Centuria Industrial Reit · ASX:CIP
Centuria Industrial Reit — HY21 Earnings Presentation
32 slides from Centuria Industrial Reit's earnings presentation, Feb 2, 2021
Slide 1: HY21 Results
HY21 RESULTS A S X: CIP 2 Feb 2021 For personal use only Centuria Industrial REIT CENTURIA OFFICE REIT ASX:COF 1 60-80 SOUTHLINK STREET, PARKINSON, QLD
Slide 2: Australia's largest domestic pure play industrial REIT: Agenda
For personal use only Australia’s largest domestic pure play industrial REIT Agenda 1. Introduction 2. Financial Results 3. Portfolio Metrics 4. Strategy & Guidance 5. Appendices CENTURIA INDUSTRIAL REIT ASX: CIP 2 207-219 BROWNS ROAD, NOBLE PARK, VIC
Slide 3: Section One: Introduction
For personal use only COLD STORE FACILITIES SECTION ONE Introduction A S X: CIP CENTURIA INDUSTRIAL REIT ASX: CIP 3 1 LAHRS RD, ORMEAU, QLD
Slide 4: CNI: ASX300-listed funds manager positioned for growth
CNI: ASX300-listed funds manager positioned for growth For personal use only Market capitalisation1 of $1.6bn Included in the S&P/ASX300 Index $10.2bn GROUP AUM LISTED REAL ESTATE UNLISTED REAL ESTATE INVESTMENT BONDS $4.8bn $4.5bn $0.9bn Unlisted Centuria Life Centuria Centuria Asset Plus Ltd NZ si
Slide 5: CIP is aligned with a highly experienced real estate funds manager
CENTURIA MANAGEMENT CIP is aligned with a highly experienced real estate funds manager For personal use only CAPITAL TRANSACTIONS PIPELINE ACTIVE ASSET MANAGEMENT CAPITAL MANAGEMENT Acquisitions of $694m1 and Occupancy2 of 97.7% with Gearing3 of 29.6%, divestments of $40m1 in HY21 a WALE2 of 9.8 yea
Slide 6: CIP: Strategic vision and objectives
CIP: Strategic vision and objectives For personal use only VISION To be Australia’s leading domestic pure play industrial REIT A CLEAR AND SIMPLE Deliver income and capital growth to investors from a portfolio of high quality Australian industrial assets STRATEGY Overseen by an active Prudently mana
Slide 7: Industrial real estate sub-sectors, backed by quality tenants
Industrial real estate sub-sectors, backed by quality tenants For personal use only MANUFACTURING DISTRIBUTION CENTRES TRANSPORT LOGISTICS DATA CENTRES COLD STORAGE 32% PORTFOLIO VALUE 27% PORTFOLIO VALUE 15% PORTFOLIO VALUE 17% PORTFOLIO VALUE 9% PORTFOLIO VALUE VIRGINIA DERRIMUT TULLAMARINE ORMEAU
Slide 8: HY21 executing on strategy
HY21 executing on strategy For personal use only • Growing portfolio scale with the acquisition of 9 industrial assets for $694m1 1 Portfolio construction and recycling capital through a $40m divestment • Balanced geographic diversification, 89%2 of portfolio weighted to eastern seaboard • High port
Slide 9: Key metrics – Australia's largest domestic pure play industrial REIT
Key metrics – Australia’s largest domestic pure play industrial REIT For personal use only PORTFOLI O FI NANCI AL 59 $2.4bn $2.99 11.9% 98% High quality Portfolio value Net Tangible 12-month Return Average rent assets Assets per unit On Equity2 collections3 July to December 2020 97.7% 9.8yrs 29.6% 1
Slide 10: Section Two: Financial Results
For personal use only MANUFACTURING FACILITIES SECTION TW O Financial Results A S X: CIP CENTURIA INDUSTRIAL REIT ASX: CIP 10 ARNOTTS: 46 ROBINSON ROAD EAST, VIRGINIA, QLD
Slide 11: Funds from operations (FFO)
Funds from operations (FFO) For personal use only REVENUE HY21 HY20 VARIANCE Gross property income ($m) 73.2 54.0 19.2 Reflects acquisitions Other income ($m) 0.0 - 0.0 through HY21 Interest income ($m) - 0.1 (0.1) Total revenue ($m) 73.2 54.0 19.2 EXPENSES 3.1% like-for-like Direct property expense
