q1 presentation v6

Owens Corning

Focused on Shareholder Value

Q1 2017This presentation shared at the following event(s):

03/20/17 OC Roadshow Hosted by Jefferies – Boston Mike Thaman, Chief Executive Officer

03/02/17 Evercore ISI Housing Symposium – New York Michael McMurray, Chief Financial Officer

03/01/17 Wells Fargo Real Estate Securities Conference – New York Thierry Denis, VP Investor Relations

02/28/17 OC Roadshow Hosted by Bank of America Merrill Lynch – Philadelphia Thierry Denis, VP Investor Relations

02/22/17 OC Roadshow Hosted by SunTrust – Los Angeles Mike Thaman, Chief Executive Officer

22

Forward-Looking Statements and Non-GAAP Measures

This presentation and the associated remarks and comments contain forward-looking statements. We caution you against relying on these statements as they involve risks and uncertainties that are difficult to predict and the Company’s actual results may differ materially from those projected in these statements. Such risks and uncertainties include, without limitation: relationships with key customers and demand for our products; macroeconomic factors like levels of construction activity, global industrial production, industry, economic and political conditions, including new legislation, policies or other governmental actions by the new U.S. presidential administration and Congress; competitive and pricing factors; currency, commodity and interest rate fluctuations; our level of indebtedness and the availability and cost of credit; weather conditions; energy and raw material availability, price volatility and cost issues; ability to protect our intellectual property and information technology systems; labor disputes, legal and regulatory proceedings; our ability to utilize our net operating loss carry-forwards; issues related to acquisitions, divestitures and joint ventures; and, factors detailed from time to time in the Company’s SEC filings.

For purposes of this presentation, any discussion referring to “year to date” or last twelve months (“LTM”) refers to the period ended on the last calendar day of the quarter preceding the date of the investor event referred to on the first page of this document. Otherwise the information in this presentation speaks as of the date of the investor event, and is subject to change. The Company does not undertake any obligation to update or revise forward-looking statements beyond what is required under applicable securities laws. Any distribution of this presentation after the date of the investor event is not intended and should not be construed as updating or confirming such information.

This presentation contains references to certain "non-GAAP financial measures" as defined by the SEC, including EBIT, adjusted EBIT, adjusted earnings, adjusted EPS, adjusted pre-tax earnings, free cash flow, free cash flow conversion of adjusted earnings, free cash flow yield and return on capital. Management uses non-GAAP measures for various purposes, including reporting results of operations to the Board of Directors, analysis of performance and related employee compensation measures. Although management believes these measures, and exclusions from GAAP therein, provide a useful representation of performance or liquidity, non-GAAP measures should not be considered in isolation or as a substitute for the corresponding GAAP measures. A reconciliation of these non-GAAP financial measures to their most directly comparable financial measures calculated and presented in accordance with GAAP can be found in the text and tables of our most recent earnings Press Release filed with the SEC on Form 8-K and in Appendix B. When the company provides forward-looking expectations for non-GAAP measures, the most comparable GAAP measures and a reconciliation between the non-GAAP expectations and the corresponding GAAP measures are generally not available without unreasonable effort due to the variability,complexity and limited visibility of the adjusting items that would be excluded from the non-GAAP measures in future periods. The variability in timing and amount of adjusting items could have significant and unpredictable effects on future GAAP results.

Adjusted EBIT, adjusted earnings, adjusted EPS, adjusted pre-tax earnings and return on capital exclude certain items that management does not allocate to its segment results because it believes they are not representative of the Company’s ongoing operations. Free cash flow is a non-GAAP liquidity measure used by investors, financial analysts and management to help evaluate the company's ability to generate cash to pursue opportunities that enhance shareholder value. Free cash flow is not a measure of residual cash flow available for discretionary expenditures due to the company’s mandatory debt service requirements. As a conversion ratio, free cash flow is compared to adjusted earnings. Free cash flow yield is a non-GAAP liquidity measure that management believes is useful to investors to compare a company’s ability to generate free cash flow to its market valuation. Free cash flow yield is not a measure of cash flow which accrues directly to the benefit of common stock share owners.

