Great Eagle Holdings Limited · HKEX:41
Great Eagle — FY2016 Earnings Presentation
45 slides from Great Eagle's earnings presentation, 2017
Slide 1: Investor Presentation Q1 2017
Great Eagle Holdings Investor Presentation Q1 2017 1
Slide 2: Background
Great Eagle Holdings Limited Background A Leading Property and Hotel Company with Prime Assets in Global Gateway Cities Long operating and listing history - Founded in 1963 and listed since 1972 - 40+ years track record property development Strong asset base with irreplaceable trophy properties - La
Slide 3: Highlights of 2016 Final Results
Great Eagle Holdings Limited Financials Highlights of 2016 Final Results 1. On expansion, the Group has successfully acquired a site in downtown Seattle, U.S. for US$18 million in December 2016. The site has an area of approximately 19,400 sq. ft and has been approved for the development of a 17-sto
Slide 4: 2016 Final Results
Great Eagle Holdings Limited Financials 2016 Final Results 2016 2015 Change HK$'000 HK$'000 HK$'000 % Gross Revenue 350,325 350,325 Rental Income 243,538 236,430 7,108 3.0% Hotel Income - Overseas 3,548,727 3,475,161 73,566 2.1% - Others 166,271 152,457 13,814 9.1% Income from Champion REIT* 1,216,0
Slide 5: 2016 Final Results
Great Eagle Holdings Limited Financials 2016 Final Results 2016 2015 Change HK$'000 HK$'000 HK$'000 % Net Operating Income Net Rental Income 180,984 174,474 6,510 3.7% Hotel Income - Overseas 611,721 506,300 105,421 20.8% - Others 108,904 87,146 21,758 25.0% Income from Champion REIT* - Asset manage
Slide 6: 2016 Final Results
Great Eagle Holdings Limited Financials 2016 Final Results 2016 2015 Change HK$'000 HK$'000 HK$'000 % Net finance costs Finance cost (133,994) (174,826) 40,832 -23.4% Interest income 42,080 149,417 (107,337) -71.8% (91,914) (25,409) (66,505) 261.7% Share of results of associates 438 (3,442) 3,880 -1
Slide 7: 2016 Final Results – Income from Champion breakdown
Great Eagle Holdings Limited Financials 2016 Final Results – Income from Champion breakdown 2016 2015 Change HK$'000 HK$'000 HK$'000 % Asset management income 243,182 214,035 29,147 13.6% Dividend received 871,569 714,678 156,891 22.0% Agency commission income & 101,276 78,837 22,439 28.5% Property
Slide 8: Analysis on change on core income
Great Eagle Holdings Limited Financials Analysis on change on core income 2016 $'000 Change in profit from core business after tax 242,406 Arise from: Increase in dividend and management income from Champion REIT 208,477 Increase in hotels division EBITDA 127,179 Distribution from the U.S. Fund 280,
Slide 9: Discount to NAV
Great Eagle Holdings Limited Discount to NAV Financials NAV based on statutory accounting principles (Dec 2016) NAV based on net assets of Champion REIT and LHI (Dec 2016) % of % of HK$m HK$/shr Total HK$m HK$/shr Total Investment properties 6,232 9.2 11% Investment properties 6,232 9.2 10% Appraise
Slide 10: Financial position
Great Eagle Holdings Limited Financials Financial position (A) Base on statutory financial positions Book Carrying Net Cash Loan to Net interest Interest (HK$ Million) Value (Debt) Net Equity Value Gearing EBITDA expense Cover Hong Kong/ PRC Assets 57,192 (10,622) 46,570 18.6% 22.8% 2,640 492 5.4 Ov
Slide 11: Valuation – Investment properties
Great Eagle Holdings Limited Valuation – Investment properties Financials As at the end of December 2016 Hong Kong investment properties Valuation Change from GFA (Sqft) HK$/psf Cap rate end of June 2016 Great Eagle Centre Office 193,271 20,469 3.6% 7.1% Retail 55,944 9,402 4.8% 0.8% 3rd floor 20,95
Slide 12: Development projects
