Fletcher Building expects the New Zealand residential construction sector to pick up gradually from a very low base but is not expecting any improvement in the US and European markets.
In its annual report, New Zealand's largest listed company reiterated that the rebuilding of Canterbury should gain momentum in the later part of the year, which will boost the construction industry.
But the outlook remains patchy for the commercial sector, with Government spending underpinning demand for infrastructure projects.
Across the Tasman, it says the home building and alterations market is weakening, and the commercial sector remains subdued, but the resilient mining sector and Government investment are expected to underpin infrastructure spending.
Fletcher Building says trading conditions in the US and Europe remain flat and no recovery is expected in the near term, but things look brighter in the fast-growing countries of China, South East Asia and Taiwan.
Meanwhile, the company's annual report reveals chief executive Jonathan Ling was paid $2.8 million in 2011, which includes base pay of $1.4 million and short term incentive bonuses worth $1.4 million.