Axis Real Estate Investment Trust · MYX:AXREIT

Axis Real Estate Investment Trust — Q3 2010 Earnings Presentation

43 slides from Axis Real Estate Investment Trust's earnings presentation, October 2010

  1. Slide 1: Axis REIT 3Q 2010 Results Presentation

    Axis REIT 3Q 2010 Results Presentation 1 Oct 2010

  2. Slide 2: Disclaimer

    Disclaimer This the information contained in this document is provided for information purposes only and in no way constitutes an offer of services or solicitation. Past performance is not indicative of future performance We decline any responsibility with respect to direct or indirect damages or co

  3. Slide 3: Snapshot

    Snapshot Approved Fund Size ‰ 375,901,000 units Manager ‰ Axis REIT Managers Bhd Investment Properties ‰ 942.00 million (as at 30 September 2010 – Unaudited) Market Capitalisation ‰ RM811.95 million (as at 30 September 2010) Unit Price ‰ RM2.16 (as at 30 September 2010) Gearing ‰ RM343.43 million (3

  4. Slide 4: Financial Results – Income Statement

    Financial Results – Income Statement Net Property Income exceeds 2Q2009 by 27.89% Changes / 3Q2010 3Q2009 Movement No. of Properties 23 19 +4 Property Income (RM’000) 22,003 17,520 + 25.59% Net Property Income (RM’000) 18,573 14,523 + 27.89% Profit before Taxation (RM’000) 12,589 10,249 + 22.83% Ear

  5. Slide 5: Financial Results – Balance Sheet

    Financial Results – Balance Sheet Trading at premium to NAV of 14.34% 3Q 2010 31 DEC 2009 (RM ‘000) (RM’000) Total Assets 1,097,859 907,745 Investment Properties 941,761 884,962 Borrowings 343,433 308,932 Net Asset Value 710,103 550,357 Unitholders’ Funds 540,281 406,854 Gearing 31.28% 34.03% NAV pe

  6. Slide 6: 30 Sept 2010 Financial Results

    30 Sept 2010 Financial Results

  7. Slide 7: Financial Results – Income Statement

    Financial Results – Income Statement 3Q 2010 3Q 2009 Changes / (RM ‘000) (RM’000) Movement No. of Properties 23 19 +4 Property Income 22,003 17,520 + 25.59% Property Expenses (3,430) (2,997) + 14.45% Net Property Income 18,573 14,523 + 27.89% Interest Income 386 151 Non‐Property Expenses (1,892) (1,

  8. Slide 8: Financial Results – Income Statement (YTD)

    Financial Results – Income Statement YTD Sept 10 YTD Sept 09 Changes / (RM ‘000) (RM’000) Movement No. of Properties 23 19 Property Income 62,778 52,211 + 20.24% Property Expenses (9,730) (8,430) + 15.42% Net Property Income 53,048 43,781 + 21.17% Interest Income 480 151 Non‐Property Expenses (5,169

  9. Slide 9: Financial Results – Income Statement (qtr-to-qtr 2010)

    Financial Results –Income Statement (qtr‐to‐qtr 2010) 3Q 2010 2Q 2010 1Q 2010 (RM ‘000) (RM’000) (RM’000) No. of Properties 23 23 23 Property Income – Note 1 22,003 20,978 19,798 Property Expenses – Note 2 (3,430) (3,225) (3,076) Net Property Income 18,573 17,753 16,722 Interest Income – Note 3 386

  10. Slide 10: Notes to Financial Results – Income Statement

    Notes to Financial Results – Income Statement Note 1 – Property Income Property Income in the current quarter increased by 5% compared to immediate preceding quarter mainly due to the followings: a) Rental income contribution from Quattro West; b) Positive rental reversion recorded up to September 2

  11. Slide 11: Notes to Financial Results – Income Statement

    Notes to Financial Results – Income Statement Note 4 – Non‐Property Expenses Increase in non‐property expenses is mainly due to the RM70,000 Corporate Social Responsibility (“CSR”) donation made to the Selangor and Federal Territory Association for Mentally Handicapped Children. Note 5 – Interest/Is

