Plumbing, bathrooms and trade supplier Reece on Monday reported a 20 per cent fall in first-half bottom-line net profit to $144.2 million.
The result reflected subdued housing market conditions across the nation and in the US in the six months ended December.
The 126-year-old company, which started as a single hardware store in Melbourne's Caulfield, recently noticed green shoots on the horizon.
But "it's not like we've got this huge recovery and we are off to the races", CEO Peter Wilson told analysts in an earnings call.
"We were just starting to see green shoots and then the interest rate rise hit."
The Reserve Bank of Australia raised interest rates for the first time in two years in February and there are expectations further increases are on the way.
Reece said its core Australia and New Zealand business had a mixed performance while its US operation, founded on its acquisition of the Morsco business eight years ago, was being impacted by affordability issues in the new residential construction sector.
"As we look ahead, we're cautious about the pace of recovery and don't expect a material shift in demand" for the remainder of the 2025/26 financial year, Mr Wilson said in a statement.
Reece's underlying earnings before interest and tax also declined - by 14 per cent to $262 million - as network expansion costs in the US increased, although that growth did help lift sales by almost six per cent to $4.6 billion.
The result, along with its net profit number, was better than expected, leading its shares 15 per cent higher to $16.04.
Its earnings from Australia and NZ totalled $179 million, while the US generated $US55 million ($A78 million).
Full-year earnings before interest and tax are now forecast to be $520 to $540 million, down from $548 million in 2024/25.
Reece declared a first-half dividend of 5.44 cents per share, down from 6.5 cents in the previous corresponding period.
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