James Hardie flags weaker earnings as affordability stifles US housing
Aug 20 (Reuters) - Fiber cement maker James Hardie JHX.AX on Wednesday issued a bleak warning for its North America business and forecast 2026 earnings below market consensus, as cash-strapped U.S. homeowners put off any high-ticket renovation projects.
James Hardie also cautioned that homebuilders were recalibrating their product inventory in line with the slowing demand for construction and remodelling projects, pushing its expectations for a market recovery into the next business year.
"Homeowners are deferring large-ticket remodeling projects like re-siding, and affordability remains the key impediment to improvement in single-family new construction," CEO Aaron Erter said in an exchange filing.
"Over the course of the summer, single-family new construction activity has been weaker than anticipated and we have adjusted our expectations to account for softer demand."
As a result, James Hardie forecast adjusted operating earnings between $1.05 billion and $1.15 billion for the fiscal year ending March 2026, below the Visible Alpha consensus of $1.23 billion. It earned $1.1 billion in fiscal 2025 .
"Demand in both repair and remodel and new construction in North America is challenging," Erter said.
That was reflected in June's sales of new U.S. single-family homes, which increased less than expected due to higher mortgage rates, pushing inventory to levels last seen in late 2007.
James Hardie's fiber cement sales in North America, its biggest money-making geography, declined 12% to $641.8 million in the quarter ended June 30.
As a result, the Dublin-headquartered firm's adjusted net income fell to $126.9 million in the first quarter from $177.6 million last year, missing the Visible Alpha estimate of $158.5 million.
James Hardie, which completed its $8.8 billion acquisition of U.S. artificial decking maker AZEK on July 1, expects to benefit from new supply agreements and product launches mainly in fiscal 2027 and beyond, rather than in the second half of FY26 as previously anticipated.
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