Grand City Properties Sa · XETR:GYC
Grand City Properties Sa — H1 2020 Earnings Presentation
29 slides from Grand City Properties Sa's earnings presentation, August 2020
Slide 1: H1 2020 Financial Results Presentation
H1 2020 FINANCIAL RESULTS PRESENTATION AUGUST 2020 COLOGNE
Slide 2: Table of Contents
TABLE OF CONTENTS BONN BERLIN LEIPZIG LONDON Financial performance 1 H1 2020 Highlights 2 3 Guidance 4 APPENDIX and Portfolio update
Slide 3: H1 2020 Highlights
H1 2020 HIGHLIGHTS – 1 STRONG OPERATIONAL PERFORMANCE TRANSLATED INTO STRONG CASH FLOW AND VALUE CREATION Net rental income +3.1% Revenue Adjusted EBITDA FFO I €186 million LFL €268 million €147 million €108 million -2% -4% +1% +2% Net profit +1% +0% FFO I per share FFO I per share Dividend of 65% o
Slide 4: Business Profitability - Sustainable Operational Results
2 BUSINESS PROFITABILITY - SUSTAINABLE OPERATIONAL RESULTS Selected consolidated statement of profit or loss 1-6/2020 1-6/2019 NET RENTAL INCOME (IN € MILLIONS) ADJUSTED EBITDA (IN € MILLIONS) in € ‘000 unless otherwise indicated Revenue 267,723 278,195 -2% Net rental income 186,364 189,320 189.3 18
Slide 5: FFO I + II
2 FFO I + II FFO I (IN € MILLION) FFO I PER SHARE (IN €) in € ‘000 unless otherwise indicated 1-6/2020 1-6/2019 FFO I per share after perpetual (in €) FFO I per share (in €) Adjusted EBITDA 147,106 146,253 106 108 Finance expenses (24,297) (22,807) Current tax expenses (14,519) (15,429) Contribution
Slide 6: EPRA NAV – Sustainable Value Creation
2 EPRA NAV – SUSTAINABLE VALUE CREATION Jun 2020 Dec 2019 EPRA NAV (IN € MILLION) € ‘000 € Per share € ‘000 € Per share EPRA NAV EPRA NAV incl perpetual notes Equity per the financial statements 5,007,920 4,966,599 CAGR EPRA NAV Equity attributable to perpetual notes investors (1,022,255) (1,030,050
Slide 7: Investment Property – Accretive Capital Growth
2 INVESTMENT PROPERTY – ACCRETIVE CAPITAL GROWTH H1 2020 INVESTMENT PROPERTIES (IN € MILLIONS) REVALUATION GAINS of over €200 million , driven by like-for-like rental growth and decreasing yields with an average yield compression of 0.2% stemming from 7,972 7,977 operational improvements and strong
Slide 8: Portfolio Overview
2 PORTFOLIO OVERVIEW DISTRIBUTION BY VALUE – JUNE 2020 Quality assets located in densely populated metropolitan regions with sustainable economic fundamentals and demographic prospects as well as valuable diversification built-in to the portfolio. PORTFOLIO OVERVIEW JUNE 2020 Area Annualized net In-
Slide 9: Portfolio NRW – June 2020
2 PORTFOLIO NRW – JUNE 2020 GCP is well positioned in Germany’s largest metropolitan area… PORTFOLIO DISTRIBUTION POPULATION DENSITY IN NRW 20%* 4th of GCP’s largest city Portfolio in Germany COLOGNE DORTMUND ESSEN WUPPERTAL * all breakdowns are by values
Slide 10: Best in Class Berlin Portfolio – June 2020
2 BEST IN CLASS BERLIN PORTFOLIO – JUNE 2020 PORTFOLIO OVERVIEW BERLIN 25% QUALITY LOCATIONS IN TOP TIER NEIGHBORHOODS OF BERLIN of GCP’s Portfolio Value 70% 70% of the Berlin portfolio is 16% located in top tier neighborhoods: of GCP’s Charlottenburg, Wilmersdorf, Mitte, Kreuzberg, Friedrichshain,
Slide 11: High Quality London Portfolio – June 2020
2 HIGH QUALITY LONDON PORTFOLIO – JUNE 2020 LONDON PORTFOLIO WELL CONNECTED LONDON PORTFOLIO 15%* of GCP’s Portfolio Over 90% of the portfolio is The total London situated within a short walking portfolio, including pre- distance to an marketed units consists underground/overground station of over 2
Slide 12: Portfolio East and North – June 2020
2 PORTFOLIO EAST AND NORTH – JUNE 2020 …with further diversification in Germany’s fast growing Eastern and largest Northern cities EAST PORTFOLIO NORTH PORTFOLIO 13%* 5%* of GCP’s of GCP’s Portfolio Portfolio DRESDEN LEIPZIG HALLE HAMBURG BREMEN * all breakdowns are by values
Slide 13: Portfolio Potential
2 PORTFOLIO POTENTIAL CURRENT ANNUALIZED NET RENTAL INCOME VS MARKET POTENTIAL* +8% 451 Only 3% of units +20% 422 ~9 years subject to rent restrictions from Average tenancy length Subsidization 352 Jun 2020 Annualized Full market potential annualized market potential (no Berlin rent cap) (incl. berl
Slide 14: Financial Policy
2 FINANCIAL POLICY GCP FINANCIAL POLICY THE STRAIGHT BONDS AND THE CONVERTIBLE BOND ARE UNSECURED AND HAVE THE BELOW COVENANT PACKAGE: Strive to achieve A- global rating in the long term Overview of Covenant Package LTV limit at 45% Covenant Type GCP Covenant limit and H1 2020 results Limitation on
Slide 15: Capital Structure
2 CAPITAL STRUCTURE INTEREST HEDGING STRUCTURE JUNE 2020 FINANCING SOURCE MIX LTV DEVELOPMENT 6% 7% Bank Debt 45% Board of Directors’ limit 4% 6% 94% Hedged 34% 37% Straight Bond 36% 36% 3% Convertible 34% 3% 33% 57% 53% Equity 90% Dec Dec Dec Jun Perpetuals fixed & swapped 2017 2018 2019 2020 Dec 2
Slide 16: Solid Liquidity Position with Conservative Financial Platform
2 SOLID LIQUIDITY POSITION WITH CONSERVATIVE FINANCIAL PLATFORM DEBT AND INTEREST COVER RATIOS – H1 2020 UNENCUMBERED ASSETS LIQUIDITY POSITION 6.1x 4.8x €6.2 bn over €1.5 billion 77% of value ICR* DSCR** LARGE POOL OF UNENCUMBERED ASSETS HIGHEST LIQUIDITY POSITION AMONG PEERS *) Adjusted EBITDA / i
Slide 17: Maintenance and Repositioning Capex
2 MAINTENANCE AND REPOSITIONING CAPEX Repositioning capex REPOSITIONING CAPEX AND MAINTENANCE (IN € PER AVG SQM) Increasing property quality Supporting value creation 10.2 9.3 Measures include: o upgrading apartments for new rentals o staircases and public areas o installing playgrounds 6.0 7.
