James Hardie Industries Plc. · NYSE:JHX
James Hardie Industries — Q4 FY2022 Earnings Presentation
41 slides from James Hardie Industries's earnings presentation, May 17, 2022
Slide 1: Q4 FY22 Management Presentation
Q4 FY22 MANAGEMENT PRESENTATION 17 May 2022 Exhibit 99.5
Slide 2: Cautionary Note on Forward-Looking Statements
Page 2 James Hardie Q4 FY22 Results 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 “Company”) may from time to time make forwar
Slide 3: Agenda
Page 3 James Hardie Q4 FY22 Results AGENDA • Transformation Update • Q4 FY22 Financial Results • FY23 Strategy and Guidance • Questions and Answers Harold Wiens Interim CEO Jason Miele CFO Sean Gadd North America President
Slide 4: Transformation Update
TRANSFORMATION UPDATE
Slide 5: Strategy Is Unchanged and Continues to Drive Profitable Growth Globally
Page 5 James Hardie Q4 FY22 Results STRATEGY IS UNCHANGED AND CONTINUES TO DRIVE PROFITABLE GROWTH GLOBALLY Market to Homeowners to Create Demand Penetrate and Drive Profitable Growth in Existing and New Segments Commercialize Global Innovations by Expanding Into New Categories Continued Execution a
Slide 6: A Globally Transformed James Hardie
Page 6 James Hardie Q4 FY22 Results A GLOBALLY TRANSFORMED JAMES HARDIE FY18 FY22 North America APAC Europe Global Net Sales US$ in millions Execution of HMOS Successful Implementation of Global Foundational Initiatives… …Leading to a Truly Global James Hardie 2,055 3,615 Engaging With Customers Sup
Slide 7: North America Historical Performance
Page 7 James Hardie Q4 FY22 Results NORTH AMERICA HISTORICAL PERFORMANCE 2,308 2,482 2,713 3,112 FY19 FY20 FY21 FY22 Volume mmsf 1,677 1,816 2,040 2,551 FY19 FY20 FY21 FY22 388 471 588 741 FY19 FY20 FY21 FY22 Adjusted EBIT US$ in millions 23.1% 25.9% 28.8% 29.1% FY19 FY20 FY21 FY22 +35% +52% +91% +6
Slide 8: APAC Historical Performance
Page 8 James Hardie Q4 FY22 Results APAC HISTORICAL PERFORMANCE 546 533 542 633 FY19 FY20 FY21 FY22 Volume mmsf 612 614 635 778 FY19 FY20 FY21 FY22 137 139 177 217 FY19 FY20 FY21 FY22 Adjusted EBIT A$ in millions 22.3% 22.7% 28.0% 28.0% FY19 FY20 FY21 FY22 +16% +27% +58% +570 bps Adjusted EBIT Margi
Slide 9: Europe Historical Performance
Page 9 James Hardie Q4 FY22 Results EUROPE HISTORICAL PERFORMANCE Volume mmsf 318 334 351 421 FY19 FY20 FY21 FY22 9 15 36 54 FY19 FY20 FY21 FY22 Adjusted EBIT € in millions 2.7% 4.5% 10.4% 12.9% FY19 FY20 FY21 FY22 +32% +500% +1020 bps Adjusted EBIT Margin % Margin in % Net Sales € in millions 816 8
Slide 10: A Global Company Enabled for Continued Growth
Page 10 James Hardie Q4 FY22 Results Global Capacity Expansion A GLOBAL COMPANY ENABLED FOR CONTINUED GROWTH FY19-FY22 Strategic Transformation Clear Go- Forward Strategy LEAN Manufacturing Customer Engagement Supply Chain Integration Global Innovation Marketing to the Homeowner Repair and Remodel M
Slide 11: Q4 FY22 Financial Results
ULTS Q4 FY22 FINANCIAL RES eaeepe Bas x
Slide 12: Global Results
Page 12 James Hardie Q4 FY22 Results • 20% increase in Q4 FY22 Group Net Sales • All 3 regions are executing on the Global Strategy simultaneously: • Foundational initiatives: HMOS, Push/Pull and Integrated Supply Chain • Marketing Directly to the Homeowner • Penetrate and Drive Profitable Growth •
Slide 13: North America Summary
Page 13 James Hardie Q4 FY22 Results NORTH AMERICA SUMMARY • 25% increase in Q4 FY22 Net Sales led by volume and Price/Mix growth • Execution in driving High Value Product penetration with our customers • FY22 Price/Mix of 10% • FY22 ColorPlus volumes +27% vs pcp • 35% Adjusted EBIT growth in Q4 FY2
Slide 14: APAC Summary
Page 14 James Hardie Q4 FY22 Results APAC SUMMARY • 23% increase in Q4 FY22 Net Sales driven by strong Price/Mix and volume growth • Continued execution in driving High Value Product penetration • Growth in high value innovations • 21% increase in Q4 FY22 Adjusted EBIT • Execution of LEAN manufactur
