Fletcher Building Limited · NZX:FBU
Fletcher Building — Investor Day (May 2013)
29 slides from Fletcher Building's investor day presentation, May 22, 2013
Slide 1: Laminates & Panels Investor Strategy Presentation
Investor Strategy Day – Laminates & Panels | Fletcher Building | © May 2013 For personal use only | Page 1 Laminates & Panels Investor Strategy Presentation Paul Zuckerman Chief Executive Laminates & Panels
Slide 2: Disclaimer
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 2 Disclaimer For personal use only This presentation contains not only a review of operations, but also some forward looking statements about Fletcher Building and the environment in which the company operates. Becaus
Slide 3: Meeting Agenda
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 3 Meeting Agenda For personal use only Welcome What is Laminates & Panels? Financial Review Key Initiatives Update Growth Opportunities Formica 100 Year Celebration
Slide 4: Laminex, Formica, and Homapal are all leading players in their respective markets
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 4 Laminex, Formica, and Homapal are all leading players in their respective markets For personal use only Global Presence Investing for growth in new and High Quality Manufacturing Assets developing markets while grow
Slide 5: High pressure manufacturing process
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 5 High pressure manufacturing process For personal use only Pressed at high pressure under heat which bonds the papers. Finished plate Overlay Treated décor, print, veneer, or foil • The main cost of manufacturing Tre
Slide 6: Single, integrated global management structure with employees in over 25 countries
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 6 Laminate & Panels operates under a single, integrated global management structure with employees in over 25 countries For personal use only Global Employees ASIA Approximately 5000* 230 EUROPE (incl INDIA) Asia 1200
Slide 7: Truly global reach, unlike other competitors
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 7 Laminates & Panels has a truly global reach, unlike other competitors selling into several countries and manufacturing in some For personal use only Manufacture & sell Sell – No Manufacturing Expansion Opportunity
Slide 8: Stable of leading brands in key geographic and product segments
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 8 Laminates & Panels has a stable of leading brands in key geographic and product segments. For personal use only BRAND REACH PRODUCT SEGMENTS Global HPL LPL Australia and HPL LPL New Zealand Australia BENCHTOP New Ze
Slide 9: Channels to market vary by geography
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 9 Channels to market vary by geography For personal use only Europe North America Asia India New Zealand Distribution Legend Direct to Customer Australia Third-Party Distribution Big Box Own Distribution Source: Manag
Slide 10: End use markets differ by region
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 10 End use markets differ by region, with higher exposure to residential in Australia and New Zealand and higher exposure to non residential elsewhere For personal use only Europe North America Asia India 35 35 End-Us
Slide 11: Products used in a wide variety of end-use applications
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 11 Laminates & Panels products are used in a wide variety of end-use applications, including residential, commercial and infrastructure For personal use only Benchtops Residential New Renovating Shelving / Laundry Clo
Slide 12: High quality, well positioned manufacturing assets in all regions
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 12 The business has high quality, well positioned manufacturing assets in all regions, and has recently taken capacity out of Australia and Europe For personal use only 80% 70% Under 50% 55% Construction 90% 95% 80% 6
Slide 13: Strong market positions (#1 or #2) in all North American markets
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 13 Laminates & Panels has strong market positions (#1 or #2) in all North American markets. For personal use only Traditional Markets Canada 3 players #1 market position 49% share USA 3 players #2 market position 32%
Slide 14: Strong positions in Western Europe, growing in Russia and Eastern Europe
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 14 Laminates & Panels has strong positions in Western Europe, except in Germany and Italy, and increasing presence in the growth markets of Russia, Eastern Europe For personal use only Traditional Markets Other Major
Slide 15: Strong positions in China, Taiwan, Thailand and South East Asia
