FLETCHER BUILDING LIMITED — Investor Presentation 2012

Oct 7, 2012

INVESTOR PRESENTATION

October 2012 Bill Roest Chief Financial Officer

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Hunua Quarry , Auckland

Investor Presentation | Fletcher Building | © October 2012

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Disclaimer

This presentation contains not only a review of operations, but also some forward looking statements about Fletcher Building and the environment in which the company operates. Because these statements are forward looking, Fletcher Building’s actual results could differ materially. Media releases, management commentary and analysts presentations, including those relating to the 2012 Annual Results announcement, are all available on the company’s website and contain additional information about matters which could cause Fletcher Building’s performance to differ from any forward looking statements in this presentation. Please read this presentation in the wider context of material previously published by Fletcher Building.

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Investor Presentation | Fletcher Building | © October 2012

Results Overview | Page 3

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Investor Presentation
RESULTS
OVERVIEW
ASB Wynyard Quarter , Auckland
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Investor Presentation | Fletcher Building | © October 2012

Results Overview | Page 4

Fletcher Building at a glance

Revenue – year to 30 June 2012: Market Capitalisation: Employees:

NZ$8.8 billion NZ$4.8 billion 20,000

Shareholders: Revenue: EBIT

(as at 30 June 2012)

(for year ended 30 June 2012) (for year ended 30 June 2012)*

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7% [5% ] 12% 16%
37%
18% 41%
48%
47%
22% 47%
New Zealand Australia New Zealand New Zealand
North America Europe Australia Australia
Rest of World Rest of World
Asia
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New Zealand Australia North America Europe Asia

* Excluding restructuring and impairment charges

Investor Presentation | Fletcher Building | © October 2012

Results Overview | Page 5

Fletcher Building – key listing information

• Listed on the New Zealand and Australian stock exchanges

New Zealand

• Largest listed company by market capitalisation on the NZX

Australia

• Ranked #59 on the ASX

• Fletcher Building gained inclusion in the S&P/ASX 200 index in March 2011

US

• Level I sponsored American Depository Receipt (ADR) programme launched December 2010

• Citi act as depository bank

• Ticker: FCREY CUSIP: 339305302

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Investor Presentation | Fletcher Building | © October 2012

Results Overview | Page 6

Market leading businesses

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Building Laminates Concrete Construction Crane Distribution Steel Products & Panels

Plasterboard	Cement	Construction	Pipelines –	Building	Laminex	Coated Steel
Insulation	Readymix		Manufacture &	Materials
Roof Tiles	Aggregates	General	Distribution	Distribution	MDF	Long Steel:
Single Businesses: Aluminium Sinkware	Concrete Products Concrete Pipes Quarries	Construction Infrastructure Projects Residential house development	Trade Distribution Australia and NZ Copper Tube – Manufacture &	 59 PlaceMakers stores	Particleboard LPM HPL Formica HPL	Reinforcing bar, mesh and wire Scrap Distribution
			Distribution

Investor Presentation | Fletcher Building | © October 2012

Results Overview | Page 7

Residential consents in NZ and US improved whilst Australia continued to slow

	June 2012	June 2011	June 2010	12/11
Building Consents	12 months	12 months	12 months	%Mvmt
New Zealand
Residential Consents	15,414	13,539	16,167	+14
Non Res WPIP ($m)*	4,481	4,798	4,618	-7
Infrastructure WPIP ($m)*	6,823	6,599	5,919	+3
Australia			Source: Statistics NZ, Infometrics
Residential Consents	145,057	164,251	171,429	-12
Non Res WPIP (A$Bn)*	31.8	34.8	34.9	-9
Infrastructure WPIP (A$Bn)*	117.6	86.8	76.7	+35
US			Source: ABS, BIS Shrapnel
Residential (US$Bn)**	259.9	237.5	239.5	+9
Non Res (US$Bn)**	347.1	333.2	339.0	+4
Infrastructure (US$Bn)**	210.0	207.9	214.9	+1
			Source: IHS	Global Insight
Y12 data includes estimate for month of June 2012
Information presented for calendar years. 2012 represents forecast position

