James Hardie Industries plc. · NYSE:JHX
James Hardie Industries — Q3 FY2021 Earnings Presentation
34 slides from James Hardie Industries's earnings presentation, Feb 9, 2021
Slide 1: Q3 FY21 Management Presentation
Q3 FY21 MANAGEMENT PRESENTATION 9 February 2021
Slide 2: Cautionary Note on Forward-Looking Statements
James Hardie Q3 FY21 Results CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS This Management Presentation contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. James Hardie Industries plc (the “Comp
Slide 3: Agenda
James Hardie Q3 FY21 Results AGENDA • Strategy Update Dr. Jack Truong Chief Executive Officer • Q3 FY21 Financial Results • Questions and Answers Jason Miele Chief Financial Officer Page 3
Slide 4: Strategy Update
STRATEGY UPDATE
Slide 5: Global Strategy Update
James Hardie Q3 FY21 Results GLOBAL STRATEGY UPDATE FY20-FY21: TRANSFORM TO ENABLE FY22 AND BEYOND: DRIVE FUTURE GLOBAL GROWTH PROFITABLE GROWTH World class manufacturing via LEAN Customer focused via Push/Pull strategy Commercialize Global Innovations Integrate supply chain with our customers
Slide 6: Profitable Organic Growth via Innovation
James Hardie Q3 FY21 Results PROFITABLE ORGANIC GROWTH VIA INNOVATION Market Driven Innovation Exterior Wall Material by Region1 North America2 Australia/New Zealand3 - Innovation Platform: Innovative products that deliver 51% 49% 41% endless possibilities of design and aesthetics for the 59% homeow
Slide 7: Profitable Organic Growth via Innovation
James Hardie Q3 FY21 Results PROFITABLE ORGANIC GROWTH VIA INNOVATION United Kingdom California, USA New Jersey, USA NSW, Australia Page 7
Slide 8: Accelerate Our Penetration into Repair & Remodel Segment
James Hardie Q3 FY21 Results ACCELERATE OUR PENETRATION INTO REPAIR & REMODEL SEGMENT Share of Owner-Occupied Housing by 44 Million homes that are more Year Structure Built1 than 40 years old Built 2010 or Later 6% • Significant opportunity for 14% re-Siding and remodeling Built 2000 to 2009 • James
Slide 9: Extend into the Consumer Brand
James Hardie Q3 FY21 Results EXTEND INTO THE CONSUMER BRAND Market directly to the homeowners to communicate the endless possibilities of aesthetic design to create more demand for James Hardie Brand exterior products • Lasting beauty with endless design possibilities • Trusted protection: durabilit
Slide 10: Extend into the Consumer Brand
James Hardie Q3 FY21 Results EXTEND INTO THE CONSUMER BRAND Page 10
Slide 11: Global Capacity Expansion and New Products Capability
James Hardie Q3 FY21 Results GLOBAL CAPACITY EXPANSION AND NEW PRODUCTS CAPABILITY • +800 mmstf nameplate capacity in NA • +60 mmstf nameplate capacity in ANZ • Additional ColorPlus capability in NA • Additional HLD Trim capability in NA • Enable innovation with R&D pilot plants in US and Australia
Slide 12: Global Growth & Strong Returns – Q3 FY21
James Hardie Q3 FY21 Results GLOBAL GROWTH & STRONG RETURNS – Q3 FY21 Global Net Sales North America US$738.6 million Net Sales US$518.1 million +20% +20% EBIT Margin 30.0% Europe Net Sales €85.3 million +12% EBIT Margin 10.2% Global Adjusted NOPAT Asia Pacific US$123.3 million Net Sales A$163.3 mil
Slide 13: Global Growth & Strong Returns – Nine Months YTD FY21
James Hardie Q3 FY21 Results GLOBAL GROWTH & STRONG RETURNS – 9 Months YTD FY21 Global Net Sales US$2.1 billion Global Adj. EBIT +9% US$455.9 million +25% Operating Cash Flow Global Adjusted NOPAT US$678.4 million US$333.1 million +72% +25% Page 13
Slide 14: Q3 FY21 Financial Results
Q3 FY21 FINANCIAL RESULTS
Slide 15: Global Results Overview
James Hardie Q3 FY21 Results GLOBAL RESULTS OVERVIEW Q3 FY21 9 Months FY21 • All 3 regions delivered strong profitable growth 1,056.9 mmsf 3,010.6mmsf Sales Volume • Adjusted EBIT increased 57% in Q3, driven by: 16% 6% ◦ North America increased US$43.3 million (+39%) US$738.6 M US$2,101.7 M ◦ Europe
Slide 16: North America Summary
James Hardie Q3 FY21 Results NORTH AMERICA SUMMARY • Exteriors volume increased +19% in Q3 and +11% in the first nine months of FY21 ◦ Accelerated share gain through customer engagement and integration • Interiors volume increased +4% in Q3 and was flat in the first nine months of FY21 • Adjusted EB
Slide 17: Europe Summary
James Hardie Q3 FY21 Results EUROPE SUMMARY • Net Sales increased 12% in Q3: ◦ Fiber Cement Net Sales €: +18% in Q3 ◦ Fiber Gypsum Net Sales €: +11% in Q3 driven by strong double digit growth in Germany • Net Sales increased 2% in the first nine months ◦ Strong organic net sales growth in Q2 (+8%) a
Slide 18: APAC Summary
