Achieve record quarterly net sales, adjusted EBIT, and adjusted net income

Global net sales in the second quarter increased by 23% to US$903.2 million

Adjusted net income in the second quarter increased by 29% to US$154.9 million

Increase the adjusted net income guidance range for fiscal year 2022 from 550 million U.S. dollars and 590 million U.S. dollars to 580 million U.S. dollars and 600 million U.S. dollars

Declared a common dividend of 40 cents per share

SYDNEY--(BUSINESS WIRE)--James Hardie Industries plc, the world's number one manufacturer and marketer of high-performance fiber cement and fiber plaster construction solutions (ASX: JHX; NYSE code: JHX) announced its record-breaking performance for the second fiscal quarter of 2022, which is the three-month period ending September 30, 2021.

Compared with the second quarter of fiscal year 2021, the highlights of the second quarter of fiscal year 2022:

The second quarter marked our tenth consecutive quarter of achieving above-market growth and strong returns. As we stated on our Investor Day in May 2021, we described three key strategic initiatives from FY2022 to FY2024: (1) Sell directly to homeowners to accelerate demand creation, (2) Penetrate and promote Existing and new profitable growth segments, especially in maintenance and renovation; (3) Commercializing global innovations by expanding into new categories. In addition, we discussed the focus of promoting a high-value product portfolio in all three regions.

Dr. Jack Truong, Chief Executive Officer of James Hardie, said: "We continue to make excellent progress on our established global strategy. Our strong execution of this strategy is reflected in a 9% increase in global prices/combination in the second quarter, including North American price/combination growth. 9%, European price/combination growth of 8% and Asia-Pacific price/combination growth of 4%. Our growth momentum in accelerating the penetration of high-value products is the basis of price/combination, which is 1) Let our customers sell more through James Hardie products make more money and 2) direct marketing to homeowners in order to create our high-value demand and provide products through our customers.” Dr. Truong continued: “In the second quarter, we continued to use Hardie ® textured panels Commercialized in North America, Hardie™ fine-textured cladding and Hardie ® VL Plank in Europe. These products and our entire high-value product portfolio provide homeowners with long-lasting beauty and unlimited design possibilities, trustworthy protection and low Maintenance cost products."

Commenting on the financial results for the second quarter, Dr. Truong said: “This is the fourth consecutive quarter of three regions that have achieved double-digit sales growth and double-digit EBIT growth. Globally, quarterly net sales increased by 23 %, reaching US$903.2 million, a new record. The execution of our high-value product portfolio strategy is gaining momentum, resulting in a 23% increase in global net sales and a 14% increase in global sales." Dr. Truong continued: "Global adjusted EBIT An increase of 26% to US$205.7 million, which is also a new record. Globally adjusted EBIT margin expanded by 70 basis points to 22.8%. Importantly, the transformation of growth driven by a high-value product portfolio, coupled with continued lean Execution allows us to absorb high input costs and large investments in marketing and innovation."

Commenting on the increase in global production capacity, Dr. Truong said: “With our growth momentum in providing high-value products, we are now investing in a global capacity expansion plan in all three regions. The capacity expansion plan reflects our commitment to innovation and Marketing directly to homeowners continues to penetrate new and existing markets to drive confidence in the ability of high-value products to grow. As we announced last quarter, we expect that in FY22, FY23, and FY24, we Of global capital expenditures will be between US$250 million and US$350 million per year."

In addition to the previously announced projects, we will invest in the following capacity expansions by region from FY22 to FY24:

Dr. Truong concluded: “Our mission is to become a high-performance global company that consistently achieves above-market organic growth and strong returns. Ten consecutive quarters of growth above the market and strong returns have resulted in operating cash Flow acceleration, which allows us to: expand global manufacturing capabilities, accelerate our growth plans, restore common dividends, reduce debt positions, and increase cash contributions to the Asbestos Injury Compensation Fund (AICF)."

Comparison of the results of the second quarter of fiscal year 2022 and the second quarter of fiscal year 2021

Global: Global net sales increased by 23% to US$903.2 million, a record high, while global adjusted EBIT increased by 26% to US$205.7 million, a record high. Global adjusted net income increased by 29%, reaching a record 154.9 million U.S. dollars, compared with 120.5 million U.S. dollars in the same period. The global adjusted EBIT margin was 22.8%, which benefited from the continuous improvement of operations in the three operating regions of North America, Europe and Asia Pacific.