Slide 15: Europe Summary
Page 15 James Hardie Q4 FY22 Results EUROPE SUMMARY • 10% increase in Q4 FY22 Net Sales underpinned by strong Price/Mix of 14% • Execution in driving High Value Product penetration, specifically strong Fiber Cement growth • Price increases to offset inflationary cost pressures • 14% Adjusted EBIT ma
Slide 16: FY23 Strategy Update and Guidance
FY23 STRATEGY UPDATE AND GUIDANCE
Slide 17: Drive High Value Product Mix in North America
Page 17 James Hardie Q4 FY22 Results DRIVE HIGH VALUE PRODUCT MIX IN NORTH AMERICA FY21 FY22 FY23 Projected Future State NA Volume Mix Lower Value Products: Including Hardie® Backer Boards and Cemplank High Value Products: Hardie® Exteriors High Value Products: Hardie® Exteriors w/ ColorPlus® Techno
Slide 18: North America FY23 Strategic Focus
Page 18 James Hardie Q4 FY22 Results NORTH AMERICA FY23 STRATEGIC FOCUS Capacity Expansion Repair and Remodel Market 65-70% JH Mix in R&R1 High Value Product Mix FY21 FY22 YTD FY23 Proj. Future State HMOS/ LEAN Customer Engagement & Partnership Marketing to the Homeowner
Slide 19: 360 Degree Marketing Program Delivering Significant Results in FY22
Page 19 James Hardie Q4 FY22 Results 360 DEGREE MARKETING PROGRAM DELIVERING SIGNIFICANT RESULTS IN FY22 1.4 M New Web Sessions +505% YoY 33K Marketing Leads +209% YoY 6K Sales Leads +102% YoY Targeted 3 Key Metros in the Northeast in FY22 360 Degree Marketing Campaign1 Driving Homeowners to Eng
Slide 20: Fiscal Year 2023 Guidance
Page 20 James Hardie Q4 FY22 Results FULL YEAR FISCAL YEAR 2023 GUIDANCE Management reaffirms full year FY23 Adjusted Net Income1 guidance of: US$740 million and US$820 million a 26% increase at the mid point relative to FY22 North America Guidance – Full Year FY23 Net Sales Growth 18-22% growth ver
Slide 21: Questions
QUESTIONS
Slide 22: Appendix
APPENDIX
Slide 23: Building Sustainable Communities: Environmental, Social and Governance
Page 23 James Hardie Q4 FY22 Results BUILDING SUSTAINABLE COMMUNITIES: ENVIRONMENTAL, SOCIAL AND GOVERNANCE 83% of raw materials sourced within 100 miles of manufacturing facilities 98% of employees hired locally 63% of our products are shipped within 500 miles of manufacturing facilities 40% Reduct
Slide 24: Driving a Higher Value Product Mix – Average Net Sales Price
Page 24 James Hardie Q4 FY22 Results DRIVING A HIGHER VALUE PRODUCT MIX – AVERAGE NET SALES PRICE
Slide 25: General Corporate Costs and Research & Development
Page 25 James Hardie Q4 FY22 Results GENERAL CORPORATE COSTS • Full year FY23 up 11% versus pcp due to legal reserves recorded in the fourth quarter, investment in global growth initiatives including talent and marketing investments, partially offset by lower stock compensation expenses. • Q4 corpor
Slide 26: Operating Cash Flow and Capital Expenditures
Page 26 James Hardie Q4 FY22 Results 1 OPERATING CASH FLOW CAPITAL EXPENDITURES • Prattville Sheet machines #1 & #2 continue to ramp up well • Summerville restart on-track Operating cash flow of US$757.2 million for FY22, decrease of 4% • Higher working capital improvement in the prior year driven b
Slide 27: Liquidity Profile
Page 27 James Hardie Q4 FY22 Results LIQUIDITY PROFILE 2 1 Incremental liquidity of up to US$250 million may be accessed via an accordion feature, which is provided for under the terms of the syndicated RCF agreement, but not credit approved. Do no anticipate accessing accordion feature. 2 Based on
Slide 28: Capital Allocation Aligned to Profitable Growth Strategy
