Annual Shareholders’ Meeting documents and 1H21 guidance

Fletcher Building Limited, Private Bag 92114, Auckland 1142, 810 Great South Road, Penrose, Auckland 1061, New Zealand

Wednesday 25 November 2020

FLETCHER BUILDING LIMITED
2020 Annual Shareholders’ Meeting
Chair’s Address

FY2020 a challenging year comprehensively and effectively dealt with
There’s no doubt that 2020 has been an extraordinary year. As with all organisations and
industries, the COVID-19 pandemic presented some unique challenges for Fletcher Building
which we comprehensively and effectively dealt with.
On this slide, we highlight the 3 areas we have been focused on to deal with the impacts of the
COVID-19 pandemic.
Firstly, we needed to act swiftly to respond to a full lockdown in New Zealand and partial business
restrictions in Australia.
We then needed to get the business positioned, for the market uncertainty of FY21 and beyond.
And finally, we wanted to move quickly on these activities to ensure we remained focused on our
overall plans.
I am extremely proud of our Board, Management and our people as we navigated the challenges.
We worked very closely and at a rapid tempo to ensure this was managed well.
I want to take this opportunity to say thank you to the people of Fletcher Building for everything
they have done to guide our business through this period and to ensure that we are strongly
positioned to play a role in the economic recovery.
Responded quickly to NZ shut down and start up and Australia restrictions
This slide highlights our immediate response to the COVID-19 pandemic.
Our focus was on four key areas: ensuring everything we did was done safely, delivering strong
customer performance and support, looking after our people and remaining acutely focused on
costs, cash and our balance sheet.
Through March and April we needed to respond to a full lockdown in New Zealand, safely
shutting down over 400 locations across the country – which was no small feat – and we recorded
virtually no revenue during this time. We also adhered to the necessary social distancing and
other safety requirements through the partial business restrictions in Australia.

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Importantly, we maintained our focus on customer service and performance.
To support the health and wellbeing of our people through this time we quickly put in place a
support hub app, implemented multiple channels of communication and we established a
financial hardship fund. We also put in place a bridging pay programme for some 90% of NZ
employees during lockdown.
The timing of the COVID-19 shutdown coincided with what is traditionally our busiest and most
profitable quarter and in particular could not have been worse from the perspective of our
Construction business. It occurred in the middle of the earthworks season on the major roading
projects and just days before the planned opening of Commercial Bay. The impacts of these
factors were the main driver of $150 million increase in provisions across our legacy Infrastructure
and B+I projects. While I appreciate the need for additional provisioning is disappointing, I believe
FCC is now increasingly well positioned to focus on its future which Ross will cover off in his
presentation shortly.
While all these actions were unable to prevent a material earnings impact – we had a $200 million
reduction in earnings in Q4 and incurred significant losses for the year overall – our cash and
cost management focus resulted in strong operating cash flows and we preserved our strong
balance sheet position.
Actions taken to set up for FY21 and beyond despite market uncertainty
Then as we looked ahead, we had to take decisive action to ensure we were effectively set up
for FY21 and beyond. This was in view of the overall uncertainty while still maintaining a focus
on our plans for Fletcher Building.
We made some tough, but necessary decisions to reduce our cost base which included a
reduction in property footprint, rationalisation across our supply chain and logistics and
procurement activities.
Regrettably our workforce was reorganised to match the expected market uncertainty. These
were not decisions that were taken lightly. In doing this, we understand it had a large impact on
many people and we put in place a range of actions to provide as much assistance as we could.
The costs of implementing this, combined with the impairments to the Rocla business in Australia
that we are divesting and the repayment of some of our USPP debt, resulted in $276 million of
significant items during FY20. We expect a further $90 million in FY21 as final cost out actions
are completed.
The Board also exercised discretion in applying 30% pay reductions for Board and CEO for six
months. Our Executive team and our General Managers pay was reduced by 30% and 15%
respectively from 25 March to 17 June and no bonuses were paid under our STI scheme in FY20.
We also reduced planned capex spend, cancelled our share buy-back programme and we also
proactively renegotiated our debt covenants to preserve liquidity. Unfortunately for our
shareholders, we did not pay a dividend. Clearly, we left no stone unturned.

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I’d like to take the opportunity now to comment briefly on the situation with the land in Ihumātao
as I know this has been a topic of interest for many of our shareholders. We have continued to
take assurances from the government that a solution that is acceptable to all parties is close. The
delay to its resolution was one of the inevitable COVID-19 impacts and we are confident the
government, with us will bring this to a conclusion for all parties in the very near future.
FY2020 results at a glance
This slide summarises our financial results, which were materially impacted by COVID-19 in FY20.
Revenue for the year was $7.3 billion, EBIT before significant items was $160 million and we made
a net loss of $196 million.
Pleasingly, cash flows from operations were well up on last year and were a solid $410 million.
Overall, despite the earnings impact of COVID-19, we ended the year with a strong balance sheet
which is testament to the efforts of Board and Management going into the pandemic but also in
effectively managing the crisis.
Liquidity was maintained at $1.6 billion. Our net debt was only $0.5 billion resulting in our 0.9x
leverage ratio remaining below the target range.
And as I have mentioned, the Board paid no dividends for the FY20 year due to the issues that
resulted from COVID-19 and the ongoing uncertain outlook.
FY2020 balanced scorecard
On this slide, I provide an update on some of the key non-financial metrics on our balanced
scorecard. Starting from the top left, we have continued to put a large amount of effort into safety
through the year. Of note, our serious injuries reduced from 20 last year, to 8 in FY20.
Sustainability is now front and centre across all our businesses and embedded into how we think
about our future. As part of this focus we have committed Fletcher Building to reduce carbon
emissions by 30% below our FY18 levels by 2030. This aligns us with aims to limit global warming
to below 2 percent.
While employee engagement is good at 71%, we still have work to do to be in the top quartile of
companies. We continue to work on improving this and our target is to be at least 80% across
all our businesses. Similarly with customers. While our present net promoter scores are OK at
39, we absolutely need to get these to be best in class across all our operations.
We are working on seeing all these measures continue to improve in the period ahead.
Strong Governance through COVID-19 as well as action on safety, culture and performance
The Board operates with the support of Board committees, three of which are noted here.
All directors took an active part in the Protect Reset and the launch of Fletcher Building’s new
Protect Value. We continued to focus on delivering the strategy and we have been actively
listening to shareholder feedback. We understand the concerns held over company

