Boral — Shareholder Meeting (November 2019)
43 slides from Boral's shareholder meeting presentation, Nov 6, 2019
Slide 1: Annual General Meeting
Annual General Meeting Sydney 6 November 2019
Slide 2: Board of Directors
Board of Directors •Kathryn Fagg •Mike Kane •Peter Alexander •Dr Eileen Doyle •Non-executive •CEO & Managing •Non-executive Director •Non-executive Director Chairman Director •John Marlay •Karen Moses •Paul Rayner •Non-executive Director •Non-executive Director •Non-executive Director 2
Slide 3: Executive Committee
Executive Committee Mike Kane Rosaline Ng Ross Harper Wayne Manners David Mariner Frederic de CEO & Managing Group President Group President President & CEO, President & CEO, Rougemont Director Ventures & CFO Operations Boral Australia Boral North America CEO, USG Boral Kylie FitzGerald Linda Coates
Slide 4: Chairman's address
Chairman’s address Kathryn Fagg
Slide 5: Safety performance
Safety performance Employee and contractor recordable injury frequency rate1 of 7.5, a 14% improvement on the prior year Employee and contractor RIFR1 (per million hours worked) 17.4 MTIFR 13.6 Comparable data LTIFR 12.1 15.5 8.8 8.7 8.1 7.5 11.7 10.3 7.5 6.6 7.1 6.2 1.9 1.9 1.8 1.3 1.5 1.6 1.3 FY20
Slide 6: FY2019 financial results
FY2019 financial results Delivering improved earnings from continuing operations FY2019 vs FY2018 REVENUE 1,2 ROFE3 from 4% 8.4% EBITDA1,2 Year-four synergy target 2% On track Net profit after tax2 Full year dividend 7% steady 1. Excluding discontinued operations 2. Excluding significant items 3. Re
Slide 7: Boral's purpose is to help our customers build something great
Boral’s purpose is to help our customers build something great Our key strategic objective is to deliver shareholder returns that exceed the cost of capital through the cycle Boral North America a leading supplier of building products USG Boral and largest fly ash a gypsum-based, interior marketer i
Slide 8: 2019 Sustainability reporting and performance
2019 Sustainability reporting and performance Reporting and disclosures • Updated materiality review undertaken • Reporting UN Sustainable Development Goals we can most significantly impact • Climate-related impacts more comprehensively addressed in line with TCFD • Enhanced approach to assessing mo
Slide 9: Building a sustainable business
Building a sustainable business Our environmental sustainability is embedded in Boral’s business strategy Boral’s Scope 1 & 2 GHG emissions, million tonnes CO2-e 3.54 1.07 0.10 0.16 2.41 Includes Largely reflects Headwaters shift from 100% to acquisition 50% ownership FY2012 Boral Boral North USG FY
Slide 10: Boral North America, Innovation Factory, San Antonio, Texas
Boral North America, Innovation Factory, San Antonio, Texas 10
Slide 11: Senior leadership changes announced in Feb-2019
Senior leadership changes announced in Feb-2019 Well positioned around executive capability today and in the future Operations leadership New appointment / CEO & Managing Director expanded roles Mike Kane Group President Ventures & CFO Group President (incl. Chair of USG Boral) Operations Ros Ng Ros
Slide 12: CEO & Managing Director's address
CEO & Managing Director’s address Mike Kane
Slide 13: Boral's Peppertree Quarry, New South Wales
Boral’s Peppertree Quarry, New South Wales 13
Slide 14: USG Boral Ensemble Monolithic Acoustical Ceiling, Western Australia
USG Boral Ensemble® Monolithic Acoustical Ceiling, Chancery House, Western Australia 14
Slide 15: Boral North America's rail cars serving as mobile fly ash storage
Boral North America’s rail cars serving as mobile fly ash storage capacity 15
Slide 16: Boral North America's landfill reclaim operation at Montour
Boral North America’s landfill reclaim operation at Montour, Pennsylvania
Slide 17: Safety performance improving in all divisions
Safety performance improving in all divisions Employee and contractor recordable injury frequency rate (RIFR)1 per million hours worked Divisional Boral Group 17.4 MTIFR LTIFR 13.6 Comparable data Boral Australia Boral USG Boral 12.1 North America 15.1 11.3 10.5 15.5 8.8 8.7 8.9 8.1 7.6 7.5 11.7 10.