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 15 Laminates & Panels has strong positions in China, Taiwan, Thailand and other parts of South East Asia, but limited presence in Japan or Korea For personal use only Traditional Markets Other Major Markets China High
Slide 16: Number 1 player in both Australia and New Zealand
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 16 Laminates & Panels is the number 1 player in both Australia and New Zealand For personal use only Traditional Markets Australia 3 players #1 market position 59% share New Zealand 5 players #1 market position 55% sh
Slide 17: FY12 revenue declines in NZ, Australia and Europe; Asia continued to grow
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 17 FY12 showed revenue declines in NZ, Australia and Europe. North America has slowly improved whilst Asia continued to grow For personal use only Revenue EBIT ROFE 2500 180 14.0% 160 12.0% 2000 140 10.0% 120 1500 8.0
Slide 18: Australian particle board and MDF volumes and prices declining
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 18 Australian volumes of commodity particle board and MDF have experienced real declines in prices accompanied with declining volumes in recent years For personal use only White Particle Board Volume 000’s Australia R
Slide 19: FY13 continues to be challenging with revenue and volume down
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 19 FY13 continues to be challenging with revenue and volume down in almost all markets. Europe deteriorated significantly and Australia continues to slow. New Zealand’s volume and revenue were impacted by exit of some
Slide 20: First half EBIT declined over FY12
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 20 First half EBIT declined over FY12 due to conditions in Europe and Australia both deteriorating significantly. Elsewhere EBIT improved For personal use only EBIT 80 2 -9 3 2 70 63 1 -8 60 -3 51 50 NZ$ M 40 30 20 10
Slide 21: Key Initiatives Update – Cost Out
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 21 Key Initiatives Update – Cost Out: All regions continue to pursue cost reduction and improvements in efficiencies to combat market deterioration and inflationary pressures For personal use only NZ$42 M North Americ
Slide 22: Key Initiatives Update – Capacity Expansion in Asia; new factory in China
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 22 Key Initiatives Update – Capacity Expansion in Asia; construction of new factory in China For personal use only Key Milestones: • Construction of new site in Jiujiang $NZ 75m (approximately 500 miles southwest of e
Slide 23: Capacity Expansion in Asia; construction stages at May 2013
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 23 Key Initiatives Update – Capacity Expansion in Asia; construction stages at May 2013 For personal use only Artist impression of site Most recent photographs of construction
Slide 24: Key Initiatives Update – Establish manufacturing capability in India
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 24 Key Initiatives Update – Establish manufacturing capability in India For personal use only Key Milestones: • Acquired site in Dec 2012 • Constructed in 2010 but Ahmedabad requires upgrading to Fletcher standards •
Slide 25: Growth Opportunities – Innovation
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 25 Growth Opportunities – Innovation For personal use only Décor Development • Current launch of anniversary range • Extension of large scale (fx180) into wood grains, and marbles • Formica Decometal {from Homapal} aw
Slide 26: Growth Opportunities – Working Smarter
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 26 Growth Opportunities – Working Smarter For personal use only Stage 1 of Global IT Upgrade/Replacement • Commenced in Feb 2013 and involves global best practice design in conjunction with INFOR (supplier of existing
Slide 27: Growth Opportunities – Geographic Expansion
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 27 Growth Opportunities – Geographic Expansion opportunities exist in several areas For personal use only Longer term growth opportunities Growth markets currently being actively pursued Potential areas for growth in
Slide 28: Formica 100 Year Anniversary – 2013
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 28 100 Year Anniversary – 2013 marks 100 years since Formica was founded in Cincinnati, Ohio in 1913 For personal use only KEY EVENTS May 1913 Plant rented in Cincinnati, • Global celebration across all regions includ
Slide 29: Formica products have evolved through innovation and design
Investor Strategy Day - Laminates & Panels | Fletcher Building | © May 2013 | Page 29 After 100 years Formica products have evolved through innovation and design, and contemporary use include many new non traditional applications. For personal use only HIGH PRESSURE LAMINATE COMPACT LAMINATE VIVIX™