James Hardie Industries Plc. · NYSE:JHX
James Hardie Industries — Shareholder Meeting (August 2009)
28 slides from James Hardie Industries's shareholder meeting presentation, Aug 21, 2009
Slide 1: Annual Information Meeting
Annual Information Meeting 18 August 2009 Louis Gries, CEO
Slide 2: Disclaimer
2 Disclaimer The presentation contains forward-looking statements. We may from time to time make forward-looking statements in our periodic reports filed with or furnished to the US Securities and Exchange Commission, on Forms 20-F and 6-K, in our annual reports to shareholders, in offering circular
Slide 3: Agenda
3 Results overview - FY 2009 and Q1 FY 2010USA and Europe Fibre Cement HardieZoneTM SystemLegacy issues Asbestos compensation funding arrangements Agenda
Slide 4: Overview
1 Excluding asbestos, ASIC expenses, tax adjustments and impairments Overview
Slide 5: Global Strategy
5 Aggressively grow demand for our products in targeted market segmentsGrow our overall market position while defending our share in existing market segmentsOffer products with superior value to that of our competitorsIntroduce differentiated products to reduce direct price competition Global Strate
Slide 6: Key points
6 USA and Europe Fibre CementThe US business continues to perform well in a severely depressed housing market We continue to stay on strategy with our product and market initiatives Europe sales continue to increase off a still small baseAsia Pacific Fibre Cement The Australian and New Zealand busin
Slide 7: Total Housing Starts - NAHB
7 Total Housing Starts - NAHB NAHB latest forecast of 2009 Housing Starts is 561k (including MF-high) Source: NAHB Executive Level Forecasts - Total US Housing Starts (incl. SF, MF-low and MF-high) May 2009 estimate Jul 2009 estimate
Slide 8: USA Fibre Cement Top Line Growth
8 USA Fibre Cement Rolling 12 month average of seasonally adjusted estimate of housing starts by US Census Bureau Top Line Growth 0 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 2,200 2,400 2,600 2,800 3,000 '90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 Q1FY10 Vol
Slide 9: USA Fibre Cement Primary Growth Performance
9 USA Fibre Cement Primary Growth Performance Sources: Dodge US addressable starts (SF & MF-low); US Census R&R $ expenditures less CPINote: • US Census discontinued their R&R $ expenditures report in 2007 • 2008 R&R = avg. published Home Depot & Lowe's same store sales less CPI
Slide 10: Average Net Selling Price USA Fibre Cement
10 Average Net Selling Price US$ per MSF USA Fibre Cement 380 420 460 500 540 580 620 FY04 FY05 FY06 FY07 FY08 FY09 Q1 FY10 US$625
Slide 11: USA Fibre Cement EBIT and EBIT Margin
11 USA Fibre Cement 0 20 40 60 80 100 120 140 FY04 Q1 FY05 Q1 FY06 Q1 FY07 Q1 FY08 Q1 FY09 Q1 FY10 EBIT US$M 0 5 10 15 20 25 30 35 EBIT MARGIN % EBIT EBIT/Sales EBIT and EBIT Margin* * Excludes impairment charges of US$45.6 million in Q4 FY08
Slide 12: The HardieZone System
12 The HardieZone(tm) System James Hardie is currently undertaking a major product launch in the United States. The HardieZoneTM System:provides specific product performance attributes relative to the climate where the product is used across full range of engineered products - Plank, Panel, Trim, Fa
Slide 13: The HardieZone System: 7th Generation versus 2nd Generation
13 The HardieZone(tm) System 7th Generation versus 2nd Generation generic fibre cementThe HardieZone(tm) System represents a logical extension of Hardie technology
Slide 14: The HardieZone System: The Right Exterior - Every Time
14 The HardieZone(tm) System The Right Exterior - Every TimeGeographic zones based on 8 climatic variables: Temperature range UV Humidity Rainfall Snow Hail Hurricane (high wind load) Topographical factors
Slide 15: The HardieZone System: Two product lines emerged
15 The HardieZone(tm) System Two product lines emerged:
Slide 16: The HardieZone System product features
16 The HardieZone(tm) System plus Factory controlled finish for maximum consistency and durabilityResistant to cracking, fading and chippingReduces costly weather delays plus Factory-controlled finish for maximum consistency and durability Resists peeling, chipping, cracking or marring Colour retent
