Fletcher Building Limited · NZX:FBU
Fletcher Building — Shareholder Meeting (October 2024)
26 slides from Fletcher Building's shareholder meeting presentation, Oct 23, 2024
Slide 1: 2024 Annual Shareholders' Meeting
2024 Annual Shareholders’ Meeting 23 October 2024 Fletcher Building Limited Annual Shareholders’ Meeting 2024
Slide 2: Peter Crowley
Peter Crowley Independent, Non-Executive Director Fletcher Building Limited Annual Shareholders’ Meeting 2024
Slide 3: Directors
Directors Barbara Chapman Peter Crowley Sandra Dodds Tony Dragicevich Andrew Reding Cathy Quinn Page 3 | Fletcher Building Limited Annual Shareholders' Meeting 2024 | © October 2024
Slide 4: Meeting agenda
Meeting agenda Acting Chair’s Address Managing Director and Chief Executive Officer’s Address Q&A Voting on Resolutions General Q&A Refreshments Page 4 | Fletcher Building Limited Annual Shareholders' Meeting 2024 | © October 2024
Slide 5: Barbara Chapman
Barbara Chapman Acting Chair Fletcher Building Limited Annual Shareholders’ Meeting 2024
Slide 6: Contextualising the market backdrop – steep pace of decline
Contextualising the market backdrop – steep pace of decline NZ RESIDENTIAL SQUARE METERAGE CONSENTED (‘000s) | ROLLING 12 MONTH AUS DWELLINGS COMMENCED (‘000s) | ROLLING 12 MONTH 8,000 Peak to Jun-24 240 Peak to Jun-24 39% 7,000 215 31% 6,000 190 5,000 165 4,000 140 Mar-19 Dec-19 Sep-20 Jun-21 Mar-2
Slide 7: FY24 key financial results
FY24 key financial results Revenue1 EBIT1,2 Net (Loss) / Earnings EPS $7,683m $509m $(227)m (29.0)c FY23 7,679m FY23 $785m FY23 $235m FY23 30.0c Cash flows from EBIT1,2 margin Return on funds employed1,2 Dividend operating activities $398m 6.6% 10.0% nil FY23: 10.2% FY23: 17.1% FY23: 34.0cps FY23 $3
Slide 8: FY24 key non-financial results
FY24 key non-financial results Safety Sustainability Customer Engagement Total Recordable Injury Carbon (CO2) Emissions & Net Promoter Score3 Employee Engagement Rating Frequency Rate1 1,600 Intensity2 170 1,400 162 150 48 3.4 126 130 35 3.3 1,200 3.1 1,199 -19% 110 42 29 36 1,000 800 969 90 26 70 6
Slide 9: Risks on WA plumbing and legacy construction projects dimensioned
Risks on WA plumbing and legacy construction projects dimensioned ➔ Joint Industry Response (JIR) to the WA plumbing failures agreed in principle ➔ Iplex® AU and the WA Government committed to cover direct costs of repairs by WA participating builders: 80% by Iplex® AU and 20% by the WA Government P
Slide 10: Decisive and pre-emptive action taken to strengthen our balance sheet
Decisive and pre-emptive action taken to strengthen our balance sheet …TO REPAY DEBT, …AND IMPROVE $700M OF EQUITY STRENGTHEN THE FINANCIAL STABILITY RAISED BALANCE SHEET… AND RESILIENCE Page 10 | Fletcher Building Limited Annual Shareholders' Meeting 2024 | © October 2024
Slide 11: Board and leadership changes
Board and leadership changes ➔ BOARD RENEWAL, STRONG INDUSTRY APPOINTMENTS ➔ MD & CEO APPOINTED ➔ KEY PRIORITY IS PERMANENT CHAIR APPOINTMENT Page 11 | Fletcher Building Limited Annual Shareholders' Meeting 2024 | © October 2024
Slide 12: Andrew Reding
Andrew Reding Managing Director and Chief Executive Officer Fletcher Building Limited Annual Shareholders’ Meeting 2024
Slide 13: On the ground – connecting with our people and businesses
On the ground – connecting with our people and businesses Page 13 | Fletcher Building Limited Annual Shareholders' Meeting 2024 | © October 2024
Slide 14: Trading update
Trading update Unique trading conditions in Materials & Distribution in 1Q25, however improvement in Resi & Devt house sales observed in September ▪ 1Q25 market volumes are 10% - 15% lower YOY MATERIALS & ▪ September trading saw revenues track lower by 12% YOY (vs. down 7% YOY in Jul-Aug) DISTRIBUTI
