FBU moves to strengthen balance sheet and focus portfolio

NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Fletcher Building moves to strengthen balance sheet and focus portfolio Key points: o Fletcher Building is undertaking actions to strengthen its balance sheet and better enable it to execute its immediate and longer term strategic objectives o Raising NZ$750m through a fully underwritten pro rata 1 for 4.46 accelerated entitlement offer ("Offer") at NZ$4.80 per share o Institutional and Retail Entitlement Offers with book-builds for any shortfall o Proceeds from the Offer will be used by the Company to repay existing debt o Commitments obtained from the required majority of lenders to a permanent solution of the current breach under the Syndicated Facility Agreement ("SFA") o New standby banking facility of NZ$500m established with ANZ, MUFG Bank and Westpac ("Standby Facility") o Discussions with the USPP Noteholders are ongoing and Fletcher Building's objective and expectation is that it will achieve a mutually acceptable outcome o While not expected to be needed, proceeds from the Offer and Standby Facility are sufficient to redeem all USPP Notes and pay associated costs if required. o Key principles of group strategy approved by the board: focus activities on New Zealand and Australia, with divestment processes to be undertaken for the Formica and Roof Tile Group businesses o No change to estimated FY18 EBIT for the Group (excluding B+I and significant items) of NZ$680m - NZ$720m and estimated loss for B+I of NZ$(660)m. Auckland, April 17 2018: Fletcher Building Limited (the "Company" or "Group") has moved to raise equity and establish new standby debt facilities to strengthen the Company's capital structure and better enable effective execution of the Group's strategy. The Company is raising NZ$750m through a fully underwritten accelerated pro rata entitlement offer, enabling eligible shareholders to purchase 1 share for every 4.46 they own at 9:00pm (NZ time) and 7:00pm (Sydney time) on the Record Date for NZ$4.80 per share. This represents a 23.4% discount to the closing share price on NZX on 16 April 2018, and a 20.0% discount to the theoretical ex-rights price (TERP) of NZ$6.00. The Offer will comprise institutional and retail entitlement offers, with any entitlements that are not taken up by eligible shareholders and entitlements of ineligible shareholders being offered for sale in the institutional and retail book builds respectively. In conjunction with the Offer, Fletcher Building has also established a new standby banking facility of NZ$500m with ANZ, MUFG Bank and Westpac. The Offer and Standby Facility will strengthen the Company's balance sheet and better enable it to execute its immediate and longer term strategic objectives. In particular, the Company expects that selected asset sales processes will be able to be transacted in a way that maximises value for shareholders. Following the Offer, the Company expects normalised leverage to reduce to 1.6x, at the lower end of the Company's revised target range of 1.5x - 2.5x. Discussions with the USPP Noteholders are ongoing, and the Company's objective and expectation is that it will achieve a mutually acceptable outcome by 31 May 2018. While not expected by the Company to be needed, the Standby Facility has been put in place to ensure that, together with the net equity proceeds of the Offer, Fletcher Building would be able to redeem all USPP Notes and pay associated costs if required. The decision to undertake the Offer has resulted from the Company's strategic review, which is progressing well and expected to be announced in full in June 2018. While work remains to be done to complete the strategic review, the key principles have been approved by the Board. Fletcher Building will focus its activities on New Zealand and Australia, and will therefore undertake divestment processes for its Formica and Roof Tile Group businesses. The Group continues to trade in line with its previously estimated FY18 EBIT for the Group (excluding B+I and significant items) of NZ$680m - NZ$720m and estimated loss for B+I of NZ$(660)m. Ross Taylor, Chief Executive of Fletcher Building, said "An outcome of the work that we have completed to date on the Group strategy is that it is now appropriate to strengthen our balance sheet. Reducing our net debt also provides us with the opportunity to undertake divestment processes for Formica and the Roof Tile Group on terms that should maximize shareholder returns." Commenting on today's announcement Fletcher Building Chairman Sir Ralph Norris said "it is important to provide all our existing eligible shareholders with the opportunity to purchase new shares in Fletcher Building. This acknowledges the continuing support that they have given the Company in the last 18 months, and enables them to contribute to the repositioning of the Company as the new strategy is rolled out." Further information Further details of the Offer are set out in the Appendix to this announcement. The Company has also lodged an Investor Presentation and Offer Document with the NZX and ASX today. The Investor Presentation and Offer Document contain important information including foreign selling restrictions with respect to the Offer. Shareholders with any questions in relation to the Offer, can contact the Fletcher Building Offer Information Line on 0800 650 034 (within New Zealand) and 1800 501 366 (within Australia) or +64 9 488 8777 (outside of New Zealand or Australia) between 8.30am and 5:00pm (NZ time and Sydney time) Monday to Friday. For other questions, shareholders should consult their broker, solicitor, accountant, financial adviser, or other professional adviser. #Ends For further information please contact: MEDIA Leela Gantman Head of Communications +64 27 541 6338 Leela.gantman@fbu.com INVESTORS AND ANALYSTS Rodney Deacon Head of Investor Relations +64 21 631 074 Rodney.deacon@fbu.com End CA:00316806 For:FBU Type:OFFER Time:2018-04-17 08:30:49