Q3 FY26 Net Sales of $1.2 Billion, Up +30% with Organic Net Sales +1%
Operating Income of $176 Million, Adjusted EBITDA of $330 Million
Siding & Trim Net Sales Up +10% with Organic Net Sales Down (2%)
500 Basis Points of Sequential Siding & Trim Adjusted EBITDA Margin Expansion
Deck, Rail & Accessories Net Sales Up +2% with Sell-Through Up Mid-Single-Digits
Integration and Cost Synergies Ahead of Schedule, Focused on the Achievement of $125 Million Target
CHICAGO--(BUSINESS WIRE)--February 10, 2026--
James Hardie Industries plc (NYSE / ASX : JHX) ("James Hardie" or the "Company"), a leading provider of exterior home and outdoor living solutions, today announced results for its third quarter ending December 31, 2025.
Aaron Erter, CEO of James Hardie said, "In the third-quarter, we achieved or exceeded each of our financial commitments despite a mixed macro backdrop. We are taking actions to address the current market environment, including optimizing our manufacturing footprint and better aligning our cost structure with the slower, but stabilizing, pace of demand. These actions will improve near-term profitability and better position the Company to profitably grow when conditions improve.
"Siding & Trim organic net sales were down modestly in the quarter, while Adjusted EBITDA margin improved nearly 500 basis points sequentially primarily driven by price / mix favorability and our actions to drive Hardie Operating System savings. Deck, Rail & Accessories delivered mid-single-digit sell-through growth, demonstrating our ability to drive material conversion through channel expansion and new product initiatives."
Mr. Erter continued, "Our confidence in the combination of James Hardie and AZEK continues to be strong as customers respond to our differentiated products, leading brands, focus on innovation and investment across the value chain. We continue to make progress on the integration and have surpassed our FY26 cost synergy goal. Our progress to date reaffirms our confidence in hitting our $125 million cost synergy target. On the commercial front, our early wins with dealers, contractors and homebuilders will drive meaningful revenue synergies in FY27 and beyond, demonstrating our potential to accelerate material conversion across exteriors and outdoor living."
____________________
Note: All Deck, Rail & Accessories growth comparisons correspond to the quarter ended December 31, 2024, prior to the acquisition of AZEK by James Hardie, unless otherwise stated.
Consolidated Financial Information
9 9
Months Months
Q3 FY26 Q3 FY25 Change FY26 FY25 Change
Group (US$ millions, except per share data)
Net Sales 1,239.8 953.3 +30% 3,431.9 2,906.0 +18%
Operating
Income 176.2 206.1 (15%) 338.8 593.8 (43%)
Operating
Income
Margin 14.2% 21.6% (740bps) 9.9% 20.4% (1,050bps)
Adjusted
EBITDA 329.9 262.1 +26% 884.9 810.8 +9%
Adjusted
EBITDA
Margin 26.6% 27.5% (90bps) 25.8% 27.9% (210bps)
Net Income 68.7 141.7 (52%) 75.5 380.4 (80%)
Adjusted
Net
Income 142.2 153.6 (7%) 423.1 488.2 (13%)
Diluted
EPS - US$
per
share 0.12 0.33 (64%) 0.14 0.88 (84%)
Adjusted
Diluted
EPS - US$
per
share 0.24 0.36 (31%) 0.79 1.13 (30%)
Segment Business Update and Results
-----------------------------------
Siding & Trim
9 Months 9 Months
Q3 FY26 Q3 FY25 Change FY26 FY25 Change
Siding &
Trim (US$ millions)
Net Sales 788.3 719.3 +10% 2,196.1 2,144.4 2%
Operating
Income 202.9 209.3 (3%) 515.1 638.5 (19%)
Operating
Income
Margin 25.7% 29.1% (340bps) 23.5% 29.8% (630bps)
Adjusted
EBITDA 268.6 250.5 +7% 698.4 754.0 (7%)
Adjusted
EBITDA
Margin 34.1% 34.8% (70bps) 31.8% 35.2% (340bps)
Net sales increased 10% due to the inorganic net sales contribution from AZEK Exteriors. On an organic basis, net sales declined (2%) with an increase in average net sales price more than offset by lower volumes driven by soft market demand. Volume of Exterior products declined mid-single-digits, with Single-Family down high-single-digits and Multi-Family up high-single-digits, while volume of Interior products declined double-digits. The Single-Family Exteriors decline was primarily due to a weaker new construction environment across the South, where James Hardie has built strong leadership positions with large homebuilders in key long-term growth markets such as Texas, Florida and Georgia. Housing markets in these geographies have been especially impacted by affordability challenges and elevated housing inventory. While Adjusted EBITDA margin improved 490bps sequentially, adjusted EBITDA margin decreased (70bps) year-over-year to 34.1%, due to unfavorable production cost absorption and higher freight and raw material costs, and the allocation of certain R&D expenses which were not allocated to the segment in the prior year, partially offset by a higher average net sales price and Hardie Operating System (HOS) savings.
