Fletcher Building Limited · NZX:FBU
Fletcher Building — Investor Presentation (November 2006)
23 slides from Fletcher Building's investor presentation, November 2006
Slide 1: Infrastructure Division
Infrastructure Division Mark Binns Perth 2006 Growing Infrastructure
Slide 2: Cautionary Statement
Cautionary Statement This presentation contains not only a review of operations, but also some forward looking statements about Fletcher Building and the environment in which the company operates. Because these statements are forward looking, Fletcher Building’s actual results could differ materiall
Slide 3: Building on a solid core: FY05 – FY06 comparison (New Zealand)
Building on a solid core: FY05 – FY06 comparison New Zealand CONCRETE & AGGREGATES CEMENT PRODUCTS CONSTRUCTION Revenue +7% Revenue +6% Revenue +2% Revenue +22% EBIT +21% EBIT +11% EBIT - 4% EBIT +26% Market 40% Market 52% Market 30% Homes 321 share share share sold (Auckland) (RMC) Source: Fletcher
Slide 4: Building on a solid core: FY05 – FY06 comparison (Australia)
Building on a solid core: FY05 – FY06 comparison Australia ROCLA PIPES ROCLA QUARRIES Revenue +8% Revenue +7% EBIT +12% EBIT - 10% Market share 35% Sydney market soft EVA positive Other states strong Infrastructure outlook positive EVA positive Source: Rocla Pipeline Products, Rocla Quarry Products
Slide 5: Continuing strong financial performance
Continuing strong financial performance Growing Infrastructure
Slide 6: NZ Construction market forecast
NZ Construction market forecast Total Construction: NZ$b June years 1995/96 prices Growing Infrastructure
Slide 7: Australian Construction market forecast
Australian Construction market forecast Total Construction: A$b 1993/94 prices Source: BIS Shrapnel September 06 Growing Infrastructure
Slide 8: FBL Construction materials volumes
FBL Construction materials volumes Sales Volumes (000’s) 2002 2003 2004 2005 2006 NZ Concrete m3 863 930 999 1063 1082 NZ Aggregates m3 3834 4109 3984 4285 4408 NZ Concrete Pipe tonnes 74 83 82 88 82 NZ Pipeline, Precast tonnes 35 36 33 32 32 AUS Pipeline, Precast tonnes 358 389 437 433 468 AUS Quar
Slide 9: Infrastructure: a positive environment
Infrastructure: a positive environment Source: Fletcher Construction backlog Growing Infrastructure
Slide 10: Infrastructure: major projects in progress
Infrastructure: major projects in progress Auckland University Business School $150m Wellington Hospital $147m Northern Busway $190m Stamford Plaza $115m Wellington Hospital Northern Busway Stamford Plaza extension Source: Fletcher Construction Growing Infrastructure
Slide 11: Strategic focus: maximising margin – Cement
Strategic focus: maximising margin Cement • Price increases restrained by import parity. • Price increase of $7.60 per tonne announced, effective 1 February 2007. • Manufacturing cost benefits will be maximised with completion of the upgrade. Source: Golden Bay Cement Growing Infrastructure
Slide 12: Strategic focus: maximising margin – Aggregates
Strategic focus: maximising margin Aggregates • Prices increased on manufactured product. • Operational improvements are reducing costs further this year. Source: Winstone Aggregates Growing Infrastructure
Slide 13: Strategic focus: maximising margin – Ready mix concrete
Strategic focus: maximising margin Ready mix concrete • Price leadership. • Demand conditions might lead to softer prices. • Increased material and distribution costs have successfully been passed on. Source: Firth Growing Infrastructure
Slide 14: Strategic focus: maximising margin – Concrete pipe
Strategic focus: maximising margin Concrete pipe • Price increases more subdued. • Significant EBIT growth. • Developing a plastics position. Source: Humes Pipeline Systems Growing Infrastructure
Slide 15: Strategic focus: minimising costs
Strategic focus: minimising costs NZ concrete operations • Large cost-out in FY2002. • Subsequent increases below inflation. • Limited pressure on overhead going forward. Source: Infrastructure Div management Growing Infrastructure
Slide 16: Strategic focus: positioning for organic growth
Strategic focus: positioning for organic growth • Targeted volumes met on commissioning Source: Golden Bay Cement Growing Infrastructure
Slide 17: Strategic focus: positioning for organic growth
Strategic focus: positioning for organic growth Whangaripo Kaipara Hunua • Capacity: 450k tpa • Increased sand • Volumes remain volumes consented. strong. • JV with Fulton Hogan • Barge operational. • Symonds Hill • Sales to commence Jan 07 consent process on schedule. Growing Infrastructure
Slide 18: Strategic focus: positioning for organic growth
Strategic focus: positioning for organic growth Growth in NZ concrete business • 1 x concrete business acquired. • 7 x greenfield concrete plants committed this year. • 2 x further RMC opportunities being considered. Growing Infrastructure
Slide 19: Strategic focus: core construction competency
Strategic focus: core construction competency People & plant • CAPEX 06 07 forecast $16m $11m • Employee growth (NZ based) Increase from 976 – 1172 over the last financial year Source: Fletcher Construction Growing Infrastructure
Slide 20: Strategic focus: secure key land assets
Strategic focus: secure key land assets Jacks Point – Queenstown LAQ – Auckland 200 sections. 800 sections. Subdivision opened October 2006, Supply period Jan 07-2011 with 6 house & land packages sold. (+ option on balance of resid. lots) Total residential land-bank: 1642 lots – with 321 sold in FY0
Slide 21: Strategic focus: positioning for organic growth
Strategic focus: positioning for organic growth . • Large investment in sleeper plants by Rocla Pipes • New pebble quarry acquired • Two new quarries under consideration Growing Infrastructure
Slide 22: Outlook Infrastructure Division FY07 – FY09
Outlook Infrastructure Division FY07 – FY09 Volumes marginally down Margins still strong but some pressure Overheads contained Return on Funds strong Growing Infrastructure
Slide 23: Questions
Questions Growing Infrastructure
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