James Hardie announces a fiscal year 2019 second half dividend of US
26.0 cents per security

SYDNEY–(BUSINESS WIRE)–James Hardie today announced results for the fourth quarter of fiscal
year 2019 and the full year ended 31 March 2019:

• Group Adjusted net operating profit of US$73.8 million for the quarter
  and US$300.5 million for the full year, a decrease of 9% and an
  increase of 3%, respectively, compared to the prior corresponding
  periods (“pcp”);
• Group Adjusted EBIT of US$100.0 million for the quarter and US$404.6
  million for the full year, a decrease of 3% and an increase of 2%,
  respectively, compared to pcp;
• Group net sales of US$624.8 million for the quarter and US$2,506.6
  million for the full year, an increase of 19% and 22%, respectively,
  compared to pcp;
• North America Fiber Cement Segment volume increased 1% for the quarter
  and 3% for the full year, compared to pcp;
• North America Fiber Cement Segment EBIT margin excluding product line
  discontinuation expenses of 22.5% for the quarter and 23.1% for the
  full year;
• Asia Pacific Fiber Cement Segment EBIT margin of 20.0% for the quarter
  and 22.3% for the full year;
• Europe Building Products Segment Adjusted EBIT margin excluding costs
  associated with the acquisition of 11.3% for the quarter and 10.6% for
  the full year; and
• The Fermacell acquisition closed on 3 April 2018 and is included in
  the financial results for the full year of fiscal year 2019.

CEO Commentary

James Hardie CEO Jack Truong said, “Our North America Fiber Cement
segment delivered solid revenue growth of 3% for the quarter and 6% for
the full year while generating good EBIT margins within our target range
in a challenging input cost environment. The North America housing
market demand was soft across most geographies and customer segments the
last six months of fiscal year 2019. Our exteriors business grew 1%
above our addressable market for fiscal year 2019 compared to negative
2% in fiscal year 2018. It was a good improvement over our fiscal year
2018 performance, albeit below our internal expectations. We have
encouraging signs of early momentum on our recent commercial
transformation and implementation of lean manufacturing in our North
American plants. We are confident these transformations will lead to
marked improvement in our ability to execute and deliver on expected
results.”

He continued, “Our Asia Pacific Fiber Cement segment continued to
deliver excellent top line growth of 7% and 11% in Australian dollars
for the quarter and full year, respectively. Our Australian and
Philippines businesses lead the way in gaining volume growth above their
underlying market growth. This strong growth was achieved despite a
continued, softening Australian housing market throughout the year.
Further, our EBIT margins were significantly impacted by input cost
rapid inflation during most of fiscal year 2019.”

Dr Truong added, “Our Europe Building Products segment delivered strong
pro-forma revenue growth in Euros of 7% with an Adjusted EBIT margin of
10.6% for the full fiscal year after excluding costs associated with the
acquisition and integration. We are encouraged by the positive first
year results. We are excited about our European business gaining
significant momentum in fiber cement growth in fiscal year 2020 while
continually improving on our fiber gypsum business.”

He concluded, “Our consolidated group results reflected good and
disciplined financial performance in a significant inflationary cost
environment. We enter fiscal year 2020 with our global team aligned on
one global strategy that is centered around delivering growth above the
market in all of our regions with strong financial returns.”

Outlook

We expect to see modest growth in the US housing market in fiscal year
2020. The single family new construction market and repair and remodel
market growth rates in fiscal year 2020 are expected to grow, albeit at
a growth rate lower than that in fiscal year 2019. The Company expects
new construction starts between approximately 1.2 million and 1.3
million.

We expect our North America Fiber Cement segment EBIT margin to be in
the top half of our range of 20% to 25% for fiscal year 2020. This
expectation is based upon the Company continuing to improve operating
performance in our plants, improved net average sales price and mix,
continued inflation for input costs and modest underlying housing growth.

In Australia, it is anticipated that our addressable underlying market
will decrease in fiscal year 2020 compared to fiscal year 2019. Net
sales from our Australian business are expected to continue to trend
above the average growth of the domestic repair and remodel and single
family detached housing markets in the eastern states of Australia.

We expect our Europe Building Product segment to achieve year on year
net sales and EBIT margin growth.