In Siding & Trim, we are focused on returning the segment to organic growth through four core growth strategies.
1. R&R Focus: We are increasing our focus on repair & remodel,
particularly in the Northeast and Midwest, where we see $1 billion
material conversion opportunity in wood- and wood-look siding products
2. Deeper New Construction Penetration: We are expanding on our strong
large builder relationships and seeking growth with custom and local
builders where there is $750 million of opportunity for additional
growth
3. Product Innovation: We are focused on new product innovation in Siding,
including differentiated offerings, to support our long-term growth
4. Installation Efficiency: We are partnering with our contractors and
installers to introduce innovative installation techniques to reduce time
and installed costs, expanding the total addressable market for fiber
cement
Deck, Rail & Accessories (DR&A)
9 Months
Q3 FY26 FY26
Deck, Rail & Accessories (US$ millions)
Net Sales 194.1 449.9
Operating Loss (24.0) (35.9)
Operating Loss Margin (12.4%) (8.0%)
Adjusted EBITDA 48.7 127.3
Adjusted EBITDA Margin 25.1% 28.3%
Deck, Rail & Accessories net sales increased +2% compared to the quarter ended December 31, 2024 prior to the acquisition driven primarily by price / mix. Sell-through was up mid-single-digits, consistent with growth in the prior quarter. Adjusted EBITDA margin was 25.1% reflecting the benefit of top-line growth, partially offset by growth investments. In addition to cost synergies, the runway for margin improvement in Deck, Rail & Accessories is enabled by recycling initiatives, improved absorption across the manufacturing network, and leveraging the Hardie Operating System.
In Deck, Rail & Accessories, the organic strategy remains consistent with a focus on continued channel expansion and new product launches. Last calendar year's new product launches have been well received by customers, and additional new offerings are being launched in early 2026 which strengthen TimberTech's commitment to combining superior aesthetics with advanced functionality for both homeowners and contractors alike. Additionally, the combination with James Hardie has helped to accelerate growth and secure incremental shelf space at dealer partners throughout early buy negotiations as customers recognize the enhanced value proposition delivered through a comprehensive product portfolio, trusted brands and long-term partnerships.
Australia & New Zealand (ANZ)
9 9
Q3 Months Months
FY26 Q3 FY25 Change FY26 FY25 Change
Australia &
New Zealand (US$ millions, unless otherwise noted)
Net Sales 126.5 118.1 +7% 381.0 401.8 (5%)
Net Sales (A$
millions) 192.9 180.1 +7% 585.6 606.9 (4%)
Operating
Income 35.6 34.8 +2% 111.4 68.0 +64%
Operating
Income
Margin 28.1% 29.3% (120bps) 29.2% 17.2% +1,200bps
Adjusted
EBITDA 41.2 39.7 +4% 127.7 139.7 (9%)
Adjusted
EBITDA
Margin 32.6% 33.5% (90bps) 33.5% 34.7% (120bps)
Net sales increased +7%, with low-single-digit volume growth and a mid-single-digit increase in average net sales price. Adjusted EBITDA margin of 32.6% decreased (90bps) as volume and price growth and HOS savings were more than offset by unfavorable production cost absorption and the allocation of R&D costs which were not previously allocated to the reportable segments.
The Company is focused on driving growth in Australia and New Zealand through new customer acquisitions and project conversion enabled by customer collaboration and leveraging the James Hardie brand. The teams are innovating to accelerate material conversion to fiber cement with a key focus on new construction. Overall, while market demand remains challenged, the ANZ team is focused on finding further manufacturing efficiencies and driving HOS savings to underpin the segment's consistent profitability.
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