James Hardie Industries Plc. · NYSE:JHX
James Hardie Industries — Q1 FY21 Earnings Presentation
32 slides from James Hardie Industries's earnings presentation, Aug 11, 2020
Slide 1: Q1 FY21 Management Presentation
Exhibit 99.5 Q1 FY21 MANAGEMENT PRESENTATION 11 August 2020
Slide 2: Cautionary Note on Forward-Looking Statements
James Hardie Q1 FY21 Results CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS This Management Presentation contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. James Hardie Industries plc (the “Comp
Slide 3: Agenda
James Hardie Q1 FY21 Results AGENDA • Strategy Update • Q1 FY21 Financial Results Dr. Jack Truong Chief Executive Officer • Summary and Guidance • Questions and Answers Jason Miele Chief Financial Officer Page 3
Slide 4: Strategy Update
STRATEGY UPDATE
Slide 5: Global Strategy: On Track and Accelerating
James Hardie Q1 FY21 Results GLOBAL STRATEGY: ON TRACK AND ACCELERATING Year 1: FY20 Year 2: FY21 Year 3: FY22 Begin the Shift from Big, Accelerate Through Crisis Create New SMALL, to Small, BIG Company Growth Platforms . Develop World Class Manufacturing . Engage and integrate with our . Continue t
Slide 6: FY21 End to End Supply Chain Integration
James Hardie Q1 FY21 Results FY21 END TO END SUPPLY CHAIN INTEGRATION Commercial Quality, Cost, Customers and Service End-Users R&D Manufacturing & Logistics Deliver what our customers need and want by integrating their demand signal and leveraging our scale to grow together Page 6
Slide 7: FY21 Begin Supply Chain Integration with Customers
James Hardie Q1 FY21 Results FY21 BEGIN SUPPLY CHAIN INTEGRATION WITH CUSTOMERS Global Inventory (US$ millions) • Seamlessly service our customers through 310 305.1 the COVID-19 pandemic 300 290 • Service metrics improved in all three 280 regions during the quarter while reducing 270 258.5 inventory
Slide 8: FY21 Working Capital Improvements
James Hardie Q1 FY21 Results FY21 WORKING CAPITAL IMPROVEMENTS • Operating Cash Flow increased to US$189.2 million (+35%) in Q1FY21 versus pcp • Best-in-class customer service throughout the pandemic helped to drive share gain, while improving working capital • Improved working capital by US$79.3 mi
Slide 9: Financial Results
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Slide 10: Group Results Overview Q1'21
James Hardie Q1 FY21 Results GROUP RESULTS OVERVIEW Q1'21 • Volume decreased 5% in the quarter 911.9mmsf Sales Volume • Adjusted EBIT flat in the quarter, driven by: -5% ◦ North America increased US$17.4 million (+15%) US$626.3 M ◦ APAC decreased A$1.8 million (-5%) Net Sales -5% ◦ Europe decreased
Slide 11: North America Summary Q1'21
James Hardie Q1 FY21 Results NORTH AMERICA SUMMARY Q1'21 • Volume and Net Sales flat versus pcp 609.7 mmsf Sales Volume FLAT • Exteriors volume increased 1% • Continued to gain share through customer engagement and integration US$451.8 M Net Sales FLAT • Interiors volume decreased 11% US$130.9 M • A
Slide 12: APAC Summary Q1'21
James Hardie Q1 FY21 Results APAC SUMMARY Q1'21 • Continued growth above market in Australia, volume 110.0 mmsf +1% Sales Volume -18% • Outstanding Australia Adjusted EBIT margin, A$138.7 M comparable to North America Net Sales -10% • Volume, gross profit and EBIT unfavorably impacted by A$33.6 M go
Slide 13: Europe Summary Q1'21
James Hardie Q1 FY21 Results EUROPE SUMMARY Q1'21 • Net Sales decreased 12% due to impact of COVID-19 192.2 mmsf pandemic, specifically UK and France government imposed Sales Volume -9% shutdowns €75.4 M ◦ Fiber Cement Net Sales: decreased 19% Net Sales -12% ◦ Fiber Gypsum Net Sales: decreased 11% €
Slide 14: General Corporate Costs and Research & Development
James Hardie Q1 FY21 Results GENERAL CORPORATE COSTS RESEARCH & DEVELOPMENT 1 Excludes asbestos related expenses and adjustments 1 Excludes restructuring expenses • Stock compensation expense • Customer Driven Innovation remains increased US$7.1 million in Q1 FY21 core strategic pillar • Increase in
Slide 15: Group Results
James Hardie Q1 FY21 Results GROUP RESULTS US$ % • Adjusted EBIT up slightly US$ Millions Q1'21 Q1'20 Change Change • Strong North America Adjusted EBIT performance, EBIT North America Fiber Cement1 $ 130.9 $ 113.5 17.4 15% up US$17.4 million and 15% 1 Asia Pacific Fiber Cement 22.3 24.8 (2.5) (10%)
Slide 16: Cash Flows and Capital Expenditures
