National Storage Reit · ASX:NSR
National Storage Reit — FY2023 Earnings Presentation
39 slides from National Storage Reit's earnings presentation, Aug 23, 2023
Slide 1: FY23 Results
FY23 RESULTS 1
Slide 2: Disclaimer
DISCLAIMER This presentation has been prepared by National direct or indirect loss or damage which may be These forward-looking statements are not or any change in the events, conditions or Storage REIT (“NSR”) comprising National Storage suffered through the use, or reliance on, anything guarantees
Slide 3: Canterbury, VIC Montrose, TAS Springfield, QLD
Canterbury, VIC Montrose, TAS Springfield, QLD Byford, WA Moorooka, QLD Penrith, NSW 3 Robina, QLD Manukau, NZ Mawson Lakes, SA
Slide 4: Agenda
AGENDA ▪ Key Highlights and Financial Results ▪ Strategy ▪ Sustainability ▪ Outlook ▪ Appendices 4
Slide 5: Key Highlights and Financial Results
KEY HIGHLIGHTS AND FINANCIAL RESULTS 5
Slide 6: FY23 Highlights
FY23 HIGHLIGHTS IFRS profit $320.4 million (EPS 25.8 cents) | Underlying EPS 11.5 cents UNDERLYING UNDERLYING GROUP WEIGHTED GROUP EARNINGS1 EPS1 OCCUPANCY2 AVERAGE PRIMARY REVPAM2 CAP RATE $141.8m 11.5 cents 85.0% $270 5.91% (Up 12.1%) (Up 8.5%) (Down 3.5%) (Up 3.6%) (Up 5bps) ACQUISITIONS DEVELOPM
Slide 7: Exceptional Profile of Growth and Returns
EXCEPTIONAL PROFILE OF GROWTH AND RETURNS Track record of strong growth and securityholder returns ▪ Total securityholder returns of 301% since IPO ▪ Outperformed ASX 200 by 162% / ASX 200 A-REIT by 180% Market share by NLA2 Total Revenue $350 $330.0 ▪ Consistent revenue and earnings growth trajecto
Slide 8: Profit and Loss for the Year Ended 30 June 2023
PROFIT AND LOSS FOR THE YEAR ENDED 30 JUNE 2023 Strategy delivering superior growth $ Million FY23 FY22 % Change Storage revenue 302.5 251.9 20% Sales of goods and services 14.0 14.5 -3% ▪ FY23 performance Other revenue 10.6 10.4 2% Total Revenue 327.1 276.8 18% ▪ Underlying earnings1 up 12% to $141
Slide 9: Summary Balance Sheet as at 30 June 2023
SUMMARY BALANCE SHEET AS AT 30 JUNE 2023 NTA uplift and balance sheet gearing provides capacity for growth $ Million Jun 23 Jun 22 Movement ▪ NTA increased by 6.0% to $2.48 per stapled security Cash 67.3 83.7 (16.4) (June 2022: $2.34) Investment Properties 1 4,287.7 3,726.8 560.9 Intangible Assets 4
Slide 10: Capital Management
CAPITAL MANAGEMENT Investment grade balance sheet Capital Management Jun-23 Jun-22 Cash balance $67.3m $83.7m ▪ Robust credit metrics: Gearing 20% | ICR 4.1x Total debt facilities $1,617m $1,283m ▪ Total debt facilities $1,617m Total debt drawn $947m $975m ▪ Includes highly successful new $400m 5 an
Slide 11: Key Operational Metrics
KEY OPERATIONAL METRICS Active management of occupancy Group REVPAM and rate maintains momentum 290 270 250 ▪ Strategy continues to deliver strong financial performance, 230 successfully navigating economic headwinds 210 ▪ Group REVPAM increased by 3.6% to $270/m2 190 Jun-21 Sep-21 Dec-21 Mar-22 Jun
Slide 12: Portfolio Snapshot
NEW SLIDE. DATA BEING VERIFIED PORTFOLIO SNAPSHOT Scale providing material upside potential Let-Up3 Expansions and Operating Assets Group1 Acquisitions2 (June 2023) Development Pipeline Developments Redevelopments Assets 195 19 17 Active Projects 34 11 Value4 $3,370m $215m $408m Net Lettable Area (m
Slide 13: Strategy
STRATEGY 13
Slide 14: NSR Vision & Mission
NSR VISION & MISSION Our Vision - To be a world leader in the provision of innovative and sustainable self-storage solutions Our Mission - United as one team, we commit to consistently and responsibly deliver on our four pillars of strategic growth ACQUISITIONS, TECHNOLOGY & ORGANIC GROWTH DEVELOPME
Slide 15: Drivers of Organic Growth and Storage Demand
DRIVERS OF ORGANIC GROWTH AND STORAGE DEMAND Multiple, diverse drivers support ongoing growth trajectory Flexible Working Conditions Downsizing Increased Utilisation Conversion of living spaces into home Large cohort of individuals and families Increased market awareness of self- offices as people c
Slide 16: Built Capacity and Pipeline
BUILT CAPACITY AND PIPELINE Embedded growth from increasing organic Total NLA occupancy, rate and development pipeline 1,400,000 Substantial growth potential within our current built capacity (NLA) ▪ Australian and New Zealand Portfolio1 total occupancy: 81.8% / NLA 1,264,000m2 1,200,000 ▪ Group occ
Slide 17: Acquisitions
