Fletcher Building Limited · NZX:FBU
Fletcher Building — Investor Presentation (March 2009)
36 slides from Fletcher Building's investor presentation, Mar 25, 2009
Slide 1: Fletcher Building Limited Analysts Presentation
For personal use only Fletcher Building Limited Analysts Presentation 25th March, 2009 1
Slide 2: Cautionary Statement
For personal use only Cautionary Statement This confidential presentation contains not only a review of operations but also some forward looking statements about Fletcher Building and the environment in which the company operates. Because these statements are forward looking, Fletcher Building’s act
Slide 3: Laminates and Panels Division overview
For personal use only The Laminates and Panels Division of Fletcher Building Limited is comprised of The Laminex Group and Formica Corporation. The Laminex Group was acquired by Fletcher Building Limited in November 2002 and subsequently integrated with the existing Scott Panel and Hardware and Flet
Slide 4: Vision
For personal use only Vision Group Vision The Laminex Group will be the innovative market leader for decorative surfaces and related products in our core geographies of Australia and New Zealand. Safety Vision Zero Harm 4
Slide 5: Vision
For personal use only Vision • Innovative • Market Leader • Decorative Focus • Powerful Integrated Product Offer • Australia and New Zealand Geography • Globally Competitive • Zero Harm 5
Slide 6: Leading Brands
For personal use only Leading Brands 6
Slide 7: Leading Products
For personal use only Leading Products Kitchen photo 7
Slide 8: TLG PBD Australia
For personal use only TLG PBD Australia Resin Fibre Dynea JV Wespine JV DARDANUP PBD KUMEU & TAUPO PBD NZ Processed LPM Flooring LPM LPM Panels Dardanup Dardanup Ballarat Brisbane Welshpool PBD Outsourced Supply TLG DISTRIBUTION Customers 8
Slide 9: TLG MDF Australia
For personal use only TLG MDF Australia Resin Fibre Resin Fibre Dynea JV Wespine JV WELSHPOOL MDF GYMPIE MDF LPM Veneers LPM LPM LPM Welshpoo Welshpoo Ballarat Gympie Brisbane l l TLG DISTRIBUTION Customers 9
Slide 10: TLG HPL Australia & New Zealand
For personal use only TLG HPL Australia & New Zealand Resin Paper Resin Paper CHELTENHAM HPL FORMICA CHINA HPL TLG AUSTRALIA TLG NEW ZEALAND DISTRIBUTION DISTRIBUTION Australian Customers New Zealand Customers 10
Slide 11: TLG PBD & MDF New Zealand
For personal use only TLG PBD & MDF New Zealand KUMEU PBD TAUPO PBD Australian Dongwha LPM Hamilton MDF JV LPL Plants TLG DISTRIBUTION Customers 11
Slide 12: Strategic Objectives
For personal use only Strategic Objectives • Market Share • Manufacturing Capacity Rationalisation • Distribution Optimisation – Value to customer, cost to serve, working capital • Margin Improvement – Pricing policies, SKU/customer rationalisation • New Product / Segment Development • Zero Harm 12
Slide 13: Revenue and EBITDA – NZ$M
For personal use only Revenue and EBITDA – NZ$M 1140 1131 180 1120 174 1120 175 1100 1089 170 166 1080 165 160 156 1060 155 1040 1031 148 150 1020 145 1000 140 980 135 2005 2006 2007 2008 2005 2006 2007 2008 2005 2006 2007 2008 2005 2006 2007 2008 REVENUE EBITDA 13
Slide 14: Industry Structure
For personal use only Industry Structure Laminex relative market position by major product group HPL Wilson Art Others Laminex Decorative MDF/PBD Laminex CHH Borg Others Raw MDF/PBD CHH Laminex excludes Export Sumitomo Others Engineered Quantum Stone Caesarstone Quartz Laminex Source :Management est
Slide 15: Competitive Advantages
For personal use only Competitive Advantages • No.1 or No.2 market positions in key product categories • Integrated decorative product range • Brand recognition • Extensive distribution branch network • Vertically integrated manufacturing facilities • Joint ventures in some key suppliers • Long term
Slide 16: Manufacturing
For personal use only Manufacturing Kumeu Gympie MDF PBD Brisbane LPM Hamilton LPM Welshpool MDF Dardanup PBD Taupo PBD Ballarat Doors / Wespine Sawmill JV Dynea Resin JV Componentry Ballarat LPM Major Manufacturing Facilities Cheltenham HPL Dunedin Benchtops Joint Ventures Dongwha MDF JV 16
Slide 17: Distribution
For personal use only Distribution Widespread geographic coverage Brisbane Auckland Perth Sydney Adelaide Melbourne 17
Slide 18: Changing Market Conditions
For personal use only Changing Market Conditions • Economic downturn • Declining market • A large fragmented customer base – some consolidation • Competitive industry – Increasing LPM capacity and competition – Large retailers growing their presence with imports – Low cost Asian kitchen and furnitur
Slide 19: Customer Size
For personal use only Customer Size ACTIVE CUSTOMERS (AUST & NZ) GROUPED BY SALES RANGE ($A) 2007/08 18,000 15,430 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 197 73 15 6 2 4 2 1 1 0 <$0.5m $0.5m-$1.0m $1.0m-$2.0m $2.0-$3.0m $3.0-$4.0m $4.0-$5.0m $5.0-$6.0m $6.0-$7.0m $13.0m-$14.0m $19.0m-$2
