Slide 1: Annual Results to June 2010
1 For personal use only Fletcher Building Limited Annual Results to June 2010 18 August 2010 Annual Results | Fletcher Building | © August 2010
Slide 2: Disclaimer
2 Disclaimer For personal use only This annual results presentation dated 18 August 2010 provides additional comment on the media release of the same date. As such, it should be ready in conjunction with, and subject to, the explanations and views of future outlook on market conditions, earnings and
Slide 3: Agenda
3 Agenda For personal use only • Introduction • Company and Market Overview • Divisional Performance • Financial Results • Strategy • Outlook Annual Results | Fletcher Building | © August 2010
Slide 4: Company & Market Overview
4 For personal use only Company & Market Overview Annual Results | Fletcher Building | © August 2010
Slide 5: Results overview
5 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Results overview For personal use only • Net earnings before unusual items $301 million. • Unusual items of $29 million due to NZ tax changes. • Net earnings $272 million • Operating earnings¹ of $521 milli
Slide 6: Most residential construction markets have improved, but commercial markets weak
6 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Most residential construction markets have improved, but For personal use only commercial markets weak June 2010 June 2009 June 2008 10/09 Building Consents 12 months 12 months 12 months %Mvmt New Zealand -
Slide 7: Continued strong financial performance despite lower volumes in most businesses
7 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Continued strong financial performance despite lower For personal use only volumes in most businesses June 2010 June 2009 NZ$m 12 months 12 months % Change Sales 6,799 7,103 -4 EBITDA¹ 727 769 -5 EBIT¹ 521
Slide 8: Earnings Commentary
8 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Earnings Commentary For personal use only • Net earnings aided by improved housing starts in NZ and Australia. • Continued strong infrastructure spending by NZ and Australian governments. • Commercial activ
Slide 9: New Zealand emissions trading scheme
9 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook New Zealand emissions trading scheme For personal use only • New Zealand’s emissions trading scheme (ETS) extended coverage to industrial and transport emissions on 1 July, 2010. • Most operations that emit
Slide 10: Divisional Performance
10 For personal use only Divisional Performance Annual Results | Fletcher Building | © August 2010
Slide 11: Strong earnings recovery in Laminates & Panels, lower volumes in Infrastructure and Steel
11 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Strong earnings recovery in Laminates & Panels, lower For personal use only volumes in Infrastructure and Steel impacted earnings EBIT NZ$million1 1. Earnings before interest, tax, and unusual items Annual
Slide 12: Building Products result
12 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Building Products result For personal use only June 10 June 09 • Plasterboard benefited from NZ$m 12 Mths 12 mths %∆ improved NZ housing starts in Sales 798 771 +4 second half and from cost-out initiatives
Slide 13: Building Products: growth in insulation volumes; plasterboard benefitted
13 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Building Products: growth in insulation volumes; For personal use only plasterboard benefitted from positive NZ housing trend Gross Sales June 10 June 09 NZ$m 12 mths 12 mths %∆ Volume ∆ Price ∆ EBITDA ∆ N
Slide 14: Distribution result
14 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Distribution result For personal use only June 10 June 09 • Sales stable year over year NZ$m 12 Mths 12 mths %∆ with a pick-up in activity seen Sales 878 883 -1 in second half from increase in residential
Slide 15: Infrastructure result
15 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Infrastructure result For personal use only NZ Concrete • Lower volumes in cement, June 10 June 09 aggregates, readymix and NZ$m 12 mths 12 mths %∆ concrete pipe. Sales 2,020 2,052 -2 • Continued softness
Slide 16: Infrastructure: lower concrete and related volumes in NZ and Australia
16 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Infrastructure: lower concrete and related volumes in NZ For personal use only and Australia Gross Sales June 10 June 09 NZ$m 12 mths 12 mths %∆ Volume ∆ Price ∆ EBITDA ∆ New Zealand - NZ Concrete 636 697
