James Hardie Industries : Consolidated Financial Statements FY 2023

James Hardie Industries plc

Consolidated Financial Statements

as of and for the Year Ended 31 March 2023

F-1

James Hardie Industries plc

Index

	Page
Report of Independent Registered Public Accounting Firm	F-3
Consolidated Balance Sheets as of 31 March 2023 and 2022	F-5
Consolidated Statements of Operations and Comprehensive Income for the Fiscal Years	F-6
Ended 31 March 2023, 2022 and 2021
Consolidated Statements of Cash Flows for the Fiscal Years Ended 31 March 2023, 2022 and	F-7
2021
Consolidated Statements of Changes in Shareholders' Equity for the Fiscal Years Ended 31	F-9
March 2023, 2022 and 2021
Notes to Consolidated Financial Statements	F-10

F-2

Report of Independent Registered Public Accounting Firm

To the Shareholders and the Board of Directors of James Hardie Industries plc

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of James Hardie Industries plc (the Company) as of 31 March 2023 and 2022, the related consolidated statements of operations and comprehensive income, changes in shareholders' equity, and cash flows for each of the three years in the period ended 31 March 2023, and the related notes(collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at 31 March 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the period ended 31 March 2023, in conformity with U.S. generally accepted accounting principles.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

F-3

	Asbestos Liability Valuation
Description of the Matter	At 31 March 2023, the aggregate asbestos liability was
	US$977.1 million. As disclosed in Note 12 to the
	consolidated financial statements, the liability relates to an
	agreement to provide long-term funding to the Asbestos
	Injuries Compensation Fund ("AICF"), a special purpose
	fund established to provide compensation of proven
	Australian-related personal injuries..
	Auditing management's estimate of the asbestos liability is
	challenging because the estimation process is based on
	actuarial estimates of projected future cash flows which are
	inherently uncertain. The projected cash flows are complex
	and use subjective assumptions including the projected
	number of claims, estimated cost of settlement per claim,
	inflation rates, legal costs, and timing of receipt of claims
	and settlements.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of the Company's internal controls over the identification of claims, review of calculations performed by the Company's third-party actuary and management's review of the use of historical claim data and actuarial assumptions mentioned above to project the future liability.

To evaluate the estimate of the asbestos liability, our audit procedures included, among others, testing the underlying claims data used in the calculation to internal and external data on a sample basis. We involved our actuarial specialists to assist in evaluating the methodologies and key assumptions mentioned above to independently develop a range for the asbestos liability and compare that range to management's recorded liability. We also assessed the adequacy of the related disclosures in the Company's consolidated financial statements.

/s/ Ernst & Young LLP

We have served as the Company's auditor since 2008. Irvine, California

16 May 2023

F-4

James Hardie Industries plc

Consolidated Balance Sheets

(Millions of US dollars)	31 March				31 March
2023				2022
Assets
Current assets:
Cash and cash equivalents	$	113.0	$	125.0
Restricted cash and cash equivalents		5.0			5.0
Restricted cash and cash equivalents - Asbestos		67.6			141.9
Restricted short-term investments - Asbestos		140.9			119.7
Accounts and other receivables, net		354.8			398.4
Inventories		344.2			279.7
Prepaid expenses and other current assets		41.0			43.2
Insurance receivable - Asbestos		6.8			7.9
Workers' compensation - Asbestos		1.8			3.2
Total current assets		1,075.1			1,124.0
Property, plant and equipment, net		1,839.6			1,457.0
Operating lease right-of-use-assets		59.4			57.8
Finance lease right-of-use-assets		2.0			2.3
Goodwill		194.9			199.5
Intangible assets, net		155.2			162.8
Restricted long-term investments - Asbestos		36.2			-
Insurance receivable - Asbestos		28.2			37.8
Workers' compensation - Asbestos		16.4			18.6
Deferred income taxes		755.6			819.2
Deferred income taxes - Asbestos		298.6			360.1
Other assets		17.9			4.1
Total assets	$	4,479.1	$	4,243.2
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable and accrued liabilities	$	387.7	$	458.0
Accrued payroll and employee benefits		108.3			116.6
Operating lease liabilities		18.1			12.5
Finance lease liabilities		0.8			1.1
Accrued product warranties		5.4			6.7
Income taxes payable		15.4			9.5
Asbestos liability		119.4			132.9
Workers' compensation - Asbestos		1.8			3.2
Other liabilities		40.4			29.4
Total current liabilities		697.3			769.9
Long-term debt		1,059.0			877.3
Deferred income taxes		93.6			86.9
Operating lease liabilities		61.1			63.1
Finance lease liabilities		1.4			1.5
Accrued product warranties		30.2			31.0
Income taxes payable		2.3			2.3
Asbestos liability		857.7			1,010.8
Workers' compensation - Asbestos		16.4			18.6
Other liabilities		48.7			48.9
Total liabilities		2,867.7			2,910.3
Commitments and contingencies (Note 14)
Shareholders' equity:
Common stock, Euro 0.59 par value, 2.0 billion shares authorized; 442,056,296 shares issued and		230.0			232.1
outstanding at 31 March 2023 and 445,348,933 shares issued and outstanding at 31 March 2022
Additional paid-in capital		237.9			230.4
Retained earnings		1,196.8			892.4
Accumulated other comprehensive loss		(53.3)			(22.0)
Total shareholders' equity		1,611.4			1,332.9
Total liabilities and shareholders' equity	$	4,479.1	$	4,243.2

The accompanying notes are an integral part of these consolidated financial statements.

F-5