Boral — Shareholder Meeting (November 2012)
40 slides from Boral's shareholder meeting presentation, November 2012
Slide 1: Annual General Meeting 2012
Slide 2: Board of Directors
Annual General Meeting 2012 BOARD OF DIRECTORS Dr Bob Every Dr Eileen Doyle Paul Rayner Richard Longes Non-executive Non-executive Non-executive Non-executive Chairman Director Director Director Mike Kane Dr Brian Clark John Marlay Catherine Brenner CEO & Managing Non-executive Non-executive Non-exe
Slide 3: Chairman's Address
Annual General Meeting 2012 CHAIRMAN’S ADDRESS Dr Bob Every 3
Slide 4: Dr Ken Moss, AM - Past Chairman of Boral
Annual General Meeting 2012 DR KEN MOSS, AM PAST CHAIRMAN OF BORAL 1945 - 2012 4
Slide 5: Mike Kane, CEO & Managing Director
Annual General Meeting 2012 MIKE KANE, CEO & MANAGING DIRECTOR 5
Slide 6: Boral Group Executives
Annual General Meeting 2012 BORAL GROUP EXECUTIVES Murray Read Mike Beardsell Bryan Tisher Al Borm Frederic de Rougemont Divisional MD − Boral Divisional MD − Divisional MD − Boral President − Boral USA Divisional MD − Construction Materials Boral Cement Building Products Boral Gypsum Ross Batstone
Slide 7: Financial Highlights
Annual General Meeting 2012 FINANCIAL HIGHLIGHTS Revenue EBIT1 $5.01bn up 6% $200m down 28% Profit after tax1 Cash from operations3 $101m down 42% $133m down 62% Net profit after tax2 Full year dividend $177m up 5% 11.0c down 24% 1. Excluding significant items 2. Including significant items 7 3. Inc
Slide 8: Housing Downturn in Australia and USA
Annual General Meeting 2012 HOUSING DOWNTURN IN AUSTRALIA AND USA New housing starts in Australia and USA1 (‘000) 185 2,500 Australia USA 175 Long-term average mid-cycle 166 2,000 165 levels in Australia and the USA 158 Australia 155 USA 1,500 145 140 1,000 135 125 500 115 105 0 FY03 FY04 FY05 FY06
Slide 9: Boral Building Products
Annual General Meeting 2012 BORAL BUILDING PRODUCTS Significantly impacted by the decline in Australian housing activity Australian Bricks, Roofing, Masonry (West), Performance drivers Plasterboard, Timber and Windows Decline in residential construction activity Revenue EBIT1 Sales volumes decre
Slide 10: Boral Construction Materials
Annual General Meeting 2012 BORAL CONSTRUCTION MATERIALS A resilient, well-positioned portfolio of businesses Concrete, Quarries, Asphalt, Performance drivers Transport and Property Reduced property earnings Revenue EBIT1 Lower volumes in key markets A$m A$m Operational inefficiencies from wet
Slide 11: Boral Cement
Annual General Meeting 2012 BORAL CEMENT Impacted by the high A$ and closure of BlueScope Steel’s Port Kembla mill Cement, Lime and Concrete Placing Performance drivers Large loss of lime and limestone sales due to closure of BlueScope Steel’s Port Kembla Revenue EBIT1 blast furnace had a net $6m
Slide 12: Plasterboard Asia
Annual General Meeting 2012 PLASTERBOARD ASIA Integration of businesses complete Korea, Thailand, China, Indonesia, Performance drivers Vietnam, Malaysia, India, the Philippines Acquired Lafarge’s 50% interest in Lafarge Boral Gypsum Asia for $530m in Dec-2011 Revenue1 EBIT1,2 A$m A$m Revenue of
Slide 13: Boral USA
Annual General Meeting 2012 BORAL USA Benefiting from volume lifts and restructuring Bricks, Roof Tiles, Cultured Stone, Performance drivers Fly Ash, Construction Materials 20% uplift in housing starts Revenue EBIT1 Continued plant rationalisations and head A$m A$m count reductions Efficiency