• FY12 data includes estimate for month of June 2012

** Information presented for calendar years. 2012 represents forecast position

Investor Presentation | Fletcher Building | © October 2012

Results Overview | Page 8

NZ housing consents – record low levels in the first half of FY12, modest improvement in second half

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Residential Consents
12 month moving average
16,000
14,000
12,000
Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Mar-12 Jun-12
Source: Statistics NZ
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Investor Presentation | Fletcher Building | © October 2012

Strategy | Page 9

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Investor Presentation
STRATEGY
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Crane pipelines (Iplex), Victoria

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Investor Presentation | Fletcher Building | © October 2012

Strategy | Page 10

Strategy

Improved earnings reliability through geographic and end-market diversification

Decentralised business model

Portfolio approach that creates value through application of proven operating model

Target attractive industry positions in Australia and NZ

Medium term aim is to grow earnings from existing portfolio of businesses irrespective of the economic cycle

Further opportunities to invest in Australia and NZ will be pursued, along with Formica growth in Asia

Investor Presentation | Fletcher Building | © October 2012

Strategy | Page 11

Fletcher Building has a vertically integrated value chain

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Pipes & Laminates Building Other
Steel Concrete
Plumbing & Panels Products Manufacturers
Dedicated Shared Other
Construction
Distribution Distribution Distribution
Markets
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Investor Presentation | Fletcher Building | © October 2012

2012 Financial Results | Page 12

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Golden Bay Cement , Whangarei (NZ)

Investor Presentation | Fletcher Building | © October 2012

2012 Financial Results | Page 13

Weak NZ and Australian construction markets adversely impacted earnings

	June 2012	June 2011	June 2011
NZ$m	12 months	12	months	% Change
Sales	8,873		7,416	+20
EBITDA¹	786		801	-2
EBIT¹	556		596	-7
Net earnings1	317		359	-12
Restructuring and impairment charges
after tax	(132)		(76)
Net earnings	185		283	-35
EPS – cps1	46.5		57.1	-19
Dividend - cps	34.0		33.0	+3
1. EBITDA, EBIT, Net Earnings and EPS all before restructuring and impairment charges

Investor Presentation | Fletcher Building | © October 2012

2012 Financial Results | Page 14

Strong full year contribution from Crane, earnings up in Concrete, other divisions down on lower volumes and/or margins

EBIT NZ$million[1 ]

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168
139
130
125
111
106
83
72
60
50 48
39
29 27
Building Products Concrete Construction Crane Distribution Laminates & Steel
Panels
12 months ended
Jun-12 Jun-11
1. Earnings before interest, tax, restructuring and impairment charges
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Investor Presentation | Fletcher Building | © October 2012

2012 Financial Results | Page 15

Operating earnings before restructuring and impairment charges – 1[st] Half compared with 2[nd] Half

6 months June 2012 (2nd half)	6 months Dec 2011 (1st half)
NZ$M Revenue EBIT	Revenue EBIT
Building Products 315 29 Concrete 490 70 Construction 520 25 Crane 1,164 53 Distribution 411 12 Laminates & Panels 910 76 Steel 554 24 Corporate (10)	355 43 468 60 520 25 1,229 53 402 15 939 63 596 24 (6)
Total 4,364 279	4,509 277

Investor Presentation | Fletcher Building | © October 2012

2012 Financial Results | Page 16

Cashflow from operations up 11%

	June 2012 12 months June 2011 12 months % Change 633 697 -9 (152) (122) +25 (123) (86) +43 122 89 +37 (23) (28) -18 15 (115) 71 20 (9) (42) (50) (52) (4) (148) -136 +130 -237 -600 448 402 +11
EBITDA
Funding costs
Cash tax paid
Non cash restructuring/impairment charges impact
Provisions movement/other
Working capital movements: - Debtors - Creditors - Stock - Other
Cashflow from operations

Investor Presentation | Fletcher Building | © October 2012

2012 Financial Results | Page 17

Key ratios

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Total Shareholder Return (TSR)
Percentage
42
24
14 14
Jun-07 Jun-08 Jun-09 Jun-10 Jun-11 Jun-12
-27
-43
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Debt/Debt Plus Equity Percentage