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performance in recent years and we are continuing to work hard to address that with sustainable
actions.
While we have strong collaboration we also bring different viewpoints through age and gender
diversity and experience. We are well balanced between Australia and New Zealand and have
complementary skills across industry, manufacturing, sales, governance and finance capabilities.
Steve Vamos stepped down from the Board during the year and we thank him for his
considerable contribution. Steve’s departure does leave a vacancy which we have not yet filled.
We will continue to appoint directors who bring the right set of skills and experience to the existing
Board.
As a priority, our Safety Health, Environment and Sustainability Committee, continued its focus
on the business-wide Protect Reset safety programme, driving the leadership, culture and critical
risk approach for success. Our site visits are one example of how we are embedding this.
A strong culture has many facets – people engagement, values, purpose, trust, incentives,
diversity and inclusion. Our Remuneration Committee has had an unwavering focus on this
through COVID-19. They have focused on ensuring our people are well supported. Importantly,
we exercised appropriate discretion on remuneration ensuring all stakeholders were treated
fairly. The team also provided enhanced remuneration reporting which delivers better
transparency.
Our Audit and Risk Committee provided strong oversight on the financial complexities resulting
from COVID-19 ensuring that our strong balance sheet remained intact. We also improved
disclosure on our risk reporting, driving transparency to all our stakeholders.
Sustainability strategy
The long-term success of Fletcher Building is driven not only in financial terms, but also in
supporting good outcomes for all our stakeholders.
Last year I presented the sustainability strategy and we continue to drive our six key priorities as
it is critical for delivering long-term and sustainable growth to our shareholders.
In FY20 our initiatives included focusing on reducing the environmental impact of our products.
We increased the number of products we manufacture that hold Environmental Product
Declarations and Environmental Choice certifications that are recognised within green building
standards.
We set group-wide Science-Based Targets for carbon reduction. In December 2019, Fletcher
Building became the first building materials and construction company in New Zealand and
Australia to attain an independently verified Science-Based Target for carbon emissions
reduction.
We published our supplier code of conduct and we published our human rights policy. This
includes our commitment to put processes in place to prevent unethical practices in our
operations and supply chains and continuing to move to full environmental, social and
governance reporting.

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Finally on this slide I make reference to the Dow Jones Sustainability Index which is an
assessment of the governance, environmental and social performance of our business. As well
as retaining the Australia membership that we gained in 2019, we improved our score this year
and have just been included in the Asia-Pacific index as well. This is a great achievement.
Summary
FY20 was without doubt a tough year for all our stakeholders and I am very proud of how the
team and board members worked together. We responded quickly to the COVID-19 impacts, set
the business up for FY21 and we remained focused on our strategy and ambitions. While COVID-
19’s long term impacts remain unclear, we have Fletcher Building well positioned for whatever
lies ahead.
Two weeks ago we provided an update on our four-month trading to the end of October. Ross
will talk in more detail about that result shortly but I would comment that we are very pleased to
see that strong trading performance as evidence of the success of the strategy being delivered.
We are financially sound with a strong balance sheet, good cash flows and liquidity. The strength
and resilience this gives our business has never been more important than in today’s uncertain
environment.
Finally, with regard to dividends, it is the Board’s expectation that the Group will resume dividend
payments in FY21. Shareholders will recall that earlier this year, in response to COVID-19, we
moved proactively to agree covenant relief with our lenders, which ensured that we had
additional protection for our funding lines until the end of 2021. Part of this agreement was that
if we paid a dividend during that period then our additional protection would come to an end.
This will be a key consideration for the Board in February and means that the payment of an
interim dividend for FY21 is unlikely.
As we look ahead to the full-year though, it is the Board’s expectation that we will resume
payment of a final dividend for FY21. Further, in the event that there is no interim dividend, our
expectation is that the final dividend would reflect a full year of dividend payments.
We look forward to resuming these returns to our shareholders.
Before I hand over to Ross, I would like to say thank you again to all our shareholders, for your
continued support of Fletcher Building. We appreciate your commitment to the success of our
business and I look forward to sharing further details with you on our progress over the coming
months.
ENDS

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Fletcher Building Limited, Private Bag 92114, Auckland 1142, 810 Great South Road, Penrose, Auckland 1061, New Zealand

Wednesday 25 November 2020

FLETCHER BUILDING LIMITED
2020 Annual Shareholders’ Meeting
Chief Executive Officer’s Address

