Fletcher Building Limited · NZX:FBU
Fletcher Building — Shareholder Meeting (October 2023)
26 slides from Fletcher Building's shareholder meeting presentation, Oct 27, 2023
Slide 1: 2023 Annual Shareholders' Meeting
2023 Annual Shareholders’ Meeting 27 October 2023 Fletcher Building Limited Annual Shareholders’ Meeting 2023
Slide 2: Bruce Hassall, Chair
Bruce Hassall Chair Fletcher Building Limited Annual Shareholders’ Meeting 2023
Slide 3: Directors
Directors Bruce Hassall, Chair Martin Brydon Barbara Chapman Peter Crowley Sandra Dodds Rob McDonald Doug McKay Cathy Quinn Page 3 | Fletcher Building Limited Annual Shareholders Meeting 2023 | © October 2023
Slide 4: Meeting agenda
Meeting agenda Chair’s address Chief Executive Officer’s address Voting on Resolutions General Q&A Refreshments Page 4 | Fletcher Building Limited Annual Shareholders Meeting 2023 | © October 2023
Slide 5: FY23 key financial results
FY23 key financial results Revenue EBIT1 Net Earnings EPS $8,469m $798m $235m 30.0c FY22 $8,498m FY22 $756m FY22 $432m FY22 53.5c Cash flows from EBIT1 margin Return on funds employed1 Dividend operating activities $388m 9.4% 17.1% 34.0cps FY22: 8.9% FY22: 19.3% FY22: 40.0cps FY22 $592m 1. Measures
Slide 6: FY23 key non-financial results
FY23 key non-financial results TRIFR1 CO2 reduction2 since 2018 Customer NPS3 Employee Engagement eNPS 3.1 16% 40 26 FY22 3.4 FY22: 12% FY22: 36 FY22: 23 1. TRIFR = Total no. of recorded injuries per million hours worked. Does not include Restricted Work Injuries. Excludes Rocla, Tumu & Waipapa 2. C
Slide 7: WA plumbing
WA plumbing ❶ ❷ ❸ SUPPORT ESTABLISHING INDUSTRY CUSTOMERS & CAUSATION SOLUTION HOMEOWNERS BOARD COMMITTEE IN PLACE TO GOVERN WA PLUMBING Page 7 | Fletcher Building Limited Annual Shareholders Meeting 2023 | © October 2023
Slide 8: Where did we start from in 2018?
Where did we start from in 2018? 2018 Position – Financial & Operational 2018 Position – Non-Financial NZ underlying business: reasonable margins but in decline, renewed focus & investment required Safety Customer NPS1 Safety culture International: multiple geographies, capital lacking 33 hungry, ex
Slide 9: What has the Board's approach been?
What has the Board’s approach been? 1 Stabilise the Company, sold International, focus on NZ & AU 2 Clean up legacy issues 3 Reposition the go-forward business for performance and growth Page 9 | Fletcher Building Limited Annual Shareholders Meeting 2023 | © October 2023
Slide 10: Clean up legacy issues – Construction projects
Clean up legacy issues – Construction projects Where we started We are almost done FCC & legacy projects have been a major undertaking c.80 Projects to complete (#) Legacy projects ▪ c.80 projects, mainly in vertical Buildings business 40 ▪ Including 8 highly complex projects >$250m each 15 11 7 5 3
Slide 11: Reposition the go forward business for performance and growth
Reposition the go forward business for performance and growth Group EBIT ($m) and EBIT Margin (%) 1,000 9.4% 10.0% 8.9% 900 8.2% 9.0% 800 7.2% 8.0% 700 756 798 7.0% 600 668 6.0% 500 598 5.0% 400 4.0% 300 2.2% 3.0% 200 0.2% 2.0% 100 20 160 1.0% - 0.0% FY18 FY19 FY20 FY21 FY22 FY23 (Covid-19) Note: EB
Slide 12: Reposition the go forward business for performance and growth
Reposition the go forward business for performance and growth Safety Sustainability Customer Engagement Serious Injuries and TRIFR1 Carbon (CO2) Emissions & Net Promoter Score3 Employee Engagement Rating 2,000 Intensity2 190 (eNPS) 6 25 1,800 153 170 5.1 1,600 150 40 26 5 121 24 33 1,400 130 20 19 1
Slide 13: Where are we now?