Slide 12: Strengthened balance sheet provides opportunities for growth
Strengthened balance sheet provides opportunities for growth For personal use only DEBT AND HEDGE MATURITY PROFILES ($m) Hedging maturity profile KEY DEBT METRICS HY21 FY20 Debt expiry profile Facility Limit $m 880 650 260 Drawn amount $m 734 454 Weighted average Year 3.3 3.3 debt expiry 295 Proport
Slide 13: Section Three: Portfolio Metrics
For personal use only DATA CENTRES SECTION THREE Portfolio Metrics A S X: CIP CENTURIA INDUSTRIAL REIT ASX: CIP 13 TELSTRA DATA CENTRE COMPLEX, CLAYTON VIC
Slide 14: Australia's largest domestic pure play industrial REIT
Australia’s largest domestic pure play industrial REIT For personal use only PORTFOLIO SNAPSHOT HY21 FY20 AUSTRALIAN LISTED PEERS 1,2 Number of assets # 59 50 PORTFOLIO VALUE – EXCL. BUSINESS PARKS ($BN) Book value $m 2,399 1,602 2.6 INDUSTRIAL % OF GROUP 100% WACR % 5.42 6.05 2.4 GLA sqm 1,047,685
Slide 15: Transformative acquisitions building on portfolio quality
Transformative acquisitions building on portfolio quality For personal use only Ability to find relative Acquired 9 assets totalling Acquisitions executed with 100%1 value in a supply $694m in HY21 and a further occupancy, average WALE of 19yrs1 constrained market $37m secured in 2H21 YTD and initia
Slide 16: Portfolio income underpinned by diverse customer base
Portfolio income underpinned by diverse customer base For personal use only TENANT INDUSTRY SECTOR DIVERSIFICATIONS 1 TENANT COMPOSITION 1 Approximately 33% of income derived 32% Manufacturing 28% ASX Listed from non discretionary, food distribution 19% Transport Logistics 5% Listed Multinational an
Slide 17: Significant portfolio leasing through active management
Significant portfolio leasing through active management For personal use only WARNERVALE WARWICK FARM WETHERILL PARK DANDENONG SOUTH 54K SQM LEASED TO WOOLWORTHS 28K SQM LEASED TO VISY 15K SQM LEASED TO WEIR MINERALS 10K SQM LEASED TO COMPLETE ON A 5-YEAR TERM ON A 10-YEAR TERM ON A 5-YEAR TERM SUPP
Slide 18: Valuation uplift driven by active leasing & strong market fundamentals
Valuation uplift driven by active leasing & strong market fundamentals PORTFOLIO VALUATION SUMMARY 1 For personal use only HY21 FY20 VALUATION HY21 FY20 MOVEMENT STATE VALUATION VALUATION MOVEMENT WACR2 WACR2 WACR2 Leasing success and market fundamentals drive like for like valuation gain of $103.8m
Slide 19: Section Four: Strategy & Guidance
For personal use only DISTRIBUTION CENTRES SECTION FOUR Strategy & Guidance A S X: CIP CENTURIA INDUSTRIAL REIT ASX: CIP 19 144 HARTLEY ROAD, SMEATON GRANGE, NSW
Slide 20: Structural tailwinds for the broader industrial real estate sector
CENTURIA MANAGEMENT Structural tailwinds for the broader industrial real estate sector and food related demand For personal use only INDUSTRIAL & LOGISTICS GROSS TAKE-UP FROM THE RETAIL TRADE SECTOR AND ONLINE RETAIL SALES (12 MTH ROLLING)1 SHARE OF FOOD RETAIL TO TOTAL RETAIL TRADE 2 bn sqm $45 900
Slide 21: FY21 earnings guidance upgraded
FY21 earnings guidance upgraded For personal use only 140 FULTON DRIVE, DERRIMUT, VIC Upgraded from 17.4 cents per unit at the commencement of FY21 to no less than 17.0c 5.5% 17.6c DPU paid in quarterly instalments Distribution yield2 FFO per unit1 1. Guidance remains subject to unforeseen circumsta
Slide 22: Section Five: Appendices
