James Hardie shares soar after Q2 result beats forecasts
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More news: James Hardie was the best performing ASX 200 company in early trading after the building products manufacturer's second-quarter result beat market estimates.
James Hardie shares were up 6.5% to $53.50 by 11:30am AEDT.
UBS analysts said James Hardie's second-quarter NPAT was 8% ahead of consensus forecasts. They noted that while the company removed the top end of its full-year guidance, they saw it as a "significant" positive that it held the lower end of volumes and lifted its US EBIT margin and NPAT.
FY26 guidance for growth is likely to fall below the market, the analysts said, but cuts to FY26 consensus should be small given its solid FY25 base.
James Hardie half-year profit tumbles in challenging market
The news: Building products manufacturer James Hardie has posted a drop in first-half profit, with the result weighed down by higher raw material costs and lower sales.
The numbers: Net profit for the six months to 30 September was down 23% to USD238.7 million ($365.1 million), while net sales were barely changed at USD1.95 billion. That included a 4% decline in sales during the second quarter and an 8% drop in adjusted second-quarter earnings.
The context: The company said net sales decreased 5% 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 were down after winding down commercial operations in the Philippines but higher in the Australia and New Zealand market. Markets across Europe remained challenged.
Despite market headwinds, the group has reaffirmed the low end of its volume guidance range and slightly lifted the low end of its North America earnings margin and adjusted net income ranges.
CEO Aaron Erter said he was encouraged by the prospect of improvements in consumer sentiment and homeowner affordability as borrowing costs normalise.
The sources: ASX announcement, UBS research
