Building materials supplier James Hardie has pared its full-year profit guidance for the second time in three months after manufacturing hold-ups and rising costs at its main North American business led to lower earnings in the December quarter.
Net sales for the three months to December 31 rose 10 per cent to $US453.8 million ($A592.3 million), helped by strong volume growth at both the North American and international businesses.
However, net operating profit for the quarter was down six per cent at $US52.6 million.
"The top line reflects strong growth but the bottom line is short of what we had planned," chief executive Louis Gries told investors on a conference call on Friday.
He blamed delays and higher-than-anticipated costs in the company's ongoing North America program to increase capacity and overhaul existing facilities.
"We did say it was a two- to three-quarter project, but the reality is it just cost us more than we thought, this quarter," Mr Gries said.
Earnings before interest and tax at the North America fibre cements business - which accounts for nearly 80 per cent of group revenue - fell 11 per cent.
Chief financial officer Matthew Marsh said the company had also faced a steady rise in input prices, with pulp, cement, gas and electricity all up between five and nine per cent in the quarter.
James Hardie is the world's biggest maker of fibre cement home panelling.
The weak quarter prompted the company to again cut its full-year guidance with net operating profit now expected to come in in the $US245-$US255 million range.
It had trimmed guidance to between $US250-$US270 million in November.
The guidance cut weighed on the company's shares, which slipped nearly five per cent.
At 1550 AEDT James Hardie shares were 4.6 per cent lower at 96 cents.
"This is clearly a disappointing result that is unlikely to be well received," RBC Capital Markets' analyst Andrew Scott said in a note.
"The revised guidance would see negligible growth from James Hardie in FY17, something that is hard to reconcile with the high PE (price to equity ratio) implied by the current share price."
The company said it expects margins to recover next year on the back of steady growth in the US housing market, but cautioned that market conditions remained uncertain.
The company plans to restart two facilities in the US on the back of improving demand and also announced a new $US121.5 million project at Tacoma in Washington state.
December quarter earnings for the company's international business - which includes operations in Australia, New Zealand, Europe and the Phillippines - jumped 35 per cent, while sales rose seven per cent.
US WEIGHS ON JAMES HARDIE 9-MONTH RESULTS
* Nine-month net profit up 8.0pct to $US232m
* Sales up 10pct to $US1.43b
* Asbestos Injuries Compensation Fund claims received down 6.0pct to 428
* Average claim settlement down 24pct to $A215,000
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