The Company

Investment Thesis

Three Strong Businesses

Additional Financial Information

Agenda

44

Owens Corning at a Glance

1938

Founded

Over 79

Years Ago

2016

Sales

Countries

Around

the World

Employees

Worldwide

Consecutive

Years on the

Fortune 500®

Three

Strong

Businesses

$5.7 BILLION

Source: Owens Corning SEC filings and Fortune Magazine

16k 26 62

55

Balanced End Market Exposure

Source: Owens Corning management estimates; estimated error margin below 5%. Consolidated figures eliminate intercompany sales between reportable segments.

15%

38%21%

26%

2016 OC REVENUE BY END MARKET

U.S. & Canada Residential New Construction

U.S. & Canada Repair and Remodeling

U.S. & Canada Commercial and Industrial

International

8%

79%

12%

1%

Roofing

36%

23%

25%

16%

Insulation3%

11%

26%60%

Composites

The Company

Investment Thesis



Agenda

77

OC Investment Thesis

Focused on Shareholder Value

Market

Leading

Businesses

2

Improved

Portfolio,

Earnings &

Cash Flow

3

Attractive

Macro

Drivers

1

Favorable

global trends

Positive

market outlook

Leadership

positions in

attractive industries

Valuable brands

Low-cost assets

Disciplined

capital allocation

Access to growth

opportunities

Improving capital

intensity

88

Portfolio Improvement Has Lifted Margin Profile

Implemented sustainable cost improvements

Drove substantial Components growth

Acquired synthetic underlayment leader InterWrap

Served market needs with premium products

Acquired and expanded mineral fiber assets

Grew business outside North America

Returned engineered & regional business to record levels

Lowered breakeven point

Repositioned low-cost network

Reduced capital intensity

Accelerated pace of product innovation

Demonstrated industry supply tension

Adjusted

EBIT

Margin:

Insulation

Roofing

Composites

13%2007 - 10

2011 - 16

2016

9%7%

Please refer to Table 1 of Appendix B for reconciliation to Owens Corning SEC filings.

99

Return on capital is defined as net operating profit after tax divided by total capital. Please refer to Table 2 in Appendix B for reconciliation to Owens Corning SEC filings. Total capital is the average of beginning and ending balances of property, plant and equipment, accounts receivable, inventories, post-emergence goodwill and intangibles, less accounts payable.

Portfolio Improvement Has Boosted

Return on Capital

4%

6%

8%

10%

12%

2012 2013 2014 2015 2016

Return on Capital

1010

18%

Significantly Improved Free Cash Flow

Please refer to Table 3 in Appendix B for reconciliation to Owens Corning SEC filings.

-100

0

100

200

300

400

500

600

2012 2013 2014 2015 2016

Mill

ion

s o

f $

2012-2014 management

actions to improve portfolio

constrained cash flow

performance

Free cash flow conversion

of adjusted earnings expected

to be about 100% on average

over 2015 to 2018

Free Cash Flow

Free Cash Flow

Conversion:126%

1111

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

Source: Management estimates, based on data from CapitalIQ as of 2/13/2017. Management believes this disclosure is useful to investors to compare a company’s ability to generate

free cash flow to its market valuation. Free cash flow yield is not a measure of cash flow which accrues directly to the benefit of common stock share owners. Calculation may differ from

methods used by peers in similar disclosures. Peer group represents building materials companies most covered by sell-side analysts who publish on Owens Corning. For detail on the

formula and GAAP reconciliation of the Owens Corning measurement, please refer to Table 4 in Appendix B.

Superior Free Cash Flow Yield Within Sector

Peer Average

1212

Disciplined Capital Allocation Strategy

Drive shareholder returns by enabling organic and inorganic growth and supporting the balance sheet

o Maintain investment grade

Capital allocation strategy

o Investing in attractive organic growth

o Pursuing value-creating acquisitions

o Returning cash to shareholders

Strong cash flow outlook supports dividend growth, share repurchase and acquisitions

Benefit from $1.8B U.S. Federal N.O.L. with estimated present value of approximately $5 per share

Source: U.S. Federal et operating loss (“N.O.L.”) as of 12/31/2016, as reported in Owens Corning SEC filings.

