Building products multi-national James Hardie has reported record sales for the year to March 31 but warned of a slowdown in the current June quarter, the first for its 2023-24 financial year.
Hardies posted a net profit of $US605 million ($A903 million) on record sales for 2022-23 of $US3.777 billion, up 4% year on year.
Much of that 4% growth though came from price rises as volumes slowed and then fell under previous year pace – North America saw a sharp drop in sales volumes in the final quarter but a solid set of price rises of around 8%.
That 4% rise was a sharp slowdown from the 24% reported for 2021-22 as the major economies (and their building sectors), led by the US, came out of their pandemic lockdowns.
That record performance reported for 2022-23 however obscured a clear sign of slowing growth over the 12 months. Hardies reported sales growth of 14% for the September 30, 2022 half year and then 8% for the nine months to December 31.
Growth in fourth quarter sales disappeared and they dropped 5% to $US917 million while global adjusted net income of $US146.2 million down more than 17% from the $US177.5 million reported for the 4th quarter of 2021-22.
The company said that the full year record sales performance was driven by an equally record effort in the North American fibre cement business where sales rose 9% to a record $US2.787 billion and earnings before interest and tax rose 4% to $US767.5 million.
Sales in Asia Pacific (including Australia) rose just 1% to a record $A787 million and there was a 3% rise in net sales in Europe to a record €431.8 million.
And the slowdown is forecast to continue into the early part of 2023-24 at least, according to the company’s filing with the ASX.
“The outlook for the housing markets we participate in, globally, is still very uncertain. In our largest market, North America, we expect our addressable market to decrease between 14% and 19% in fiscal year 2024 versus fiscal year 2023,” the report stated.
By way of guidance for the first quarter of fiscal year 2024, Hardies expects adjusted net income to be in the range of $US145 million to $US165 million compared with $US163.1 million a year ago.
Hardies sees lower sales in Australia in the coming quarter and beyond but expects to offset that with cost controls and good marketing, as well as pushing through cost recoveries through higher prices.
James Hardie shares rose 0.9% to $22.86.