FY2020 tough year well handled
Like Bruce, I feel FY20 was a tough year for the business. But one that we handled well.
Importantly, we responded quickly and effectively to the COVID-19 crisis, across the shutdowns,
the restrictions, and then the progressive restarts. We then got the business set up, for what were,
and which continue to be uncertain times. And critically, this work set us up to continue to deliver
against the strategies that we’ve been working on for the last two years.
Unfortunately, these necessary actions came with consequences for all stakeholders and I
wanted to acknowledge these impacts on you, our shareholders, on our partners, and on our
people, as we worked through these challenges.
I found it a privilege to work in the business through this period, and see everyone lean into this
adversity, and get on with what was necessary with little complaint. This was a trait I saw from
the shop floor right through to the Board. And I would also like to add my thanks and appreciation
to everyone that helped us navigate FY20 and enter FY21 as well as we have.
Two years into strategy - Business is reset and stabilised
As I mentioned, this good work sets us up well to continue on with the plans we laid out back in
mid-2018, and which are summarised on this slide. Our aspiration for Fletcher Building is to be
the leader in Building Products and Solutions across New Zealand and Australia. Back in mid-
2018 we set ourselves a timetable to move the Company convincingly towards this over a 5-year
period:
• Through FY19 we successfully stabilised the business, we got our arms around the
Construction issues, we refocused the business on the; NZ, Pacific and Australia
geographies, we achieved the successful sale of our various international businesses
outside of these areas, and ended the FY19 year with a materially stronger balance sheet.
• Through FY20, we were then able to focus on what I call the “self-help” issues and look to
drive performance improvements across all areas of our business. This included some
major interventions. An organisation-wide safety reboot, the complete overhaul of
Fletcher Construction, and the major reset of our Australian business. But it also covered
a drive to get better at the basic operational disciplines across all our businesses, making
it clear what was expected and providing the training to support this.

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• The unexpected twist in FY20 was COVID-19 but because we dealt with its consequences
quickly and firmly, it has allowed us to stay on track with our plans to keep driving
performance and growth across the entire business.
I will spend the balance of my presentation talking to what we are now focused on and look to
bring it to life for you with examples as I go.
Key areas we are driving
Across each area of our business we are constantly looking at five main things:
• Firstly, getting everyone who works for us, or with us, home safely each and every day.
• Secondly, having the customer at the centre of everything we do. We have to ensure we
are providing market leading customer services, customer solutions, and customer
performance all of the time.
• Thirdly, is our drive to operational excellence. We want to be lean and efficient, with
competitive cost structures across all areas of our business.
• Next, we want all our go forward businesses producing economic returns in the top
quartile of their respective industry.
• And finally, we want to lead the market and our competition in innovation and
sustainability, effectively using both these, as levers to achieve growth above market, and
to ensure we’re doing the disrupting to others.
Positions us well to drive shareholder returns into the future
Beyond the progress we are making across these five areas, there are a number of other factors
that that set us up well, to drive strong shareholder returns into the future.
• We are a much more focused company, with the bulk of our operations now only in New
Zealand and Australia.
• We are running similar businesses across both these geographies. And this means that
there is a lot of consistency in what we need to get right across all of Fletcher Building.
• There is still a large chunk of improvement that can come from what I call “self-help”. This
means there are significant upside improvements available to us, from what is “in our
control”.
• We have a strong balance sheet and good cash flows underpinning these endeavours.
• And, the longer-term trends, are tails winds. Population and immigration growth will
reboot and should continue and the relative isolation of both countries means; that in
country scale positions have a good competitive advantage, and that we can be a fast
follower, and still be first with the introduction of new technologies and innovation in our
region.
All this positions us well for a strong future.
Against this backdrop, I remain confident we can deliver against the FY23 targets we set
ourselves back in mid-2018, and these are:
• To achieve revenue growth above the background market growth;
• To grow margins across all businesses such that group profitability gets to at least 10%;
• And with this to get ROFE above 15%.

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Trading update 4 months ended 31 October 2020 – Safety focus continues with a strong
emphasis on critical risks
I want to now move onto the 4-month trading update for FY21 that we provided to the market on
the 10
th
of November. Starting firstly with safety. Our Serious Injury rates and Total Recordable
rates are running at similar levels to this time last year. That said, through FY21 we are targeting
to improve on last year, as we expect to see the benefits from our safety programs flowing
through to the outcomes we are achieving.
Our particular emphasis through this year is to ensure our people have the skills to identify and
eliminate critical risks. These are the risks, that should they occur, they would cause a serious
injury or fatality.
Trading update 4 months ended 31 October 2020 – Safety focus continues with a strong
emphasis on critical risks
The trading update also showed we are making good progress on improving the operating
performance across all of our businesses. Through the first 4 months we saw Group revenues
up slightly by 1%, Group EBIT of $227 million, up $80 million, Group EBIT margin up 2.9ppts to
8.4% due to improved operating efficiency, and our cash flows and balance sheet remain strong:
with net debt at $388 million and available liquidity at $1.4 billion as at 31 October 2020
Looking forward we want to build on this progress and in the coming slides I will outline where
our focus and emphasis will be in each of our major business areas.
NZ Core – Key focus areas
Starting with our New Zealand Core businesses which cover our; Building Products, Distribution
and Concrete Divisions. Unsurprisingly, our focus across these businesses will continue in 3 key
areas:
• Firstly, continuing to drive operational excellence;
• Secondly, building a greater tempo and cadence in driving innovation and sustainability
across our products and services;
• And finally, moving at pace to improve on our customer offerings particularly around
ecommerce and our digital interfaces.
NZ Core – What we are delivering
Digging into each of these areas a bit more. The graphic on the left of this slide, brings to life the
progress we have made on driving margin improvements across our core NZ businesses. Here
you can see that through the first 4 months of FY21 we achieved a margin increase of 2.4%. On
the right-hand side, we have picked out a few examples of innovation that are occurring across
these businesses that are driving both revenue, and cost improvements.
Dimond Steel has developed a methodology that allows the steel roof to be rolled at the site, and
up at the roof level. This unique process removes all the joints across a long span roof making
installation easier, safer, and the roof far less susceptible to leaks – this methodology was recently
used with great success, at a large distribution centre in Auckland

