Eagle Materials Inc · NYSE:EXP
Eagle Materials — BB&T Capital Markets Manufacturing and Materials Conference 2009
47 slides from Eagle Materials's conference presentation, Apr 1, 2009
Slide 1: BB&T Capital Markets Manufacturing and Materials Conference April 2, 2009
BB&T Capital Markets Manufacturing and Materials Conference April 2, 2009 Exhibit 99.1
Slide 2: Forward Looking Statement
Forward Looking Statement This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified b
Slide 3: Current Business Environment
1. Current Business Environment 2. Industry Outlook 3. Eagle at a Glance
Slide 4: Current Business Environment and Eagle Materials' Response
New residential construction remains at low levels Non-residential construction’s near term outlook is weak Public construction varies from state to state Eagle Materials’ Response Intense focus on quality and customer service Minimize capital spending but maintain plants in like new condition Reduc
Slide 5: Industry Outlook
1. Current Business Environment 2. Industry Outlook 3. Eagle at a Glance
Slide 6: E77 Jeagie
Ag E77 Jeagie 1Vili Materials
Slide 7: U.S. Cement Industry Update
U.S. Cement Industry Update Current Supply/Demand Dynamics Demand anticipated to decline approximately 15% in calendar Due to the decline in demand, several plant closures have been announced Announced delays of expansion projects Imports of foreign cement have been dramatically reduced Landed cost
Slide 8: Cost of imported cement (through September 2008)
Cost of imported cement (through September 2008) Source: Portland Cement Association; Company estimates Asian Financial Crisis Current landed price – Mid-$50’s/ton
Slide 9: U.S. Cement Industry Consumption
Source: PCA Data and Company estimates U.S. Cement Industry – Consumption 30% imports 7% imports
Slide 10: Public Construction Spending – Value Put in Place
Public Construction Spending – Value Put in Place Source: Portland Cement Association (Projection from Fall 2008). ?
Slide 11: Architectural Billings Index (ABI) (January 2009)
Architectural Billings Index (ABI) (January 2009) Commercial/Industrial Institutional Mixed Use Source: American Institute of Architects As a leading economic indicator of construction activity, the ABI reflects the approximate nine to twelve month lag between architectural billings and construction
Slide 12: Private Non-Residential Construction Spending – Value Put in Place
Private Non-Residential Construction Spending – Value Put in Place $0 $50 $100 $150 $200 $250 $300 $350 Source: U.S. Bureau of the Census; PCA (Projection from Fall 2008) -23%
Slide 13: Wind Farms
Wind Farms
Slide 14: Wind Farms
Wind Farms
Slide 15: Our Cement Operations
Our Cement Operations Eagle Operations Overview Approximately 3.1 million tons of capacity 3.1% market share (12th in North America) Low cost producer Exceptional quality and customer service Cement Plants Cement Terminals Markets Served
Slide 16: Eagle
Eagle Et =
Slide 17: Wallboard Industry Update
Wallboard Industry Update Wallboard demand was approximately 25 billion square feet (BSF) in calendar 2008 (down 31% from the 2005 peak) We expect demand to decline approximately 25% in calendar 2009 New plant capacity increases are operational All new plants were built in the East Older, high-cost
Slide 18: New Residential Construction
New Residential Construction Near Term Outlook Extreme low pace of new home construction Overhang of existing homes and foreclosures continues to put downward pressure on pricing and new housing starts. New housing starts at 40 year low. Access to 30-year fixed-rate traditional mortgages remains lim
Slide 19: U.S. Single Family Housing Starts 1972-2008
U.S Single Family Housing Starts – 1972-2008 1,000 1,200 1,400 1,600 1,800 2,000 2,200 Source: U.S Bureau of the Census; Eagle estimates Wallboard consumption by type of construction: -Single Family – approx. 10,000 sf -Multi Family – approx. 4,000 sf
Slide 20: Home Supply 1972-2009 (January)
Home Supply – 1972 – 2009 (January) Source: U.S Bureau of the Census
Slide 21: Home Ownership Rates
Home Ownership Rates – 1972 – Source: U.S. Bureau of the Census Total occupied homes 111.8 million Owner occupied 75.5 million Renter occupied 36.3 million
Slide 22: Ratio of Median Existing Single Family Home Price to Median Income
Ratio of Median Existing Single Family Home Price to Median Income – 1975-2008 Source: National Association of Realtors Ratio at the end of - 2.9
Slide 23: Mortgage Rates 1977-2009 (January)
30 Year Mortgage Rates – 1977 – 2009 (January) Source: Freddie Mac
Slide 24: Unemployment Rate 1977-2009 (February)
Unemployment Rate – 1977 – 2009 (February) Source: Department of Labor Current Month
Slide 25: New Home OR Existing Home?
New Home OR Existing Home?