Slide 17: Key Ratios
17 Key Ratios Q1' FY10 FY09 FY08 EPS (Diluted)1 9.6c 22.3c 36.9c Dividend Paid per share N/A 8.0c 27.0c Return on Shareholders' Funds1 17.8% 11.2% 17.7% Return on Capital Employed2 23.6% 16.7% 24.2% EBIT/ Sales (EBIT margin)2 22.4% 14.2% 19.2% Gearing Ratio1 19.0% 24.0% 21.5% Net Interest Expense Co
Slide 18: Key points Q1 FY 2010
18 Improved US and Europe EBIT, reflecting lower average unit manufacturing costs, lower freight costs, decreased SG&A spending, improved plant performance and an increase in average net sales priceIn Australian dollars, Asia Pacific Fibre Cement EBIT for the quarter decreased 13% due to a lower gro
Slide 19: Legacy Issues Update
19 Legacy Issues Update ASIC ProceedingsFurther hearing in relation to exoneration, penalties and costs heldDecision awaited ATO tax mattersSettled FY 2002-2006 auditsCourt hearing for FY1999 amended assessment scheduled for September 2009 Domicile EGM on Stage 1 of Proposal Friday, 21 August 2009
Slide 20: Asbestos Compensation Funding Arrangements
20 Updated actuarial report completed as at 31 March 2009Discounted central estimate increased to A$1,781.6 million from A$1,446.6 millionAs per AFFA, no contribution is being made to AICF in financial year ending 31 March 2010AICF liquidity at 30 June 2009: A$125.6m - cash and short-term investment
Slide 21: Endnotes
21 Endnotes 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 Management's Analysis of Results, a Media Release and a Financial Report. DefinitionsFinancial Measures - US G
Slide 22: Endnotes: Financial Ratios
22 Endnotes Financial RatiosGearing Ratio - Net debt (cash) divided by net debt (cash) plus shareholders' equity.Net interest expense cover - EBIT divided by net interest expense.Net interest paid cover - EBIT divided by cash paid during the period for interest, net of amounts capitalised.Net debt p
Slide 23: Non-US GAAP Financial Measures
23 Non-US GAAP Financial MeasuresEBIT and EBIT margin excluding asbestos and ASIC expenses - EBIT and EBIT margin excluding asbestos and ASIC expenses are not measures of financial performance under US GAAP and should not be considered to be more meaningful than EBIT and EBIT margin. James Hardie ha
Slide 24: Non-US GAAP Financial Measures (continued)
24 Non-US GAAP Financial Measures (continued)Net operating profit excluding asbestos, ASIC expenses and tax adjustments - Net operating profit excluding asbestos, ASIC expenses and tax adjustments is not a measure of financial performance under US GAAP and should not be considered to be more meaning
Slide 25: Non-US GAAP Financial Measures (continued)
25 Non-US GAAP Financial Measures (continued)Diluted earnings per share excluding asbestos, ASIC expenses and tax adjustments - Diluted earnings per share excluding asbestos, ASIC expenses and tax adjustments is not a measure of financial performance under US GAAP and should not be considered to be
Slide 26: Non-US GAAP Financial Measures (continued)
26 Non-US GAAP Financial Measures (continued)Effective tax rate excluding asbestos and tax adjustments - Effective tax rate excluding asbestos and tax adjustments is not a measure of financial performance under US GAAP and should not be considered to be more meaningful than effective tax rate. The c
Slide 27: Non-US GAAP Financial Measures (continued)
27 Non-US GAAP Financial Measures (continued)EBITDA - is not a measure of financial performance under US GAAP and should not be considered an alternative to, or more meaningful than, income from operations, net income or cash flows as defined by US GAAP or as a measure of profitability or liquidity.
Slide 28: Non-US GAAP Financial Measures (continued)
28 Non-US GAAP Financial Measures (continued)General corporate costs excluding domicile change related costs - General corporate costs excluding domicile change related costs is not a measure of financial performance under US GAAP and should not be considered to be more meaningful than general corpo
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