Slide 14: Capital Management
Annual General Meeting 2012 CAPITAL MANAGEMENT Net debt Net debt of $1.5bn at year-end A$m Gearing of 40%1 based on bank 1,482 1,515 1,514 1,518 covenant remains well within bank threshold of <60% 1,183 Tight management of capital expenditure in FY2013 Divestment of non-core assets and prope
Slide 15: Chairman's Concluding Comments
Annual General Meeting 2012 CHAIRMAN’S CONCLUDING COMMENTS Significant restructuring and investment have reshaped the business over the past two years More is being done to deliver required returns Group wide performance improvement plan underway will further strengthen strategic business posi
Slide 16: CEO & Managing Director's Address
Annual General Meeting 2012 CEO & MANAGING DIRECTOR’S ADDRESS Mike Kane 16
Slide 17: Strengthened Core Businesses
Annual General Meeting 2012 STRENGTHENED CORE BUSINESSES Gypsum (plasterboard) – Asia Acquired remaining 50% of LBGA1 Cladding and Roofing for $530m, creating a global scale Expanded Boral’s exterior cladding gypsum business in the Asia Pacific offering through acquisitions of region MonierLifetile
Slide 18: Immediate Priorities
Annual General Meeting 2012 IMMEDIATE PRIORITIES Maximise returns Manage costs down from existing assets Effectively manage margins Constrain capital expenditure Maximise cash generation and Reduce working capital reduce debt Divest non-core and property assets Improve safety Achieve wor
Slide 19: Safety Performance
Annual General Meeting 2012 SAFETY PERFORMANCE Employee and contractor LTIFR* 3.2 2.2 2.0 2.0 1.8 FY08 FY09 FY10 FY11 FY12 * Lost Time Injury Frequency Rate per million hours worked 19
Slide 20: Position Boral to Deliver Strong Returns
Annual General Meeting 2012 POSITION BORAL TO DELIVER STRONG RETURNS Key platforms of change Safety (Our right to be in business) LEAN – Sales & operational Marketing Innovation excellence Excellence People Engagement & Leadership (The way we execute) 20
Slide 21: Plasterboard Businesses Restructured Under Single Division
Annual General Meeting 2012 BORAL’S PLASTERBOARD BUSINESSES RESTRUCTURED UNDER SINGLE DIVISION Boral’s Divisional Structure Boral Boral Boral Boral Boral Construction Building Cement Gypsum USA Materials Products Quarries Cement and Bricks Boral Brick & Lime Gypsum Asia Cultured Concrete Roof Tiles
Slide 22: Improving Operating Performance
Annual General Meeting 2012 IMPROVING OPERATING PERFORMANCE Five key drivers being rigorously pursued to improve operating performance Reduce fixed costs Re-size capacity below peak cycle demand operating base Reduce overhead costs to better align with adjusted portfolio Leverage LEAN Reduce p
Slide 23: Boral USA: Dramatic Reduction in Cost Base to Align with Demand
Annual General Meeting 2012 BORAL USA: DRAMATIC REDUCTION IN COST BASE TO ALIGN WITH DEMAND US housing starts1 vs Boral USA EBIT2 BRICKS USA FY05 FY08 FY12 US housing starts ('000) Housing starts (‘000) 2,016 1,132 687 EBIT2 US$m 2,016 2,036 Total bricks plants 24 24 13 150 2,050 Long term average 1
Slide 24: Trading Update
Annual General Meeting 2012 TRADING UPDATE Boral USA: US housing starts increased 28% to annualised rate of 786,000 in 1Q FY2013; improved market conditions starting to flow through to improved sales volumes In Australia, tough market conditions continued, similar to 2H FY2012, although weather
Slide 25: Formal Business
Annual General Meeting 2012 Formal Business