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40
34 35
31
27
22
Jun-07 Jun-08 Jun-09 Jun-10 Jun-11 Jun-12
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Return on Average Funds
Percentage¹
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25
19
12 13 13
10
Jun-07 Jun-08 Jun-09 Jun-10 Jun-11 Jun-12
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1. Earnings before interest, tax, restructuring and impairment charges / average funds

Investor Presentation | Fletcher Building | © October 2012

2012 Financial Results | Page 18

Budgeted capital expenditure to reduce in FY 13

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Capital Expenditure
June 12 June 11
FY13
363 12 mths 12 mths [% ∆ ] Budget
307
Stay-in-business 207 200 +4 162
96 * Budget
56
264
Growth¹ 60 51 +18 102
246
230
60
51 205 Acquisitions² 96 56 +71 0
102
Total 363 307 +18 264
200 207 Depreciation 230 205 +12 246
162
2011 2012 2013
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Acquisitions Stay in business Growth Depreciation

1. Excludes acquisition of shares in Crane Group Ltd

1. Forecast includes investment in new Formica plant in China 2. Excludes Crane in 1H11

Investor Presentation | Fletcher Building | © October 2012

2012 Financial Results | Page 19

Debt maturity profile

Funding and Maturity Profile June 2012

Undrawn credit lines of $782 million and cash on hand of $168 million.

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200
30
352 200
456
315
240 232
167 199 180 155
105 98
NZ$m
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Average maturity of debt is 5 years.

Average interest rate on debt is 6.7%.

67% of borrowings are at fixed rates.

Long term debt issuance during FY12: − US$300m private placement to US investors (10 and 12 year terms) − A$120 private placement to Japanese investors (15 year term)

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2013 2014 2015 2016 2017 2018 2020 2022 2024 2027
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June Years

Debt - Drawn Commited Undrawn Debt Facilities

Investor Presentation | Fletcher Building | © October 2012

2012 Financial Results | Page 20

Canterbury update

Residential repairs for Earthquake Commission:

21 hubs established to carry out repairs

Over 20,000 home repairs completed to date

In addition, 45,000 emergency repairs and 16,400 winter heat installations completed

Target is to have last of the 100,00 repairs completed by end of 2015

Infrastructure repairs:

Fletcher Construction one of 5 contractors in the alliance to repair Christchurch infrastructure

Activity levels have been low due to planning work required, but momentum is now building

Rebuilding Christchurch City Centre:

Development plan for the new Christchurch central city area now finalised

70% to 80% of CBD buildings will be demolished

Investor Presentation | Fletcher Building | © October 2012

2012 Financial Results | Page 21

Restructuring and impairment charges

Year to 30 June 2012	Restructuring and impairments charges	Restructuring and impairments charges	Restructuring and impairments charges
NZ$ Million	Before tax	Tax	After tax
Laminex restructuring – Australia and New Zealand	54	(16)	38
Formica – Bilbao plant closure	20	0	20
Insulation – adjustment to business asset carrying values	79	(5)	74
Total	153	(21)	132

Investor Presentation | Fletcher Building | © October 2012

2012 Financial Results | Page 22

Strong contribution from Crane in first full year of ownership

Operating earnings $106 million, up 15% on 2011 result

Pipelines:

Operating earnings up 28% to $59 million

Gross revenues up 17%

Increased revenues from two coal seam gas contracts

Demand from resources, civil and rural sectors offset decline in building activity

Trade Distribution:

Operating earnings down 31% to $38 million

Gross revenues down 6% in Australia, flat in NZ

Performance impacted by decline in residential and commercial building

Industrial Products:

Operating earnings slightly higher at $8 million

Gross revenues down 16%

Austral Wright Metals and Mico Metals sold at year end, anticipated proceeds of NZ$70m

Investor Presentation | Fletcher Building | © October 2012

Outlook | Page 23

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Investor Presentation
OUTLOOK
Formica , Topshop London
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Investor Presentation | Fletcher Building | © October 2012

Outlook | Page 24

Outlook FY2013

New Zealand:

• Continued modest improvement in new house building

• Assisted by low interest rates and increased activity in Canterbury

• Commercial and infrastructure activity not expected to improve materially in FY13

• FY14 should benefit from several large infrastructure projects

Australia:

• Trend in residential activity unclear, risk of further decline

• Commercial construction likely to remain subdued

• Infrastructure expected to remain steady

Trading conditions in North America expected to remain flat to slightly positive

No recovery expected in Europe, but Germany and Scandinavia should remain relatively strong

China, SE Asia and Taiwan: continued growth expected

Investor Presentation | Fletcher Building | © October 2012

Appendix | Page 25

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Investor Presentation
APPENDIX
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Crane Copper Tube , Adelaide

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Investor Presentation | Fletcher Building | © October 2012

Appendix | Page 26

Building Products

Division Overview

The Building Products division manufactures a broad range of building products. The divisions’ core plasterboard, insulation and metal roof tile businesses have market leading positions and respected brands.

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Summary Financials (NZ$M)
Revenue source FY12
798
771 60 [25 ]
739
94
313
692
670
148
178
106 114 111
72
Insulation Roof Tiles
2008 2009 2010 2011 2012
Plasterboard Aluminium
Revenue EBIT (excl restructuring and
Sinkware
impairment charges)
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Business Description
Fletcher Insulation in Australia manufactures a
wide range of insulation and acoustic products.
Insulation
Tasman Insulation is New Zealand’s only domestic
manufacturer of glasswool insulation.
Winstone Wallboards is New Zealand’s sole
Plasterboard
manufacturer and leading supplier of plasterboard.
Global manufacturer of metal roof tiles with plants
Roof Tiles
in New Zealand, Malaysia, Hungary, and the USA.
Designs and manufactures aluminium windows and
Aluminium
door systems in New Zealand.
Australia’s only manufacturer of sinkware and
Sinkware
accessories.
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Key Brands
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Investor Presentation | Fletcher Building | © October 2012

Appendix | Page 27

Building Products result

NZ$m
	June 12 12 Mths June 11 12 Mths % ∆
Sales	670 692 -3
EBITDA¹	97 138 -30
EBIT¹	72 111 -35
Restructuring and impairment charges	(79) (80)
EBIT	(7) 31
Funds Employed	481 583
EBITDA1/sales %	14.5 19.9
EBIT1/sales %	10.7 16.0
ROFE1%	15.0 19.0

Plasterboard operating earnings down 10% due to lower volumes.

Insulation continued industry oversupply in Australia and NZ$ and A$ strength adversely impacted earnings.

Roof Tiles volume growth in Africa and USA, flat volumes in Asia and down in NZ and Europe.

1. Excluding restructuring and impairment charges

Investor Presentation | Fletcher Building | © October 2012

Appendix | Page 28

Concrete

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Business Description
NZ’s leading national concrete company supplying
Firth
readymix and masonry products throughout the
(NZ)
country.
NZ’s largest cement manufacturer and distributor of
Winstone
aggregates and sand to roading, readymix concrete and
Aggregates
concrete product industries, and other building and
(NZ)
civil engineering customers.
NZ’s leading supplier of manufactured concrete
Humes
infrastructure products to civil contractors, developers,
(NZ)
local governments and other authorities.
NZ’s largest cement manufacturer for readymix
Golden Bay
producers, concrete product manufacturers, building
Cement
materials distributors, paving and construction
(NZ)
contractors, and other major users
Leading Australian supplier of manufactured concrete
Rocla Pipelines
infrastructure products to civil contractors, developers,
(AUS)
local governments and other authorities.
Rocla Quarry Construction sands manufacturer supplying sands to the
(AUS) building & construction industries throughout Australia.
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Business Description
NZ’s leading national concrete company supplying
Firth
readymix and masonry products throughout the
(NZ)
country.
NZ’s largest cement manufacturer and distributor of
Winstone
aggregates and sand to roading, readymix concrete and
Aggregates
concrete product industries, and other building and
(NZ)
civil engineering customers.
NZ’s leading supplier of manufactured concrete
Humes
infrastructure products to civil contractors, developers,
(NZ)
local governments and other authorities.
NZ’s largest cement manufacturer for readymix
Golden Bay
producers, concrete product manufacturers, building
Cement
materials distributors, paving and construction
(NZ)
contractors, and other major users
Leading Australian supplier of manufactured concrete
Rocla Pipelines
infrastructure products to civil contractors, developers,
(AUS)
local governments and other authorities.
Rocla Quarry Construction sands manufacturer supplying sands to the
(AUS) building & construction industries throughout Australia.
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Division Overview