  12. Slide 12: Summary of EPU (Realised) and DPU

    Summary of EPU (Realised) and DPU 18.00 15.77 15.80 16.00 15.46 15.27 14.00 13.60 13.63 12.82 12.95 11.70 11.70 12.00 10.00 Sen/ unit 8.00 6.00 4.87 4.70 4.00 2.00 - 2005 2006 2007 2008 2009 YTD Sept 10 EPU (realised) DPU 12

  13. Slide 13: Detailed Property Performance Analysis (RM'000)

    Detailed Property Performance Analysis (RM’000) Book Value Fair Value Acq Cost + Annualised Gross Yield 30 Sept 2010 (a) Adjust (b) Enhancement (c) Revenue (d) (d) / (c) 1 ABP 107,000 21,883 85,117 11,366 13.35% 2 Axis Plaza 31,000 8,498 22,502 2,711 12.05% 3 Crystal Plaza 96,000 39,458 56,542 9,600

  14. Slide 14: Total Assets and Management Expense Ratio

    Management Expense Ratio (“MER”) MER: Total administrative expenses incl. Manager and Trustee’s fees Average net asset value of the Fund. 1,098 1,100 4.00 1,000 908 900 800 726 733 Total Assets (RM'000) 700 658 % of NAV 582 600 2.00 500 417 400 300 1.47 1.38 1.37 1.35 200 1.29 1.22 100 1.16 0 1.00 J

  15. Slide 15: Balance Sheet Highlights (RM'000)

    Balance Sheet Highlights (RM’000) 30/9/10 31/12/09 Changes Investment Properties 941,761 884,962 + 56,799 Other Assets 156,098 22,783 + 133,315 TOTAL ASSETS 1,097,859 907,745 + 190,114 Borrowings 343,433 308,932 + 34,501 Other Payables 44,323 48,456 ‐ 4,133 TOTAL LIABILITIES 387,756 357,388 + 30,368

  16. Slide 16: Total Assets & Unitholders' Funds

    Total Assets & Unitholders’ Funds 1,200.0 Total Asset & Unitholders' Funds 1,097.9 1,000.0 952.6 907.7 800.0 726.4 732.9 710.1 658.2 581.8 RM mil 600.0 550.0 565.2 447.9 450.3 402.3 411.8 416.8 423.2 400.0 339.6 334.7 277.9 286.5 294.1 294.2 200.0 - 31-Dec-05 30-Jun-06 31-Dec-06 30-Jun-07 31-Dec-07

  17. Slide 17: Borrowings

    Borrowings YTD Sept 2006 2007 2008 2009 10 Total Borrowings (RM’000) 88,089 209,816 230,456 308,932 343,433 Total Assets (RM’000) 411,781 581,857 726,371 907,745 1,097,859 Gearings 21.39% 36.06% 31.73% 34.03% 31.28% Effective Interest Rate 4.38% 4.39% 4.28% 4.11% 4.44% Percentage of short term 100%

  18. Slide 18: Gearing Levels

    Gearing Levels Placements undertaken 40.0% 36.1% 36.0% 35.4% 35.0% 34.0% 33.0% 33.1% 31.2% 31.8% 31.7% 31.3% 30.0% 29.1% 26.8% 27.3% 25.0% 25.0% 23.7% 23.5% 22.4% 21.4% 20.0% 15.0% 14.0% 11.8% 10.8% 10.0% 5.0% 0.0% 18

  19. Slide 19: Summary of Fair Value movement in 3Q 2010 (RM'000)

    Summary of Fair Value movement in 3Q 2010 (RM’000) Book Value Surplus to as at Revaluation be Name of Properties 30 Sept 2010 Amount incorporated 1 FCI Senai 14,000 14,000 ‐ 2 Axis Business Park 105,972 107,000 1,028 3 Axis Plaza 29,500 31,000 1,500 4 Crystal Plaza 89,805 96,000 6,195 5 Infinite Cen

  20. Slide 20: Fair Valuation Gain on Investment Properties

    Fair Valuation Gain on Investment Properties Properties Appreciation Value as at 30 Sept 2010 120,000 100,000 80,000 RM'000 60,000 40,000 20,000 - Fair Value Adjustment Acquisition Cost + Enhancement 20