For personal use only TRANSPORT LOGISTICS SECTION FIVE Appendices Appendix A – Leasing expiry by state A S X: CIP Appendix B – Key vacancies and upcoming expiries Appendix C – Market research Appendix D – Income statement Appendix E – Balance sheet Appendix F – Portfolio valuation summary Appendix G
Slide 23: Appendix A – Leasing expiry by state
Appendix A – Leasing expiry by state For personal use only SUBPORTFOLIO EXPIRY PROFILE (% BY INCOME) SUBPORTFOLIO EXPIRY PROFILE (% BY INCOME) NSW WALE OCCUPANCY GLA VIC WALE OCCUPANCY GLA 78.1 5.5 years 100% 287,044 sqm 13.7 years 95.8% 318,442 sqm 75.2 19.5 5.2 4.2 4.2 3.8 7.5 2.2 Vacant FY21 FY22
Slide 24: Appendix B – Key vacancies and upcoming expiries
Appendix B – Key vacancies and upcoming expiries % OF VACANT For personal use only CURRENT KEY PROPERTY GLA (SQM) PORTFOLIO STATUS VACANCIES SINCE AREA Lease surrendered to take advantage of favourable leasing 14-17 Dansu Court, Hallam VIC 15,333 1.4 01-Aug-20 conditions. Strong interest from severa
Slide 25: Appendix C – Market research: availability across all key markets
For personal use only 0 100 200 400 500 600 700 800 900 300 Apr-11 Sep-11 SQM (‘000) Feb-12 Jul-12 Dec-12 May-13 SECONDARY Oct-13 SYDNEY Mar-14 1. Source: Knight Frank Research Aug-14 Jan-15 PRIME Jun-15 Nov-15 Apr-16 Sep-16 Feb-17 Jul-17 Dec-17 May-18 Oct-18 Mar-19 Aug-19 Jan-20 Jun-20 Nov-20 AVAIL
Slide 26: Appendix D – Income statement
Appendix D – Income statement For personal use only HY21 HY20 REVENUE Gross property income ($’000) 73,176 53,966 Other income ($’000) 6 0 Interest income ($’000) 0 50 Total revenue ($'000) 73,182 54,016 EXPENSES Direct property expenses ($’000) (12,806) (10,741) Rental waiver provisions ($’000) (79
Slide 27: Appendix E – Balance sheet and NTA movement
Appendix E – Balance sheet and NTA movement For personal use only HY21 FY20 NTA GROWTH2 Cash ($’000) 21,009 17,078 Investment properties ($’000) 2,399,373 1,602,400 Trade & other receivables ($’000) 6,063 5,805 Goodwill ($’000) 10,501 10,501 Total assets ($'000) 2,436,946 1,635,784 Interest bearing
Slide 28: Appendix F – Portfolio valuation summary
Appendix F – Portfolio valuation summary1 For personal use only STATE HY21 VALUATION FY20 VALUATION VALUATION MOVEMENT2 HY21 WACR3 FY20 WACR3 MOVEMENT WACR3 NSW 496.4 470.7 25.7 5.42% 5.80% (0.38%) PORTFOLIO VIC 384.2 361.3 22.9 5.85% 6.17% (0.32%) VALUATION QLD 573.3 525.9 47.4 5.33% 5.76% (0.43%)
Slide 29: Appendix G – Investment portfolio
Appendix G – Investment portfolio BOOK VALUE CAP GLA WALE OCCUPANCY SUB For personal use only PROPERTY STATE $/SQM ($ MILLION) RATE (SQM) (YRS)1 %1 SECTOR 2 Woolworths Way, Warnervale 74.0 1,365 7.00% 54,196 5.6 100.0% Distribution Centre 67-69 Mandoon Road, Girraween 73.1 2,877 5.50% 25,418 6.9 100
Slide 30: Appendix G – Investment portfolio
Appendix G – Investment portfolio For personal use only BOOK VALUE CAP GLA WALE OCCUPANCY SUB PROPERTY STATE $/SQM ($ MILLION) RATE (SQM) (YRS)1 %1 SECTOR 46 Robinson Road East, Virginia 245.0 5,471 4.50% 44,785 29.0 100.0% Manufacturing 60-80 Southlink Street, Parkinson 49.0 5,824 5.50% 8,413 5.9 1
Slide 31: Disclaimer
For personal use only Disclaimer This presentation has been prepared by Centuria Property Funds No.2 Limited (ABN 38 133 363 185, The information in this presentation has been obtained from and based on sources believed by CPF2L AFSL 340304) (CPF2L) as responsible entity of Centuria Industrial REIT
Slide 32: For personal use only
For personal use only CENTURIA INDUSTRIAL REIT ASX: CIP 32
Centuria Industrial REIT — HY21 Earnings Presentation on 6ix