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Iplex has introduced a mobile production plant for polyethylene pipes in the South Island, again
this allows for much longer pipe lengths to be produced, reducing both the number of joints, and
the installation costs.
Winstone Wallboard’s weatherline product continues to see good uptake and increasing
volumes, particularly across the residential sector. And, our focus on sustainability continues.
Two good examples include; the modification of our Portland cement works to consume old tyres
as fuel – this prevents up to 60% of waste tyres going to NZ landfill and displaces coal as a fuel
source, a double win for the environment. And secondly, the addition of solar panels to the roof
top of our Laminex manufacturing plant in Hamilton – this makes it one of NZ’s largest solar roof
top installation.
NZ Core – What we are delivering
As I mentioned our customer focus across our NZ core is on improving our capability and offers,
across the ecommerce, digitisation and data analytics space. And the impacts from the COVID-
19 pandemic have only amplified the need for speed in this area.
Pleasingly, we are starting to make some good progress across a number of fronts:
In PlaceMakers we have continued to build on our back of house “in store” digital customer
interfaces, and have now added uber style track and trace capabilities to over 70% of our “from
branch” deliveries, we have also ramped up our online presence where expect to have more than
50,000 of our products online for sale by January 2021.
The upgrade of our Firth ready mix concrete truck fleet continues - and it now has 35% its fleet
digitally enabled. This means we bypass the need for physical paperwork, with the customer
now receiving electronic delivery dockets directly.
And Laminex NZ has deployed our successful Laminex Australia ecommerce portal and is
already achieving around $1.2 million of sales per month since its launch late last year.
All this however is only the beginning, and we will continue to work hard in this space across all
of our core New Zealand businesses.
Residential and Development – Key focus areas
Our Residential and Development business continues to perform strongly and remains well
positioned to pursue a number of growth initiatives.
Firstly, we are confident we can continue to grow our present low-rise residential business, from
around 750 to 1,000 houses a year over the coming years.
Secondly, we want to progressively scale up Clevercore, our OSM manufacturing business, such
that it’s manufacturing at least 500 houses per year.
And Thirdly, we will look to also scale up our mid-rise apartments business. We see this as a
good opportunity, that follows the trend of increasing densification of housing in larger cities.

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Residential and Development – What we are delivering
This year our Residential housing business will deliver between 700 to 800 houses and with
around 3,500 future lots under our control, the business remains well positioned to continue
performing at this level. The speed with which we will then grow to a 1,000 houses per year, will
be dependent on accessing sufficient land at the right price, and on how strong the overall market
is. Our land development business pipeline remains robust, and this business should continue
to generate at least $25 million per annum into the future. This year our key sales are second half
weighted and are likely to include sales of land from two sites in Brisbane and Sydney. These
are sites we no longer are using to operate our businesses in Australia.
Residential and Development – What we are delivering
Clever Core is our off-site manufacturing plant for residential housing. This is an important
investment for us; both as a business opportunity in its own right, but also it allows us to directly
participate in the construction macro trend, for increasingly more modularisation and offsite
manufactured components.
Clever Core provides us with an opportunity to disrupt ourselves in this space, and adapt our
manufacturing, distribution, and onsite construction techniques to suit where the industry is
heading over the coming years.
And finally, with the increasing trend to housing densification in major cities, we are well placed
to scale up our apartment business. Like our low-rise housing business, we will position
ourselves in the mid-market range, and focus on producing a high quality, and good value for
money product for our customers.
Market permitting, we would expect to take around three years to get this business to a
meaningful scale and annual throughput.
Construction – Key focus areas
While we remain intent on finishing the legacy Construction projects to a high quality and within
provisions, pleasingly, our focus across Fletcher Construction is increasingly about building its
future, rather than clearing up the mistakes of the past.
The teams continue to make good progress on lifting the skills, operating disciplines, and
governance across all the construction businesses. The best evidence of the success of this, is
with our customers, where we continue to successfully build our forward order book, winning the
right work, with the right risk profile and margins.
Construction – What we are delivering
This progress is well evidenced on this slide. The graph on the left shows the progress we have
made in completing the legacy projects. We now have under $600 million of work remaining,
while at the same time we have successfully built a forward order book of over $2.4 billion with
much better risk and margin profiles.

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Unsurprisingly, with the NZ Government’s focus on infrastructure sector investment - much of
this new work is focused in this area.
A pleasing recent win was the AMETI Eastern Busway Alliance project in Auckland. This is a
major multi-year project, and the consortium we are part of has now been announced as the
preferred partner with Auckland Transport.
Australia – Key focus areas
Our Australian business has been through a tough few years, as we dealt with a contracting
market, the impacts of COVID-19, and many of our own “home-made” operational issues. Over
this period, the team in Australia has stayed focused on what was needed to work through this,
and we are now seeing improvements in both profits and profitability. That said, there remains
much to do and with that, further upside and opportunity for us to deliver.
To ensure we complete the Australian turnaround, and capture these further improvements we
continue to focus across 3 main areas:
• Driving and improving operational excellence;
• Ensuring we have a strong pipeline of product innovation and sustainability
improvements;
• And really lift our customer service proposition and performance, with a particular
emphasis on ecommerce and digital.

Australia – What we are delivering
The progress we are making in Australia is brought to life well on this slide. In the graphic on the
left, you can see the profitability improvements we are now delivering - EBIT profits were 4.0% for
the first 4 months of FY21, compared to 2.3% for the same period last year – a pleasing increase.
And the pictures on the right showcase some of what we are doing around product innovation
and sustainability:
• In Laminex, we have completed our biggest product launch in 25 years, which saw us
refresh the entire brand and range. This has been very well received by our customers
and is a big part of what is driving the performance improvements we are seeing across
this business;
• In Fletcher Insulation, we have completely refreshed and upgraded our packaging, our
range of products, and introduced new and innovative products such as the FirmaSoft
wall and ceiling insulation batts. These contain 80% recycled content, have better
thermal and acoustic properties, and are easier to handle;
• In Stramit, we have introduced new steel roofing ranges, the Sharpline roof, and
InfinitiLine gutter both which have a more modern profile, is our own product, and
therefore we can earn better margins;
• And in Oliveri, we have recently launched a whole new bathroom category, this means
we now have a “good, better, and best” option across our own range and brands in
bathroom products.

