 million.
Looking ahead, the company said it expected growth in central and eastern Europe to continue during 2008, aided by investment in new plants Romania, Bulgaria and Russia.
In France it is expecting stability, although it was hopeful of expansion in the hollow bricks and clay tiles sectors.
"The integration and consolidation of Baggeridge and Korevaar in the Netherlands will also support a further increase in revenues and earnings," it said in its statement.
However, it said it saw no sign of a recovery in the German market, while the US looked even worse.
"In the US, housing starts are projected to drop by a further 20 per cent to 1.1 million in 2008," it said.