  21. Slide 21: 2010 Acquisitions

    A8%41S 2010 Acquisitions

  22. Slide 22: 2010 Acquisition – Tesco, Johor

    2010 Acquisition – Tesco, Johor Land Area : 9.69 acres (422,370 sq ft) • SPA signed on 24 August 2010 Gross Built Up : 308,128 sq ft Land Tenure : Freehold • Completion Date : 1 October 2010 Occupancy : 100% • Tenant – Tesco Stores (Malaysia) Sdn Bhd Tenure : 30‐yr lease • Strengths – Brand new faci

  23. Slide 23: 2010 Acquisition – Axis PDI Center

    2010 Acquisition – Axis PDI Center • 4TH related party acquisition since IPO • Sale & Purchase Agreement signed on 3 June 2010 • Completion Date : 15 October 2010 • The purchase price of RM85 million is at 7.61% discount to the market value providing Unitholders with a capital gain of approximately

  24. Slide 24: 2010 Acquisition – Axis Technology Center

    2010 Acquisition – Axis Technology Center • 3rd related party acquisition since IPO • Sale & Purchase Agreement signed on 3 June 2010 • Estimated Completion Date : 8 November 2010 • Tenant – Sigma Elevators, Fresenius Medical, Fresenius Kabi, Green Packet • Tenure – ranging from 2‐year tenancy to 6‐

  25. Slide 25: 2010 Acquisition – PTP D8, Johor

    2010 Acquisition – PTP D8, Johor • Sale & Purchase Agreement signed on 20 April 2010 • Estimated Completion Date : 30 November 2010 • The purchase price of RM30 million is at 3.23% discount to the market value providing Unitholders with a capital gain of approximately RM0.5 million • Tenant – Nippon

  26. Slide 26: Impact on Asset Under Management

    Impact on Asset Under Management 1,600.00 1,400.00 1,357.86 1,200.00 1,097.86 1,000.00 952.58 907.74 926.78 RM mil 800.00 726.37 732.91 658.22 600.00 518.86 402.27 411.78 416.75 400.00 339.63 200.00 ‐ Dec'05 Jun'06 Dec'06 Jun'07 Dec'07 Jun'08 Dec'08 Jun'09 Dec'09 Mar'10 Jun'10 Sept'10 Dec'10* Note *

  27. Slide 27: Capital Raising

    AXelS Capital Raising

  28. Slide 28: Unit Placement – Trading @ Premium to NAV

    Unit Placement – Trading @ Premium to NAV 2.40 Third Placement @ RM1.97 2.20 Initial 2.16 2.12 Placement 2.00 2.00 2.02 @ RM1.80 1.93 1.89 1.85 1.84 1.84 1.80 1.78 1.79 1.79 1.75 1.75 1.76 1.74 1.70 1.68 1.65 1.65 1.65 1.60 1.63 1.62 1.50 1.40 Second 1.31 Placement 1.20 @ RM1.66 1.12 1.00 Dec'07 Mar

  29. Slide 29: Placement Exercise

    Placement Exercise ™ Third successfully placement since IPO. Issued another 68,819,800 units via private placement and new units were listed on 15 September 2010. ™ The private placement received strong response from the existing Unitholders. The Placement was oversubscribed several times. ™ The pla

  30. Slide 30: Investor Relations

    AS%4|S Investor Relations

  31. Slide 31: Improving Unit Price Performance

    Improving Unit Price Performance 2.20 2.16 2.15 2.12 2.10 2.09 2.05 2.03 2.02 2.00 2.01 2.00 1.96 1.95 1.95 1.90 1.85 1.80 Jan Feb Mar Apr May Jun Jul Aug Sep 31

  32. Slide 32: Improving Investor Visibility and Liquidity – No. of Unitholders

    Improving Investor Visibility and Liquidity 2,385 2,400 2,230 2,200 2,109 2,125 2,038 1,959 2,000 1,778 1,800 1,652 1,600 No. of Unitholders 1,370 1,400 1,216 1,166 1,200 1,034 1,000 941 800 600 400 200 - Dec'05 Dec'06 Jun'07 Dec'07 Jun'08 Dec'08 Mar'09 Jun'09 Sept'09 Dec'09 Mar'10 Jun'10 Sept'10 32