The Company

Investment Thesis



Agenda

1414

2016

(Millions $)Insulation Roofing Composites Corporate Total

Net sales 1,748 2,194 1,952 (217) 5,677

EBIT / Adj EBIT 126 486 264 (130) 746

EBIT / Adj EBIT as % of

sales7% 22% 14% 13%

Portfolio Financial Profile

Source: Owens Corning SEC filings. For the Corporate column, Net sales reflects intercompany eliminations and EBIT reflects General corporate expense and other as disclosed in our

SEC filings. The Total column reflects total company Adjusted EBIT, which is reconciled to Owens Corning SEC filings in Table 5 of Appendix B.

1515

Margin >= 10% 0%<= Margin < 10% Margin < 0%

'97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16

Insulation

Roofing

Composites

Strong Portfolio

Last 20 years of performance. Source: Owens Corning’s SEC filings since 2006. For comparability purposes, prior years have been provided based on Owens Corning’s SEC filings,

internal management reports, and management estimates.

1616

Insulation Business

Track record of proven performance

Strong brand and broad product portfolio

Investment opportunities for global

expansion

Confidence in return to historical

profitability

Source: Owens Corning SEC filings; segment reporting comparability may differ over time

* In millions

Sales* EBIT as % of sales

-5%

0%

5%

10%

15%

$0

$500

$1,000

$1,500

$2,000

2012 2013 2014 2015 2016

Progress supports confidence in return to historical profitability

INSULATION | 16

1717

-10%

0%

10%

20%

30%

'85 '90 '95 '00 '05 '10 '15

EBIT Margin Avg EBIT Margin '85-'08 (15%)

Return to Historical Profitability Levels

Historically Delivered 15% EBIT Margins at 1.5 Million Housing Starts; Expect to Average 50% Operating Leverage through the Housing Recovery

Source: Owens Corning management estimates and SEC filings of Owens Corning and predecessor company. Segment reporting comparability may differ over time.

INSULATION | 17

‘16

1818

( 0.5)

( 0.3) ( 0.2)

4.6 4.1

3.8 3.6

2005 TotalCapacity

Retired 2016 TotalCapacity

Mothballed OperatingPlants

Capacity

Cold Lines OperatingLines Capacity

Capacity

Utilization: 100% 73% 85% 90%

2005

B L

bs

U.S. & Canada Fiberglass Industry

Light Density Network Capacity and Demand

Light density fiberglass demand and capacity based on assets producing batts, rolls, flexible duct media, metal building insulation, duct wrap and appliance insulation; excludes loosefill products. Capacity utilization reported in 5% increments. Source: Owens Corning management estimates as of January 2017 and various industry sources and publications (including North America Insulation Manufacturers Association); all competitive information legally obtained from appropriate 3rd party sources.

INSULATION | 18

80% 85% 90%

2016

2.1 MM

U.S. Housing Starts

1.2 MM

U.S. Housing Starts

1919

Market Pricing Still Significantly Below

Historical Levels

OC U.S. New Construction Price Index

INSULATION | 19

60%

70%

80%

90%

100%

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Source: Owens Corning management estimates as of January 2017. Owens Corning nominal price index based on average price of fiberglass batts to U.S. contractors.

2020

Residential Fiberglass Below Historical

Levels; Non-Residential at Record Levels

Residential fiberglass building insulation includes batts & rolls and loosefill sold to insulation contractors and distributors, home centers, and manufactured housing producers in the U.S. and Canada. Engineered insulation and other regions includes pipe and flexible duct media insulation, foam, mineral fiber, and all building material products sold to Latin America and Asia. Source: Owens Corning management estimates. Comparability may differ over time. Margin of error on intra-segment EBIT estimated to be below $15MM.

-200

-100

0

100

200

300

400

2006(Peak)

2009(Trough)

2015

MM

$

EBITMM$ & Margins

U.S. & Canada Residential Fiberglass Building Insulation

Engineered Insulation & Other Regions

26%

17%

-23%

4% 2%

14%

INSULATION | 20

2121

Roofing Business

Strong market position and leading brands

Performance track record through varied

market conditions

Confidence in sustaining average operating

margins of mid-teens or better

* In millions


0%

5%

10%

15%

20%

25%

$0

$500

$1,000

$1,500

$2,000

$2,500

2012 2013 2014 2015 2016

Strong market position sustaining high operating margins

ROOFING | 21Source: Owens Corning SEC filings; segment reporting comparability may differ over time