James Hardie Q3 FY21 Results APAC SUMMARY • Continued market share gain in Australia and New Zealand • First nine months volume, gross profit and EBIT unfavorably impacted by government imposed COVID-19 lockdowns in the Philippines and New Zealand during the first quarter • Adjusted EBIT growth of 2
Slide 19: Operating Cash Flow Up, Capital Expenditures Down
James Hardie Q3 FY21 Results OPERATING CASH FLOW UP CAPITAL EXPENDITURES DOWN 800 Operating Cash Flow US$ Millions 678.4 700 600 500 1 393.4 400 309.3 300 265.8 271.6 200 100 0 9 Mths FY17 9 Mths FY18 9 Mths FY19 9 Mths FY20 9 Mths FY21 CAPEX spend for the nine months of US$77.0 million • Carole Par
Slide 20: Liquidity Profile
James Hardie Q3 FY21 Results LIQUIDITY PROFILE Corporate debt structure • On 15 January 2021 redeemed US$400 million 4.75% senior unsecured notes maturing 2025 - US$9.5 million call premium and US$3.6 million in unamortized financing costs to be recorded in Q4 FY21 • €400 million (US$492 million)2 3
Slide 21: Capital Management and Allocation
James Hardie Q3 FY21 Results CAPITAL MANAGEMENT AND ALLOCATION Strong capital structure and cash flows to execute on capital allocation objectives: • Preserve strong liquidity position and financial flexibility; • Invest in capacity expansion to support organic growth; • Invest in market driven inno
Slide 22: Full Year FY21 Guidance
James Hardie Q3 FY21 Results FULL YEAR FY21 GUIDANCE Management raises full year FY21 Adjusted net operating profit1 to range of US$440 million and US$450 million • Prior Adjusted net operating profit range of US$380 million and US$420 million • The comparable full year Adjusted net operating profit
Slide 23: Questions
QUESTIONS EE TEI AT AK
Slide 24: Appendix
| APPENDIX
Slide 25: General Corporate Costs and Research & Development
James Hardie Q3 FY21 Results GENERAL CORPORATE COSTS RESEARCH & DEVELOPMENT • Stock compensation expense was flat in • Customer Driven Innovation remains Q3 and increased US$11.5 million in the core strategic pillar first nine months • R&D up 3% in the first nine months • Increase in stock compensat
Slide 26: Depreciation and Amortization
James Hardie Q3 FY21 Results DEPRECIATION AND AMORTIZATION US$ Millions Three Months and Nine Months Ended 31 December Q3 FY21 Q3 FY20 9 Months FY21 9 Months FY20 Depreciation and amortization North America Fiber Cement $ 21.8 $ 22.0 $ 64.7 $ 66.0 Asia Pacific Fiber Cement 3.2 3.2 9.0 9.4 Europe Bui
Slide 27: Asbestos Claims Data
James Hardie Q3 FY21 Results ASBESTOS CLAIMS DATA First Nine Months ended 31 December 2020: • Net cash outflow was 13% below actuarial expectations • Gross cash outflow was 12% below actuarial expectations • Claims received were 9% below actuarial estimates and 16% below pcp • Number of claims settl
Slide 28: Non-GAAP Financial Measures and Terms
James Hardie Q3 FY21 Results NON-GAAP FINANCIAL MEASURES AND TERMS 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
Slide 29: Non-GAAP Financial Measures
James Hardie Q3 FY21 Results NON-GAAP FINANCIAL MEASURES Financial Measures – GAAP equivalents This document contains financial statement line item descriptions that are considered to be non-GAAP, but are consistent with those used by Australian companies. Because the company prepares its Condensed
Slide 30: Non-GAAP Financial Measures
James Hardie Q3 FY21 Results NON-GAAP FINANCIAL MEASURES Financial Measures – GAAP equivalents Adjusted EBIT US$ Millions Three Months and Nine Months Ended 31 December Q3'21 Q3'20 9 Months FY21 9 Months FY20 EBIT $ 131.8 $ 88.2 $ 328.1 $ 373.3 Asbestos: Asbestos adjustments 35.8 18.5 115.8 (8.8) AI
Slide 31: Non-GAAP Financial Measures
James Hardie Q3 FY21 Results NON-GAAP FINANCIAL MEASURES Asia Pacific Fiber Cement Segment Adjusted EBIT excluding restructuring expenses US$ Millions Three Months and Nine Months Ended 31 December Q3'21 Q3'20 9 Months FY21 9 Months FY20 Asia Pacific Fiber Cement Segment EBIT $ 33.5 $ 23.4 $ 91.1 $
Slide 32: Non-GAAP Financial Measures
James Hardie Q3 FY21 Results NON-GAAP FINANCIAL MEASURES Research and Development Segment Adjusted EBIT excluding restructuring expenses US$ Millions Three Months and Nine Months Ended 31 December Q3'21 Q3'20 9 Months FY21 9 Months FY20 Research and Development Segment EBIT $ (7.9) $ (6.6) $ (20.4)
Slide 33: Non-GAAP Financial Measures
James Hardie Q3 FY21 Results NON-GAAP FINANCIAL MEASURES Adjusted net operating profit US$ Millions Three Months and Nine Months Ended 31 December Q3'21 Q3'20 9 Months FY21 9 Months FY20 Net operating profit $ 68.6 $ 45.6 $ 164.8 $ 235.2 Asbestos: Asbestos adjustments 35.8 18.5 115.8 (8.8) AICF SG&A
Slide 34: Q3 FY21 Management Presentation
Q3 FY21 MANAGEMENT PRESENTATION 9 February 2021
James Hardie Industries — Q3 FY2021 Earnings Presentation on 6ix