Great Eagle Holdings Limited Development projects Development projects Dalian Mixed-use Development Project As at the end of 2016, 220 apartments of the first batch pre-sold apartments were completed and handed to buyers. While there was a development profit from the recognition of 220 apartments, s
Slide 13: Langham Hotels International
Langham Hotels International Great Eagle 13 Holdings Limited
Slide 14: Hotel portfolio – 2016 Revenue and EBITDA
Great Eagle Holdings Limited Langham Hotels International Hotel portfolio – 2016 Revenue and EBITDA Hotel Revenue Growth EBITDA Growth 2016 2015 2016 2015 (in HK$ mn) Overseas Hotels Europe 466.7 535.6 -12.9% 101.1 119.6 -15.5% North America 1,975.3 1,857.5 6.3% 278.0 174.0 59.8% Australia/New Zeala
Slide 15: Hotel portfolio – 2016 Operational Statistics
Great Eagle Holdings Limited Langham Hotels International Hotel portfolio – 2016 Operational Statistics Occupancy Average Room Rate RevPar 2016 2015 Change 2016 2015 Change 2016 2015 Change Owned by subsidiary LHI Hong Kong The Langham, Hong Kong 87.7% 84.7% 3.0ppt $2,092 $2,198 -4.9% $1,834 $1,862
Slide 16: Hotel portfolio – 2016 Room and F&B revenue growth
Great Eagle Holdings Limited Langham Hotels International Hotel portfolio – 2016 Room and F&B revenue growth (in local currency) Room revenue growth F&B revenue growth YTD- Dec 2016 YTD- Dec 2016 The Langham, London -4% 4% The Langham, Boston -1% 2% The Langham. Chicago 7% 6% The Langham Place, Fift
Slide 17: Hotel portfolio – Profit contribution
Great Eagle Holdings Limited Langham Hotels International Hotel portfolio – Profit contribution in Local Currency in HK$ 2016 2015 Change 2016 Contribution to Owned Hotels in mn in mn in mn hotel profits China Shanghai (Langham Xintiandi and RMB 88.5 RMB 81.9 8.1% $103.4 17% a small part of the pre-
Slide 18: Hotel portfolio – Currency impact
Great Eagle Holdings Limited Langham Hotels International Hotel portfolio – Currency impact Dec-16 Dec-15 yoy change Variance in profit contribution (in HK$ mn) GBP 10.5117 11.8528 -11.3% (12.9) CAD 5.8632 6.0724 -3.4% (4.2) AUD 5.7755 5.8307 -0.9% (0.6) USD 7.7622 7.7527 0.1% 0.2 NZD 5.4146 5.4211
Slide 19: The Langham, Hong Kong
Great Eagle Holdings Limited Langham Hotels International 2015 2016 Change The Langham, Hong Kong Rooms Available 457 498 + 41 RevPAR $1,862 $1,834 -1.5% Room Rate $2,198 $2,092 -4.8% Occupancy Rate 84.7% 87.7% 3.0 ppt The hotel benefitted from keen demand for its renovated rooms and was able to cap
Slide 20: Cordis, Hong Kong
Great Eagle Holdings Limited Langham Hotels International Cordis, Hong Kong 2015 2016 Change RevPAR dropped by 18% year-on-year Rooms Available 620 653 + 33 during February and March 2016 which dragged down the RevPAR for the full year RevPAR $1,555 $1,485 -4.5% in 2016. Room Rate $1,734 $1,653 -4.7
Slide 21: Eaton, Hong Kong
Great Eagle Holdings Limited Langham Hotels International Eaton, Hong Kong The hotel faced severe room rate 2015 2016 Change competition from nearby hotels. Rooms Available 465 465 - However, with the hotel’s flexible RevPAR $978 $948 -3.1% room rates, the hotel witnessed growth in arrivals from all
Slide 22: The Langham, London
Great Eagle Holdings Limited Langham Hotels International The Langham, London 2015 2016 Change Rooms Available 341 297 - 44 The renovation of 109 rooms that started in November 2015 and throughout 2016 has RevPAR £238 £260 9.2% negatively impacted the revenue of the Room Rate £294 £304 3.4% hotel. O
Slide 23: The Langham, Melbourne
