Slide 1: Half Year Results to 31 December 2010
1 For personal use only Fletcher Building Limited Half Year Results to 31 December 2010 16 February 2011 Half Year Results | Fletcher Building | © February 2011
Slide 2: Disclaimer
2 For personal use only Disclaimer This annual results presentation dated 16 February 2011 provides additional comment on the media release of the same p date. As such, it should be ready in conjunction with, and subject to, the explanations and views of future outlook on market conditions, conditio
Slide 3: Agenda
3 For personal use only Agenda • Introduction • Company and Market Overview • Divisional Performance • Financial Results • Strategy • Outlook Half Year Results | Fletcher Building | © February 2011
Slide 4: Company & Market Overview
4 For personal use only Company & Market Overview Half Year Results | Fletcher Building | © February 2011
Slide 5: Results overview
5 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Results overview • Net earnings $166 million. million • Operating earnings¹ of $285 million. • Cashflow from operations $202 million. million • Revenues up 2% to $3,468 million: • High
Slide 6: Residential recovery has stalled, while commercial markets have bottomed out
6 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Residential recovery has stalled, while commercial markets have bottomed out Dec 2010 Dec 2009 Dec 2008 10/09 Building Consents 12 months 12 months 12 months %Mvmt New Zealand - Reside
Slide 7: Earnings growth driven by modest revenue growth and margin expansion
7 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Earnings growth driven by modest revenue growth and margin expansion Dec 2010 Dec 2009 NZ$m 6 months 6 months % Change Sales 3,468 3,393 +2 EBITDA 381 372 +2 EBIT 285 271 +5 Net earnin
Slide 8: Earnings Commentary
8 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Earnings Commentary • Mixed trading conditions experienced across the group: − NZ housing recovery stalled but strong infrastructure work levels − Continued growth in most Australian b
Slide 9: Divisional Performance
9 For personal use only Divisional Performance Half Year Results | Fletcher Building | © February 2011
Slide 10: Earnings ahead in all divisions except Building Products
10 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Earnings ahead in all divisions except Building Products EBIT NZ$million1 1. Earnings before interest and tax Half Year Results | Fletcher Building | © February 2011
Slide 11: Building Products result
11 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Building Products result Dec 10 Dec 09 • Insulation earnings down NZ$m 6 Mths 6 mths %∆ 51% due to impact of stimulus Sales 371 37 436 43 -15 5 package withdrawal in A Australia. li E
Slide 12: Building Products: insulation volumes down significantly in Australia
12 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Building Products: insulation volumes down significantly in Australia Gross Sales Dec 10 Dec 09 NZ$m 6 mths 6 mths %∆ Volume ∆ Price ∆ EBITDA ∆ New Zealand - Plasterboard 77 89 -13 -
Slide 13: Distribution result
13 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Distribution result Dec 10 Dec 09 • Sales ahead due to prior year NZ$m 6 Mths 6 mths %∆ improvement in new housing Sales l 446 435 +3 construction activity EBITDA 29 22 +32 • Continue
Slide 14: Infrastructure result
14 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Infrastructure result NZ Concrete • Cement volumes steady Dec 10 Dec 09 • Softer demand for readymix and NZ$m 6 mths 6 mths %∆ masonry products Sales 1,034 974 +6 • Aggregate and pipe
Slide 15: Infrastructure: lower concrete and related volumes in NZ and Australia
15 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Infrastructure: lower concrete and related volumes in NZ and Australia Gross Sales Dec 10 Dec 09 NZ$m 6 mths 6 mths %∆ Volume ∆ Price ∆ EBITDA ∆ New Zealand - NZ Concrete 319 310 +3 •
Slide 16: Canterbury update
16 Canterbury update For personal use only • All of the company’s p y Canterburyy based businesses are back up p and running g • Trading in Canterbury has been quiet while repairs are assessed and insurance claims are lodged • Fletcher l h Construction C i selected l d to undertake d k project j man
