Fletcher Building Limited · NZX:FBU
Fletcher Building — Corporate Update (August 2024)
15 slides from Fletcher Building's corporate update, Aug 30, 2024
Slide 1: Western Australia Plumbing Issues Update
Western Australia Plumbing Issues Update Joint Industry Response 30 August 2024
Slide 2: Summary
Summary A Joint Industry Response to the Perth plumbing failures has been agreed in-principle ➔ A Joint Industry Response to the WA plumbing failures has been agreed in principle by the Western Australia Government, Iplex Pipelines Australia (“Iplex AU”) and almost all builders of WA homes built wit
Slide 3: Summary (cont.)
Summary (cont.) A Joint Industry Response to the Perth plumbing failures has been agreed in-principle ➔ Iplex AU has committed to the JIR because it is in all parties’ interests for there to be a pragmatic and homeowner-friendly mitigation of future issues. The JIR also means the Government has chos
Slide 4: Summary (cont.)
Summary (cont.) A Joint Industry Response to the Perth plumbing failures has been agreed in-principle ➔ The JIR is entered into by the parties on a no liability, no admissions basis. All participants have agreed to a “no sue” provision as to part of the agreement. ➔ Each party is not restricted from
Slide 5: Summary (cont.)
Summary (cont.) A Joint Industry Response to the Perth plumbing failures has been agreed in-principle Current Litigation ➔ As previously notified, a class action has been served on Iplex AU on behalf of all homeowners, Australia wide, alleging that the Pro-Fit product was not of acceptable quality a
Slide 6: Background
Background The plumbing failures continue to be concentrated in Perth ESTIMATED HOMES BUILT WITH TYPLEX PRO-FIT Data as of 21st August 2024 ➔ Pro-Fit with Typlex resin was first produced by Iplex AU in mid-2017 and was the bulk of the supply across Australia from then onwards c.15k homes c.15k homes
Slide 7: Iplex's approach to the plumbing failures
Iplex’s approach to the plumbing failures We have had a consistent focus on three workstreams ❶ ❷ ❸ SUPPORT FOR ESTABLISHING INDUSTRY CUSTOMERS & CAUSATION RESPONSE HOMEOWNERS A$15m interim investigation fund: Independent expert reports into causation confirm that: Iplex has been working with the In
Slide 8: Trends in first time leak rates
Trends in first time leak rates Information to Iplex shows homes in Perth with first-time leaks are reducing, measured period-on-period AVERAGE MONTHLY NUMBER OF PERTH HOMES EXPERIENCING A LEAK FOR THE FIRST TIME 124 43% Other Builders BGC 101 34% 89 21% 49 37 67 70 70 30 24 25 25 75 64 59 43 45 45
Slide 9: Trends in leak rates
Trends in leak rates Different leak rates between plumbers / builders – and therefore between homes BGC and three plumbing PLUMBING FAILURE RATES1 groups account for ~95% (% of plumbing failures / Perth homes built with Typlex Pro-Fit pipe) of WA leaks 23% 21% 21% (2) Average of 18% smaller builders
Slide 10: How the Joint Industry Response will work
How the Joint Industry Response will work Leak detector units & a stepped approach to leak repairs offers a pragmatic response to plumbing failures ➔ Iplex AU will offer all eligible WA homeowners, free of charge, the installation of a leak detector LEAK DETECTOR unit (LDU). LDUs funded 100% by Iple
Slide 11: Why Iplex is committed to the Joint Industry Response
Why Iplex is committed to the Joint Industry Response The JIR is in all parties’ interests Avoids a product recall, which would have involved massive & needless disruption and cost at a time where there was no capacity The Joint Industry Response: in the industry to deliver it. The JIR with Governme
Slide 12: Financial considerations
Financial considerations Provision of ~A$155m based on ~35% of homes being impacted & allows for BGC homes to be included under JIR. Costs & cash flows will be affected by actual level and will be lower if BGC does not join. Provision is Significant Item; cash flows are pre-tax ➔ Assuming the JIR is
Slide 13: Next Steps
Next Steps ➔ Formally document the Joint Industry Response among agreed participants ▪ Support under Iplex’s Interim Fund remains in place to the end of September to allow the JIR to get up and running ➔ Stand up the operational and administrative support for the Joint Industry Response ▪ Inclusive
Slide 14: Questions?
Questions? ; Fletcher ~ Building
Slide 15: Important Information
Important Information This presentation has been prepared by Fletcher Building Limited and its group of companies (“Fletcher Building”) for informational purposes. This disclaimer applies to this document and the verbal or written comments of any person presenting it. The information in this present