Slide 1: Annual Results to 30 June 2013
For personal use only Annual Results to 30 June 2013 Mark Adamson -Chief Executive Officer NickOlson -Chief Financial Officer 21 August 2013
Slide 2: Disclaimer
Disclaimer For personal use only This Annual results presentation dated 21 August 2013 provides additional comment on the media release of the same date. As such, it should be read in conjunction with, and subject to, the explanations and views of future outlook on market conditions, earnings and ac
Slide 3: Agenda
Agenda For personal use only Results Overview Divisional Performances Financial Results Business Transformation Programme Outlook 3 Fletcher Building Annual Results Presentation | © August 2013
Slide 4: Results Overview
Results Overview For personal use only CSP Pacific streetlight columns, Auckland
Slide 5: Results Overview
Results Overview For personal use only Net earnings of $326 million Operating earnings of $569 million In line with guidance provided at the half-year result Cashflow from operations $559 million Up 25% on prior year Driven by strong results in Building Products, Distribution and Construction divisi
Slide 6: Strong improvement in New Zealand residential consents, but Australia flat
Strong improvement in New Zealand residential For personal use only consents, but Australia flat June 2011 June 2012 June 2013 13/12 Building Consents 12 months 12 months 12 months % Mvmt New Zealand Residential Consents 13,539 15,414 18,731 +22 Non Res WPIP ($m)* 4,798 4,452 5,010 +13 Infrastructur
Slide 7: Continued upward trend in New Zealand residential consents
Continued upward trend in New Zealand For personal use only residential consents throughout the past year Total residential consents 12 month rolling – New Zealand and Australia Australia New Zealand 20,000 185,000 19,000 175,000 18,000 165,000 17,000 155,000 16,000 145,000 15,000 135,000 14,000 125
Slide 8: Strong growth in volumes in New Zealand offset by weaker markets elsewhere
Strong growth in volumes in New Zealand offset For personal use only by weaker markets elsewhere June 2012 June 2013 NZ$m 12 months 12 months %∆ Sales 8,839 8,517 -4 EBITDA¹ 786 789 - EBIT¹ 556 569 +2 Net earnings¹ 317 326 +3 Significant items after tax (132) 0 Net earnings 185 326 +76 EPS - cps¹ 46
Slide 9: New Zealand operating earnings up strongly, most other markets down
New Zealand operating earnings up strongly with For personal use only volume growth, while most other markets were down EBIT¹ NZ$million 286 259 207 203 90 80 New Zealand Australia Rest of the World Year to June 2012 Year to June 2013 1. EBIT before significant items 9 Fletcher Building Annual Resul
Slide 10: FY13 earnings split evenly between NZ and Rest of World
FY13 earnings split evenly between NZ and For personal use only Rest of World • Revenues EBIT (Year to 30 June 2013) (Year to 30 June 2013) 12% 14% 45% 50% 43% 36% New Zealand Australia Rest of World New Zealand Australia Rest of World 10 Fletcher Building Annual Results Presentation | © August 2013
Slide 11: Earnings commentary
Earnings commentary For personal use only New Zealand operating earnings¹ up 38%, driven by increased house- building activity and repairs and rebuilding work in Canterbury Deterioration in Australian volumes evident early in the year, and the market remained soft throughout FY13 Improvement in Nort
Slide 12: Divisional Performances
Divisional For personal use only Performances Fletcher Residential, Auckland
Slide 13: Divisional operating earnings overview
Divisional operating earnings overview For personal use only EBIT¹ NZ$million 222 209 139 122 120 109 87 65 50 50 Infrastructure Building Products Laminates & Distribution Construction Products Panels Year to June 2012 Year to June 2013 1. EBIT before significant items 13 Fletcher Building Annual Re
Slide 14: Infrastructure Products
Infrastructure Products For personal use only Result June 2012 June 2013 Cement, concrete & aggregates NZ$M 12 months 12 months %∆ New Zealand volumes improved: - Cement volumes up 4% Sales 2,299 2,095 -9 - Aggregates volumes up 6% EBITDA 312 - Readymix volumes up 19% 302 +3 Australian quarry volume
Slide 15: Building Products
Building Products For personal use only Result June 2012 June 2013 Plasterboard NZ$M 12 months 12 months %∆ Volumes and earnings up in strong New Zealand residential market. Sales 1,390 1,350 -3 Insulation EBITDA¹ 146 159 +9 Operating earnings down 23% due to continued competitive pressures in EBIT¹
Slide 16: Laminates & Panels
Laminates & Panels For personal use only Result June 2012 June 2013 Formica NZ$M 12 months 12 months %∆ Operating earnings reduced by 18% due to declines in Europe and further Bilbao Sales 1,849 1,738 -6 closure costs. EBITDA¹ 205 180 -12 Volumes in North America up slightly. Operating earnings grow
Slide 17: Formica: decline in earnings due to Bilbao closure and lower European volumes
Formica: decline in earnings due to additional costs For personal use only of Bilbao plant closure and lower volumes in Europe June 2012 June 2013 EBIT NZ$m¹ 12 months 12 months %∆ Asia 38 37 -3 North America 34 41 +21 Europe 13 (5) - Corporate (14) (15) - Total EBIT 71 58 (18) 1. Excluding signific
Slide 18: Distribution