Slide 17: Property activities include quarry end use, residential and surplus assets
17 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Property activities include quarry end use, residential and For personal use only surplus assets EBIT NZ$m 2H 10 1H 10 2H 09 1H 09 Quarry end use 0 0 0 0 Residential 13 5 8 4 Surplus property assets 0 2 0
Slide 18: Laminates & Panels result
18 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Laminates & Panels result For personal use only Laminex June 10 June 09 • Australian domestic volumes 12 mths %∆ NZ$m 12 mths higher due to improved Sales 1,930 2,076 -7 residential, export volumes EBITDA
Slide 19: Laminates & Panels: volumes growth in Australia and Asia
19 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Laminates & Panels: volumes growth in Australia and For personal use only Asia, offset by flat or weaker volumes in other regions Gross Sales June 10 June 09 NZ$m 12 mths 12 mths %∆ Volume ∆ Price ∆ EBITDA
Slide 20: Formica: continued growth in Asia, North America and Europe stabilising
20 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Formica: continued growth in Asia, North America and For personal use only Europe stabilising EBIT US$m1 2H 10 1H10 2H09 1H09 Asia 8 12 9 10 North America 8 3 5 -3 Europe 6 -3 -1 1 Corporate -5 -5 -6 -4 EB
Slide 21: Steel result
21 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Steel result For personal use only June 10 June 09 NZ$m 12 Mths 12 mths %∆ • Volatile operating Sales 1,172 1,321 -11 environment with uncertain demand and declining prices. EBITDA1 107 175 -39 • Long stee
Slide 22: Steel: prices lower, volumes typically weaker
22 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Steel: prices lower, volumes typically weaker For personal use only Gross Sales June 10 June 09 NZ$m 12 mths 12 mths %∆ Volume ∆ Price ∆ EBITDA ∆ New Zealand - Long Steel 272 361 -25 ↑ ↓ ↓ - Coated Steel 1
Slide 23: Financial Results
23 For personal use only Financial Results Annual Results | Fletcher Building | © August 2010
Slide 24: Net earnings
24 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Net earnings For personal use only June 2010 June 2009 NZ $m 12 months 12 months %∆ EBIT1 521 558 -7 Interest 107 140 -24 Tax1 103 96 +7 Minority Interests 10 8 +25 Net Earnings before unusual items 301 31
Slide 25: Net debt levels have continued to reduce
25 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Net debt levels have continued to reduce For personal use only 1800 1500 1,356 1,107 151 13 1200 191 900 (2) (42) (38) 600 (512) (10) 300 0 Dividends FX on Debt Opening Net Cash from Capex Distribution Div
Slide 26: Key Ratios
26 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Key Ratios For personal use only Total Shareholder Return (TSR) Debt/Debt Plus Equity Percentage Percentage Return on Average Equity Return on Average Funds Percentage1 Percentage2 1. Net earnings / averag
Slide 27: Debt maturity profile
27 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Debt maturity profile For personal use only NZ$m Debt Maturity Profile June 2010 300 • Undrawn credit lines of $1,130 million. 250 200 • Average maturity of debt is over 5 years. 150 100 • Average interest
Slide 28: Geographic exposure to end markets
28 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Geographic exposure to end markets For personal use only Summary Residential Commercial Infrastructure Total 51% 25% 24% 100% New Zealand 57% 30% 13% 100% Australia 49% 51% 0 100% Rest of World Total Group
Slide 29: Strategy
29 For personal use only Strategy Annual Results | Fletcher Building | © August 2010
Slide 30: Strategy
30 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Strategy For personal use only Longer term strategy continues to be: • improve earnings reliability • maintain and improve internal capabilities - increased focus on growth oriented capex - business transf
Slide 31: Outlook
31 For personal use only Outlook Annual Results | Fletcher Building | © August 2010
Slide 32: Outlook 2011
32 Company & Market Overview | Divisional Performance | Financial Results | Strategy | Outlook Outlook 2011 For personal use only Caution required in formulating outlook for 2011: New Zealand: • Slow and gradual continuing recovery in residential building activity. • Commercial construction activity
Slide 33: Annual Results to June 2010
33 For personal use only Fletcher Building Limited Annual Results to June 2010 18 August 2010 Annual Results | Fletcher Building | © August 2010