Slide 18: FY2019 divisional performance
FY2019 divisional performance Three focused and well-positioned divisions, delivering substantial benefits through improvement initiatives Boral Australia Boral North America USG Boral › $593 million EBITDA › $415 million (US$297 million) › $252 million underlying EBITDA EBITDA (100% of JV) › EBITDA
Slide 19: Owning 100% of USG Boral Australia & NZ will be value-creating
Owning 100% of USG Boral Australia & NZ will be value-creating for Boral’s shareholders • US$200 million investment, FY2019 EBITDA multiple ~5.7 times1 NT • Additional A$576 million of reported revenue for Boral, based on FY2019, and with EBITDA margins >16%, significant EBITDA uplift QLD 1 • USG Bo
Slide 20: A new expanded USG Boral Asia joint venture
A new expanded USG Boral Asia joint venture Once completed, the expanded USG Boral Asia JV will deliver a stronger growth platform in Asia Operating footprint1 Plasterboard manufacturing capacity2, million m2 Number of operating sites 132 KNAUF 15 USG Boral China South Korea plasterboard plants USG
Slide 21: USG Boral transaction summary
USG Boral transaction summary • Boral’s direct funding requirement of Knauf / BORAL USG US$335 million (after the USG Boral JV self-funds a proportion of the investment1) 100% 50% 50% 100% to be through debt and proceeds from divestments USG Boral USG Boral Asia Knauf Australia Plasterboard • ~3-5%
Slide 22: 1Q FY2020 trading
1Q FY2020 trading Boral Boral North Boral Group USG Boral Australia America › As expected, volume › 1Q earnings lower due › 1Q earnings slightly › 1Q earnings slightly pressures in several to softer housing lower than prior year lower than last year businesses reflecting market and delays in softer
Slide 23: Reaffirming FY2020 NPAT outlook guidance
Reaffirming FY2020 NPAT outlook guidance • Boral’s full year FY2020 earnings outlook remains unchanged • We continue to expect NPAT1 to be ~5-15% lower in FY2020 relative to FY2019, reflecting lower earnings and higher depreciation charges FY2020 • Expect FY2020 Property earnings to be $55-$65 mill
Slide 24: Expected 2H FY2020 earnings skew
Expected 2H FY2020 earnings skew Underpinned by › Expected ramp up of several major projects, including Queens Wharf and Westgate Tunnel Boral › Already planned improvement initiatives expected to deliver savings of $40-50 million in FY2020 Australia › Further cost savings initiatives that aggressi
Slide 25: A lower carbon footprint
A lower carbon footprint 32% reduction in Scope 1 & 2 GHG emissions since FY2012 GHG emissions from operations1 • Absolute GHG emissions of 2.4m tonnes CO2-e pa Australia North America Asia (Scope 1 & 2) Emissions intensity 7% in FY2019 32% since FY2012 tonnes CO2-e per A$m revenue • Emissions inten
Slide 26: Innovation in response to customers' needs and for a more sustainable future
Innovation in response to customers’ needs and for a more sustainable future Investment in innovation benefits customers with development of more sustainable products; currently ~10% of revenues from lower carbon and high-recycled products Boral North America, sourcing fly ash ENVISIA® concrete pour
Slide 27: Boral's multi-year transformation journey
Boral’s multi-year transformation journey We have delivered significant gains and we are focused on delivering continued improvements FY2019 vs FY2012 Recordable injury frequency rate ROFE2 from 19.0 from 4.1% EBITDA1 Earnings per ordinary share3 from $473m from 12.7 cents Net profit after tax1 Full
Slide 28: Annual General Meeting: Formal business
Annual General Meeting Formal business
Slide 29: Item 1 – Financial reports
Item 1 – Financial reports To consider the Financial Report, the Directors’ Report and the Auditor’s Report for the year ended 30 June 2019. 29
Slide 30: Item 2 – Re-election of directors
Item 2 – Re-election of directors Item 2.1 To re-elect Eileen Doyle as a Director To consider and, if “That Eileen Doyle, who retires in accordance with clause thought fit, to pass the 6.3(b) of the Company’s Constitution, being eligible, be following resolution as re-elected as a Director of the Co
Slide 31: Eileen Doyle
Eileen Doyle Non-executive Director
Slide 32: Item 2.1 proxy results
Item 2.1 To re-elect Eileen Doyle as a Director Proxies % to be cast FOR the resolution* For 721,073,347 Open 7,799,369 Against 8,346,612 98.6% * On basis open proxies in favour of the Chairman of the Meeting are voted FOR 32
Slide 33: Item 2 – Re-election of directors
Item 2 – Re-election of directors Item 2.2 To re-elect Karen Moses as a Director To consider and, if “That Karen Moses, who retires in accordance with clause thought fit, to pass the 6.3(b) of the Company’s Constitution, being eligible, be following resolution as re-elected as a Director of the Comp
Slide 34: Karen Moses
Karen Moses Non-executive Director
Slide 35: Item 2.2 proxy results
Item 2.2 To re-elect Karen Moses as a Director Proxies % to be cast FOR the resolution* For 498,097,659 Open 5,449,010 Against 233,687,613 68.0% * On basis open proxies in favour of the Chairman of the Meeting are voted FOR 35
Slide 36: Chairman of Remuneration & Nomination Committee
Chairman of Remuneration & Nomination Committee John Marlay
Slide 37: 2019 Remuneration outcomes
2019 Remuneration outcomes Remuneration structured to focus executives on strategy delivery and align with shareholder value creation Zero STIs were paid in FY2019 for the CEO and most KMP and their teams and Zero LTI awards vested in FY2019 Boral EBIT ($A million) and Vested CEO LTI grants ($A mill
Slide 38: Item 3 Remuneration Report
Item 3 Remuneration Report To consider and, if thought fit, to pass the following resolution as “To adopt the Remuneration Report for the year ended a non-binding ordinary 30 June 2019.” resolution: 38
Slide 39: Item 3 proxy results
Item 3 Remuneration Report Proxies % to be cast FOR the resolution* For 585,762,019 Open 7,725,543 Against 136,399,194 81.5% * On basis open proxies in favour of the Chairman of the Meeting are voted FOR 39
Slide 40: Item 4 Award of LTI Rights to Mike Kane
Item 4 Award of LTI Rights to Mike Kane, CEO & Managing Director To consider and, if “That approval is given for the award to Mike Kane, the thought fit, to pass the CEO & Managing Director, of rights to fully paid ordinary following resolution as shares in the Company on the terms described in the
Slide 41: Item 4 proxy results
Item 4 Award of LTI Rights to Mike Kane, CEO & Managing Director Proxies % to be cast FOR the resolution* For 660,514,630 Open 7,616,309 Against 66,267,032 90.7% * On basis open proxies in favour of the Chairman of the Meeting are voted FOR 41
Slide 42: Annual General Meeting
Annual General Sydney Meeting 6 November 2019
Slide 43: Disclaimer
Disclaimer The material contained in this document is a presentation of information about the Group’s activities current at the date of the presentation, 6 November 2019. It is provided in summary form and does not purport to be complete. It should be read in conjunction with the Group’s periodic re