Page 28 James Hardie Q4 FY22 Results CAPITAL ALLOCATION ALIGNED TO PROFITABLE GROWTH STRATEGY • Preserve strong liquidity and flexibility • Invest in organic growth: capacity expansion, market driven innovation & marketing directly to the homeowner • Maintain net leverage ratio of less than 2x • 0.8
Slide 29: Depreciation and Amortization
Page 29 James Hardie Q4 FY22 Results DEPRECIATION AND AMORTIZATION US$ Millions Q4 FY22 Q4 FY21 FY22 FY21 Depreciation and amortization North America Fiber Cement 30.5$ 24.4$ 114.4$ 89.1$ Asia Pacific Fiber Cement 3.8 4.9 13.6 13.9 Europe Building Products 7.2 7.9 29.8 28.0 Research and Development
Slide 30: Asbestos Compensation Key Points
Page 30 James Hardie Q4 FY22 Results 1 ASBESTOS COMPENSATION KEY POINTS • Updated actuarial report completed as of 31 March 2022 • Undiscounted and uninflated estimate increased from A$1,352 million to A$1,390 million • For fiscal year 2022, we noted the following related to asbestos-related claims
Slide 31: Asbestos Claims Data
Page 31 James Hardie Q4 FY22 Results Fiscal year ended 31 March 2022: • Average claim settlement was 1% above actuarial estimates and 27% above pcp • Number of claims settled were 1% below actuarial expectations and 5% below pcp • Claims received were 3% below actuarial estimates and 2% above pcp •
Slide 32: Net Post-Tax Unfunded Asbestos Liability
Page 32 James Hardie Q4 FY22 Results 1 NET POST-TAX UNFUNDED ASBESTOS LIABILITY
Slide 33: Asbestos Cash Movements for Full Year
Page 33 James Hardie Q4 FY22 Results 1 ASBESTOS CASH MOVEMENTS FOR FULL YEAR
Slide 34: Financial Measures – GAAP Equivalents and Definitions
Page 34 James Hardie Q4 FY22 Results This Management Presentation forms part of a package of information about the company’s results. It should be read in conjunction with the other parts of this package, including the Management’s Analysis of Results, Media Release and Consolidated Financial Statem
Slide 35: Non-GAAP Financial Measures
Page 35 James Hardie Q4 FY22 Results NON-GAAP FINANCIAL MEASURES Adjusted EBIT and Adjusted EBITDA US$ Millions Q4'22 Q4'21 FY22 FY21 EBIT 82.4$ 144.7$ 682.6$ 472.8$ Asbestos: Asbestos adjustments loss 142.5 28.1 131.7 143.9 AICF SG&A expenses 0.4 0.3 1.3 1.2 Restructuring expenses - - - 11.1 Adjust
Slide 36: Non-GAAP Financial Measures
Page 36 James Hardie Q4 FY22 Results NON-GAAP FINANCIAL MEASURES US$ Millions Q4'22 Q4'21 FY22 FY21 Asia Pacific Fiber Cement Segment EBIT 38.4$ 33.7$ 160.8$ 124.8$ Restructuring expenses - - - 3.4 Asia Pacific Fiber Cement Segment Adjusted EBIT 38.4$ 33.7$ 160.8$ 128.2$ Asia Pacific Fiber Cement Se
Slide 37: Non-GAAP Financial Measures: Adjusted Net Income
Page 37 James Hardie Q4 FY22 Results NON-GAAP FINANCIAL MEASURES Adjusted net income US$ Millions Q4'22 Q4'21 FY22 FY21 Net income 52.2$ 98.0$ 459.1$ 262.8$ Asbestos: Asbestos adjustments loss 142.5 28.1 131.7 143.9 AICF SG&A expenses 0.4 0.3 1.3 1.2 AICF interest income, net (0.4) (0.2) (0.9) (0.5)
Slide 38: Non-GAAP Financial Measures
Page 38 James Hardie Q4 FY22 Results NON-GAAP FINANCIAL MEASURES
Slide 39: Non-GAAP Financial Measures: Adjusted EBIT
Page 39 James Hardie Q4 FY22 Results NON-GAAP FINANCIAL MEASURES Adjusted EBIT US$ Millions FY22 FY21 FY20 FY19 FY18 EBIT 682.6$ 472.8$ 342.5$ 351.6$ 229.2$ Asbestos: Asbestos adjustments 131.7 143.9 58.2 22.0 156.4 AICF SG&A expenses 1.3 1.2 1.7 1.5 1.9 Restructuring and product line discontinuatio
Slide 40: Non-GAAP Financial Measures
Page 40 James Hardie Q4 FY22 Results NON-GAAP FINANCIAL MEASURES A$ Millions FY22 FY21 FY20 FY19 Asia Pacific Fiber Cement Segment EBIT 217.4A$ 172.4A$ 80.8A$ 136.5A$ Restructuring expenses - 4.9 58.3 - Asia Pacific Fiber Cement Segment Adjusted EBIT 217.4A$ 177.3A$ 139.1A$ 136.5A$ Asia Pacific Fibe
Slide 41: Q4 FY22 Management Presentation
Q4 FY22 MANAGEMENT PRESENTATION 17 May 2022
James Hardie Industries — Q4 FY2022 Earnings Presentation on 6ix