2222

U.S. Asphalt Shingle Re-Roof Demand Drivers

Replacement age Average replacement age increased

driven by technological advances

Major storms & other weather events Weather events drive demand and create

early replacement of roofs

Weather-related demand estimated based on

NOAA data and insurance claims information

Economic factors Existing home sales, consumer income, and

borrowing capacity affect consumer decisions

on timing of re-roof

IMP

AC

T

LOW

HIGH

ROOFING | 22

2323

New Construction and Replacement Markets

Growing over Last Three Years

Source: Asphalt Roofing Manufacturers Association - Summary of Asphalt Roofing Industry Shipments. Management estimates based on data provided by National Oceanic and Atmospheric Administration (NOAA), National Association of Realtors, EIA, Moody’s Analytics, Oxford Economics reports, U.S. Bureau of Labor Statistics and U.S. Bureau of Economic Analysis.

MM Sq.

Total 136 143 145 154 161 173 155 129 135 120 108 122 118 111 107 112 133

U.S. Asphalt Shingle Market

ROOFING | 23

30 31 32 34 37 39 3526

17 11 11 11 14 17 18 19 20

71 7581

86 8795

7775

7371 63 61 59 58 60 65 68

3234

3027

2821

35

25

2321 28 31 34 30 23

2430

33 2

78

18

8

322

17

6

1911

66

4

'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16

New Construction Age Related/Economic Other Weather Events Major Storms

15

2424

Track Record of Strong Financial Performance

Delivered average EBIT

margins of 18% since

2010 (ranging from 13%

to 22%)

Strong market position;

confidence in sustaining

average EBIT margins

of mid-teens or better

ROOFING | 24

0

5

10

15

20

25

2010 2011 2012 2013 2014 2015 2016

%

Roofing EBIT Margin

Average 18%

Source: Owens Corning SEC filings; segment reporting comparability may differ over time

2525

Composites Business

A leader in a stable industry with strong growth

prospects

Improving economic conditions and higher

utilization rates

Transformed business delivering double-digit

EBIT margins & ROC

Strategy to deliver profitable, capital efficient

growthSource: Owens Corning SEC filings. Segment ROC differs from total company ROC. Please refer to Table 2 of Appendix B for explanation.

* In millions


Market-leading business with improving economic conditions and higher utilization rates

0%

5%

10%

15%

20%

25%

$0

$500

$1,000

$1,500

$2,000

$2,500

2012 2013 2014 2015 2016

COMPOSITES | 25

2626

Glass Fiber

A $7.5 Billion Global Market With Favorable Exposure

Glass fiber market defined as glass fiber reinforcements and direct conversion products as consumed, excluding yarns. Source: Fiber Economics Bureau, GlassFibreEurope (APFE), Global Trade Information Services, Inc. and Owens Corning management estimates as of January 2017.

Markets

Size

Power & EnergyConsumerBuilding &

Construction

Transportation Industrial

COMPOSITES | 26

2727

Positioned to Compete Anywhere in the World

% Market Revenue = market revenue in region as % of 2016 global market size; % OC Revenue = OC revenue in region as % of OC Composites global 2016 sales; Glass reinforcements market defined as glass fiber reinforcements and direct conversion products as consumed, excluding yarns. Sources: Fiber Economics Bureau, GlassFibreEurope (APFE), Global Trade Information Services, Inc. and Owens Corning management estimates of 2016 global market.

33%

47%

% MarketRevenue

% OCRevenue

Americas

#1 Position

26%

11%

% MarketRevenue

% OCRevenue

China

Emerging PositionWorld headquarters

Composites facilities

#1 Position

23%28%

% MarketRevenue

% OCRevenue

Europe

#1 Position

18%14%

% MarketRevenue

% OCRevenue

Rest of World

COMPOSITES | 27

2828

Supply Tension Expected in the Near Term

Glass fiber market demand excludes E-glass yarns. Sources: Fiber Economics Bureau, GlassFibreEurope (APFE), Global Trade Information Services, Inc. and Owens Corning management estimates as of August 2016 (high probability capacity additions only). Estimated demand calculated as 2015 demand grown at 1.6x growth rate of global IP per June 2016 Oxford Economics.