Where are we now? 1 Stable foundation, consistent strategy 3 legacy construction projects to complete, strong focus on resolving WA plumbing – 2 governance of these risks are a priority for the Board 3 Significant operational gains, well-positioned for medium-term performance & growth Page 13 | Flet
Slide 14: Ross Taylor, Chief Executive Officer
Ross Taylor Chief Executive Officer Fletcher Building Limited Annual Shareholders’ Meeting 2023
Slide 15: FY23 - continuing operational improvements across the base business
FY23 - continuing operational improvements across the base business FY23 - Operating highlights All key metrics improved EBIT1 margin increased to 9.4%: NZ businesses EBIT1 margin Customer NPS2 strong; Australia now at 6% margins Safety: Culture transformation well advanced & 9.4% 40 FY22: 8.9% FY22
Slide 16: We are investing for growth - having made $800m+ of commitments
We are investing for growth - having made $800m+ of commitments which sets us up for $120m+ of profit growth from FY27 Waipapa Timber Laminex Taupō Comfortech Frame & Truss Circular economy ALTERNATIVE FUELS CONSTRUCTION & DEMOLITION WASTE CLINKER SUBSTITUTION Page 16 | Fletcher Building Limited Ann
Slide 17: Outlook on Construction legacy
Outlook on Construction legacy Pūhoi to Warkworth motorway (P2W) International Convention Centre (NZICC) Wellington International Airport ▪ Opened in June 2023, some final works to be ▪ Carparks complete, hotel & ICC steel remediation ▪ Working with Airport to agree a completed in FY24 complete by D
Slide 18: Outlook on WA plumbing issues
Outlook on WA plumbing issues Our approach remains: A$15m SUPPORT SEEK EVIDENCE- HELP INDUSTRY INTERIM FUND IN 1 CUSTOMERS & 2 BASED CONSENSUS 3 DEVELOP A SOLUTION PLACE FOR FY24 HOMEOWNERS AROUND CAUSATION ➔ Our evidence points to installation failures as the reason leaks are occurring ➔ Our testin
Slide 19: FY24 trading update
FY24 trading update ▪ Infra. & Comm. sectors remain robust; Resi sector volumes c.5% softer than prior guidance NZ MATERIALS & ▪ Market share stable, solid pricing being achieved in the materials businesses but strong price DISTRIBUTION competition in the merchant distribution channel ▪ EBIT1 tracki
Slide 20: FY24 underlying trading cash flows robust & balance sheet well positioned
FY24 underlying trading cash flows robust & balance sheet well positioned ▪ Expect robust trading cash flows in FY24 (excl. legacy) as working capital managed tightly ▪ Leverage (net debt / EBITDA) to move to upper end of 1x-2x range due to FCC legacy cash flows and growth capex investments ▪ Commit
Slide 21: Fletcher Building is well positioned for the medium term
Fletcher Building is well positioned for the medium term FY24 FY25 FY26 FY27 FY28 Legacy - Physical Work Completed Macro Residential headwinds Market tailwinds Preserve Margins Further operating margin improvements / + any cycle upside operational gains $800m+ in committed growth capex @ 15% ROFE $1
Slide 22: Clear aspirations for non-financial measures
We have clear aspirations for our performance on non-financial measures Online Sales Safety Customer NPS1 Zero serious 100% ≥55 c.$1.5b injuries sites injury free In FY25 CO2 reduction 70% Employee Engagement eNPS 30% by FY30 2 waste diverted from landfill by FY26 ≥40 30% Net Zero carbon 75% women i
Slide 23: Resolutions and Voting
Resolutions and Voting Fletcher Building Limited Annual Shareholders’ Meeting 2023
Slide 24: Resolutions
Resolutions ➔ Ordinary Resolutions ➔ Resolution 1 – Re-election of Bruce Hassall ➔ Resolution 2 – Re-election of Barbara Chapman ➔ Resolution 3 – Re-election of Martin Brydon ➔ Resolution 4 – Election of Sandra Dodds ➔ Resolution 5 – Auditor fees and expenses ➔ Resolution 6 – Director’s remuneration
Slide 25: 2023 Annual Shareholders' Meeting
2023 Annual Shareholders’ Meeting 27 October 2023 Fletcher Building Limited Annual Shareholders’ Meeting 2023
Slide 26: Important Information
Important Information This presentation has been prepared by Fletcher Building Limited and its group of companies (“Fletcher Building”) for informational purposes. This disclaimer applies to this document and the verbal or written comments of any person presenting it. This presentation dated 27 Octo
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