James Hardie tumbles on weak result, outlook
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More news: Shares in James Hardie tumbled nearly 6% to $36.35 in early trading after the building products manufacturer posted a drop in full-year profit and warned of lower volumes in its main North America market in FY26 as market headwinds continue.
RBC Capital Markets analyst Matthew McKellar said while the results were near consensus, its outlook for FY26 was cautious.
"We view the company's statement that it expects to outperform its end markets across each of North America, APAC and Europe in FY26 as supportive but unsurprising, and although the company is maintaining its outlook that North American net sales and EBITDA margins will grow, its comments around North American R&R demand are somewhat more cautious than we had been anticipating. We think investors will be looking for more granular detail around James Hardie's outlook," he said in a note.
James Hardie FY profit drops 17% in challenging market
The news: Building products manufacturer James Hardie has posted a drop in full-year profit, with the result weighed down by higher raw material costs and lower sales.
The numbers: Net profit for the year to 31 March was down 17% to USD424 million ($660 million), while net sales slipped 1% to USD3.88 billion. That included a 3% decline in sales during the fourth quarter and a 4% drop in adjusted quarterly earnings. It will not pay any dividends.
The context: The company said net sales decreased 2% in the key North America market driven by lower volumes amid market weakness, partially offset by a price increase in January. In Asia Pacific, sales slumped 13% due to lower volumes after winding down commercial operations in the Philippines but were down in single digits in the Australia & New Zealand market. Markets across Europe remained challenged.
With market headwinds continuing, the group expects volumes to contract in its main North America market FY26, but earnings margin is expected to hold at around 35%. The result comes as the company looks to complete its $14 billion acquisition of NYSE-listed outdoor living products maker AZEK. The deal will “further accelerate our sales growth by an incremental two and a half percentage points on top of our double-digit trajectory due to AZEK’s faster growth profile,” it said in a statement on Wednesday.
The source: ASX
