James Hardie Industries Plc. · NYSE:JHX
James Hardie Industries — Investor Presentation (March 2012)
39 slides from James Hardie Industries's investor presentation, Mar 19, 2012
Slide 1: Investor Presentation
Exhibit 99.13 INVESTOR PRESENTATION March 2012
Slide 2: Disclaimer
DISCLAIMER This Management Presentation contains forward-looking statements. James Hardie may from time to time make forward-looking statements in its periodic reports filed with or furnished to the SEC, on Forms 20-F and 6-K, in its annual reports to shareholders, in offering circulars, invitation
Slide 3: Agenda
AGENDA Business overview USA and Europe Fibre Cement Asia Pacific Fibre Cement Group Outlook Summary Appendix In this Management Presentation, James Hardie may present financial measures, sales volume terms, financial ratios, and Non-US GAAP financial measures included in the Definitions section of
Slide 4: James Hardie: A Growth Focused Company
JAMES HARDIE: A GROWTH FOCUSED COMPANY Annual net sales US$1.2b Total assets US$1.4b Net cash US$25.8m Operations in North America, Asia Pacific and Europe 2,500 employees Market cap US$3.2b S&P/ASX 100 company NYSE ADR listing Note: Net sales (annualised but not seasonally adjusted), total assets a
Slide 5: James Hardie – World Leader in Fibre Cement
JAMES HARDIEA –WORLD LEADER IN FIBRE CEMENT USA Fibre Cement Products Siding Soffit Fascia Trim Asia Pacific Fibre Cement Products Backerboard Residential siding Commercial exteriors Flooring Ceiling and internal walls 5
Slide 6: Global Business Portfolio
GLOBALBUSINESS - PORTFOLIO 76% 69% 66% 24% 31% 34% Volume Sales EBIT* USA and Europe Fibre Cement Asia-Pacific Fibre Cement At and for the nine months ended 31 December 2011 * EBIT – Excludes Research and Development EBIT and Asbestos-related items 6
Slide 7: Fibre Cement – Superior Product Performance
FIBRE CEMENTSUPERIOR – PRODUCT PERFORMANCE Fibre cement is more durable than wood and engineered wood, and looks and performs better than vinyl, and cheaper and quicker to build with than brick Fibre cement Vinyl Engineered wood Fire resistant Hail resistant Resists warping Resists buckling Colour l
Slide 8: Group Overview
1 GROUP OVERVIEW rd 3 quarter operating results reflected higher sales volume (in the US business), improved manufacturing performance, lower general corporate costs and an appreciation of Asia Pacific businesses’ currencies compared to the US dollar, partially offset by an unfavorable product mix a
Slide 9: The USA Business – Largest Fibre Cement Producer in North America
THE USA BUSINESS LARGEST – FIBRE CEMENT PRODUCER IN NORTH AMERICA Plant locations JH Plant Design Capacity Flat Sheet Capacity Plants (mmsf) • Tacoma, WA Plants operating Cleburne, Texas 500 Peru, IL Blandon, PA • • Peru, Illinois 560 Plant City, Florida 300 • Reno, NV Pulaski, Virginia 600 Pulaski,
Slide 10: US Exterior Cladding Market
US EXTERIOR CLADDING MARKET Large growth opportunity Wood 17.3% FC 13.5% Vinyl 39.7% Stucco 6.0% Brick, Stone and Other 23.5% Note: 1) Market share figures reflect siding only; exclude fascia, soffits & trim; data reflects Repair & Remodel and New Construction markets, combined. 2) Siding volumes ex
Slide 11: USA and Europe Fibre Cement: EBIT and EBIT Margin
USA AND EUROPE FIBRE CEMENT 1 EBIT and EBIT Margin EBIT EBIT Margin 1 Excludes impairment charges of US$45.6 million in Q4 FY08 11
Slide 12: USA and Europe Fibre Cement: Top Line Growth
USA AND EUROPE FIBRE CEMENT Top Line Growth 3,000 $1,300 2,800 $1,200 2,600 $1,100 2,400 $1,000 2,200 2,000 $900 1,800 $800 1,600 $700 1,400 $600 1,200 $500 1,000 $400 800 $300 600 400 $200 200 $100 0 $0 JH Volume Housing Starts JH Revenue Rolling 12 month average of seasonally adjusted estimate of
Slide 13: USA and Europe Fibre Cement: Average Net Sales Price
USA AND EUROPE FIBRE CEMENT Average Net Sales Price (US dollars) 1 680 US$654 per msf 640 600 560 520 480 440 400 360 FY06 FY07 FY08 FY09 FY10 FY11 Q3 FY12 1 FY12 average net sales price represents 3 rd quarter year to date; other years presented are for the full year 13