Slide 20: Revenue by Segment 2007/08
For personal use only Revenue by Segment 2007/08 Export, 6% Export 9% New Hom es, 31% New Homes Alterations & Additions 26% 30% Alterations & Additions, 31% Commercial Com m ercial, 32% 35% 20
Slide 21: Revenue by Product 2007/08
For personal use only Revenue by Product 2007/08 HPL, 15% Other, 23% Raw board Dom estic, 13% Raw board Export, 6% Decorated Board, 43% 21
Slide 22: Revenue by Major Region 2007/08
For personal use only Revenue by Major Region 2007/08 Export, 6% South Australia, 6% New Zealand, 20% New South Wales & ACT, 17% Victoria & Tasm ania, 18% Queensland, 17% Western Australia, 16% 22
Slide 23: Manufacturing Performance
For personal use only Manufacturing Performance Medium Density Fibreboard Particleboard 380 405 400 375 395 390 ‘000 m³ 370 ‘000 m³ 385 365 380 375 360 370 365 355 360 350 355 FY04 FY05 FY06 FY07 FY08 FY04 FY05 FY06 FY07 FY08 MDF - Excludes Taupo MDF facility Low Pressure Laminate High Pressure Lami
Slide 24: TLG LTIFR 2001/02 – 28th February 2009
For personal use only TLG LTIFR 2001/02 – 28th February 2009 (Rolling) 30 25 20 14.4 14.96 15 12.56 8 months to 9.2 February 2009 10 7.91 LTIFR 1.90 5.14 4.64 5 2.85 0 2001/2 2002/3 2003/4 2004/5 2005/6 2006/7 2007/8 2008/9 • Zero Harm Philosophy – continuous improvement • Safety Management System b
Slide 25: Capacity Flexibility Economic Downturn
For personal use only Capacity Flexibility Economic Downturn Operational Changes • PBD - Kumeu 7 to 4 day • MDF - Welshpool 7 to 4 day • LPM - Ballarat 7 to 5 day • HPL - Cheltenham 5 to 4 day • Benchtops - O’Brien’s NZ site rationalisation 25
Slide 26: Staffing Levels
For personal use only Staffing Levels 11% Reduction • Manufacturing capacity • Administration rationalisation • Warehousing efficiencies • Operational efficiencies 26
Slide 27: Growth
For personal use only Growth 27
Slide 28: Significant Formica Related Synergies
For personal use only Significant Formica Related Synergies HPL Import and Facility Rationalisation • HPL Formica China imports successfully transitioned • Key synergy identified at the time of the Formica acquisition • Papakura (NZ HPL site) closed June 2008 • Cheltenham HPL facility re-structured
Slide 29: Laminex & Formica Range Rejuvenation
For personal use only Laminex & Formica Range Rejuvenation • High pressure and low pressure ranges updated • Formica July 2008 – HPL sourced from Formica China • Laminex September 2008 – Colour and finish update – Capex $3.5m texture press plates much improved manufacturing process 29
Slide 30: Major Investments: Western Australia Branch Upgrades
For personal use only Major Investments Western Australia Branch Upgrades • Investing A$4m upgrading the Western Australian branch network • New consolidated WA Metro DC completed June 2008 • Adjacent to the Welshpool MDF facility, will incorporate WA sales, distribution and administration. • Contin
Slide 31: Major Investments: Gympie Heat Energy Plant
For personal use only Major Investments Gympie Heat Energy Plant (HEP) • Investing A$15m in a new HEP and cyclone • Commissioned in May 2008 • Eliminates significant business interruption risk • Allows for future capacity expansion 31
Slide 32: Major Investments: Dardanup
For personal use only Major Investments Dardanup – Wood Processing • Capex $2.6m • Reduced fibre cost • Improves plantation saw log yields and benefits Wespine JV Dardanup – Drier • Capex $16m • Significant improvement achieved in environmental and production performance • 64% reduction in energy co
Slide 33: Major Investments: Ballarat Doors/Componentry
For personal use only Major Investments Ballarat Doors /Componentry • Relocation / rationalise production • Capex $8m - Powder Coated Doors and Panels – new products - Laminated Doors – improved product - Upgraded manufacturing equipment – efficiencies • To be commissioned March / April 2009 • Growt
Slide 34: Major Investments: Gympie Operational Sustainability
For personal use only Major Investments Gympie Operational Sustainability • Capex $5.3m • Major improvements / replacements to sustain ongoing operations • Support ability to increase MDF capacity by 6% with capex @ A$6m Drier cyclones form a prominent part of the Gympie skyline. 34
Slide 35: Growth Product Opportunities
For personal use only Growth Product Opportunities • Chemical Resistant Laminate • Engineered Stone : Essa Stone • Solid Surface Benchtop Material • Gloss LPM range • Splashbacks • Greenfirst product range • Kitchen Doors and Componentry Panels • Plywood • Veneers 35
Slide 36: Thank you
For personal use only Thank you 36
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