James Hardie Industries (JHX) Q2 2026 earnings summary

Executive summary

• Q2 FY26 net sales rose 34% to $1.29 billion, driven by the AZEK acquisition, while organic sales declined 1% due to soft market demand in legacy businesses.

• Adjusted EBITDA increased 25% to $330 million (25.5% margin), reflecting cost synergies and integration progress with AZEK.

• Adjusted diluted EPS was $0.26, down 27% year-over-year.

• Operating income fell 84% to $24 million, with a net loss of $55.8 million, mainly due to acquisition-related costs and higher interest expense.

• The AZEK acquisition was completed for $8.4 billion, significantly expanding the product portfolio and market reach.

Financial highlights

• Q2 FY26 net sales: $1,292 million (+34% YoY), including $345 million from AZEK; organic sales declined 1%.

• Adjusted EBITDA was $330 million (25.5% margin); adjusted net income was $154 million; adjusted EPS was $0.26.

• Year-to-date free cash flow was $58 million, impacted by transaction and integration costs.

• Siding and Trim segment net sales up 10% (including AZEK), but organic net sales declined 3% due to lower volumes.

• Deck, Rail & Accessories net sales up 6% year-over-year, with adjusted EBITDA margin of 30.7%.

• Australia/New Zealand net sales declined 10%, with adjusted EBITDA margin down to 32.7%.

• Europe net sales up 18% (11% in euros), with adjusted EBITDA margin up to 15.3%.

Outlook and guidance

• FY26 consolidated net sales guidance updated to $5.3–$5.4 billion, with adjusted EBITDA of $1.20–$1.25 billion and free cash flow of at least $200 million.

• Siding & Trim FY26 net sales expected at $2.925–$2.995 billion, adjusted EBITDA $920–$955 million.

• Deck, Rail & Accessories FY26 net sales guided at $780–$800 million, adjusted EBITDA $215–$225 million.

• CapEx outlook unchanged at ~$400 million for FY26; free cash flow expected at least $200 million.

• Net leverage at 3.2x, with a target to reduce below 2x within two years post-close.