Fletcher Building Limited · NZX:FBU

Fletcher Building — ABN Amro NZ Day March 2004

22 slides from Fletcher Building's conference presentation, March 2004

  1. Slide 1: ABN Amro NZ Day March 2004

    ABN Amro NZ Day March 2004 Ralph Waters Chief Executive Officer

  2. Slide 2: Fletcher Building

    Mar 2004 Fletcher Building ƒ One of New Zealand’s top industrial companies with a history going back to the early 1900’s ƒ The leader in the NZ building industry ƒ NZ$4 billion revenue; NZ$1.8 billion market capitalisation ƒ FBU is listed on NZX and ASX ƒ Strong market shares in all its building sec

  3. Slide 3: What is Fletcher Building?

    Mar 2004 What is Fletcher Building? Earnings Make Up Building Laminates & Construction Concrete Products Panels Distribution 10% 10% 15% 80% 75% ƒ Not a construction company ƒ Not a distribution business ƒ A building materials manufacturer which controls its channels to market 3

  4. Slide 4: The Fletcher Building Model

    Mar 2004 The Fletcher Building Model Laminates Building Other Building Panels & Products Concrete Concrete Manufacturers Panels Products Distribution Construction Construction Other Other Distribution Distribution Markets Markets 4

  5. Slide 5: Fletcher Building product range

    Mar 2004 Tasman sarking overlay Pynefloor® particleboard flooring Plyco doors Fletcher Steel Tasman Dimond or AHI roofing structural steel I beams insulation Laminex high pressure laminates Tasman house wrap Oliveri sinks Firth bricks Firth concrete Gib® and pavers blocks plasterboard Fletcher Alumi

  6. Slide 6: Concrete

    Mar 2004 Concrete 50% of NZ market 33% of NZ market 25% of NZ market 60% of NZ market 60% of NZ market 6

  7. Slide 7: Building Products

    Mar 2004 Building Products 94% of NZ market No.2 in NZ No.1 in Australasia No.1 in Australasia (also facility in California) No.2 in Australasia No.1 in Australasia 7

  8. Slide 8: Building Products – Steel

    Mar 2004 Building Products – Steel 50% of Sims 200,000T EAF Steel Mill Rod, Bar & Wire General steel distribution Flat products 8

  9. Slide 9: Laminates & Panels

    Mar 2004 Laminates & Panels HPL (2 mills) No.1 Australasia Decorated Board No.1 Australasia MDF (3 mills) No.2 in Australasia Particle Board (2 mills) No.2 in Australasia 40 owned distribution outlets Hardboard (1 mill) across Australasia No.2 in Australasia 9

  10. Slide 10: Distribution

    Mar 2004 Distribution 54 PlaceMakers stores in NZ 35% of building materials market Joint Venture rather than franchise No.1 in segment Trade focus – 80% of sales 10

  11. Slide 11: Construction

    Mar 2004 Construction New Zealand’s leading construction company ‰ Commercial (Buildings) ‰ Engineering (Infrastructure) ‰ South Pacific (General) ‰ Residential (NZ largest home builder) 11

  12. Slide 12: Company Dimensions

    Mar 2004 Company Dimensions Revenue: NZ$4.00 billion annualised Market cap: NZ$1.8 billion No.5 on NZX Employees: 11,000 Shares: 432 million Daily average turnover ≈1,000,000 Shareholders: NZ 47% Aust 30% USA 13% Other 10% 12

  13. Slide 13: Results Record

    Mar 2004 Results Record 2001** 2002 2003 ½ 2004 EBIT NZ$m* 94 205 331 217 ROE 16.9% 23.0% 23.6% ROFE 23.1% 24.4% 23.9% TSR 24% 43% 20% (for 6 mths) * Pre unusuals ** Proforma for 12 months 13

  14. Slide 14: Latest Result

    Mar 2004 Latest Result Jun Jun Dec 2002 2003 2003 NZ$m 12 Mths 12 Mths 6 Mths Building Products 77 102 74 Distribution 34 59 36 Concrete 60 81 42 Construction 30 34 20 Laminates & Panels 8 54 48 Corporate/Unallocated -4 1 -4 EBIT 205 331 216 14

  15. Slide 15: Latest Result

    Mar 2004 Latest Result Jun Jun Dec 2002 2003 2003 NZ$m 12 Mths 12 Mths 6 Mths EBIT before Unusuals 205 331 216 Interest -51 -59 -36 Tax -54 -85 -58 Minority Interests -12 -19 -11 88 168 111 Adjustment net of tax 5 - - Profit After Tax 93 168 111 15

  16. Slide 16: Dividends

    Mar 2004 Dividends NZ$ 2002 2003 2004 cps to residents 6 8 9 10 11 Tax credit refund 2.95 3.94 4.43 4.92 5.42 Non-resident withholding tax 15% -1.34 -1.79 -2.01 -2.24 -2.46 Net paid to non-residents 7.61 10.15 11.42 12.68 13.96* * Plus a 50% Imputation Credit for Australian Holders 16

  17. Slide 17: Stewardship Credentials

    Mar 2004 Stewardship Credentials ‰ Exceeded consensus forecasts for five consecutive announcements ‰ Australian acquisitions are performing well and ahead of expectations ‰ New Zealand’s “Company of the Year 2003” 17

  18. Slide 18: So why the current share price?

    Mar 2004 So why the current share price? ‰ Uncertainty as to extent of NZ housing downturn ‰ Uncertainty as to the impact of an economic downturn on Fletcher Building’s earnings ‰ Poor profit history through previous downturns 18

  19. Slide 19: What will happen?

    Mar 2004 What will happen? ‰ Company has been fundamentally changed since separation ‰ Lower fixed cost base ‰ Not one single loss business unit ‰ Less reliant on NZ economy ‰ 2001 downturn 19,000 housing starts in NZ 2004/5 downturn 27-28,000 housing starts expected in NZ ‰ For last decade 24,000 w

  20. Slide 20: What will happen?

    Mar 2004 What will happen? ‰ Non-residential construction on the rise ‰ Infrastructure spending high ‰ Fletcher Building’s construction backlog at $550m is high by past standards ‰ Several plants have been capacity constrained 20

  21. Slide 21: NZ – Does it deserve a discount or premium?

    Mar 2004 NZ – Does it deserve a discount or premium? Fletcher Building ƒ has standout defensible market positions ƒ captures value right through the chain This results in ƒ ability to maintain our prices ƒ returns well above peer average ƒ improvements have taken earnings to their true potential Str

  22. Slide 22: o)) = x) = ea)

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Fletcher Building — ABN Amro NZ Day March 2004 on 6ix