Slide 14: Total USA Housing Starts
TOTAL USA HOUSING STARTS US CENSUS – 14
Slide 15: Response to US Housing Downturn
RESPONSE TO US HOUSING DOWNTURN Focus on primary demand growth and cost management Business re-set to balance supply and demand production suspended at Blandon PA (November 2007), Summerville SC (November 2008) plants and Fontana CA (December 2008) corporate-wide review of activities, projects and c
Slide 16: Product Leadership Example – ColorPlus
PRODUCT LEADERSHIP EXAMPLE COLORPLUS® – ColorPlus® Collection (pre-painted siding and trim): Driving growth against vinyl in Northern USA Launched in Western and Southern USA FY07 Higher value products with higher revenue streams Strategy designed to reduce ‘on the wall’ cost and close gap with viny
Slide 17: Product Leadership Example – HardieZone System
PRODUCT LEADERSHIP EXAMPLE HARDIEZONE™ – SYSTEM 7 th Generation versus 2 nd Generation generic fibre cement The HardieZone™ System represents a logical extension of Hardie technology 17
Slide 18: Asia Pacific Fibre Cement
ASIA PACIFIC FIBRE CEMENT Five manufacturing plants in Asia Pacific Net sales US$382.5m EBIT US$88m Higher value differentiated products Lower delivered cost Growth model Asia Pacific manufacturing facilities. Net Sales and EBIT as at 31 December 2011 and annualised, but not seasonally adjusted. 18
Slide 19: Asia Pacific Fibre Cement – Examples
ASIAPACIFICFIBRECEMENT – EXAMPLES Ceilings and partitions Exterior cladding Philippines Australia New Zealand Australia Interior walls General purpose flooring 19
Slide 20: Group Outlook
GROUP OUTLOOK United States Although industry activity and demand have stabilised, there remains no evidence of a sustainable recovery Pulp price index (NBSK) steadily declining, but remains at elevated levels Freight costs continue to be high compared to prior year Company initiatives, such as the
Slide 21: Capital Management
CAPITAL MANAGEMENT The reduced level of debt, along with a reduction in the number of company specific contingencies and a strengthened confidence in the business’ ability to adapt and meet the challenges of the low demand operating environment enabled the Board to announce in May 2011 the resumptio
Slide 22: Summary
SUMMARY We have a strong, well-established, growth-focused, strong cash-generating and high return business We have a sustainable competitive advantage Our model for strong growth is based on: Large market opportunity Superior value proposition Proprietary and/or protected technology Ongoing commitm
Slide 23: Appendix
&) James Hardie APPENDIX
Slide 24: Global Strategy
GLOBAL STRATEGY Industry leadership and profitable growth Aggressively grow demand for our products in targeted market segments Grow our overall market position while defending our share in existing market segments Introduce differentiated products to deliver a sustainable competitive advantage 24
Slide 25: Group Outlook: Key Priorities
GROUP OUTLOOK Key Priorities The company’s key medium term priorities in the US are: Grow primary demand and exterior cladding market share – with focus on repair and remodel and non-metro markets Increase market penetration of our ColorPlus® and Trim products Continue to rollout our job pack distri
Slide 26: USA and Europe Fibre Cement: Primary Growth Performance
USA AND EUROPE FIBRE CEMENT Primary Growth Performance 30% 20% 10% 0% -10% - 20% - 30% - 40% Q106 Q206 Q306 Q406 Q107 Q207 Q307 Q407 Q108 Q208 Q308 Q408 Q109 Q209 Q309 Q409 Q110 Q210 Q310 Q410 Q111 Q211 Q311 Q411 Q112 Q212 Q312 %JHBP Growth (sdft) NC/R&R Growth Rolling 4Qtr - JHBP Growth (sdft) Roll
Slide 27: Guidance
GUIDANCE Challenges remain, with the operating environment in the US still weak and the Asia Pacific residential markets softening Management anticipates FY12 full year earnings excluding asbestos, ASIC expenses and tax adjustments expected to be within the range of US$130 million to US$140 million
Slide 28: Legacy Issues Update
