August 10, 2018 / 4:32 AM / a year ago

UPDATE 2-Australia's James Hardie Q1 profit jumps, but FY outlook disappoints

* Co's Q1 profit surges 29 pct

* Full-year profit outlook misses estimates

* ASX-listed stock falls up to 9.1 pct earlier in the day

* For graphic - (Adds analyst quote, background on U.S. economy, graphic)

By Ambar Warrick

Aug 10 (Reuters) - James Hardie Industries PLC, the world's biggest fibre cement product maker, on Friday posted a 29 percent jump in first-quarter profit, but its shares hit an over six-month low as full-year outlook missed analysts' expectations.

The company's first-quarter performance was buoyed by a stronger U.S. dollar and construction in the United States, its key market. Adjusted operating profit for the fiscal year ended March 2019 is expected to be between $300 million and $340 million, the fibre cement product maker said.

"The management cautions that although the U.S. housing activity has been improving, market conditions remain somewhat uncertain and some input costs remain volatile," the company said in a statement.

The mid-point of the company's range missed analysts' average estimate of $331.86 mln, according to 11 respondents polled by Thomson Reuters I/B/E/S.

The company's ASX-listed shares were trading down 8.6 percent at A$21.24, as of 0411 GMT, after losing as much as 9.1 percent earlier in the session.

"James Hardie has outperformed a sector that has underperformed. Expectations were pretty high, and even though it was a strong result, it was actually a slight miss," said Mathan Somasundaram, market portfolio strategist, Blue Ocean Equities.

First-quarter adjusted operating profit, which excludes one-off items such as the company's compensation payments to people claiming asbestos-related illness, came in at $79.9 million, up from $61.7 million a year ago.

Unadjusted net profit for the quarter surged 58 percent to $90.6 million. The company attributed the jump chiefly to its closing of the Fermacell acquisition, which was incorporated into its first-quarter results.

Apart from Australia, the firm has a manufacturing presence in countries including the United States, New Zealand and the Philippines.

James Hardie generated over 66 percent of first-quarter net sales from its North America segment, underpinned by a surge in new U.S. home sales in April and May. However, housing sales in the world's leading economy eased later in June.

U.S. homebuilding fell to a nine-month low in June and permits for future construction dropped for a third straight month, according to the Commerce Department.

"The funding pressure in mortgages in Australia and United States is picking up and that just makes it harder for them in the future," Blue Ocean Equities' Somasundaram added.

The housing market in the United States could lag further if the Federal Reserve clears the way for more interest rate hikes in 2018.

James Hardie's North America Fiber Cement segment clocked in a 10 percent growth in sales, and benefited from higher selling prices.

Earnings from the segment are expected to be at the top-end of its 20 percent-25 percent growth range in 2019, the company added.

Reporting by Ambar Warrick, Aaron Saldanha and Rushil Dutta in Bengaluru; Editing by Phil Berlowitz, Rosalba O'Brien and Sherry Jacob-Phillips

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