BRICKWORKS LIMITED 23 April 2015
Australian Securities Exchange
Attention: Companies Department
BY ELECTRONIC LODGEMENT
Dear Sir/Madam,
Please find attached a presentation to be given to analysts this morning, for immediate release to the market.
Yours faithfully, BRICKWORKS LIMITED
IAIN THOMPSON COMPANY SECRETARY
JP MORGAN BUILDING FORUM
Mr. Mark Finney, Austral Bricks East Coast Group GM
23rd April 2015
Presentation Outline Brickworks Corporate Structure
Building Products
Austral Bricks Performance
Austral Bricks Outlook
Questions
1
Brickworks Corporate StructureBuilding
Products Group
Austral Bricks
Austral Masonry
Bristile Roofing
Austral Precast
Auswest Timbers
Land & Development Group
Property Sales
Property Trust
Waste Management
Investments
42.7% holding in WHSP
BUILDING PRODUCTS
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Building Products Result1H 2015 | 1H 2014 | % Change | |
Sales revenue | $340.6m | $296.2m | 15.0 |
EBITDA | $38.8m | $31.8m | 22.0 |
EBIT1 | $26.1m | $19.2m | 35.9 |
EBITDA to sales | 11.4% | 10.7% | 6.5 |
EBIT to sales | 7.7% | 6.5% | 18.5 |
Return on Capital Employed | 6.4% | 4.7% | 36.2 |
Return on Net Tangible Assets | 9.2% | 7.1% | 29.6 |
FTE Employees2 (vs. Jul 14) | 1,484 | 1,478 | 0.4 |
Safety (TRIFR) (vs. Jul 14) | 107.2 | 161.7 | (33.7) |
Safety (LTIFR) (vs. Jul 14) | 2.8 | 3.3 | (15.2) |
1. | Pre significant items | ||
2. | Includes casuals |
By Product
By State
Timber
9%
Precast
11%
Masonry
13%
Bricks
51%
QLD
14%
WA
20%
TAS SA
NSW
35%
Roofing
17%
VIC
26%
Note: Excludes product "tolling", export sales and New Zealand Brick Distributors.
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200,000
Australian Dwelling Starts / Approvals History 12 month moving average175,000
150,000
125,000
100,000
75,000
50,000
25,000
-
Detached Starts Other Res Starts Total Starts
Detached Approvals
Source: ABS
Other Res Approvals
Total Approvals
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Residential Approvals - Historical Trend (Moving Annual Total)New South Wales Victoria
70,000
Queensland Western Australia
70,000
60,000
50,000
40,000
30,000
20,000
10,000
-
60,000
50,000
40,000
30,000
20,000
10,000
-
1995 1999 2003 2007 2011 2015
"High rise" (>3 storey) "Low rise" multi-res Detached houses
1995 1999 2003 2007 2011 2015
Source: ABS
AUSTRAL BRICKS
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Austral Bricks - Context2012
Toughest conditions in over a decade
TODAY
Much improved conditions and outlook
• Detached housing at cyclical low point
• Industry overcapacity
• Unsustainable prices
• High fixed costs and input cost pressures
• Strong housing construction expected to continue
• Capacity removed + "tolling"
arrangements as required
• Improved pricing in most states but more to do
• Alternative fuels and other
cost reduction programs
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Austral Bricks Trends (Since 1H2012)State | Volume | Pricing | Production Cost | Profit |
New South Wales | ||||
Queensland | ||||
Victoria | ||||
South Australia | ||||
Tasmania | ||||
Western Australia |
20%
15%
• Price increases to restore margins is on track in most states
• Western Australia remains challenging
• Additional increases required
• 6-10% increases announced in most states
10%
5%
0%
NSW QLD VIC SA TAS WA
-5%
-10%
Exit of K&D and absorption of large account
1H12 1H13 1H14 1H15
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Major Capital Projects Recommissioned Plant 2 at Horsley
Park in NSW to meet demand− First bricks now being produced
New setter plus kiln, dryer and dehacker upgrades at Rochedale in QLD to improve quality and reduce cost(ongoing)
Refit at Malaga in WA, including upgrades to kiln and dryer, to reduce
cost
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Alternative Fuels StrategyAustral Bricks East Coast
Forecast Profile of Energy Supply (share of required GJ)
Biomass
Landfill gas
Strike Energy
Option agreement signed for 12.5PG
Conventional natural gas supply
Austral Bricks Return on Capital EmployedStrong momentum
Turn-around ongoing
Gathering momentum
Strong momentum
Strong momentum
Challenges remain
NSW QLD VIC SA TAS WA
1H2015 impacted by extended plant shut- down
* 1H2015 earnings annualised
FY2012 FY2013 FY2014 1H2015 *
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Austral Bricks Outlook Strong order book to drive further volume growth
Price increases of 6-10% over the next 12 months
Product "tolling" in some markets to improve
production efficiency
Capital projects to improve competitive position in
QLD and WA
Continued implementation of alternative fuels projects and other cost reduction initiatives
Questions
10
Disclaimer
IMPORTANT: The information in this document has been provided to you for information only by Brickworks Limited ("BKW") and is subject to change without notice. Nothing contained in this document constitutes investment, legal, tax or other advice. The information in this does not take into account your investment objectives, financial situation or particular needs. Before making an investment decision, you should consider, with or without the assistance of a professional securities adviser, whether an investment in BKW is appropriate in the light of your particular investment needs, objectives and financial circumstances.
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US person including (1) any US resident, (2) any partnership or corporation or other entity organised or incorporated under the laws of the US or any state thereof, (3) any trust of which any trustee is a US person, or (4) an agency or branch of a foreign entity located in the US.
By accepting this document you agree to be bound by these limitations. BKW has prepared this document based on information available to it. Although reasonable care has been taken to ensure that the facts stated and opinions given in this document are fair and accurate, the information provided in this document has not been independently verified. Accordingly, no representation or warranty, expressed or implied is made as to the reliability, fairness, accuracy, completeness or correctness of the information and opinions contained in this document. To the fullest extent permitted by law, none of BKW, its related bodies corporate, directors, employees or agents nor any other person accepts any liability for any loss whatsoever arising from any use of this document or its contents, or otherwise arising in connection therewith.
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