The Concrete division consists of a vertically integrated concrete business in New Zealand and concrete products businesses in Australia.

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Summary Financials (NZ$M)
967
958 Revenue source FY12
930
912
250 857 469 489
144
125 130
107
Concrete New
2008 2009 2010 2011 2012 Zealand
Concrete Australia
Revenue EBIT (excl restructuring and
impairment charges)
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Key Brands

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Investor Presentation | Fletcher Building | © October 2012

Appendix | Page 29

Concrete result

NZ$m	June 12 12 mths June 11 12 mths % ∆
Sales	958 912 +5
EBITDA Concrete NZ Concrete Aust.	101 91 102 85 -1 +7
Total EBITDA	192 187 +3
EBIT	130 125 +4
Funds Employed	1,071 1,016 +5
EBITDA/sales %	20.0 20.5
EBIT/sales %	13.6 13.7
ROFE %	12.1 12.3

NZ Concrete

• Revenues 3% higher with most product volumes similar or slightly up on prior year;

• Cement and masonry volumes lower, cement export margins also lower;

• Market shares for all core products was stable.

Australia Concrete

• Earnings contributions from Australian Construction Products and Atlantic Civil Products acquisitions;

• Pipeline products: pricing initiatives and operational enhancements increased earnings;

• Quarry earnings benefited from favourable sales mix and improved margins.

Investor Presentation | Fletcher Building | © October 2012

Appendix | Page 30

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Construction

Division Overview

Business Description

A leading general constructor of commercial, retail, health, hospitality, education and government buildings. Work undertaken includes both main structures and commercial fitouts.

The Construction division comprises one of New Zealand’s largest general construction contractors Fletcher Construction, and Fletcher Residential, a residential home building business in New Zealand. Also in the division is Fletcher EQR, which is project managing residential earthquake repairs in Canterbury for the Earthquake Commission.

Building + Interiors

Earthquake Recovery is a project-specific division established to manage the $3+ billion repair process of residential homes that the Earthquake Commission is responsible for following the Canterbury earthquakes.

Earthquake Recovery

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Summary Financials (NZ$M)
Revenue source FY12
1122 1163 1140
1040
890
191
58 59 57
60 50
849
2008 2009 2010 2011 2012
Revenue EBIT
Construction Residential
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A leading general contractor operating in transport, energy, water and wastewater, with specialist business units focused on foundations, general infrastructure projects, piles and pipeline rehabilitation.

Infrastructure

Undertakes a wide range of projects for local and foreign governments, aid agencies, religious organisations and commercial entities in the South Pacific

South Pacific

Residential

Land subdivision and home builder.

Key Brands

Investor Presentation | Fletcher Building | © October 2012

Appendix | Page 31

Construction result

NZ$m	June 12 12 mths June 11 12 mths % ∆
Sales	1,040 1,140 -9
EBITDA Total EBIT	61 50 70 60 -13 -17
Funds Employed	109 118 -8
EBITDA/sales %	5.9 6.1
EBIT/sales %	4.8 5.3
ROFE %	45.9 50.8

Tighter construction margins in subdued market

Construction backlog increased to $1,094m at end of June

Additional $300m contract for new mens prison concluded in September 2012

In addition, preferred contractor on two projects worth $537m: would positively impact FY14 earnings if they proceed

Residential earnings up 35% due to increased house sales, particularly in Stonefields subdivision in Auckland

Investor Presentation | Fletcher Building | © October 2012

Appendix | Page 32

Division Overview

Crane is the Australian leader in the manufacturing and distribution of plastic pipelines systems, plumbing in Australia and New Zealand. Previously a listed public company, the business was acquired by Fletcher Building in March 2011.

