James Hardie share price stumbles despite 36% lift in annual sales

Both quarterly and yearly net income figures increased markedly.

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Key points

  • The James Hardie share price falters on Tuesday despite strong sales growth
  • Net tangible assets per share increased 43% from the prior year
  • The company reaffirmed its fiscal year 2023 adjusted net income guidance

The James Hardie Industries (ASX: JHX) share price is edging lower in morning trade despite the company reporting some strong results this morning. At the time of writing, James Hardie shares are down 2.3%.

Here’s what the S&P/ASX 200 Index (ASX: XJO) buildings products manufacturer reported for the fiscal year ending 31 March 2022, alongside the company’s fourth-quarter (Q4) financial results.

What happened during the quarter and fiscal year?

The James Hardie share price is slipping despite the company reporting a 20% year-on-year lift in its Q4 global net sales to US$968 million.

Global net sales for the fiscal year were up 24% from the prior year, reaching US$3.6 billion.

James Hardie also reported a 42% lift in adjusted net income for Q4 to US$178 million. This helped boost the adjusted net income for the fiscal year by 36%, reaching US$621 million.

As at 31 March, the company had net tangible assets per share of US$2.18. That’s up 43% from the prior year’s US$1.52 per share.

As for dividends, James Hardie paid a first-half dividend of 40 US cents, unfranked, that was paid out to shareholders on 17 December 2021. The 2021 financial year special dividend of US 70 cents was paid out on 30 April 2021.

What did management say?

Commenting on the results, James Hardie interim CEO Harold Wiens said:

I am delighted to report that the James Hardie team has continued to deliver strong execution of our global strategy. This is reflected in strong Price/Mix growth in all three regions, including North America Price/Mix growth of +12%, Asia Pacific Price/Mix growth of +11% and Europe Price/Mix growth of +14%.

The global team’s success in delivering high value products, is the result of (1) enabling our customers to make more money by selling more James Hardie products and, (2) marketing directly to the homeowners to create demand of our high value products through our customers.

What’s next?

Looking ahead, James Hardie reaffirmed its fiscal year 2023 adjusted net income guidance in the range of US$740 million to US$820 million.

That compares to adjusted net income of US$621 million for the fiscal year 2022.

Wiens said:

I believe our strategy, along with the depth in our world class leadership team and 5,000 committed and hard-working employees, will drive James Hardie to meet our mission of being a high-performance global company that delivers organic growth above market with strong returns.

James Hardie share price snapshot

The James Hardie share price has struggled this year to date, down 31%. That compares to a loss of 6% posted by the ASX 200 in 2022 so far.

Over the past five years, James Hardie shares have gained 92%.

The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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