James Hardie Industries Plc. · NYSE:JHX
James Hardie Industries — Investor Presentation (June 2018)
34 slides from James Hardie Industries's investor presentation, Jun 6, 2018
Slide 1: Investor Presentation June 2018
For personal use only INVESTOR PRESENTATION June 2018
Slide 2: Cautionary Note on Forward-Looking Statements
CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS For personal use only This Management Presentation contains forward-looking statements. James Hardie Industries plc (the “Company”) may from time to time make forward-looking statements in its periodic reports filed with or furnished to the Securities an
Slide 3: Cautionary Note on Forward-Looking Statements (continued)
CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS (continued) For personal use only Words such as “believe,” “anticipate,” “plan,” “expect,” “intend,” “target,” “estimate,” “project,” “predict,” “forecast,” “guideline,” “aim,” “will,” “should,” “likely,” “continue,” “may,” “objective,” “outlook” and sim
Slide 4: Use of Non-GAAP Financial Information; Australian Equivalent Terminology
USE OF NON-GAAP FINANCIAL INFORMATION; AUSTRALIAN EQUIVALENT TERMINOLOGY For personal use only This Management Presentation includes financial measures that are not considered a measure of financial performance under generally accepted accounting principles in the United States (US GAAP). These fina
Slide 5: Agenda
AGENDA For personal use only • Global Overview • North America Fiber Cement • International Fiber Cement • Corporate • Appendix PAGE 5
Slide 6: Global Overview
For personal use only GLOBAL OVERVIEW
Slide 7: Our Strategic Focus
OUR STRATEGIC FOCUS For personal use only PEOPLE Continue to invest in the safety, development and promotion of our people DRIVING PROFITABLE GROWTH BRAND PROMISE DELIVERING MARKET POSITION Build on industry leadership SUPERIOR Grow fiber cement market through unrivaled commitment to manufacturing,
Slide 8: A Growth Focused Company
A GROWTH FOCUSED COMPANY For personal use only • Annual net sales US$2.1b • Total assets US$2.4b • Strong operational cash generation • Operations in North America, Asia Pacific and Europe • 3,960 employees • Market cap US$7.5b • S&P/ASX 100 company • NYSE ADR listing Market capitalization per Bloom
Slide 9: World Leader in Fiber Cement
WORLD LEADER IN FIBER CEMENT For personal use only Geographic Mix¹ Net Sales International 23% North America 77% EBIT ² International 22% North America 78% 1 All percentages are for the fiscal year ended 31 March 2018 ² EBIT – excludes research and development, asbestos-related expenses and adjustme
Slide 10: Building a Portfolio of Products and Brands
BUILDING A PORTFOLIO OF PRODUCTS AND BRANDS For personal use only Primary Products Trim / Commercial Interior Walls / Soffit Backerboard Siding Flooring Fascia Exteriors Ceilings U.S. & Europe Asia Pacific Brand Portfolio PAGE 10
Slide 11: Creating a Sustainable and Differentiated Advantage
CREATING A SUSTAINABLE AND DIFFERENTIATED ADVANTAGE For personal use only Research & Development: Significant and consistent investment • US$27.8m spent on Research & Development in FY18 • US$521.7m spent on Research & Development since 2000 James Hardie Siding Products History of Fiber Cement Subst
Slide 12: Delivering Superior Product Performance
DELIVERING SUPERIOR PRODUCT PERFORMANCE For personal use only Fiber cement is more durable than wood and engineered wood, looks and performs better than vinyl, and is more cost effective and quicker to build with than brick Fiber Cement Vinyl Engineered Wood Fire resistant ? ? Hail resistant ? ? Res
Slide 13: Global Financials
GLOBAL FINANCIALS Adjusted Net Operating Profit¹ (US$m) Net Sales (US$m) For personal use only 300 291 $291M 2500 $2,055M 249 2055 250 243 2000 1922 221 1728 1657 197 1494 200 1500 1321 150 141 1000 100 500 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 Adjusted
Slide 14: North America Fiber Cement
For personal use only NORTH AMERICA FIBER CEMENT
Slide 15: Driving Category and Market Share Gains
DRIVING CATEGORY AND MARKET SHARE GAINS For personal use only North America External Cladding Share¹ 8% 19% Fiber Cement 8% Vinyl 8% Wood (including engineered wood) Stucco Brick Stone Other (aluminium etc) 10% 26% 21% 35/90 Plan • Grow fiber cement share to 35% of the exterior cladding market again
Slide 16: North America Fiber Cement Segment
NORTH AMERICA FIBER CEMENT SEGMENT For personal use only • Largest fiber cement producer in gg Tacoma, WA Chicago, • 2,659 employees1 IL Reno, NV Naperville, IL Peru, IL Pulaski, VA • 9 manufacturing plants Fontana, CA Mission Summerville, Viejo, CA Waxahachie, Prattville, SC • 2 research and AL TX