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Summary Financials (NZ$M)
Revenue source FY12:
316
Pipelines
791
363 Trade Distribution AUS
Trade Distribution NZ
Industrial Products
1123
Gross of $200m intercompany sales
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Crane

Business Description

A leading manufacturer and supplier of plastic pipeline systems in Australia & New Zealand

Iplex pipeline systems in Australia & New Zealand Includes Tradelink, a leading Australian business in Crane plumbing supplies and bathroom solutions, and Distribution Hudson Building Supplies with a strong footprint in Australia timber and building materials and branches across NSW & South East Queensland Crane Mico, New Zealand’s leading supplier of plumbing Distribution and bathroom products and solutions. NZ Industrial Manufacturer of a wide range of copper plumbing Products tubes.

Includes Tradelink, a leading Australian business in plumbing supplies and bathroom solutions, and Hudson Building Supplies with a strong footprint in timber and building materials and branches across NSW & South East Queensland

Key Brands

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Investor Presentation | Fletcher Building | © October 2012

Appendix | Page 33

Crane – full year earnings overview

	FY12 Sales NZ$M FY11 Sales NZ$M¹	FY12 EBIT NZ$M FY11 EBIT² NZ$M¹ % ∆
Pipelines Tradelink Trade Distribution - NZ Industrial Products Intersegment/Unallocated Total	791 674 1,123 1,205 363 371 316 378 (200) (190)	59 46 +28 38 55 -31 (1) 3 8 7 +14 1 (17)
	2,393 2,437	106 92 +15

1. For comparative purposes only. Fletcher Building acquired Crane in March 2011, and its financial results for FY11 included 3 months trading contribution from Crane

2. Before restructuring and impairment charges

Investor Presentation | Fletcher Building | © October 2012

Appendix | Page 34

Distribution

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Division Overview

The Distribution division consists of the PlaceMakers business in New Zealand and supplies building materials to New Zealand’s commercial and residential construction markets. PlaceMakers represents an important distribution network for Fletcher Building Group products.

PlaceMakers

Business Description

Is a nationwide supplier of building materials to New Zealand’s commercial and residential markets. It operates 59 stores and 12 frame and truss manufacturing sites. The majority of stores are operated in a joint venture partnership with local owners/operators.

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Summary Financials (NZ$M)
1083
883 878 856
813
73
38 39
30 27
2008 2009 2010 2011 2012
Revenue EBIT (excl restructuring and impairment charges)
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Key Brands

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Investor Presentation | Fletcher Building | © October 2012

Appendix | Page 35

Distribution result

NZ$m	June 12 12 Mths June 11 12 Mths % ∆
Sales	813 856 -5
EBITDA	35 48 -27
EBIT	27 39 -31
Funds Employed	141 142 -1
EBITDA/sales %	4.3 5.6
EBIT/sales %	3.3 4.6
ROFE %	19.1 27.5

• Revenues down 5%, impacted by continued low levels of residential house building

Increased competitor activity impacted margins in the second half Operating costs reduced by 2% and inventory levels down by 8%

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NZ Quarterly housing starts
4,500
4,000
3,500
3,000
2,500
Source: Statistics NZ
Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Mar-12 Jun-12
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Investor Presentation | Fletcher Building | © October 2012

Appendix | Page 36

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Laminates & Panels

Division Overview

Business Description

The Laminates & Panels division comprises of the Australasian based woodpanels manufacturer and distributor Laminex, and a global high pressure laminates manufacturer, Formica.

Is the leading Australian and New Zealand manufacturer and distributor of decorative wood panels, particleboard, medium density fibreboard and other durable surfaces for use in residential and commercial applications. Laminex also distributes high pressure laminate and operates a high pressure laminate plant in Australia

The Laminex Group

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Summary Financials
Laminex Formica
1101 1069
1007 999 1003
931
878
846
107 112
56 68 18 34 56 71
2009 2010 2011 2012 2009 2010 2011 2012
Revenue EBIT (excl restructuring and Revenue EBIT (excl restructuring and
impairment charges) impairment charges)
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Formica manufactures and distributes high pressure decorative surface laminates with plants in North America, Europe and Asia. Formica’s products are used in both residential and commercial applications. The Formica brand is well recognised and highly respected globally. In markets where it has manufacturing facilities it either leads the market or holds the second largest share.