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Australia – What we are delivering
And in Australia, very much like our focus in New Zealand, we are putting a significant effort into
our customer facing, ecommerce and digital capabilities. We show two good examples of our
progress on this slide:
• In Laminex, we are now seeing around 27% of our sales occurring through our
ecommerce portals, and this has occurred in only an 18-month period.
• And in Tradelink, our new website just went live, and this now provides the ability for
customers to purchase and transact online. This had been a critical missing piece in our
Tradelink customer offer.
These, and the other steps we are taking around our ecommerce platforms across Australia, are
critical components in getting our businesses competitive and fighting fit across the country.
FY2021 outlook
To finish, I would now like to move to the outlook. As we covered in our recent trading update,
we expect first half volumes to remain very resilient, and continue in line with the strong trading
we have seen so far through FY21. The second half remains less certain but from what we can
tell from our present quote activity, and order books, we expect a reasonable start.
But as a result of the ongoing uncertainty caused by COVID-19, we will only be providing half
year guidance today. In line with this, we expect our FY21 half year EBIT to be in the range of
$305 to $320 million – and this compares favourably to the $219 million we made in the first half
of last year. We will also continue to keep a tighter rein on capex through this year, and as such
we continue to expect the full year capex to be around $200 million.
In closing, I’d like to thank our employees, suppliers, and customers for their commitment and all
they have done through the last 12 months. I also want to thank you, our shareholders, for
continuing to support Fletcher Building.
This has been a challenging year for us, which we I feel we’ve navigated well. Even more
pleasing for me, is that we are now seeing the benefits of the work we have been doing over the
last two years, start to show up in our performance and results.
Tena koutou, Tena koutou, Tena koutou katoa.
ENDS

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Fletcher Building Limited
Annual Shareholders’ Meeting 2020
2020 Annual
Shareholders’ Meeting
25 November 2020

Fletcher Building Limited
Annual Shareholders’ Meeting 2020
Bruce Hassall
Chair

Directors
Barbara Chapman
Martin Brydon
Doug McKayCathy Quinn
Rob McDonald
Peter Crowley
3
Fletcher Building Limited Annual Shareholders’ Meeting 2020

Meeting agenda
Chair’saddress
Chief Executive Officer’s address
Voting on Resolutions
General Q&A
4
Fletcher Building Limited Annual Shareholders’ Meeting 2020

FY2020 a challenging year comprehensively and
effectively dealt with
5
1.Responded quickly
to COVID-19
restrictions, shut
down and start-up
2.Business well set
up for FY21 and
beyond
3.Remained focused
on our overall plan,
strategy and
growth ambitions
remain unchanged
Board and Management worked very closely at a rapid tempo to ensure impacts were well managed
Fletcher Building Limited Annual Shareholders’ Meeting 2020

Responded quickly to NZ shut down and start up
and Australia restrictions
Maintained customerservice and performance
6
Safelyshut down and restarted NZ businesses and dealt with Australia restrictions
Peopleand mental health and well-being, Support Hub App, Bridging Pay Programme (NZ govt
supported), financial hardship fund in place
Strong focus on costs and cash management, but significant impact with lost earnings from
stringent NZ shutdown, additional Construction provisions
Fletcher Building Limited Annual Shareholders’ Meeting 2020

Actions taken to set up for FY2021 and beyond
despite market uncertainty
7
Fletcher Building Limited Annual Shareholders’ Meeting 2020
➢Costs reduced and workforce reorganised to
prepare for market uncertainty
➢Board, Exec and GM remuneration reduced
➢No bonuses under STI scheme
➢Proactively renegotiated debt covenants to
preserve liquidity
➢No dividends paid for FY20, share buy back
programme suspended
➢Fixed cost reduction of c$150m in FY21
➢Additional variable cost reductions to meet market
activity
➢Significant items (FY20 and FY21)
➢Balance sheet strength preserved, strong liquidity
Actions
Impact

FY2020 results at a glance
EBIT*
$160m
FY2019 $549m
EPS
(23.5c)
FY2019 28.8c
* Before significant items
EBIT margin
2.2%
FY2019: 6.6%
Dividend
nil
FY2019: 23.0cps
Cash flows from
operating activities
$410m
FY2019 $153m
Leverage ratio
0.9x
Target range: 1.0-2.0x
Revenue
$7,309m
FY2019 $8,308m
Net Earnings/(Loss)
($196)m
FY2019 $246m
8
Note: All metrics are for continuing operations except cash flow from operating activities. RTG and Formica were sold in FY19
Measures before significant items are non-GAAP measures used by management to assess the performance of the business and
have been derived from Fletcher Building’s financial statements for the 12 months ended 30 June 2020. Details of significant
items can be found in note 2 of the financial statements
Fletcher Building Limited Annual Shareholders’ Meeting 2020

FY2020 balanced scorecard
SafetyEngagement
SustainabilityCustomer
Total Recordable Injury
Frequency Rate
1
Employee Engagement Rating
4
Net Promoter Score
5
6.9
5.1
5.0
5.7
FY17FY18FY19FY20
26
28
39
39
FY17FY18FY19FY20
66%
67%
70%
71%
FY16FY17FY18FY19
1
TRIFR = Total no. of recorded injuries per million man hours worked. Does not include Restricted Work Injuries.
2
Serious Injury include immediate treatment as an in-patient at hospital for more than 24 hours or immediate treatment for a serious injury or illness as defined by Safe Work Australia.
3
Carbon data excludes emissions from the International division which was divested in FY19.
3
Next employee engagement survey planned for FY21.
4
Net Promoter Score calculated as % Promoters (9 -10) minus % Detractors (0 -6). Prior years have been restated to reflect inclusion of all Business Units in NPS programme
1,238
1,147
1,132
FY18FY19FY20
Carbon (CO
2
) Emissions
(thousand Tonnes)
3
9
33
21
20
8
FY17FY18FY19FY20
Serious Injuries
2
Fletcher Building Limited Annual Shareholders’ Meeting 2020

