Fletcher Building Limited · NZX:FBU
Fletcher Building — Shareholder Meeting (November 2008)
43 slides from Fletcher Building's shareholder meeting presentation, Nov 12, 2008
Slide 1: Annual Shareholders' Meeting 12 November 2008
For personal use only Annual Shareholders’ Meeting 12 November 2008
Slide 2: Dr Roderick Deane, Chairman
For personal use only Dr Roderick Deane Chairman
Slide 3: Directors
For personal use only Directors • Dr Roderick Deane (Chairman) • Paul Baines • Hugh Fletcher • John Judge • Jonathan Ling (Managing Director) • Geoffrey McGrath • Sir Dryden Spring • Kerrin Vautier • Ralph Waters
Slide 4: Meeting agenda
For personal use only Meeting agenda • Chairman’s overview • Chief Executive Officer’s address • Trading outlook • Shareholder questions and discussion • Consideration of, and voting on, the resolutions of the meeting
Slide 5: Overview remarks
For personal use only Overview remarks
Slide 6: Sales
For personal use only Sales NZ$m 7,091 5,926 5,520 4,636 3,934 2004 2005 2006 2007 2008
Slide 7: Net earnings
For personal use only Net earnings NZ$m 484 467 85* 379 347 240 399** 2004 2005 2006 2007 2008 * Net unusual items ** Net earnings on a normalised basis
Slide 8: Earnings per share pre-unusuals
For personal use only Earnings per share ‐ pre‐unusuals cents 93 81 84 78 56 2004 2005 2006 2007 2008
Slide 9: Return on average funds
For personal use only Return on average funds Percentage 29 25 26 25 19 2004 2005 2006 2007 2008
Slide 10: Dividends
For personal use only Dividends Cents per share 48.5 45 40 32 25 2004 2005 2006 2007 2008
Slide 11: Total shareholder return (TSR)
For personal use only Total shareholder return (TSR) Percentage 61 40 42 33 2004 2005 2006 2007 2008 ‐‐43
Slide 12: Fletcher Building relative share price performance
For personal use only Fletcher Building relative share price performance Fletcher Building NZX CSR Boral James Hardie
Slide 13: International business context
For personal use only International business context
Slide 14: Responding to a challenging environment
For personal use only Responding to a challenging environment • Reducing operating expenditure • Constraining capital expenditure • Working capital and cashflow management • Maintaining conservative balance sheet settings
Slide 15: Governance and reporting
For personal use only Governance and reporting
Slide 16: Our people
For personal use only Our people
Slide 17: Jonathan Ling, Chief Executive and Managing Director
For personal use only Jonathan Ling Chief Executive and Managing Director
Slide 18: Results overview
For personal use only Results overview
Slide 19: Market conditions in FY2008
For personal use only Market conditions in FY2008 New Zealand: – Residential market softened throughout the year – Commercial and infrastructure markets remained strong Australia: – Markets were softer overall – Slowdown noticeable in the second half North America: – Sub‐prime mortgage crisis had a
Slide 20: Operating earnings pre-unusuals
For personal use only Operating earnings pre‐unusuals NZ$m 2008 2007 308 271 80* 49* 148 141 141 131 101 73 80 80 Building Products Distribution Infrastructure Laminates & Steel Panels * Property earnings
Slide 21: Building Products
For personal use only Building Products • Sales up 6% to $739 million • Operating earnings up 5% to $148 million • Insulation earnings up 12% including Forman Insulation • Metal roof tiles earnings up 16% • Wallboards earnings down 2% due to weakness in the last quarter • Strong performances in sink
Slide 22: Distribution
For personal use only Distribution • Sales up 2% to $1.08 billion • Operating earnings fell by 9% to $73 million • Margins impacted by increased competition and deteriorating retail market conditions • PlaceMakers store refurbishment continued with Thames, Dunedin and Wairau Park; • A new Frame & Tr
Slide 23: Infrastructure
For personal use only Infrastructure • Sales down 4% to $1.857 billion • Operating earnings up 14% to $308 million • Earnings from property related activities $80 million versus $49 million in FY2007 • Lower demand in NZ for cement, aggregates, readymix concrete, and masonry • Pipe business: 24% vol
Slide 24: Laminates & Panels
For personal use only Laminates & Panels • Sales doubled to $2.1 billion with Formica • Operating earnings up 8% to $141 million • US – Market for HPL declined 9% – Evendale plant consolidation impacted earnings • UK and Spain experienced market weaknesses • Australia – Sales higher but operating ea
Slide 25: Steel
For personal use only Steel • Sales up 10% to $1.3 billion • Operating earnings up 26% to $101 million • Second half saw improved earnings with exit of unprofitable businesses and higher scrap prices • Long steel: record scrap metal prices negatively impacted results • Rollforming: strong year in bo
Slide 26: Current operating climate
For personal use only Current operating climate
Slide 27: Geographic and business diversification
For personal use only Geographic and business diversification
Slide 28: New Zealand residential exposure is reducing
For personal use only New Zealand residential exposure is reducing NZ residential 26% International 39% NZ Non‐ residential 35%
Slide 29: Diversification of sales continues to improve
For personal use only Diversification of sales continues to improve External revenue by region Percentage 60 2008 2007 51 35 30 7 6 1 3 1 2 3 0 NZ Australia Nth America Europe Asia Other
Slide 30: Financial strength
For personal use only Financial strength
Slide 31: Financial position remains strong
For personal use only Financial position remains strong Gearing: Interest cover Debt to debt plus equity Times Percentage 43.1 44.4 40.1 9.6 9.8 9.3 37.1 7.8 7.1 22.2 2004 2005 2006 2007 2008 2004 2005 2006 2007 2008
Slide 32: Debt maturity profile
For personal use only Debt maturity profile NZ$m Committed undrawn facilities Debt Capital Notes 239 107 31 236 300 218 118 254 144 167 173 93 67 68 54 75 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 June years
Slide 33: Responding to the current environment
For personal use only Responding to the current environment
Slide 34: Responding to the current environment
For personal use only Responding to the current environment • Cost savings are being pursued across the business • Shift numbers and staffing levels at key plants reduced in response to lower volumes • Prices adjusted to reflect increased input and transportation costs • Inventory and working capita
Slide 35: Sustainability
For personal use only Sustainability
Slide 36: Environmental sustainability
For personal use only Environmental sustainability • NZ Emissions Trading scheme legislation passed – Will come into effect in 2010 – Golden Bay Cement and Pacific Steel will be required to acquire and surrender emission units – all operations will face higher energy costs • Participated in the Carb
Slide 37: For personal use only
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Slide 38: Dr Roderick Deane, Chairman
For personal use only Dr Roderick Deane Chairman
Slide 39: Outlook
For personal use only Outlook
Slide 40: Market outlook 2009
For personal use only Market outlook 2009 • Good infrastructure markets in New Zealand and Australia • Residential – NZ housing consents at 25 year low – Australia weakening – US remains weak • Europe: UK and Spain down, other European markets likely to be softer • Asia still showing growth albeit s
Slide 41: Performance outlook
Performance outlook • Current range of analysts’ forecast net earnings For personal use only excluding unusuals for FY 2009 is NZ$289 million to NZ$354 million • If current trading conditions are maintained then net earnings for the full year should be within this range • Range reflects significant
Slide 42: Dr Roderick Deane, Chairman
For personal use only Dr Roderick Deane Chairman
Slide 43: For personal use only
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