Slide 17: Aggressively Growing Demand for Our Products
AGGRESSIVELY GROWING DEMAND FOR OUR PRODUCTS Top Line Growth1 Average Net Sales Price (US$ per MSF) For personal use only 698 3,000 $1,600 700 JH Volume (mmsf), Starts (000s Units) 2,500 666 669 $1,200 665 2,000 Revenue (US$M) 1,500 $800 650 641 1,000 $400 500 616 0 $0 '13 '14 '15 '16 '17 '18 600 FY
Slide 18: International Fiber Cement
For personal use only INTERNATIONAL FIBER CEMENT
Slide 19: International Delivering Strong Returns
INTERNATIONAL DELIVERING STRONG RETURNS Quarterly EBIT and EBIT Margin1 5 year results For personal use only 35 FY14 FY15 FY16 FY17 FY18 30 25 Net Sales 399 418 379 412 462 US$m 20 15 Sales Volume 441 484 481 487 529 10 mmsf 5 EBIT US$m¹ 86 90 78 95 108 0 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 FY2013 F
Slide 20: International Fiber Cement Segment
INTERNATIONAL FIBER CEMENT SEGMENT For personal use only • 1,050 employees1 Manila, PH • 4 manufacturing plants • 1 research and development facility Carole Park, AU Penrose, NZ • Annual flat sheet design capacity Sydney, AU 600 mmsf² as at 31 March 2018 Manufacturing plant R&D center • Additional c
Slide 21: Fermacell Acquisition
For personal use only FERMACELL ACQUISITION
Slide 22: Europe Overview
EUROPE OVERVIEW For personal use only Before Acquisition Post Acquisition Workforce • 70 employees • 900+ employees Presence • UK, FR, DK, DE • 12+ countries • 5 manufacturing facilities • Residential New • Residential New Construction Segments Construction • Repair and Renovation • Repair and Renov
Slide 23: Europe Financials and Future Growth
EUROPE FINANCIALS AND FUTURE GROWTH For personal use only FY 18 Financials1 10 year objective • JH Europe Revenue ~ € 300 million € 1 billion in Revenue • JH Europe EBIT margin ~10% with Hardie type returns Future Growth ~ 10% EBIT margin • Fiber Gypsum • Existing Fiber Cement Products • New Fiber C
Slide 24: Corporate
For personal use only CORPORATE
Slide 25: Financial Management Supporting Growth
FINANCIAL MANAGEMENT SUPPORTING GROWTH Strong Financial Disciplined Capital For personal use only Liquidity and Funding Management Allocation • Invest in R&D and capacity • Conservative leveraging of balance • Strong margins and operating sheet at a target within 1-2 times cash flows expansion to su
Slide 26: FY2019 Key Planning Assumptions
FY2019 KEY PLANNING ASSUMPTIONS For personal use only • The Company expects to see steady growth in the US housing market continue in fiscal year 2019 • US Residential Housing Starts forecasted to be between 1.2 and 1.3 million • North America Fiber Cement Segment EBIT margins expected to be in th
Slide 27: Appendix
For personal use only APPENDIX
Slide 28: Non-US GAAP Financial Measures and Terms
NON-US GAAP FINANCIAL MEASURES AND TERMS For personal use only 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 and Con
Slide 29: Non-US GAAP Financial Measures
NON-US GAAP FINANCIAL MEASURES For personal use only 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 Consolid
Slide 30: Non-US GAAP Financial Measures
NON-US GAAP FINANCIAL MEASURES Financial Measures – US GAAP equivalents For personal use only Adjusted EBIT US$ Millions Three Months and Full Year Ended 31 March Q4'18 Q4'17 FY18 FY17 EBIT $ (95.8) $ 78.2 $ 229.2 $ 393.2 Asbestos: Asbestos adjustments 192.9 (1.4) 156.4 (40.4) AICF SG&A expenses 0.6
Slide 31: Non-US GAAP Financial Measures
NON-US GAAP FINANCIAL MEASURES Adjusted diluted earnings per share For personal use only Three Months and Full Year Ended 31 March Q4'18 Q4'17 FY18 FY17 Adjusted net operating profit (US$ Millions) $ 81.1 $ 54.6 $ 291.3 $ 248.6 Weighted average common shares outstanding - 443.0 441.4 442.3 443.9 Dil
Slide 32: Non-US GAAP Financial Measures
NON-US GAAP FINANCIAL MEASURES Adjusted EBITDA excluding Asbestos For personal use only US$ Millions Three Months and Full Year Ended 31 March Q4'18 Q4'17 FY18 FY17 EBIT $ (95.8) $ 78.2 $ 229.2 $ 393.2 Depreciation and amortization 23.4 20.7 92.0 83.2 Adjusted EBITDA $ (72.4) $ 98.9 $ 321.2 $ 476.4
Slide 33: Non-US GAAP Financial Measures
NON-US GAAP FINANCIAL MEASURES For personal use only Adjusted Return on Capital Employed ("Adjusted ROCE") US$ Millions Full Year Ended 31 March1 FY18 FY17 Numerator Adjusted EBIT $ 397.5 $ 354.3 Denominator Gross capital employed (GCE) 1,272.0 1,107.6 Adjustment to GCE (24.3) 50.3 Adjusted gross ca
Slide 34: For personal use only
For personal use only INVESTOR PRESENTATION June 2018
James Hardie Industries — Investor Presentation (June 2018) on 6ix