0.5

1.7

0.6

1.7

0.8

0.6

2005-09 2010-15 2016E-18E

Change in global

demand (MM T)

Change in global

capacity (MM T)

Estim

ate

d C

ap

acity U

tiliz

ation

China Emergence

Capacity Overbuild

Tightening Capacity

Price Inflection

Supply Tension

Improved Returns

90% Threshold

50%

60%

70%

80%

90%

100%'05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16E '17E '18E

COMPOSITES | 28

The Company

Investment Thesis



Agenda

3030

Improved level of safety performance

Adjusted EBIT of $746MM

Composites: record EBIT of $264MM

Roofing: $486MM EBIT; 22% EBIT margins

Insulation: $126MM EBIT

Free cash flow: $570MM; 126% conversion of adjusted

earnings over last two years

Repurchased 4.8MM shares and paid dividends of $81MM

Anticipate continued growth in U.S. housing starts and

moderate global industrial production growth in 2017

Appendix A

FY 2016 Highlights and Outlook

Source: Owens Corning SEC filings; Please refer to the tables in Appendix B for reconciliation of adjusted EBIT, free cash flow and free cash flow conversion to Owens Corning SEC filings.

3131

($ in millions, except per share data) 2016 2015Q4

2016

Q4

2015

Net sales $5,677 $5,350 $1,383 $1,297

Net earnings attributable to Owens Corning $393 $330 $86 $109

Diluted earnings per share attributable to Owens Corning common stockholders

$3.41 $2.79 $0.76 $0.92

Earnings before interest and taxes (EBIT) $699 $548 $136 $138

Adjusted EBIT $746 $550 $157 $136

Adjusted Earnings $419 $304 $81 $79

Adjusted EPS (diluted) $3.63 $2.57 $0.72 $0.66

Adjusted EBIT as a % of sales 13% 10% 11% 10%

Depreciation and amortization $343 $300 $101 $76

Net cash flow provided by operating activities $943 $742 $264 $332

Free cash flow $570 $341 $172 $205

Total debt (excluding rate swap), net of cash $1,982 $1,769 $1,982 $1,769

Appendix A

Key Financial Data - Corporate

Source: Owens Corning SEC filings; Please refer to the tables in Appendix B for reconciliation of EBIT, adjusted EBIT, adjusted earnings, adjusted EPS and free cash flow to Owens Corning SEC filings.

3232

Insulation Roofing Composites

($ in millions) Q4 2016 Q4 2015 Q4 2016 Q4 2015 Q4 2016 Q4 2015

Net sales $473 $518 $483 $368 $466 $445

EBIT $43 $70 $98 $53 $65 $44

EBIT as % of sales 9% 14% 20% 14% 14% 10%

D&A $28 $26 $12 $10 $35 $33

Appendix A

Key Financial Data - Business

FY 2016 FY 2015 FY 2016 FY 2015 FY 2016 FY 2015

Net sales $1,748 $1,850 $2,194 $1,766 $1,952 $1,902

EBIT $126 $160 $486 $266 $264 $232

EBIT as % of sales 7% 9% 22% 15% 14% 12%

D&A $106 $101 $46 $39 $138 $125

Source: Owens Corning SEC filings; reportable segment totals are shown in SEC filings before intercompany eliminations

3333

Macro Environment

Environment consistent with consensus U.S. housing starts

Expect moderate global industrial production growth

Primary Guidance

Strong conversion of adjusted earnings into free

cash flow

Insulation: $100MM of revenue growth;

EBIT of at least $160MM

Composites: EBIT growth of about $25MM

Roofing: growth in new construction and age-

related markets more than offset by decline of

storm demand; benefit from full year of InterWrap

Corporate expenses in $120-$130MM range

Interest expense about $110MM

Capital expenditures about $375MM

Depreciation & amortization about $345MM

Cash tax rate of 10-12% and book tax rate of

32-34% on adjusted pre-tax earnings

Source: Owens Corning management estimates

Other Guidance Items

Appendix A

2017 Corporate Environment and Guidance

3434

Appendix B

Non-GAAP Reconciliations – Table 1

3535

Appendix B


3636

Appendix B


3737

Appendix B


3838

Appendix B


3939

Appendix B