  33. Slide 33: Improving Investor Visibility and Liquidity

    Improving Investor Visibility and Liquidity No UNITHOLDERS @ 30 SEP 2010 % 1 EMPLOYEES PROVIDENT FUND BOARD 30,543,600 8.13 2 TEW PENG HWEE @ TEOH PENG HWEE 27,335,500 7.27 3 ALEX LEE LAO 23,819,100 6.34 4 KUMPULAN WANG PERSARAAN (DIPERBADANKAN) 21,053,300 5.6 CITIGROUP NOMINEES (TEMPATAN) SDN BHD 5

  34. Slide 34: Investors Outreach Program

    Investors Outreach Program ™ In collaboration with AmFirst REIT, AmanahRaya REIT, Regroup Associates and OSK Investment Bank Bhd , Axis REIT Managers Bhd initiated the first of a series of Retail Investor Roadshows . ™ The first roadshow was held in Penang on 4 July 2009, with over 200 members of th

  35. Slide 35: APREA Best Practices Award

    APREA Best Practices Award Recently won the Asia Pacific Real Estate Association (APREA) Best Practices Award 2010 (Emerging Markets Category) 35

  36. Slide 36: Property Portfolio Performance

    Property Portfolio Performance

  37. Slide 37: Occupancy Levels

    Occupancy Levels 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 95.03 % 93 90 86 83 80 77 70 65 % Area Occupcied 61 60 Refurbishment completed 50 40 30 20 10 ‐ Note : Quattro West – 64.9% space signed up with 3 tenants @ 30 Sept’10. Pre‐committed take‐up @1 Nov’10 will raise

  38. Slide 38: Top 10 Tenants

    Top 10 Tenants ™ IDS Logistics Services (M) Sdn Bhd ™ Konsortium Logistik Berhad ™ Fuji Xerox Asia Pacific Pte Ltd ™ Tenaga Nasional Berhad ™ Kompakar CRC Sdn Bhd ™ BMW Asia Technology Center Sdn Bhd ™ Scope International (M) Sdn Bhd ™ GCH Retail (Malaysia) Sdn Bhd ™ Cycle & Carriage Bintang Berhad

  39. Slide 39: Lease Expiry Profile 2010 - 2012

    Lease Expiry Profile 2010 ‐ 2012 Property NLA % of % of Rental NLA % of % of Rental NLA % of % of Rental Year 2010 Total NLA per month Year 2011 Total NLA per month Year 2012 Total NLA per month Menara Axis 58,002 1.52 2.96 14,034 0.37 1.12 ‐ ‐ 0.04 Crystal Plaza 169,146 4.42 7.83 9,118 0.24 0.49 12

  40. Slide 40: Maintaining Positive Rental Reversions

    Maintaining Positive Rental Reversions Multi Tenanted Properties Space Negotiated % Movement Menara Axis 44,304 + 5.61% Crystal Plaza 169,146 + 8.41% Axis Business Park 40,189 + 4.83% Infinite Centre 77,753 + 7.24% Axis Plaza 32,873 + 0.13% Wisma Kemajuan 65,570 + 5.16% Kayangan Depot 76,278 No chan

  41. Slide 41: Portfolio Diversifications

    Portfolio Diversifications Portfolio Diversification by Type and NLA Portfolio Diversification by Geographical and NLA 4% Kedah Prai 12% 4% 4% Johor 44% 15% Petaling Jaya 36% 41% Klang 13% 4% Shah Alam 23% Office Office/Industrial Warehouse Retail Warehouse Logistic Single Tenant Vs Multi‐Tenants 45

  42. Slide 42: Portfolio Diversifications

    Portfolio Diversifications Portfolio Diversification by Sector and Revenue Services Healthcare & Lifestyle Engineering/Building Materials Financial Services Logistics Automotive IT/Electronics Retail Consumer Products Others 4% 6% 1% 8% 23% 8% 8% 8% 24% 10% 42

  43. Slide 43: Thank You

    AXelS Thank You

Axis Real Estate Investment Trust — Q3 2010 Earnings Presentation on 6ix