Slide 1: Fletcher Building Limited Annual Results to June 2009
1 For personal use only Fletcher Building Limited Annual Results to June 2009 12 August 2009 Annual Results | Fletcher Building | August 2009
Slide 2: Disclaimer
2 Disclaimer For personal use only This annual results presentation dated 12 August 2009 provides additional comment on the media release of the same date. As such, it should be ready in conjunction with, and subject to, the explanations and views of future outlook on market conditions, earnings and
Slide 3: Agenda
3 Agenda For personal use only • Introduction • Company and Market Overview • Divisional Performance • Financial Results • Strategy • Outlook Annual Results | Fletcher Building | August 2009
Slide 4: Company & Market Overview
4 For personal use only Company & Market Overview Annual Results | Fletcher Building | August 2009
Slide 5: Results overview
5 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Results overview For personal use only • Group underlying operating earnings1 of $558 million (down 27%). • Strong cashflow performance – cashflow from operations $533 million (up 23%). • Unusual items resu
Slide 6: FY09 has been a demanding year
6 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook FY09 has been a demanding year For personal use only • Group operating earnings impacted by: • weak residential building markets globally • significant deterioration in commercial construction activity • on
Slide 7: Residential construction activity was significantly lower in all key markets
7 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Residential construction activity was significantly lower For personal use only in all key markets Jun 2009 Jun 2008 Jun 2007 09/08 Building Consents 12 months 12 months 12 months % Mvmt New Zealand 12,503
Slide 8: FY09 annual results summary
8 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook FY09 annual results summary For personal use only Jun 2009 Jun 2008 NZ$m 12 months 12 months % Change Sales 7,103 7,091 EBITDA¹ 769 966 -20 EBIT¹ 558 768 -27 Net earnings1 314 467 -33 Unusual items after ta
Slide 9: Focus on optimising cash has proven beneficial
9 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Focus on optimising cash has proven beneficial For personal use only • Cashflow from operations up 23% to $533 million, driven by: • reduction in debtors of $203 million • reduction in inventory of $101 mil
Slide 10: Unusual items reflect pro-active stance in re-basing operations
10 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Unusual items reflect pro-active stance in re-basing For personal use only operations for lower volumes • Redundancy and restructuring costs: $43 million (after tax) • labour reduction of 2,500 to 16,500 a
Slide 11: Other unusual items
11 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Other unusual items For personal use only • Adjustments to asset carrying values: $157 million (after tax) • reduction in goodwill for Formica: $56 million • impairment of fixed assets in Formica: $65 mill
Slide 12: Divisional Performance
12 For personal use only Divisional Performance Annual Results | Fletcher Building | August 2009
Slide 13: Strong performance in Steel, other businesses had lower volumes and margins
13 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Strong performance in Steel, other businesses typically For personal use only had lower volumes and margins EBITDA NZ$million1 296 255 214 171 175 159 131 123 82 80 40 18 Building Distribution Infrastructu
Slide 14: Building Products result
14 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Building Products result For personal use only Jun 09 Jun 08 • Plasterboard performance NZ$m 12 mths 12 mths %∆ impacted by low NZ housing Sales 771 739 +4 starts. EBITDA1 131 171 -23 • Insulation in NZ &
Slide 15: Building Products: volumes typically lower but improved trend in Insulation
15 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Building Products: volumes typically lower but improved For personal use only trend in Insulation due to government stimulus Gross Sales Jun 09 Jun 08 NZ$m 12 mths 12 mths1 %∆ Volume ∆ Price ∆ EBITDA ∆ New
Slide 16: Distribution result
16 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Distribution result For personal use only Jun 09 Jun 08 • Sales impacted by weak NZ NZ$m 12 mths 12 mths %∆ housing starts but market Sales 883 1,083 -18 share maintained. EBITDA1 40 82 -51 • Significant s
Slide 17: Infrastructure result
17 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Infrastructure result For personal use only NZ Concrete Jun 09 Jun 08 • Volume declines in cement, NZ$m 12 mths 12 mths %∆ aggregates, readymix, masonry Sales 2,052 1,857 +11 and concrete pipe. • Reflects
