James Hardie Industries Plc. · NYSE:JHX
James Hardie Industries — Non-Deal Roadshow (August 2006)
23 slides from James Hardie Industries's roadshow presentation, Aug 30, 2006
Slide 1: Building On Proven Performance
4 @® James Hardie feu James Hardie Building On Proven Performance UK Roadshow - August 2006 Jo this Management Presentation, James Martie may prosent tho fixancias measutos, eles volume terms, Rnawciel ratios, ard Non-US GAAP finuncia! measures included Jn the Defiitions suction of this document sta
Slide 2: Focussed on Fibre Cement
os Focussed on Fibre Cement vy) Investment Attributes High growth Sustainable competitive advantage Unique proprietary technology Strong financial performance, cash flows and balance sheet Track record of outperforming US housing market @® James Hardie Superior Durability
Slide 3: Business Overview
@® James Hardie Business Overview @® James Hardie * External siding/soffit lining * Trim and fascia » Internal wall/floor wet area lining * Ceiling lining and flooring * External/internal wall systems » Commercial facades * Drainage pipes
Slide 4: Sustainable Competitive Advantage
@® James Hardie Sustainable Competitive Advantage = Unique plant engineering and proprietary process technology and product formulations — significant investment in R&D = Superior capital cost efficiency = Low cost manufacturer * Only national producer of fibre cement in each key market = Excellent
Slide 5: Operations Overview
4 @® James Hardie Operations Overview @® James Hardie Business Portfolio Total FY 2006" Identifiable Sales EBIT?* Assets*# USA Fibre Cement Established high growth/high 78% 82% 95% return Asia Pacific Fibre Cement Established high return 16% 16% 12% Other Potential growth opportunities 5% 2% (7%)? (
Slide 6: Largest Fibre Cement Producer in North America
@® James Hardie se i Largest Fibre Cement Producer in North America JH Plant Design Capacity Fiat Sheet Capacity Plants (mumsfy Fontana, Cafifornia 180 Plant City, Florida 300 Cleburne, Texas 600 Tacoma, Washington 200 Peru, ilfinais: 560 Waxahachie, Texas 360 Blandon, Pennsylvania 200 Summerville,
Slide 7: Superior Product Performance
fa i Superior Product Performance Fibre Cement is more durable than wood and engineered wood _ Superior Fibre Ci t wre Semen} Durability # Moisture Resistant Engineered Wood La Fire Resistant Weather Resistant ‘a Termite Proof | & — Resists Warping w# — Resists Cracking ae Resists Rotting Holds Pain
Slide 8: Revenue Growth Streams
@® James Hardie eee 1 Revenue Growth Streams Exterior products ® Siding « Soffit s Fascia « Trim Interior products « % inch backerboard ® Hardibacker 500® « Total sales compound annual growth rate of 27% (FY02 — FY06) ‘USA Fibre Cement Share of siding market % , @® James Hardie cs Continuing to incr
Slide 9: Exterior Products Divisions: Established Markets
”) James Hardie Min: , Exterior Products Divisions €stablished Markets Established Markets * Accounts for 75% of USA Fibre Cement sales * High builder penetration * High brand awareness * Aggressive growth of dernand for fibre cement products » Further penetration against wood-based technologies * O
Slide 10: Emerging Markets
@® James Hardie Emerging Markets « Approx. 50% of new housing sales « Accounts for 25% of USA Fibre Cement sales « Penetrating regions where vinyl is dominant siding material * Focus on majority colour penetration « Estimated terminal share of 30% « — Internal target of 30% - 50% revenue growth p.a.