Strong Governance through COVID-19 as well as
action on safety, culture and performance
10
Safety, Health, Environment
and Sustainability Committee
Remuneration CommitteeAudit and Risk Committee
•Protect Reset and Protect Value launch
•Focus on delivery of strategy, listening to shareholders and actioning feedback
Fletcher Building Limited Annual Shareholders’ Meeting 2020
•Culture focus through safety, people
engagement, values, diversity,
inclusion and incentives
•Supported our people through
COVID-19
•Significantly enhanced
remuneration disclosure
•Strong oversight on complexities
through COVID-19, including banking,
liquidity and balance sheet
•Risk management policy + framework
refreshed; independent review
•Enhanced risk reporting disclosure
•Safety leadership, culture and critical
risk approach for safety
•16 site visits; regional site visits during
COVID-19
•Strategic commitmentto reduce
carbon emissions by 30% by 2030

Sustainability strategy
11
TRANSPARENT
ENVIRONMENTAL, SOCIAL AND
GOVERNANCE REPORTING
BE THE LEADER IN
MAKING SUSTAINABLE
BUILDING PRODUCTS
CAREFUL MANAGEMENT
OF OUR RESOURCES
AND EMISSIONS
PARTNER WITH OUR
SUPPLY CHAIN TO
DELIVER SUSTAINABLE
OUTCOMES
SUPPORT OUR
PEOPLE AND OUR
COMMUNITIES
BUILD HEALTHY HOMES AND
DELIVER SUSTAINABLE
INFRASTRUCTURE
Fletcher Building Limited Annual Shareholders’ Meeting 2020
FIRST
to set a Science Based Carbon
Target in our Sector, in New
Zealand and Australia

Summary
12
➢FY20 a tough year for all stakeholders
➢Proud of how our people and Board members worked together remaining focused on steering the
Company through a challenging period while setting up for FY21 and beyond
➢Pleasing year-to-date trading performance in FY21
➢Balance sheet and liquidity strong
➢Dividend:
➢Agreement in place with lenders to provide covenant relief, means FY21 interim dividend unlikely
➢Expect to resume dividend payments at year-end FY21, and for this to reflect a full-year of
dividends
Fletcher Building Limited Annual Shareholders’ Meeting 2020

Fletcher Building Limited
Annual Shareholders’ Meeting 2020
Ross Taylor
Chief Executive Officer

FY2020 tough year well handled
14
•Responded quickly to COVID-19 impacts
•Very proud of our people and their resilience
•Sig. items but strong cash & balance sheet
FY20
FY21
set-up
•Positioned cost base for potential reduced activity in FY21
•Accelerated key ecommerce activities
•Debt lines and liquidity strong and available
FY21 &
beyond
•Strategy and growth ambitions remain unchanged
•Focus on profitability and operational excellence
Fletcher Building Limited Annual Shareholders’ Meeting 2020

Two years into strategy –Business is reset and stabilised
FY2020
PERFORMANCE
Fletcher Building Limited Annual Shareholders’ Meeting 2020
FY2019
REFOCUS AND
STABILISE
15
FY2021–23
PERFORMANCE AND GROWTH
To be the undisputed leader in New Zealand
and Australian building products & solutions

Key areas we are driving
16
SafetyCustomerBusiness
performance
Operational
disciplines
Innovation and
Sustainability
Fletcher Building Limited Annual Shareholders’ Meeting 2020

Positions us well to drive shareholder returns into the future
Focus
Strong balance sheet, strong cash flows
Consistency
Leveraged to upside
Well positioned for macro trends
FY23 Key Financial Targets
➢Revenue growth > market growth
➢Group EBIT margin >10%
➢Return on Funds Employed (ROFE) >15%
17
Fletcher Building Limited Annual Shareholders’ Meeting 2020

Trading update 4 months ended 31 October 2020
–Safety focus continues with a strong emphasis on critical risks
18
Serious Injuries
2
Total Recordable Injury
Frequency Rate
1
Safety
1
TRIFR = Total no. of recorded injuries per million man hours worked. Does not include Restricted Work Injuries.
2
Serious Injury include immediate treatment as an in-patient at hospital for more than 24 hours or immediate treatment for a serious injury or illness as defined by Safe Work Australia.
6.9
5.1
5.0
5.7
5.96
FY17FY18FY19FY204 mths FY21
33
21
20
8
4
FY17FY18FY19FY204 mths FY21
Fletcher Building Limited Annual Shareholders’ Meeting 2020

Trading update 4 months ended 31 October 2020
–Improved operating efficiency and margins across all businesses
➢Cash flow and balance sheet remain strong: net debt $388 million, liquidity $1.4 billion as at 31 October 2020
19
Revenue ($b)
147
227
4 mths FY204 mths FY21
2,683
2,698
4 mths FY204 mths FY21
EBIT before sig items ($m)
5.5%
8.4%
4 mths FY204 mths FY21
EBIT margin (%)
Performance and Growth
+1%
+55%
Fletcher Building Limited Annual Shareholders’ Meeting 2020
Note: Measures before significant items are non-GAAP measures used by management to assess the performance of the business

NZ Core –Key focus areas
Product innovation &
sustainability
Operational excellence
Leading customer services &
solutions, esp. via digital
1
3
2
20
Fletcher Building Limited Annual Shareholders’ Meeting 2020
Building Products
Distribution
Concrete