Slide 15: FY25 Outlook
FY25 Outlook Expect FY25 EBIT to be c.60% weighted to 2H primarily due to cost savings, housing settlements & non-repeat of one-off costs ▪ Continue to expect FY25 market volumes in our Materials & Distribution1 businesses to be c.10-15% lower vs FY24 ▪ Consistent with our expectation in September ▪
Slide 16: Fletcher Building remains focused on delivering near-term milestones
Fletcher Building remains focused on delivering near-term milestones ➔ Ongoing cost reductions to manage profitability ➔ Continued focus on cash generation ➔ Managing working capital and capex to respond to market conditions ➔ Completing remaining legacy issues ➔ Strategic review underway – completi
Slide 17: Long term fundamentals solid
Long term fundamentals solid WE OPERATE IN ATTRACTIVE …WHERE WE HAVE STRONG …WELL-POSITIONED ONCE MARKETS… BUSINESSES… MARKET VOLUMES RECOVER Balance sheet strengthening Population dynamics and allows us to focus on executing 1 infrastructure deficit underpin 1 operational and strategic long term se
Slide 18: Questions
Questions Fletcher Building Limited Annual Shareholders’ Meeting 2024
Slide 19: Resolutions and Voting
Resolutions and Voting Fletcher Building Limited Annual Shareholders’ Meeting 2024
Slide 20: Resolutions
Resolutions ➔ Ordinary Resolutions ➔ Resolution 1 – Re-election of Cathy Quinn ➔ Resolution 2 – Election of Tony Dragicevich ➔ Resolution 3 – Election of Andrew Reding ➔ Resolution 4 – Auditor fees and expenses ➔ Resolution 5 – Adoption of Remuneration Report Page 20 | Fletcher Building Limited Annu
Slide 21: Remuneration principles
Remuneration principles ❶ ❷ ❸ ❹ SHAREHOLDER VALUE OUR PEOPLE STRATEGY RISK ATTRACT, RETAIN and SUSTAINABLE An OWNERSHIP REWARD high Promoting high EARNINGS & CULTURE with ‘skin-in- standards of standards and PROFITABLE GROWTH the- game’ performance and ACCOUNTABILITY (short- and long-term) values Pa
Slide 22: Our executive remuneration framework supports our performance focus and remuneration principles
Our executive remuneration framework supports our performance focus and remuneration principles Short Term Incentive Fixed Remuneration Long Term Incentive (LTI) (STI) • 50%: relative • Base Salary • 65%: Financial goals shareholder returns • KiwiSaver + Health • 35%: Non-financial • 50%: 3-year ROF
Slide 23: This approach has resulted in strong alignment to CEO remuneration outcomes with actual performance
This approach has resulted in strong alignment to CEO remuneration outcomes with actual performance FY19 FY20 FY21 FY22 FY23 FY24 Short Term Incentive 36% 0% 94% 93% 36% 0% (% earned of max STI) Long Term Incentive 0% 0% 0% 0% 0% 0% (% earned of max LTI)1 Page 23 | Fletcher Building Limited Annual S
Slide 24: Group CEO remuneration arrangements (At maximum)
Group CEO remuneration arrangements (At maximum) Previous Group CEO - Ross Taylor New Group CEO - Andrew Reding LTI: $1.8m Equity: $3.6m STI Equity: $1.9m LTI: $2.2m Equity: $3.3m STI Cash: $1.9m STI Equity: $1.1m Cash: STI Cash: $1.1m $4.2m Cash: Fixed Remuneration: $2.3m $2.5m Fixed Remuneration:
Slide 25: 2024 Annual Shareholders' Meeting
2024 Annual Shareholders’ Meeting 23 October 2024 Fletcher Building Limited Annual Shareholders’ Meeting 2024
Slide 26: Important Information
Important Information This presentation has been prepared by Fletcher Building Limited and its group of companies (“Fletcher Building”) for informational purposes. This disclaimer applies to this document and the verbal or written comments of any person presenting it. This presentation dated 23 Octo
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