Distribution For personal use only Result June 2012 June 2013 PlaceMakers NZ$M 12 months 12 months %∆ Strong revenue growth due to recovery Sales: in residential homebuilding. PlaceMakers 779 850 +9 Earnings growth assisted by cost Tradelink/Mico 1,482 1,291 -13 reduction and efficiency measures. EB
Slide 19: Construction
Construction For personal use only Result June 2012 June 2013 Residential earnings up 55% due to NZ$M 12 months 12 months %∆ strong house sales in Auckland. Sales 1,040 1,193 +15 Continued momentum in Canterbury with residential house repairs and EBITDA 61 95 +56 earthquake recovery work. EBIT 50 87
Slide 20: Canterbury update
Canterbury update For personal use only Considerable progress on repairs 42,000 full scope repairs completed: half-way point now passed $1.3 billion of work completed Repairs to the final Earthquake Commission referred property are now expected to be completed in December 2014 NZ Govt and Christchur
Slide 21: Financial Results
Financial Results For personal use only Stramit Building Products, Sydney
Slide 22: Cashflow from operations increased by 25%
Cashflow from operations increased by 25% For personal use only June 2012 June 2013 12 months 12 months %∆ EBITDA 633 789 25 Funding costs (152) (146) -4 Cash tax paid (123) (60) -50 Non cash unusual impact 122 0 - Provisions movement/other (23) (58) 248 Working capital movements: Debtors 15 34 Cred
Slide 23: Net debt reduction bridge
For personal use only Opening Net Debt 2,059 Cash from operations NZ$million (525) (pre working capital) Working capital (34) Growth capex + acquisitions 98 23 Fletcher Building Annual Results Presentation | © August 2013 Stay in business 148 capex Divestments (91) Dividends 208 12 divestments and o
Slide 24: Capital expenditure to increase modestly in FY14
Capital expenditure to increase modestly in FY14 For personal use only – includes investment in FBUnite projects Growth Stay in business June 2012 June 2013 353 12 months 12 months %∆ 307 Stay-in-business 207 148 -29 Growth 60 85 +42 246 230 220 Acquisitions 86 13 -86 205 Total 353 246 -30 148 Depre
Slide 25: Key Ratios
Key Ratios For personal use only Total Shareholder Return (TSR) Debt/Debt Plus Equity Percentage Percentage 37 34 33 51 31 27 24 14 14 Jun-09 Jun-10 Jun-11 Jun-12 Jun-13 -27 Jun-09 Jun-10 Jun-11 Jun-12 Jun-13 Return on Average Funds Percentage¹ 13 13 12 11 10 Jun-09 Jun-10 Jun-11 Jun-12 Jun-13 1. Ea
Slide 26: Debt maturity profile
Debt maturity profile For personal use only Funding and Maturity Profile Undrawn credit lines and cash on hand of $943 million. 214 Average maturity of debt is 5 years. 200 383 Approximately 74% of all borrowings have fixed interest NZ$m rates. 22 424 Average interest rate on debt is 318 221 6.7%. 1
Slide 27: Business Transformation
Business For personal use only Transformation Fletcher Reinforcing, Auckland
Slide 28: FBUnite transformation programme
FBUnite transformation programme For personal use only All workstreams established with senior leadership teams in place Specific Workstream updates: Shared Services Centre being established in Auckland Group Procurement teams in place and a number of categories already completed Property revi
Slide 29: Outlook
Outlook For personal use only Formica DecoMetal® laminate, Heathrow Airport
Slide 30: Outlook FY2014
Outlook FY2014 For personal use only New Zealand New residential construction expected to be strong Canterbury repairs and construction activity will boost activity levels Steady improvement expected in civil infrastructure and commercial construction Australia Outlook remains uncertain with
Slide 31: Financial outlook FY2014
Financial outlook FY2014 For personal use only Earnings growth expected to be driven by: • Sustained improvement in activity levels in New Zealand • Operational efficiency gains No significant volume growth forecast in Australia Further update will be provided at Annual Shareholders Meeting on 16 Oc
Slide 32: Supplementary Information
Supplementary For personal use only Information Dimond cladding, Auckland
Slide 33: Infrastructure Products: Increased NZ activity drove volume growth
Infrastructure Products For personal use only Increased NZ activity drove volume growth Gross Sales June 2012 June 2013 NZ$m 12 months 12 months %∆ Volume ∆ Price ∆ EBITDA ∆ Cement, concrete & aggregates¹ 619 669 +8 Cement Readymix - Aggregates: - New Zealand - - - Australia Concrete pipes & product
Slide 34: Building Products: Earnings ahead due to improvement in NZ market
Building Products For personal use only Earnings ahead due to improvement in NZ market Gross Sales June 2012 June 2013 NZ$m 12 months 12 months %∆ Volume ∆ Price ∆ EBITDA ∆ Building Products 600 584 -3 Plasterboard - Insulation¹ Coated Steel Products 954 940 -1 Roof Tile Group² - Coated Steel NZ³ -
Slide 35: Laminates & Panels: Volumes up in North America, down elsewhere
Laminates & Panels For personal use only Volumes up in North America, down elsewhere Gross Sales June 2012 June 2013 NZ$m 12 months 12 months %∆ Volume ∆ Price ∆ EBITDA ∆ Laminex Australia 901 816 -9 - New Zealand¹ 133 117 -12 - Formica Asia 213 205 -4 - - - Europe 294 247 -16 - North America 336 33
Slide 36: Annual Results to June 2013
For personal use only Annual Results to 30 June 2013 Mark Adamson -Chief Executive Officer NickOlson -Chief Financial Officer 21 August 2013