NZ Core –What we are delivering
21
Fletcher Building Limited Annual Shareholders’ Meeting 2020
Product innovation & sustainability
Dimond’s largest roll to roof project in NZ
GBC’s New Tyre Derived Fuel
handling arm and feed equipment
Operational excellence
NZ’s largest “roof-top” solar installation
at Laminex’s Hamilton factory
10.3%
9.8%
9.5%
11.9%
FY18FY19FY20FY21
EBIT Margin
Jul-Oct, 2018-2021
Building Products
Distribution
Concrete
WWB’s GIB Weatherline®
Iplex’s new 25m trailer carrying first
load from mobile extraction plant
Note: Measures before significant items are non-GAAP measures used by management to assess the performance of the business.
FY18 and FY19 EBIT margins have been restated for the impact of IFRS16 lease accounting standard to ensure comparability withFY20 and FY21.

NZ Core –What we are delivering
22
>50k
products online
across Distribution
by Jan-21
PlaceMakers digitisation
Leading customer services & solutions, esp. via digital
Track & trace delivery
in PlaceMakers
~$1.2m
of website / digital sales for
Laminex NZ in Oct-20
35%
of Firth’s trucks now
digitally-enabled
70%
of all products delivered
from a PlaceMakersbranch
have track & trace capability
Building Products
Distribution
Concrete
Fletcher Building Limited Annual Shareholders’ Meeting 2020

Residential and Development
–Key focus areas
Clever Core panelisation plant
drives speed and quality
Grow to 1,000 units p.a.
Land Dev at least $25m p.a.
Scale our apartments business
1
3
2
23
Fletcher Building Limited Annual Shareholders’ Meeting 2020

Residential and Development –What we are delivering
24
Fletcher Building Limited Annual Shareholders’ Meeting 2020
Grow to 1,000 units p.a.Land Development continues at least $25m EBIT p.a.
•Second transaction of former Crane Copper Tube site in
Sydney forecast to settle in H2
•Sale of Rocla site in Brisbane expected in H2, and sale of Rocla
site in Sydney planned for FY22
•Future pipeline of land sales from rationalisation of legacy FB
sites plus growth of industrial development business
0
200
400
600
800
FY11FY12FY13FY14FY15FY16FY17FY18FY19FY20FY21
TotalJul-Oct Actual FY21700-800 forecast range FY21
Residential units sold

Residential and Development –What we are delivering
25
Fletcher Building Limited Annual Shareholders’ Meeting 2020
Scale our apartments business
•Opportunity to leverage density into own developments and
standalone apartment sites
•Continue to deliver to our customers in a key pricing segment
•Committed pipeline of 250 apartments, progressively scale to
c.200 p.a. by 2025, depending on market conditions
Clever Core panelisation plant drives speed and quality
•Productivity uplift, ability to
significantly reduce build
times vs. traditional stick
build
•Building materials waste
reduction, streamlined
consenting and compliance
process
•61 units delivered to Fletcher
Living to date, first external
sales planned for FY22
•Mix of terraces, duplexes and
standalone houses

Construction –Key focus areas
Complete legacy projects
within provisions
Improved operating skills,
disciplines and governance
Winning the right work with
the right customers
1
3
2
26
Fletcher Building Limited Annual Shareholders’ Meeting 2020

Construction –What we are delivering
Winning the right work with the right customersReshaping the risk profile of the order book
•Watercare Enterprise Model, 10 year contract
•Auckland International Airport Runway
•AMETI
1
Eastern Busway Alliance
•Strong pipeline of pavement and maintenance
27
Fletcher Building Limited Annual Shareholders’ Meeting 2020
2.2
0.6
0.7
2.4
HY18FY18FY19FY20
High-risk legacy projectsBalanced-risk projects
Work to Complete ($b)
1
Auckland Manukau Eastern Transport Initiative (AMETI)

Australia –Key focus areas
28
Fletcher Building Limited Annual Shareholders’ Meeting 2020
Product innovation &
sustainability
Operational excellence
Leading customer services &
solutions, esp. via digital
1
3
2

Australia –What we are delivering
Product innovation & sustainability
29
Fletcher Building Limited Annual Shareholders’ Meeting 2020
Operational excellence
Laminex AU’s largest product launch in 25 years
Stramit’sSharpline® roof
Fletcher
Insulation’s
FirmaSoft
4.4%
2.6%
2.3%
4.0%
FY18FY19FY20FY21
EBIT Margin
Jul-Oct, 2018-2021
Oliveri’s expansion into bathroom category,
with its own brand vitreous china range
Note: Measures before significant items are non-GAAP measures used by management to assess the performance of the business.
FY18 and FY19 EBIT margins have been restated for the impact of IFRS16 lease accounting standard to ensure comparability withFY20 and FY21.

Australia –What we are delivering
Leading customer services & solutions, esp. via digital
30
Fletcher Building Limited Annual Shareholders’ Meeting 2020
10%
27%
Jul'19Oct'20
Laminex % total customers
digital sales
>$170m
Laminex eCommerce revenue
since launch in Apr-19
Tradelink’snew B2C transactional website launched in Nov-20

FY2021 outlook
31
Fletcher Building Limited Annual Shareholders’ Meeting 2020
➢1H21 –volumes expected to remain in line with year-to-date trading: NZ slightly higher YOY, AU slightly lower YOY
➢2H21 –trading conditions less certain, impact of macro-economic factors on our markets not yet clear
➢Further update on market activity will be provided at the 1H21 results announcement in February
Earnings
Market
outlook
➢Benefiting from resilient trading conditions
➢Our lower cost base positions us well for the remainder of the year
➢1H21 EBIT before significant items expected to be approximately $305 to 320 million, compared to $219 million in
1H20
➢FY21 capex expected to be approximately $200 million, including c$50 million for the new Winstone Wallboards
plant
Capex