LEGACY ISSUES UPDATE ATO – RCI successful in its appeal of the 1999 disputed amended tax assessment James Hardie’s initial appeal dismissed by the Federal Court of Australia in September 2010 Charge of US$345.2 million effective 1 September 2010 (no impact on net operating cash flow in FY11) On 22 A
Slide 29: Key Ratios
KEY RATIOS * 9 Months 9 Months 9 Months FY2012 FY2011 FY2010 1 EPS (Diluted) 24.7c 18.8c 25.3c 2 EBIT/ Sales (EBIT margin) 16.3% 15.6% 20.1% 1 Gearing Ratio -2.0% 4.6% 11.7% 2 Net Interest Expense Cover 25.6x 24.1x 37.9x 2 Net Interest Paid Cover 24.8x 22.5x 33.4x Net Debt Payback - 0.3yrs 0.5yrs *
Slide 30: USA and Europe 5 Year Results Overview
USA AND EUROPE 5 YEAR RESULTS OVERVIEW FY07 FY08 FY09 FY10 FY11 Q3 FY12* Net Sales 1,262 1,144 910 828 814 641 US$m Sales Volume 2,148 1,916 1,508 1303 1,248 981 mmsf Average 588 597 604 635 652 654 Price US$ per msf EBIT 362 313 200 208 160 126 US$m EBIT Margin 29 27 22 25 20 20 % * For nine months
Slide 31: Asia Pacific 5 Year Results Overview
ASIA PACIFIC 5 YEAR RESULTS OVERVIEW FY07 FY08 FY09 FY10 FY11 Q3 FY12* Net Sales 223 298 273 296 353 287 US$m Sales Volume 390 398 390 389 407 298 mmsf Average 842 862 879 894 916 924 Price A$ per msf EBIT 39 50 47 58 79 66 US$m EBIT Margin 16 17 17 20 23 23 % * For nine months ending 31 December 20
Slide 32: Endnotes
ENDNOTES This Management Presentation forms part of a package of information about the company’s results. It should be read in conjunction with the other parts of this package, including the Management’s Analysis of Results, Media Release and Condensed Consolidated Financial Statements. Definitions
Slide 33: Endnotes (Continued)
ENDNOTES (CONTINUED) Sales Volumes mmsf – million square feet, where a square foot is defined as a standard square foot of 5/16” thickness. msf – thousand square feet, where a square foot is defined as a standard square foot of 5/16” thickness. Financial Ratios Gearing Ratio – Net debt (cash) divide
Slide 34: Non-US GAAP Financial Measures
NON-US GAAP FINANCIAL MEASURES EBIT and EBIT margin excluding asbestos and ASIC expenses– EBIT and EBIT margin excluding asbestos and ASIC expenses are not measures of financial performance under US GAAP and should not be considered to be more meaningful than EBIT and EBIT margin. Management has inc
Slide 35: Non-US GAAP Financial Measures (Continued)
NON-US GAAP FINANCIAL MEASURES (CONTINUED) Net operating profit excluding asbestos, ASIC expenses and tax adjustments– Net operating profit excluding asbestos, ASIC expenses and tax adjustments is not a measure of financial performance under US GAAP and should not be considered to be more meaningful
Slide 36: Non-US GAAP Financial Measures (Continued)
NON-US GAAP FINANCIAL MEASURES (CONTINUED) Non-US GAAP Financial Measures (continued) Diluted earnings per share excluding asbestos, ASIC expenses and tax adjustments– Diluted earnings per share excluding asbestos, ASIC expenses and tax adjustments is not a measure of financial performance under US
Slide 37: Non-US GAAP Financial Measures (Continued)
NON-US GAAP FINANCIAL MEASURES (CONTINUED) Effective tax rate excluding asbestos and tax adjustments– Effective tax rate excluding asbestos and tax adjustments is not a measure of financial performance under US GAAP and should not be considered to be more meaningful than effective tax rate. Manageme
Slide 38: Non-US GAAP Financial Measures (Continued)
NON-US GAAP FINANCIAL MEASURES (CONTINUED) EBITDA– is not a measure of financial performance under US GAAP and should not be considered an alternative to, or more meaningful than, income from operations, net income or cash flows as defined by US GAAP or as a measure of profitability or liquidity. No
Slide 39: Non-US GAAP Financial Measures (Continued)
NON-US GAAP FINANCIAL MEASURES (CONTINUED) General corporate costs excluding ASIC expenses and domicile change related costs– General corporate costs excluding ASIC expenses and domicile change related costs is not a measure of financial performance under US GAAP and should not be considered to be m
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