Prosperity Real Estate Investment Trust · HKEX:808
Prosperity Real Estate Investment Trust — H1 2015 Earnings Presentation
25 slides from Prosperity Real Estate Investment Trust's earnings presentation, August 2015
Slide 1: Interim Results for the six months ended 30 June 2015
Interim Results For the six months ended 30 June 2015 August 2015
Slide 2: Disclaimer
Disclaimer This document was prepared by ARA Asset Management (Prosperity) Limited, in its capacity as the manager (“REIT Manager”) of Prosperity Real Estate Investment Trust (“Prosperity REIT”) solely for use at the presentation to analysts in relation to the announcement of the results of Prosperi
Slide 3: Table of Contents
Table of Contents Results Highlights Financial Review Operations Review Outlook & Strategies Appendix Prosperity REIT 2015 Interim Results Presentation 3
Slide 4: Results Highlights
Results Highlights
Slide 5: Results Highlights
Results Highlights Revenue Net Property Distributable Distribution Income Income Per Unit 9.1% 10.0% 8.2% 6.9% HK$215.8m HK$170.7m HK$124.8m HK$0.0871 HK$197.8m HK$115.3m HK$0.0815 HK$155.2m 1H14 1H15 1H14 1H15 1H14 1H15 1H14 1H15 Rental Occupancy Cost-to- Average Reversion Rate revenue Effective Ra
Slide 6: 1H15 Key Takeaways
1H15 Key Takeaways Acquisition of 9 Chong Yip Street ● Net property income increased by 25.2% y-o-y ● Strong revenue uplift from an expiry profile of 55.2% in FY2014 Harbourfront Landmark ● Net property income in Harbourfront Landmark increased by 21.7% y-o-y ● Strong revenue uplift from an expiry p
Slide 7: Financial Review
Financial Review
Slide 8: Income Statement
Income Statement (HK$’000) 1H15 1H14 Change (unaudited) (unaudited) 1. Strong rental reversion Revenue 215,802 197,793 +9.1% 2. Additional income from 9 Total property operating expenses (45,115) (42,637) +5.8% Chong Yip Street Net property income 170,687 155,156 +10.0% 3. Costs spread over a larger
Slide 9: Financial Position
Financial Position As at 30 Jun As at 31 Dec Change 2015 2014 Out of HK$10,258m investment properties5, Total assets (HK$m) 10,351.2 9,965.2 +3.9% HK$6,462m was pledged Borrowings1 (HK$m) 2,806.9 2,800.6 +0.2% Interest Rate6 Other liabilities (HK$m) 530.2 495.9 +6.9% Fixed : Floating 55% : 45% Net a
Slide 10: Debt Maturity Profile
Debt Maturity Profile No major refinancing needs until 2019 3,000 2,500 430 2,000 HK$ million 1,500 1,000 2,070 500 380 404 0 Jan 2017 2018 Jan 2019 Nov 2019 Unsecured 3-yr term loan @ HIBOR+150 bps Secured 5-yr term loan @ HIBOR+135 bps Secured 5-yr term loan @ HIBOR+145 bps Secured RCF @ HIBOR+135
Slide 11: Portfolio Valuation
Portfolio Valuation (HK$m) 30 June 2015 31 Dec 2014 Change The Metropolis Tower 3,120 3,042 +2.6% Prosperity Millennia Plaza 1,936 1,824 +6.1% 9 Chong Yip Street 1,086 1,079 +0.6% Harbourfront Landmark (portion) 494 461 +7.2% Prosperity Place 1,503 1,436 +4.7% Trendy Centre 984 955 +3.0% Prosperity
Slide 12: Operations Review
Operations Review Prosperity REIT 2015 Interim Results Presentation 12
Slide 13: Property Income
Property Income Revenue Net Property Income Trendy Centre Trendy Centre Prosperity Prosperity HK$23.2m HK$18.0m Place Place HK$29.2m Prosperity Center Prosperity Center HK$21.2m HK$17.8m HK$13.7m 10.8% 10.6% 13.5% New Treasure 12.4% New Treasure Harbourfront 8.2% Harbourfront 8.0% Centre Centre Land