Slide 18: Infrastructure: strong construction levels partly offset lower concrete volumes
18 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Infrastructure: strong construction levels helped to For personal use only partly offset lower concrete volumes Gross Sales Jun 09 Jun 08 NZ$m 12 mths 12 mths %∆ Volume ∆ Price ∆ EBITDA ∆ New Zealand - NZ
Slide 19: Property activities include quarry end use, residential and surplus assets
19 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Property activities include quarry end use, residential and For personal use only surplus assets EBIT NZ$m 2009 2008 2007 2006 Quarry end use 0 42 6 0 Residential 12 19 34 25 Surplus assets 6 19 9 10 Total
Slide 20: Laminates & Panels result
20 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Laminates & Panels result For personal use only Jun 09 Jun 08 Laminex NZ$m 12 mths 12 mths %∆ • Volumes down in NZ and Sales 2,076 2,132 -3 Australia, export markets EBITDA weak. • Significant input cost -
Slide 21: Laminates & Panels: Asian region stronger but other markets weaker
21 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Laminates & Panels: Asian region stronger overall but For personal use only all other markets were weaker Gross Sales Jun 09 Jun 08 NZ$m 12 mths 12 mths %∆ Volume ∆ Price ∆ EBITDA ∆ New Zealand - Laminex 1
Slide 22: Formica growth in Asia and North America turnaround boosted result
22 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Formica growth in Asia and North America turnaround For personal use only boosted result, but Europe weak EBITDA NZ$m1 2H09 1H09 2H08 1H08 Asia 19 20 14 16 North America 17 2 -17 10 Europe 8 9 30 22 Corpor
Slide 23: Steel result
23 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Steel result For personal use only Jun 09 Jun 08 • Strong result in first half NZ$m 12 mths 12 mths %∆ reflected high steel prices and Sales 1,321 1,279 +3 strong demand. EBITDA1 175 123 +42 • Second half
Slide 24: Steel: strong first half, but volumes lower in second half
24 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Steel: strong first half, but volumes lower in second half For personal use only Gross Sales Jun 09 Jun 08 NZ$m 12 mths 12 mths %∆ Volume ∆ Price ∆ EBITDA ∆ New Zealand - Long Steel 361 288 +25 ↓ ↑ ↑ - Coa
Slide 25: Financial Results
25 For personal use only Financial Results Annual Results | Fletcher Building | August 2009
Slide 26: Net earnings
26 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Net earnings For personal use only Jun 2009 Jun 2008 NZ $m 12 months 12 months %∆ EBIT1 558 768 -27 Interest 140 136 +3 Tax1 96 150 -36 Minority Interests 8 15 -47 Net Earnings before unusual items 314 467
Slide 27: Balance sheet strengthened with equity raising and higher operating cashflow
27 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Balance sheet strengthened with equity raising and For personal use only higher operating cashflow Jun 2009 Jun 2008 NZ $m 12 months 12 months %∆ Operating Cashflow 533 434 +23 Net Debt 1,350 1,846 -27 Net
Slide 28: Key ratios
28 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Key ratios For personal use only Total Shareholder Return (TSR) Debt/Debt Plus Equity Percentage Percentage 44.4 61 40.1 37.1 40 42 31.1 22.2 14 Jun 05 Jun 06 Jun 07 Jun 08 Jun 09 Jun 05 Jun 06 Jun 07 Jun
Slide 29: Debt maturity profile
29 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Debt maturity profile For personal use only • No significant refinancing Funding and Maturity Profile until 2013, with undrawn credit lines of over $1 billion. June 2009 Excluding Cash of NZ$43 million 400
Slide 30: Net debt movement
30 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Net debt movement For personal use only 2400 NZ$m 1,846 2000 533 20 226 292 1600 47 67 1,350 (52) 1200 (432) (148) (516) 800 400 0 NZ pension top FX on Debt Closing Debt Opening Debt Equity Cash from ops C
Slide 31: Strategy
31 For personal use only Strategy Annual Results | Fletcher Building | August 2009
Slide 32: Strategy
32 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Strategy For personal use only Longer term strategy continues to be: • improve earnings reliability • maintain and improve internal capabilities • pursue acquisition opportunities where these meet key inve
Slide 33: Outlook
33 For personal use only Outlook Annual Results | Fletcher Building | August 2009
Slide 34: Outlook 2010
34 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Outlook 2010 For personal use only • Subdued outlook for FY10 with low activity levels expected in most markets. • Infrastructure spending in NZ and Australia will assist construction, concrete and steel b
Slide 35: For personal use only
35 For personal use only Annual Results | Fletcher Building | August 2009