Fletcher Building Limited
Annual Shareholders’ Meeting 2020
Resolutions
and Voting

Ordinary Resolutions
•Resolution 1 –Re-election of Martin Brydon
•Resolution 2 –Re-election of Barbara Chapman
•Resolution 3 –Re-election of Bruce Hassall
•Resolution 4 –Auditor fees and expenses
Resolutions
33
Fletcher Building Limited Annual Shareholders’ Meeting 2020

Important Information
ThispresentationhasbeenpreparedbyFletcherBuildingLimitedanditsgroupofcompanies(“FletcherBuilding”)forinformationalpurposes.Thisdisclaimerappliestothisdocumentandtheverbalor
writtencommentsofanypersonpresentingit.
Thispresentationdated25November2020shouldbereadinconjunctionwith,andsubjectto,theexplanationsandviewsoffutureoutlookonmarketconditions,earningsandactivitiesgiveninthe
2020AnnualReport(togetherwithmanagementcommentary)publishedon19August2020andtheCompany’stradingupdatedated10November2020.
Incertainsectionsofthispresentation,FletcherBuildinghaschosentopresentcertainfinancialinformationexclusiveoftheimpactofsignificantitemsand/ortheresultsofthebusinessesdivestedin
theyearended30June2019.Forthe12monthsended30June2020,theGroup’sfinancialstatementsarepreparedinaccordancewiththenewleaseaccountingstandardNZIFRS16,adoptedfrom1
July2019.Inpriorperiods,leasecostswerefullyreportedinEBIT.UnderNZIFRS16,thetwocomponentsofleasecostsarereportedseparately:(1)thedepreciationofright-of-useassetsisreportedin
EBITand(2)thedeemedinterestportionoftheleaseliabilityisreportedinleaseinterestexpense.Financialtablesinthispresentation(whereindicated)showboththereportedresultfortheprior
period,aswellasaproformarestatementofthepriorperiodtoillustratetheimpactofNZIFRS16haditbeenappliedandtoallowforalike-for-likecomparison.Anumberofnon-GAAPfinancial
measuresareusedinthispresentationwhichareusedbymanagementtoassesstheperformanceofthebusinessandhavebeenderivedfromFletcherBuilding’sfinancialstatementsforthe12months
ended30June2020.Youshouldnotconsideranyofthesestatementsinisolationfrom,orasasubstitutefortheinformationprovidedintheFinancialStatementsforthe12monthsended30June
2020,whichareavailableatwww.fletcherbuilding.com.
TheinformationinthispresentationhasbeenpreparedbyFletcherBuildingwithduecareandattention,however,neitherFletcherBuildingnoranyofitsdirectors,employees,shareholders,norany
otherpersongivesanyrepresentationsorwarranties(eitherexpressorimplied)astotheaccuracyorcompletenessoftheinformationandtothemaximumextentpermittedbylaw,nosuchpersonshall
haveanyliabilitywhatsoevertoanypersonforanyloss(including,withoutlimitation,arisingfromanyfaultornegligence)arisingfromthispresentationoranyinformationsuppliedinconnectionwithit.
Thispresentationmaycontainforwardlookingstatements,thatisstatementsrelatedtofuture,notpast,eventsorothermatters.Forwardlookingstatementsmayincludestatementsregardingour
intent,belieforcurrentexpectationsinconnectionwithourfutureoperatingorfinancialperformance,ormarketconditions.Suchforwardlookingstatementsarebasedoncurrentexpectations,
estimatesandassumptionsandaresubjecttoanumberofrisksanduncertainties,includingmaterialadverseevents,significantone-offexpensesandotherunforeseeablecircumstances.Thereisno
assurancethatresultscontemplatedinanyoftheseprojectionsandforwardlookingstatementswillberealised.Actualresultsmaydiffermateriallyfromthoseprojected.Exceptasrequiredbylaw,or
therulesofanyrelevantstockexchangeorlistingauthority,nopersonisunderanyobligationtoupdatethispresentationatanytimeafteritsreleaseortoprovidefurtherinformationaboutFletcher
Building.
Theinformationinthispresentationdoesnotconstitutefinancialproduct,legal,financial,investment,taxoranyotheradviceorarecommendation.
34
Fletcher Building Limited Annual Shareholders’ Meeting 2020

---

Fletcher Building Limited, Private Bag 92114, Auckland 1142, 810 Great South Road, Penrose, Auckland 1061, New Zealand




Fletcher Building Annual Shareholders’ Meeting documents and 1H21
guidance

Auckland, 25 November 2020: Fletcher Building is today holding its 2020 Annual Shareholders’
Meeting (ASM). Attached are the:
- Chair’s address
- Chief Executive Officer’s address
- ASM presentation

Included in the Chief Executive Officer’s address is guidance for 1H21 EBIT before significant
items which is expected to be in the range of $305 million to $320 million. In 1H20, EBIT before
significant items was $219 million.

Further details are provided in the Chair and Chief Executive Officer’s addresses and
presentation. A live recording of the meeting will also be broadcast on the Company’s website
https://fletcherbuilding.com/investor-centre/reports-presentations-and-webcasts/

Note if you are a shareholder and wish to cast your vote during the meeting please follow
the Lumi voting instructions contained in your Notice of Meeting documents.

#Ends

Authorised by:
Andrew Clarke
Company Secretary

For further information please contact:
MEDIA
Christian May
General Manager - Corporate Affairs
+64 21 305 398
christian.may@fbu.com
INVESTORS AND ANALYSTS
Aleida White
Head of Investor Relations
+64 21 155 8837
aleida.white@fbu.com