Slide 26: Financial Reports
Annual General Meeting 2012 ITEM 1 – FINANCIAL REPORTS To consider the financial reports, the Directors’ Report and the Auditor’s Report for the year ended 30 June 2012 26
Slide 27: Remuneration Report
Annual General Meeting 2012 ITEM 2 – REMUNERATION REPORT To adopt the Remuneration Report for the year ended 30 June 2012 27
Slide 28: Remuneration Report - Committee Chairman's Address
Annual General Meeting 2012 ITEM 2 – REMUNERATION REPORT Remuneration & Nomination Committee Chairman’s Address Dr Brian Clark 28
Slide 29: Remuneration Report
Annual General Meeting 2012 ITEM 2 – REMUNERATION REPORT To adopt the Remuneration Report for the year ended 30 June 2012 29
Slide 30: Remuneration Report Proxy Results
Annual General Meeting 2012 ITEM 2 – REMUNERATION REPORT Proxies For 463,017,012 Open 6,687,309 Against 50,995,973 % to be cast FOR the resolution* 89.8% * On basis open proxies in favour of the Chairman of the Meeting are voted FOR 30
Slide 31: Election of Directors
Annual General Meeting 2012 ITEM 3 – ELECTION OF DIRECTORS 3.1 To re-elect John Marlay as a Director 3.2 To re-elect Catherine Brenner as a Director 31
Slide 32: Re-election of John Marlay
Annual General Meeting 2012 ITEM 3 – ELECTION OF DIRECTORS 3.1 Re-election of John Marlay 32
Slide 33: Re-election of John Marlay Proxy Results
Annual General Meeting 2012 ITEM 3 – ELECTION OF DIRECTORS 3.1 Re-election of John Marlay Proxies For 474,295,516 Open 6,931,365 Against 41,076,388 % to be cast FOR the resolution* 91.7% * On basis open proxies in favour of the Chairman of the Meeting are voted FOR 33
Slide 34: Re-election of Catherine Brenner
Annual General Meeting 2012 ITEM 3 – ELECTION OF DIRECTORS 3.2 Re-election of Catherine Brenner 34
Slide 35: Re-election of Catherine Brenner Proxy Results
Annual General Meeting 2012 ITEM 3 – ELECTION OF DIRECTORS 3.2 Re-election of Catherine Brenner Proxies For 474,088,501 Open 6,904,937 Against 41,251,532 % to be cast FOR the resolution* 91.6% * On basis open proxies in favour of the Chairman of the Meeting are voted FOR 35
Slide 36: Proportional Takeover Approval Provisions
Annual General Meeting 2012 ITEM 4 – PROPORTIONAL TAKEOVER APPROVAL PROVISIONS To consider and, if thought fit, to pass the following resolution as a special resolution: “That the proportional takeover approval provisions currently contained in Schedule 5 of the Constitution of the Company be includ
Slide 37: Proportional Takeover Approval Proxy Results
Annual General Meeting 2012 ITEM 4 – PROPORTIONAL TAKEOVER APPROVAL PROVISIONS Proxies For 504,944,882 Open 7,185,908 Against 3,575,213 % to be cast FOR the resolution* 98.8% * On basis open proxies in favour of the Chairman of the Meeting are voted FOR 37
Slide 38: Award of Rights to Mike Kane
Annual General Meeting 2012 ITEM 5 – AWARD OF RIGHTS TO MIKE KANE To consider and, if thought fit, to pass the following resolution as an ordinary resolution: “That approval is given for the award to Mike Kane, the Chief Executive Officer and Managing Director designate, of rights to fully paid ordi
Slide 39: Award of Rights to Mike Kane Proxy Results
Annual General Meeting 2012 ITEM 5 – AWARD OF RIGHTS TO MIKE KANE Proxies For 497,971,248 Open 6,572,190 Against 11,103,875 % to be cast FOR the resolution* 97.4% * On basis open proxies in favour of the Chairman of the Meeting are voted FOR 39
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