North American Fiber Cement Division: Net sales increased by 23% to US$635.3 million, a record high. This is due to the continued strengthening of the execution momentum of our high-value product portfolio strategy, with price/combination growth of 9% and strong sales growth of 14% this quarter . The implementation of our push/pull strategy continued to bring market share growth, with exterior decoration sales increasing by 16%. Lean Manufacturing plans to continue to improve the performance of the company's North American manufacturing network, helping to achieve an adjusted EBIT growth of 23%, reaching a record US$182.5 million, and an adjusted EBIT margin of 28.7%.

Dr. Truong said: “Spurred by the implementation of a high-value product portfolio strategy in the region, our North American business achieved excellent quarterly net sales and EBIT. 1) Our commercial team works closely with our customers, 2) Our focus In order to create demand through direct marketing to homeowners, and 3) we increase the additional capacity provided by Prattville Sheet Machines #1 & #2 on time, we believe that we are ready to continue to drive strong net sales growth and obtain strong returns, At the same time gain market share."

European construction products sector: net sales increased by 23% to 104.6 million euros, as we worked with customers to promote a high-value product portfolio, which resulted in a price/combination increase of 8%. Fibre cement net sales increased by 40%. Adjusted EBIT increased by 51% to 14.2 million euros, and adjusted EBIT margin was 13.6%. The adjusted EBIT margin expansion was due to strong net sales, good growth in high-margin fiber cement products and fiber gypsum flooring products, and lean manufacturing savings, partially offset by higher input costs.

Dr. Truong said: "It is great to see the transformation and development momentum of our European business. This is the fourth consecutive quarter to achieve double-digit net sales growth and double-digit adjusted EBIT margin. We provide high The value product strategy resulted in a 40% increase in fiber cement sales and a 20% increase in fiber gypsum sales this quarter."

Asia Pacific Fiber Cement Division: Net sales increased by 15% to A$196.6 million, a record high. Adjusted EBIT increased by 12% to A$60.6 million, which was also a record high. The adjusted EBIT margin was 30.8%. Similar to North America and Europe, our Australia and New Zealand operations have gained traction and momentum in executing our high-value product portfolio strategy, with price/combination growth of 9% in the quarter.

Dr. Truong said: "A series of strong results have been achieved in the Asia-Pacific region. Building momentum through high-value products and working closely with our customers has enabled Australia and New Zealand to achieve strong price/combined growth this quarter."

At James Hardie, we are all committed to building sustainable communities. This commitment is to 1) the smallest community—individual families, 2) the James Hardie community, 3) the local community where we live and operate, and 4) the largest community, the global ecosystem. In order to build a sustainable community, our goal is to change the way the world is built through safer, higher performance, more beautiful and more sustainable products. When commenting on sustainable development, Dr. Truong said: “Sustainability and ESG are part of our strategy. It is not a separate and unique initiative, but integrated into our operating methods and the core of our strategy.”

For more information about our commitment to sustainability (including our goals), please refer to our FY21 Sustainability Report at https://ir.jameshardie.com.au/esg/sustainability

The strong operating cash flow of US$357.5 million in the first half of the year was due to the continuous improvement of our lean manufacturing performance, strong profitable organic sales growth, and the integration of our supply chain and customers. In the first half of fiscal year 2022, working capital increased by US$4.9 million. In the 30 months since LEAN was established, we have achieved US$155.4 million in lean savings worldwide, including US$110.7 million in lean savings in North America. We have surpassed the 3-year Lean Savings commitment of 100 million US dollars for the North American business, 6 months ahead of schedule.

James Hardie Chief Financial Officer Jason Miele said: “We continued to generate strong cash flow in the first half of the year, with operating cash flow of US$357.5 million. Our continued strong cash flow allowed us to recover our shareholding through ordinary dividends in the first half of fiscal year 2022. In return, we announced today a dividend of 40 cents per share. The registration date is November 19, and the payment date is December 17. Our strong cash flow also helps to continue to increase our contribution to AICF, FY 21 and The total contribution in fiscal year 22 will reach 549.1 million Australian dollars. By September 30, 2021, since the establishment of AICF, we have now contributed 1.7 billion Australian dollars. We are very pleased with AICF's cash and investment balance as of October 31, 2021 The total is over 253 million Australian dollars."