Great Eagle Holdings Limited Langham Hotels International The Langham, Melbourne 2015 2016 Change Rooms Available 388 388 - As there was a lack of large scale high profile events in the city in 2016 compared RevPAR $261 $258 -1.1% with 2015, performance of the hotel merely Room Rate $301 $300 -0.3%
Slide 24: The Langham, Sydney
Great Eagle Holdings Limited Langham Hotels International 2015 2016 Change The Langham, Sydney Rooms Available 88 89 +1 RevPAR $262 $296 13.0% Room Rate $415 $435 4.8% Occupancy Rate 63.2% 68.0% 4.8 ppt Business of the hotel continued to ramp up subsequent to its reopening in late 2014 after a major
Slide 25: The Langham, Auckland
Great Eagle Holdings Limited Langham Hotels International The Langham, Auckland 2015 2016 Change The hotel staged a good performance Rooms Available 409 409 - in 2016 which was underpinned by the RevPAR $159 $185 16.4% buoyant local market conditions. Room Rate $190 $206 8.4% There was strong demand
Slide 26: Langham Place Fifth Avenue, New York
Great Eagle Holdings Limited Langham Hotels International Langham Place Fifth Avenue, 2015 2016 Change New York Rooms Available 214 214 - RevPAR $409 $386 -5.6% Room Rate $549 $543 -1.1% Occupancy Rate 74.5% 71.1% -3.4 ppt The performance of the hotel was impacted by the room renovation that took pl
Slide 27: The Langham, Chicago
Great Eagle Holdings Limited Langham Hotels International The Langham, Chicago 2015 2016 Change The hotel was awarded with a Rooms Available 316 316 - number of prestigious accolades in RevPAR $246 $263 6.9% the lodging industry, which has helped the hotel to further raise Room Rate $352 $372 5.7% i
Slide 28: The Langham, Boston
Great Eagle Holdings Limited Langham Hotels International The Langham, Boston 2015 2016 Change Rooms Available 318 318 - As business from the retail and group RevPAR $229 $226 -1.3% segments was weak in the year, the hotel Room Rate $273 $295 8.1% targeted at travellers from the corporate segment, w
Slide 29: The Langham, Huntington Hotel & Spa, Pasadena
Great Eagle Holdings Limited Langham Hotels International The Langham, Huntington Hotel & Spa, 2015 2016 Change Pasadena Rooms Available 380 380 - RevPAR $194 $204 5.2% The hotel witnessed a strong return in Room Rate $263 $283 7.6% demand from high yielding group business in 2016, which helped driv
Slide 30: Chelsea Hotel, Toronto
Great Eagle Holdings Limited Langham Hotels International Chelsea Hotel, Toronto 2015 2016 Change Following the completion of the Rooms Available 1,590 1,590 - room renovation in 2015, the RevPAR $96 $117 21.9% hotel was well placed to capture the strong demand from several Room Rate $137 $153 11.7%
Slide 31: The Langham, Xintiandi
Great Eagle Holdings Limited Langham Hotels International The Langham, Xintiandi 2015 2016 Change Rooms Available 357 357 - Revenue growth of hotel would have been even higher in 2016, RevPAR ¥1,245 ¥1,264 1.5% but the replacement of business Room Rate ¥1,758 ¥1,716 -2.4% tax by value added tax in M
Slide 32: Managed hotel owned by third parties
Great Eagle Holdings Limited Langham Hotels International Managed hotel owned by third parties 32
Slide 33: Managed hotels in China
Great Eagle Holdings Limited Langham Hotels International The Langham, Langham Place, Guangzhou Shenzhen Guangzhou, China Guangzhou, China With 500 rooms With 352 rooms Opened in 2013 Opened in October 2012 Langham Place, Langham Place, Ningbo Culture Plaza Beijing Capital Airport With 143 rooms Wit
Slide 34: Managed hotels in China
Great Eagle Holdings Limited Langham Hotels International Langham Place, Xiamen The Langham, Haikou Xiamen, China Hainan, China With 327 rooms With 249 rooms Opened in 2014 Opened in June 2016 Langham Place, Haining Zhejiang, China With 263 rooms Opened in July 2015 34