Slide 17: Laminates & Panels result
17 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Laminates & Panels result Laminex Dec 10 Dec 09 • Australian volumes higher on NZ$m 6 mths 6 mths %∆ new house completions and Sales 1,001 965 +4 government-funded schools EBITDA prog
Slide 18: Laminates & Panels: volumes growth in Australia and Asia
18 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Laminates & Panels: volumes growth in Australia and Asia, offset by flat or weaker volumes in other regions Gross Sales Dec 10 Dec 09 NZ$m 6 mths 6 mths %∆ Volume ∆ Price ∆ EBITDA ∆ A
Slide 19: Formica: continued improvement in earnings
19 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Formica: continued improvement in earnings, due to Asia growth and cost reduction programme EBIT US$m 1H11 1H10 Asia 14 12 North America 8 3 E Europe 1 -3 3 Corporate -6 -5 EBIT $US 1
Slide 20: Steel result
20 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Steel result Dec 10 Dec 09 NZ$m 6 Mths 6 mths %∆ • Long steel earnings impacted Sales 616 583 5 3 +6 by competitive pricing pressures and higher scrap EBITDA 54 54 - (input) costs. EB
Slide 21: Steel: long steel margins contracted, strong growth in distribution
21 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Steel: long steel margins contracted, strong growth in steel distribution volumes Gross Sales Dec 10 Dec 09 NZ$m 6 mths 6 mths %∆ Volume ∆ Price ∆ EBITDA ∆ N New Z Zealand l d - Long
Slide 22: Financial Results
22 For personal use only Financial Results Half Year Results | Fletcher Building | © February 2011
Slide 23: Net earnings
23 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Net earnings Dec 2010 Dec 2009 NZ $m 6 months 6 months %∆ EBIT¹ 285 271 +5 Interest 51 52 -2 2 Tax 63 59 +7 Minority Interests 5 6 -17 Net Earnings 166 154 +8 1. Earnings before inter
Slide 24: Net debt levels increased with investment in Crane Group
24 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Net debt levels increased with investment in Crane Group 1800 1500 9 1 92 291 1200 78 (32) (7) 900 600 (280) 1,259 1,107 300 0 orking ments dends Equity Capex bution ng Net FX on Debt
Slide 25: Key Ratios
25 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Key Ratios Total T t l Sh Shareholder h ld R Return t (TSR) D bt/D bt Plus Debt/Debt Pl Equity E it Percentage Percentage Jun-06 Jun-07 Jun-09 Jun-10 Dec-10 Return on Average Equity R
Slide 26: Debt maturity profile
26 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Debt maturity profile Debt Maturity Profile December 2010 NZ$m • Undrawn credit lines of $1,002 300 million. 250 • Average maturity of debt is 200 over 4.5 years. 150 • Average intere
Slide 27: Significant undrawn credit facilities in place
27 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Significant undrawn credit facilities in place NZ$m • Crane Group acquisition can be met from current debt headroom • IIntention i to refinance fi syndicated debt facility out to 3-5
Slide 28: Strategy
28 For personal use only Strategy Half Year Results | Fletcher Building | © February 2011
Slide 29: Strategy
29 For personal use only Strategy Longer term strategy continues to be: • improve earnings reliability • maintain and improve internal capabilities - increased i d focus f on growth h oriented i d capex - business transformation initiatives • pursue acquisition opportunities where these meet key inv
Slide 30: Outlook
30 For personal use only Outlook Half Year Results | Fletcher Building | © February 2011
Slide 31: Outlook 2011
31 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook For personal use only Outlook 2011 Outlook for 2011 financial year continues to be mixed as to the pace of economic recovery, and impacts of Queensland floods and the Canterbury earthquake New Zealand: • R
Slide 32: Fletcher Building Limited
32 For personal use only Fletcher Building Limited Half Year Results to 31 December 2010 16 February 2011 Half Year Results | Fletcher Building | © February 2011