Based on the continued strong execution of the global strategy in all three regions and expectations for continued growth in the US residential and market, the company is increasing its guidance for the 2022 fiscal year (ending March 31, 2022). Management now expects adjusted net income for fiscal year 2022 to be between US$580 million and US$600 million, compared to the previous range of US$550 million to US$590 million. The adjusted net income for the 2021 fiscal year was US$458 million from the previous year.

James Hardie's guidance is based on current estimates and assumptions and is subject to a number of known and unknown uncertainties and risks, including those associated with the COVID-19 pandemic. James Hardie continues to assess the impact and uncertainty of the COVID-19 pandemic on the geographic location where it operates. The continuing impact of the pandemic on the company's business and future financial performance remains uncertain.

North American Fiber Cement (US$ million)

Asia Pacific Fiber Cement (Million Australian dollars)

Readers can refer to the company’s condensed consolidated financial statements for the second quarter ended September 30, 2021 and management’s analysis of performance to learn more about the company’s performance, including information on income tax, asbestos liabilities and contingent liabilities .

Management briefing for analysts, investors and media

James Hardie will host a conference call and audio webcast for analysts, investors and the media at 9 am Sydney time on Tuesday, November 9, 2021 (Monday, November 8, 2021, 5 pm in New York City, USA) . Analysts, investors and the media can access the management briefing in the following ways:

Use of non-GAAP financial information; Australian equivalent term

This press release includes financial measures that are not considered financial performance measures under US Generally Accepted Accounting Principles (GAAP), such as adjusted net income and adjusted EBIT. These non-GAAP financial measures should not be seen as more meaningful than equivalent GAAP measures. The management has incorporated such measures to provide investors with an alternative method of evaluating their operating performance, which focuses on the performance of their continuing operations and excludes the impact of certain legacy items (such as asbestos adjustments). In addition, management uses such non-GAAP financial measures for the same purpose. However, these non-GAAP financial measures are not prepared in accordance with GAAP and may not be reported by all of the company’s competitors, and due to potential differences in the exact calculation methods, they may not be directly comparable with similarly titled indicators of the company’s competitors. Due to actuarial estimates In the future period, the company is unable to predict the financial indicators of comparable US generally accepted accounting principles in the future due to the uncertainty of the impact of asbestos-related assets and liabilities. For more information on the non-GAAP financial measures published in this media, including the reconciliation of each non-GAAP financial measure with an equivalent GAAP measure, please refer to the section titled "Non-GAAP Financial Measures" in the company's management analysis as of 2021 Second quarter results on September 30.

In addition, this media release includes financial indicators and descriptions that are deemed non-GAAP but consistent with financial indicators reported by Australian companies, such as EBIT and EBIT margin. Because the company prepares its consolidated financial statements in accordance with GAAP, the company has provided investors with definitions and provided cross-references between the non-GAAP financial measures used in this press release and the equivalent GAAP financial measures used in the company's consolidated financial statements. Please refer to the section titled "Non-GAAP Financial Measures" in the company's management's second quarter performance analysis as of September 30, 2021.

This press release contains forward-looking statements and information, which are necessarily subject to risks, uncertainties and assumptions. Many factors may cause James Hardie’s actual results, performance or achievements to differ materially from those expressed or implied in this press release, including the risks and uncertainties described in Section 3 “Risk Factors” of James Hardie’s Annual Report. In Form 20-F for the year on March 31, 2021; changes in general economic, political, government, and business conditions in the world and the countries where James Hardie does business; changes in interest rates; changes in inflation rates; changes in exchange rates ; Overall construction level; changes in cement demand and prices; changes in raw materials and energy prices; changes in business strategies and various other factors. If one or more of these risks or uncertainties become reality, or if the basic assumptions prove to be incorrect, the actual results may differ materially from the results described here. Except as required by law, James Hardie assumes no obligation to update or correct the information contained in this media release.

This media release has been authorized by the James Hardie Board of Directors.

James Hardie Industries plc is a limited liability company incorporated in Ireland with registered address at Europa House, 2nd Floor, Harcourt Centre, Harcourt Street, Dublin 2, D02 WR20, Ireland

Investor/media/analyst consultation: James Brennan-Chong Director of Investor Relations and Market Intelligence 61 2 9638 9205 media@jameshardie.com.au

Investor/media/analyst consultation: James Brennan-Chong Director of Investor Relations and Market Intelligence 61 2 9638 9205 media@jameshardie.com.au