Slide 11: Average Net Sales Price and Top-Line Growth
@® James Hardie ile, 1) 108) Average Net Sales Price Average price growth driven by mix and 600 5 price increases 580 + 560 4 540 4 520 4 500 + 480 4 ooo 460 4 440 4 420 4 400 4 380 4 360 T r r 1 1 1 1 1 FY0O FYO1 FY02 FYO3 FY04 FY05 FYO6 1 FYO7 ad US 3 f minst 24 @ James Hardie bre Cement Top-Line
Slide 12: EBIT and EBIT Margin
EBIT US$ £ 2 2 8 R 6 8 & 6 8 Sy & EBIT and EBIT Margin* RR ERI etter EBTSales Fyo4 FYOS FYO6 “Excludes restructuring and other operating expenses of US$12.6 million in Q3 FYO2 Note: dofted fines indicate EBIT margin long-term target range of 20% - 25% EBIT MARGIN % 23 $250" wis Reverse llllll # of E
Slide 13: US New Housing Market and Backerboard
@® James Hardie st fase ousing Market ~ Siowing US New H « Key sales determinants » Level of new housing construction activity » Level of repair and remodelling activity » Market development program effectiveness « Price improvement « New housing 70% of sales (repair and remodel 30%) « Internal sale
Slide 14: Asia, Pipes and Europe Market Development
4 @® James Hardie Asia Australia, New Zealand, Philippines FY06 net sales US$242m FY06 EBIT US$42m Higher value differentiated products Lower delivered cost Shift to growth mode! Philippines focus on profitability 27 @ James Hardie Pipes « USA manufacturing plant commissioned 2001 « Advantages over
Slide 15: Financials: Results Q1 FY07
@® James Hardie Financials 29 @® James Hardie : Results — Q1 FY07 US$Million Net Sales 415.5 Up 16% Gross Profit 157.7 Up 9% EBIT* 96.1 Up 11% Operating Profit’ 62.7 Up 12% * Excludes effect of forsign exchange on asbestos provision. 30
Slide 16: Results Q1 FY07: USA Fibre Cement and Other Businesses
@® James Hardie Results —Q1 FYO7” USA Fibre Cement USSMillion Net Sales 348.9 Up 21% EBIT 103.3 Up 10% Volume 605.7 mmst Up 16% EBIT Margin 29.6% Down 3.1pts Ey @® James Hardie Results = Q1 FY07 Other Businesses « ANZ volumes slightly up, EBIT margin 16.7% * Philippines sales up 2%, EBIT positive ®
Slide 17: Key Ratios and Long-Term Targets
4 @® James Hardie tin, J i] Key Ratios QUEYO7 FY06 FYO5 EPS (Diluted)* 13.4c 44.9c 27.7c Dividend paid per share - 40.0c 3.06 Return on Shareholders’ Funds'.? 29.3% 29.6% 22.4% Return on Capital Employed’. + 38.2% 28.9% 23.6% EBIT/ Sales (EBIT margin)" 23.1% 18.9% 16.2% Net Interest Expense Cover! 4
Slide 18: Asbestos Related Progress: Background
4 @® James Hardie Asbestos Related Progress 35 4 @® James Hardie li o Asbestos Reiated Personal Inj Background ® Inquiry into establishment of Medical Research and Compensation Foundation (MRCF) announced by NSW Government — February 2004 « Inquiry report released September 2004: « Establishment of
Slide 19: Asbestos Funding Agreement Key Elements
@® James Hardie « Non-binding agreement signed with NSW Government, union and claimants’ representatives - December 2004 ® Funding arrangement intended to allow James Hardie to remain profitable, financially strong and to fund growth « Final funding agreement signed with NSW Government — December 20
Slide 20: Asbestos Provision and Actuarial Comparison
(US$27m charge to P&L) OC James Hardie «Net provision of US$716m (A$1 billion) recorded at 31 March 2006 — “probable and estimable” under US GAAP « Net provision adjusted to US$742m (A$1 billion) at 30 June 2006 due to FX » Jurie 2006, Australian Taxation Office (ATO) declines to endorse SPF as tax
Slide 21: Asbestos Accounting and Summary
@® James Hardie g a ee Voluntary, Asbesto ding Proposal Accounting = Annual payments to SPF charged against provision * Provision adjusted annually to align with 31 March annual actuarial assessment (projected cash flows, undiscounted and uninflated) s Asbestos provision in income statement to refle
Slide 22: Endnotes: Financial Measures
@® James Hardie = ope Endnotes Financlai Measures ~ US GAAP equivalents EBIT and EBIT margin — EBIT is equivalent to the US GAAP measure of operating income, EBIT margin is defined as EBIT as a percentage of net sales. James Harifie believes EBT and EBIT margin fo be relavant and useful information
Slide 23: Non-US GAAP Financial Measures
NON-US GAAP FINANCIAL MEASURES: EBIT and EBIT margin exchuding asbestos — EBIT and EBIT margin excluding asbestos are not measures of financial performance under US GAAP and should not be considered to be more meaningtul than EBIT and EBIT margin. James Hardie has incluited these financiat measures
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