James Hardie Q1 FY21 Results CASH FLOWS CAPITAL EXPENDITURES US$ Millions FY21 FY20 Change % a a a a Cash provided by operations 189.2 140.2 35 % 1 Cash used in investing (6.3) (43.3) (85 %) Cash used in financing (130.1) (80.1) 60 % Higher operating cash flow, up 35% • Integrated with our customers
Slide 17: Liquidity Profile at June 2020
James Hardie Q1 FY21 Results LIQUIDITY PROFILE AT 30 JUNE 2020 Strong balance sheet • US$693.1 million of liquidity at 30 June 2020 ◦ US$197.8 million cash and US$495.3 million available on RCF • US$1,036.6 million net debt3 Corporate debt structure 2 2 • US$400 million 4.75% senior unsecured notes
Slide 18: Capital Management
James Hardie Q1 FY21 Results CAPITAL MANAGEMENT We periodically review our capital structure and capital allocation objectives and expect the following capital management focus through the end of FY21: • Maintain flexibility through the market volatility of the pandemic; • Invest in capacity expansi
Slide 19: Summary and Guidance
SUMMARY AND GUIDANCE ii
Slide 20: Growth Above Market and Strong Returns
James Hardie Q1 FY21 Results GROWTH ABOVE MARKET AND STRONG RETURNS Growth Above Market AND Strong Returns • Continued focus on customer • North America Adjusted EBIT engagement to drive market o Increased 21% in FY20 share gains o Increased 15% in Q1FY21 • North America Exteriors volume • NA Adjust
Slide 21: Guidance
James Hardie Q1 FY21 Results GUIDANCE Q2 FY21 Guidance • North America exteriors volume growth of between 7% and 11% • North America Adjusted EBIT margin between 27% and 29% Full-Year FY21 Guidance • Management expects full year FY21 Adjusted net operating profit1 to be between US$330 million and US
Slide 22: Questions
QUESTIONS
Slide 23: Appendix
APPENDIX
Slide 24: Depreciation and Amortization
James Hardie Q1 FY21 Results DEPRECIATION AND AMORTIZATION US$ Millions Three Months Ended 30 June Q1'21 Q1'20 Depreciation and amortization North America Fiber Cement $ 21.2 $ 22.0 Asia Pacific Fiber Cement 2.8 3.0 Europe Building Products 6.1 5.4 Other Businesses - 0.1 Research and Development 0.3
Slide 25: Asbestos Claims Data
James Hardie Q1 FY21 Results ASBESTOS CLAIMS DATA Quarter ended 30 June 2020 • Net cash outflow was 5% below actuarial expectations • Gross cash outflow was 6% below actuarial expectations • Claims received were flat compared to actuarial estimates and pcp • Number of claims settled were 20% above p
Slide 26: Non-US GAAP Financial Measures and Terms
James Hardie Q1 FY21 Results NON-US GAAP FINANCIAL MEASURES AND TERMS This Management Presentation forms part of a package of information about the company’s results. It should be read in conjunction with the other parts of this package, including the Management’s Analysis of Results, Media Release
Slide 27: Non-US GAAP Financial Measures
James Hardie Q1 FY21 Results NON-US GAAP FINANCIAL MEASURES Financial Measures – US GAAP equivalents This document contains financial statement line item descriptions that are considered to be non-US GAAP, but are consistent with those used by Australian companies. Because the company prepares its C
Slide 28: Non-US GAAP Financial Measures: Adjusted EBIT
James Hardie Q1 FY21 Results NON-US GAAP FINANCIAL MEASURES Financial Measures – US GAAP equivalents Adjusted EBIT US$ Millions Three Months Ended 30 June Q1'21 Q1'20 EBIT $ 49.8 $ 132.5 Asbestos: Asbestos adjustments 63.7 (8.5) AICF SG&A expenses 0.3 0.4 Restructuring expenses 11.1 - Adjusted EBIT
Slide 29: Non-US GAAP Financial Measures
James Hardie Q1 FY21 Results NON-US GAAP FINANCIAL MEASURES Asia Pacific Fiber Cement Segment Adjusted EBIT excluding restructuring expenses US$ Millions Three Months Ended 30 June Q1'21 Q1'20 Asia Pacific Fiber Cement Segment EBIT $ 18.9 $ 24.8 Restructuring expenses 3.4 - Asia Pacific Fiber Cement
Slide 30: Non-US GAAP Financial Measures
James Hardie Q1 FY21 Results NON-US GAAP FINANCIAL MEASURES Research and Development Segment Adjusted EBIT excluding restructuring expenses US$ Millions Three Months Ended 30 June Q1'21 Q1'20 Research and Development Segment EBIT $ (6.1) $ (6.2) Restructuring expenses 0.1 - Research and Development
Slide 31: Non-US GAAP Financial Measures
James Hardie Q1 FY21 Results NON-US GAAP FINANCIAL MEASURES Adjusted net operating profit US$ Millions Three Months Ended 30 June Q1'21 Q1'20 Net operating profit $ 9.4 $ 86.5 Asbestos: Asbestos adjustments 63.7 (8.5) AICF SG&A expenses 0.3 0.4 AICF interest income, net (0.1) (0.2) Restructuring exp
Slide 32: Q1 FY21 Management Presentation
Q1 FY21 MANAGEMENT PRESENTATION 11 August 2020
James Hardie Industries — Q1 FY21 Earnings Presentation on 6ix