Hardie slugged with more asbestos claims

James Hardie will be forced to pay more than $100 million extra for asbestos victims after being hit by more claims than expected in the past 12 months.

The company had believed the "peak year" for asbestos claims was 2010-11, but a jump in claims since March last year means it will have to pay an extra $117 million into a special victims' fund.

The readjustment is also partly due to a projected increase in the future number of claims for a number of disease types.

It means the company's asbestos liability now stands at an estimated $1.7 billion, up from $1.58 billion a year ago.

The news comes as Telstra said this week that more of its cabling pits, which are being used to roll out the national broadband network program, contain traces of the deadly asbestos fibre.

According to James Hardies' 2013 financial report, there were 542 new claims filed against the company since March last year, compared with 456 claims filed in the previous 12 months.

The spike in the number and cost of claims has caught the company off guard.

"During fiscal year 2013, mesothelioma claims reporting activity has been above actuarial expectations for the first time since fiscal year 2009," the company's annual report says.

"One of the critical assumptions used to derive the [claims] estimate is the estimated peak year of mesothelioma disease claims, which was targeted for 2010-11."

New claims from mesothelioma victims had been falling, from 494 in financial year 2011 to 456 in the following year.

The average claim settlement has also jumped in the past 12 months.

In fiscal year 2013, the average claim settlement of $231,000 was $12,000 more than the previous year.

The increase in the average claim settlement was due largely to the rise in mesothelioma claims, which are "more costly to settle and represented a larger proportion of total claims than in fiscal year 2012".

Asbestos claims paid of $121.3 million for fiscal year 2013 were consistent with the actuarial expectation of $122.2 million.

James Hardie moved its base to the Netherlands from Australia in 2001. Directors of the company were later found by a NSW Supreme Court to have made misleading statements about the adequacy of the compensation fund it set up in Australia for asbestosis sufferers.

Meanwhile, James Hardie chief executive Louis Gries said he was confident the recent improvements seen in the US housing markets were sustainable. But he expressed caution over the building materials market in Australia and parts of Asia which he described as "challenging" with operating conditions likely to remain subdued.

James Hardie recently posted a full-year net profit of $US140.8 million, down from $144.3 million.

The group benefited from higher sales volumes in all major markets, but with lower average selling prices in the key US and European markets.