Slide 35: Hotel pipeline
Great Eagle Holdings Limited Langham Hotels International Hotel pipeline 2017 Rooms Status Cordis Hongqiao 400 Owned hotel Eaton Washington 265 Owned hotel 2018 Rooms Status Langham Place, Changsha 296 Agreement The Langham Chongqing 174 Agreement Langham Place, Datong 327 Agreement The Langham Hefe
Slide 36: Investment properties
Investment properties Great Eagle 36 Holdings Limited
Slide 37: 2016 Results - Rental income breakdown
Great Eagle Holdings Limited Investment properties 2016 Results - Rental income breakdown Gross rental income Growth Net rental income Growth 2016 2015 (%) 2016 2015 (%) (in HK$ mn) Hong Kong Investment Properties Great Eagle Centre 139.6 143.4 (2.6) 137.2 133.0 3.2 Eaton House 51.2 47.2 8.5 31.7 28
Slide 38: Great Eagle Centre
Great Eagle Holdings Limited Investment properties Great Eagle Centre The occupancy of the Great Eagle Centre dropped from 98.2% as at the end of 2015 to 95.3% as at the end of 2016, as a majority of the incremental increase in available area are reserved for the Group’s in-house expansion, which wi
Slide 39: Eaton Serviced Apartments
Great Eagle Holdings Limited Investment properties Eaton Serviced Apartments • There was an increase in the overall occupancy of the three serviced apartments, which increased from 75.8% in 2015 to 78.8% in 2016. • The increase was driven primarily by the improved occupancy of the serviced apartment
Slide 40: The U.S. Fund
Great Eagle Holdings Limited U.S. Fund The U.S. Fund In 2016, as the asset manager of the U.S. Fund, we had disposed of the Fund’s three office towers in San Francisco. This has resulted in a distribution income from the Fund of HK$280.6 million attributable to our interest in the Fund for the year.
Slide 41: Outlook for the Group's results in 2017
Great Eagle Holdings Limited Outlook Outlook for the Group’s results in 2017 As for the Hotels Division, pre-opening expenses for the Cordis hotel in Hongqiao, Shanghai and Eaton hotel in Washington D.C. will be booked in 2017. In addition, renovations of different scale of the Group’s certain hotel
Slide 42: Reconciliation to core earnings from reported
Great Eagle Holdings Limited Core earnings reconciliation Reconciliation to core earnings from reported Reported earnings Core earnings Core earnings 2016 2016 2015 HK$'000 HK$'000 HK$'000 Gross Revenue 350,325 350,325 Rental Income - HK 243,538 243,538 - 236,430 - Income from the U.S. Fund 242,770
Slide 43: Reconciliation to core earnings from reported
Great Eagle Holdings Limited Core earnings reconciliation Reconciliation to core earnings from reported Reported earnings Core earnings Core earnings 2016 2016 2015 HK$'000 HK$'000 HK$'000 Net Operating Income Net Rental Income - HK 180,984 180,984 - 174,474 - Overseas 44,415 - - - - Core profit ign
Slide 44: Reconciliation to core earnings from reported
Great Eagle Holdings Limited Core earnings reconciliation Reconciliation to core earnings from reported Reported earnings Core earnings Core earnings 2016 2016 2015 HK$'000 HK$'000 HK$'000 Operating profit before Dep. and Amortisation 3,903,085 2,943,948 2,267,961 Depreciation and amortisation (590,
Slide 45: Reconciliation to core earnings from reported
Great Eagle Holdings Limited Core earnings reconciliation Reconciliation to core earnings from reported Reported earnings Core earnings Core earnings 2016 2016 2015 HK$'000 HK$'000 HK$'000 Net finance costs Finance cost (643,875) (133,994) - (174,826) - Exclude interest expense of CREIT, LHI and US