Slide 18: Guidance Confirmed
3 GUIDANCE FY 2020 Guidance FFO I (in € millions) 213-220 FFO I per share (in €) 1.27-1.31 GUIDANCE CONFIRMED – GCP IS Dividend per share (in €) 0.82-0.85 FFO I per share WELL-POSITIONED TOWARDS after perpetual notes attribution (in €) 1.07-1.11 MEETING THE GUIDANCE Total net rent like-for-like grow
Slide 19: Appendix
GRAND CITY Properties S.A APPENDIX
Slide 20: COVID-19 – Agile and Adaptable
4 COVID-19 – AGILE AND ADAPTABLE The dynamic and innovative DNA of the Company has been vital in GCP’s ability to adapt to fast-changing situations, which in turn has mitigated possible effects of the COVID-19 pandemic Limited direct impact of the pandemic on underlying business operations During th
Slide 21: Berlin Rent Cap – Limited Effect on the Total Portfolio
4 BERLIN RENT CAP – LIMITED EFFECT ON THE TOTAL PORTFOLIO Berlin Mietendeckel (rent cap) was passed on January 30, 2020 and was implemented on February 23, 2020 - The law limits existing rents to 120% of the rent cap (including modernization & location-based adjustments). - Landlords will be require
Slide 22: ESG - Outperformer
4 ESG - OUTPERFORMER GCP publishes its Corporate Responsibility Report annually, demonstrating the Company’s commitment to sustainability by presenting to investors, business partners, employees and other stakeholders its activities and achievements and to embed the high ESG criteria of the Company.
Slide 23: Proven Ability to Access Capital Markets
4 PROVEN ABILITY TO ACCESS CAPITAL MARKETS Proven track record Over €7 billion of capital raised since 2012, with a proven track record in 4 different instruments: Equity, Perpetual notes, Convertible bonds and Straight bonds across a broad spectrum of investors & markets €1,308 Mn €1,201 Mn €600 mi
Slide 24: Analyst Coverage
4 ANALYST COVERAGE Analyst Research Target Price 32 28 27.5 24 26.5 26.2 25.2 25.0 25.0 24.5 24.0 24.0 23.5 20 22.0 22.0 22.0 21.0 21.0 20.9 20.5 20.0 20.0 16 16.0 12 8 4 0 First Berlin UBS Citigroup Credit Suisse Kepler Commerzbank J.P. Morgan Berenberg Bankhaus DZ Bank HSBC Deutsche Bank Bank of A
Slide 25: Share Development and Structure
4 SHARE DEVELOPMENT AND STRUCTURE GCP - Share Price and Total Return Since First Equity Placement (19.7.2012) 26 Grand City Properties 793% 24 22 20 18 16 14 12 10 FTSE EPRA/NAREIT Germany (rebased)206% 8 Issue price €2.75 6 4 MDAX (rebased) 156% 2 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15 Jul-15 Ja
Slide 26: Management
4 MANAGEMENT Christian Windfuhr Mr. Windfuhr is Grand City Properties’ CEO. Before joining Grand City Mr. Windfuhr served as CEO of Maritim Hotels, with 40 hotels in Germany. Prior to this he served as CEO of Mövenpick. He achieved CEO the financial turnaround of Mövenpick, drove international expan
Slide 27: Management
4 MANAGEMENT Senior Management (continued) Michael Bar-Yosef Mr. Bar-Yosef is responsible for financial modeling and cooperates with equity researchers to analyze their financial models. Before joining GCP he served as a financial and corporate analyst for a Senior Financial Analyst financial adviso
Slide 28: Credit Rating Matrix
4 CREDIT RATING MATRIX Financial risk profile 1 2 3 4 5 6 Min Modest Aggr High - Intermediate Significant e- Lever- imal ssive aged 1 GCP will continue strengthening its position within the business profile aaa Excellent bbb- / aa a+/a a- bbb /bb+ aa+ (Vonovia- BBB+) Business risk profile 2 (Aroundt
Slide 29: Contact and Disclaimer
CONTACT Katrin Petersen Head of Communications E-mail: katrin.petersen@grandcity.lu www.grandcityproperties.com DISCLAIMER IMPORTANT: This presentation has been provided for information purposes only and is being circulated on a confidential basis. This presentation shall be used only in accordance
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