Further Information

Readers are referred to the Company’s Consolidated Financial Statements
and Management’s Analysis of Results for the fourth quarter and full
year ended 31 March 2019 for additional information regarding the
Company’s results, including information regarding income taxes, the
asbestos liability and contingent liabilities.

As of 30 June 2018, the Company changed its reportable operating
segments. Previously, the Company reported on four operating segments:
(i) North America Fiber Cement, (ii) International Fiber Cement, (iii)
Other Businesses, and (iv) Research and Development. As of 30 June 2018,
the Company began reporting on five operating segments: (i) North
America Fiber Cement, (ii) Asia Pacific Fiber Cement, (iii) Europe
Building Products, (iv) Other Businesses, and (v) Research and
Development. The significant changes to how certain businesses are
reported in the new segment structure are as follows: Our European Fiber
Cement business as well as the newly acquired Fermacell business are now
reported as the Europe Building Products segment, and the remaining
businesses that were historically reported in the International Fiber
Cement segment are now reported in the Asia Pacific Fiber Cement
segment. The Company has revised its historical segment information at
31 March 2018 and for the years ended 31 March 2018 and 2017 to be
consistent with the new reportable segment structure. The change in
reportable segments had no effect on the Company’s financial position,
results of operations or cash flows for the periods presented. Readers
are referred to Note 18 of our consolidated financial statements for
further information on our segments.

Use of Non-GAAP Financial Information;
Australian Equivalent Terminology

This Media Release includes financial measures that are not considered a
measure of financial performance under generally accepted accounting
principles in the United States (GAAP), such as Adjusted net operating
profit and Adjusted EBIT. These non-GAAP financial measures should not
be considered to be more meaningful than the equivalent GAAP measure.
Management has included such measures to provide investors with an
alternative method for assessing its operating results in a manner that
is focused on the performance of its ongoing operations and excludes the
impact of certain legacy items, such as asbestos adjustments.
Additionally, management uses such non-GAAP financial measures for the
same purposes. However, these non-GAAP financial measures are not
prepared in accordance with US GAAP, may not be reported by all of the
Company’s competitors and may not be directly comparable to similarly
titled measures of the Company’s competitors due to potential
differences in the exact method of calculation. For additional
information regarding the non-GAAP financial measures presented in this
Media Release, including a reconciliation of each non-GAAP financial
measure to the equivalent US GAAP measure, see the section titled
“Non-US GAAP Financial Measures” included in the Company’s Management’s
Analysis of Results for the fourth quarter and full year ended 31 March
2019.

In addition, this Media Release includes financial measures and
descriptions that are considered to not be in accordance with US GAAP,
but which are consistent with financial measures reported by Australian
companies, such as operating profit, EBIT and EBIT margin. Since the
Company prepares its Consolidated Financial Statements in accordance
with US GAAP, the Company provides investors with a table and
definitions presenting cross-references between each US GAAP financial
measure used in the Company’s Consolidated Financial Statements to the
equivalent non-US GAAP financial measure used in this Media Release. See
the sections titled “Non-US GAAP Financial Measures” included in the
Company’s Management’s Analysis of Results for the fourth quarter and
full year ended 31 March 2019.

Forward-Looking Statements

This Media Release contains forward-looking statements and information
that are necessarily subject to risks, uncertainties and assumptions.
Many factors could cause the actual results, performance or achievements
of James Hardie to be materially different from those expressed or
implied in this release, including, among others, the risks and
uncertainties set forth in Section 3 “Risk Factors” in James Hardie’s
Annual Report on Form 20-F for the year ended 31 March 2019; changes in
general economic, political, governmental and business conditions
globally and in the countries in which James Hardie does business;
changes in interest rates; changes in inflation rates; changes in
exchange rates; the level of construction generally; changes in cement
demand and prices; changes in raw material and energy prices; changes in
business strategy and various other factors. Should one or more of these
risks or uncertainties materialize, or should underlying assumptions
prove incorrect, actual results may vary materially from those described
herein. James Hardie assumes no obligation to update or correct the
information contained in this Media Release except as required by law.

Contacts

Media/Analyst Enquiries:
Jason Miele
Vice President,
Investor and Media Relations
Telephone: +61 2 8845 3352
Email:
[email protected]