Slide 26: U.S. Demand for Gypsum Wallboard (BSF)
U.S. Demand for Gypsum Wallboard (BSF) Source: Gypsum Association; Eagle estimates
Slide 27: Wallboard Utilization Outlook
Wallboard Utilization Outlook (numbers in billion square feet) CY CY CY CY 2009E Consumption Estimates: New Residential – Single Family 15.0 10.8 6.6 4.4 New Residential – Multi-Family 1.4 1.4 1.2 1.0 New Commercial 7.6 7.2 7.0 4.9 Repair & Remodel 10.6 10.5 9.7 7.9 Mfd Housing 0.4 0.3 0.3 0.3 Total
Slide 28: Wallboard industry capacity and market share
Materials Capacity Capacity Share we 1 | USG 10.0 27% é H 2 | National Gypsum 75 20% , ff 3 | Koch Industries (fka Georgia Pacific) 48 13% nt [4 | CertainTeed 44 11% L § | 5 | American Gypsum (Eagle Materials) 4.0 11% Subtotal 30.4 82% : ; 6 | LaFarge 9% t) 4 7 | Temple Inland 19 5% 1/8 | Pabco 14 4
Slide 29: Wallboard Industry Capacity Expansions/Closures
Wallboard Industry Capacity Expansions/Closures INDUSTRY CAPACITY ADDITIONS CAPACITY CLOSURES EAGLE PLANTS Capacity Summary (in BSF) 1/1/07 37.9 Additions 5.7 Closures (6.8) Current 36.8
Slide 30: Eagle's Wallboard Operations
Eagle’s Wallboard Operations American Gypsum Operations Overview 18-year history Nearly 4.0 billion square feet of capacity 11% market share (5th in U.S.) Lowest cost producer Exceptional customer service Premium quality Wallboard Plants Reload/Distribution Yards Core Markets Served
Slide 31: Materials
Materials
Slide 32: Gypsum Paperboard Industry Update
Gypsum Paperboard Industry Update Nearly 100% vertically integrated One notable exception – CertainTeed – • 40% of Republic Paperboard’s capacity supplies 65% of CertainTeed’s U.S. paper needs at full utilization Wallboard industry’s paperboard capacity is mostly high cost cylinder machines that pro
Slide 33: Materials
Materials wo e e
Slide 34: Materials
Materials
Slide 35: Eagle's Operations Overview: Concrete and Aggregates
Eagle’s Operations Overview Strong competitive position in local markets Capacity • Aggregates – 5.5 million tons • Concrete – 850,000 cubic yards Complimentary to Eagle’s Cement business Organic growth opportunities Vast aggregates reserves of over 1 billion tons in Northern California Exceptional
Slide 36: Current Business Environment
1. Current Business Environment 2. Industry Outlook 3. Eagle at a Glance
Slide 37: New residential construction continues to weaken
New residential construction continues to weaken Non-residential construction’s near term outlook is weak Public construction varies from state to state Eagle Materials’ Response Intense focus on quality and customer service Minimize capital spending but maintain plants in like new condition Reduce/
Slide 38: Construction Demand Drivers
Construction Demand Drivers • Public Infrastructure • New Residential Construction • New Non-Residential Construction • Repair and Remodel Construction American Gypsum’s Wallboard Eagle’s Cement Single Family Residential, 24% Multi Family Residential, 5% New Non- Residential, 26% Repair and Remodel,
Slide 39: Our Cement Production and Cost
Our Cement Production and Cost * - Includes effect of downtime for Illinois Cement start-up Energy costs up 50% Since FY04 Total Manufactured Tons Produced (L) Manufactured Cost per Equivalent Ton (R)
Slide 40: American Gypsum's Wallboard Production and Cost
American Gypsum’s Wallboard Production and Cost * Before SG&A ** Includes effect from start-up of new plant in Georgetown, South Carolina
Slide 41: Financial Highlights
Financial Highlights ($ in millions) For Fiscal Year Ending March 31 * Before Corporate G&A Revenues Operating Earnings *
Slide 42: We Continue to Outperform the Group
We Continue to Outperform the Group * EBIT Margins (TTM as of 12/31/08) • Based on comparison of EBIT Margins (TTM) for each of the listed companies (1) TTM as of 11/30/08 Mean: 9%
Slide 43: Why Eagle Materials likes its position in bad times and in good times
Why Eagle Materials likes its position in bad times and in good times Premium quality products Exceptional customer service Strong long-term customer relationships Low overhead Extremely efficient modern, low-cost manufacturing plants Smart, hard working, technologically proficient employees Solid b
Slide 44: Question & Answer
Eagle Materials Inc. Question & Answer
Slide 45: BB&T Capital Markets Manufacturing and Materials Conference April 2, 2009
BB&T Capital Markets Manufacturing and Materials Conference April 2, 2009
Slide 46: Contact Information
Contact Information Steve Rowley, President and CEO Telephone: 214-432-2020 Email: srowley@eaglematerials.com Mark Dendle, Executive Vice President and CFO Telephone: 214-432-2011 Email: mdendle@eaglematerials.com Craig Kesler, Vice President - Investor Relations and Corporate Development Telephone:
Slide 47: Major Facilities
MAJOR FACILITIES CONCRETE GYPSUM WALLBOARD PLANTS. _ CEMENT PLANTS PAPERBOARD MILL AND AGGREGATES PLANTS AMERICAN GYPSUM COMPANY ILLINOIS CENENT COMPANY LLC REPUBLIC PAPERBOARD CENTEX MATERIALS LiC Abuquerqe, ew Mexico Lal, lino COMPANY Lic Austin and Buda, Texas Bera New Mexko—yguytan cenent couran
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