Formica

Key Brands

Investor Presentation | Fletcher Building | © October 2012

Appendix | Page 37

Laminates & Panels result

NZ$m	June 12 12 mths June 11 12 mths % ∆
Sales	1,849 1,979 -7
EBITDA¹
Laminex¹	105 149 -30
Formica¹	100 83 +20
Total EBITDA¹	205 232 -12
EBIT¹	139 168 -17
Restructuring and impairment charges	(74) (9)
EBIT	65 159 -59
Funds Employed	1,799 1,745
EBITDA1/sales %	11.1 11.7
EBIT1/sales %	7.5 8.5
ROFE1%	7.7 9.6

Laminex

• Australian revenues down 9% due to slowdown in residential and commercial markets

• Cost increases not fully offset by compensating price changes

• Staff levels reduced by 285

Formica

• Operating earnings pre-restructuring and impairments charges up 27%

• Result due to increased revenue in North America and Asia, and continued operational improvements

• $4m EBIT contribution from Homapal acquisition

1. Excluding restructuring and impairment charges

Investor Presentation | Fletcher Building | © October 2012

Appendix | Page 38

Formica: strong growth in operating earnings before restructuring and impairment charges, driven by Asia and North America

EBIT NZ$m	FY12	FY11	% Change
Asia	38	34	+12
North America	34	28	+21
Europe¹	13	9	+33
Corporate	(14)	(15)	-7
EBIT beforerestructuring and	71	56	+27
impairments charges
Bilbao closure costs	(20)	0
EBIT	51	56	-9
1. Includes $4m contribution from Homapal in FY12 (nil in FY11)

Investor Presentation | Fletcher Building | © October 2012

Appendix | Page 39

Division Overview

The Steel division operates a diversified portfolio of steel businesses across three business lines, primarily in Australia and New Zealand. Each business has a leading market position and widely recognised brands.

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Summary Financials (NZ$M)
1321 Revenue source FY12
1279
213
154
1214
1172
101 1150 217
82 83 720
48
2008 2009 2010 2011 2012 Coated Steel
Long Steel
Revenue EBIT (excl unusuals)
Distribution and Services
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Key Brands

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Steel

Coated Steel

Long Steel

Distribution

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Business Description

• Stramit Building Products: a leading Australian manufacturer of steel building products, including roofing, walling, gutters and fascia's, purlins, flooring structural formworked and roller doors.

• CSP Coatings Systems provides metal coating systems to customers throughout New Zealand.

• Dimond: New Zealand’s largest manufacturer of steel roofing, cladding, structural and rainwater products.

• Pacific Coilcoaters pioneered pre-painted metals products in New Zealand

• Pacific Steel Group; New Zealand’s only manufacturer of wire rod, galvanised wire and reinforcing bar and coil products.

• Sims Pacific Metals: NZ’s largest metal recyclers, a 50/50 joint venture between Sims Metal Industries.

• Fletcher Easysteel, a major New Zealand processor and distributor of steel and related products.

• Fletcher Reinforcing: supplies reinforcing steel and mesh for concrete foundations and structures.

Investor Presentation | Fletcher Building | © October 2012

Appendix | Page 40

Steel result

NZ$m	June 12 12 Mths June 11 12 mths % ∆
Sales	1,150 1,214 -5
EBITDA	73 106 -31
EBIT	48 83 -42
Funds Employed	540 577 -6
EBITDA/sales %	6.3 8.7
EBIT/sales %	4.2 6.8
ROFE %	8.9 14.4

Lower rollforming volumes in Australia, margins impacted by increased competition

Long steel margins impacted by strong NZ$ and A$; NZ volumes up 20%, but export returns lower

Low volumes and increased competition impacted Distribution margins

Investor Presentation | Fletcher Building | © October 2012

Appendix | Page 41

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