Slide 14: Occupancy Rates
Occupancy Rates Portfolio Occupancy Rates Above 95% Since 2006 (As at 30 Jun 2015) The Metropolis Tower 98.4% Prosperity Millennia Plaza 99.1% 9 Chong Yip Street 100.0% Pre-acquisition occupancy rate of Harbourfront Landmark (portion) 100.0% 94.1% improved to 100% Prosperity Place 97.2% Trendy Centr
Slide 15: Commercial Tenants at Prosperity Place
Commercial Tenants at Prosperity Place As at 30 June 2015, retail/service trade tenants accounted for around 33.7% of gross rentable area of Prosperity Place. Prosperity REIT 2015 Interim Results Presentation 15
Slide 16: Marketing Campaigns for Prosperity Place
Marketing Campaigns for Prosperity Place Summer Education Promotion Event Prosperity REIT 2015 Interim Results Presentation 16
Slide 17: AEIs – Prosperity Millennia Plaza & Trendy Centre
AEIs – Prosperity Millennia Plaza & Trendy Centre ● Replaced an existing chiller set with a more energy-efficient model in both Prosperity Millennia Plaza and Trendy Centre, enabling about 15% in energy cost savings for air conditioning consumption Prosperity Millennia Plaza Before After Trendy Cent
Slide 18: AEIs – 9 Chong Yip Street
AEIs – 9 Chong Yip Street Roof garden was set up in 1H2015 in order to provide green building facilities for tenants’ enjoyment After Before After Prosperity REIT 2015 Interim Results Presentation 18
Slide 19: Outlook & Strategies
Outlook & Strategies Prosperity REIT 2015 Interim Results Presentation 19
Slide 20: Outlook & Strategies
Outlook & Strategies Stable and sustainable distribution to continue ● 100% payout ratio ● Defensive investment as proven in economic cycles ● 154.5%* total return since IPO DPU (HK$) 0.0871 0.0815 0.0815 0.0744 0.0751 0.0660 0.0694 0.0555 0.0595 0.0607 0.0554 0.0544 0.0546 1H09 2H09 1H10 2H10 1H11
Slide 21: Outlook & Strategies
Outlook & Strategies Kowloon East (accounting for 32.5% of NPI) on track to become “CBD2” 9 Chong Yip Street – Completed AEIs to increase rental level Prosperity Place – Ginza building operating style driving up rental income 2015 AEIs to focus in energy saving Prosperity REIT 2015 Interim Results P
Slide 22: Appendix
Appendix Prosperity REIT 2015 Interim Results Presentation 22
Slide 23: Portfolio Map
Portfolio Map The Metropolis 1 Prosperity 5 Total Gross Rentable Area: 1.35m sq.ft. Tower Place GRA: 271,418 sq. ft. GRA: 240,000 sq. ft. Prosperity Trendy 2 6 Millennia Plaza Centre 6 GRA: 217,955 sq. ft. GRA: 173,764 sq. ft. 8 9 Chong Yip Prosperity Street 3 Center Property 7 GRA: 136,595 sq. ft.
Slide 24: Key Facts
Key Facts Key Facts as at 30 June 2015 IPO Date 16 Dec 2005 IPO Price HK$2.16 6.27% Indicative Yield (based on 1H15 DPU of HK$0.0871 and closing unit price of HK$2.78 as at 30 June 2015) Number of Issued Units 1,428,119,111 Market Capitalization HK$3.97 billion (US$509.0 million) Average Daily Tradi
Slide 25: Contacts
Contacts ARA Asset Management (Prosperity) Limited (as manager of Prosperity REIT) Ms. Mavis Wong Chief Executive Officer maviswong@ara.com.hk Mr. Vicho Chung Assistant Manager, Investments & Investor Relations vichochung@ara.com.hk Mr. Abel Mak Assistant Manager, Investments & Research abelmak@ara.
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