ACQUISITIONS Australasia’s number 1 acquirer of high-quality, independently owned storage centres PORTFOLIO VALUE (A$ MILLION) ▪ Focus remains on “value” accretive acquisitions - - - - 6 8 8 11 11 13 14 22 23 23 25 25 26 31 33 33 # assets ▪ Targeting multi-centre acquisitions where possible 38 41 49
Slide 18: Acquisitions
ACQUISITIONS Market remains highly fragmented with FY23 Acquisitions significant potential for further consolidation LOCATION / TYPE NUMBER OF CENTRES NLA (m2) NSW 2 15,300 33 acquisitions totalling $234m transacted in FY23 QLD 1 6,200 VIC 2 4,000 ▪ NSR remains focused on executing its acquisition s
Slide 19: Developments, Expansions and Redevelopments
DEVELOPMENTS, EXPANSIONS AND REDEVELOPMENTS Increasing focus on development, expansion and redevelopment projects Development Strategy ▪ Combination of turn-key, greenfield / brownfield development and expansion allows NSR to leverage its 4 projects completed in FY23, adding 22,200m2 of NLA in-house
Slide 20: Technology
TECHNOLOGY Harnessing new technology and innovation for enhanced business outcomes Cyber Security Embedding Technology Process Improvements ▪ Comprehensive program, ▪ Enhancing scalability ▪ Enhanced contact centre including the ongoing efficiencies by product offerings evolution of key policies imp
Slide 21: Sustainability
SUSTAINABILITY 21
Slide 22: Sustainability Framework
SUSTAINABILITY FRAMEWORK FOUR PILLARS APPROACH TO SUSTAINABILITY STRATEGY ENVIRONMENT PEOPLE GOVERNANCE ▪ Sustainability is a core ▪ Environmentally ▪ Talent attraction ▪ Trust & transparency pillar of NSR’s strategy efficient operations and retention ▪ Responding to ▪ Economic ▪ Sustainable ▪ Emplo
Slide 23: Strategy and Governance
STRATEGY AND GOVERNANCE Instilling trust and confidence that we are Customer & building a resilient and sustainable business Environmentally employee experience for our stakeholders efficient Economic operations performance ▪ Sustainability is a core pillar of the Group’s strategy Climate change ▪ I
Slide 24: People
PEOPLE Focus on fostering wellbeing and professional growth whilst driving technological innovation and enhancing the employment lifecycle and the success of our people Technological Value Proposition Wellbeing Community Innovation ▪ Leadership capability ▪ Upgraded benefits ▪ Longstanding ▪ Activel
Slide 25: Environment
ENVIRONMENT Strategy to reduce environmental footprint ▪ Typical storage centre emissions remain low NSR is a low ▪ Initiatives underway to further reduce landfill emissions business and environmental footprint ▪ 8,300m2 solar panel footprint across more than 110 sites Material investment ▪ Approxim
Slide 26: Outlook
OUTLOOK 26
Slide 27: FY24 Guidance & Outlook
FY24 GUIDANCE & OUTLOOK1 Underlying EPS minimum 11.3cps EPS Bridge (cps): FY23 to FY24 UNDERLYING EPS Minimum 11.3 cps UNDERLYING EARNINGS Greater than $154m DISTRIBUTION GUIDANCE 90%-100% payout of Underlying Earnings Key Assumptions: ▪ REVPAM growth No less than 4.2% ▪ Average floating interest ra
Slide 28: Thank You
THANK YOU invest@nationalstorage.com.au nationalstorage.com.au 28
Slide 29: Appendices
APPENDICES invest@nationalstorage.com.au nationalstorage.com.au 29
Slide 30: Development
DEVELOPMENT Targeted development providing additional unit pipeline in key areas Overview ▪ Target projects providing additional pipeline in key areas: ▪ Four projects completed during FY23 (22,200m2 of NLA) ▪ 20 active projects, with 13 projects under construction ▪ Aggregate NLA pipeline of approx
Slide 31: Expansion and Redevelopment
EXPANSION AND REDEVELOPMENT Expansion and redevelopment projects providing significant value add potential Robina – QLD Expansions and Redevelopment – Existing centres ▪ Strategic expansion of existing sites where occupancy levels are consistently high, and demand exceeds supply ▪ Optimisation of la
Slide 32: Case Study – Expansion
CASE STUDY 1 – EXPANSION Port Kennedy, WA Development Site Before ▪ Purchased additional land adjacent to existing centre ▪ Construction of purpose built storage centre ▪ Additional NLA: 6,600m2 ▪ Cost: $12m ▪ NLA: 5,725m2 ▪ Construction time: 12 months ▪ Annualised revenue: $1.4m ▪ Est additional r
Slide 33: Case Study – Mixed Use Development
CASE STUDY 2 – MIXED USE DEVELOPMENT Springfield, Brisbane ▪ Construction of purpose built storage facility and car wash ▪ Storage NLA: 7,000sqm ▪ Total Development Cost: $22.4m ▪ Construction time: 12 months ▪ Valuation (Day 1): $23.6m ▪ Land Acquisition ▪ Estimated valuation at stabilised: $3.4m $
Slide 34: Case Study – Integration of Acquisitions
CASE STUDY 3 – INTEGRATION OF ACQUISITIONS Delivering value: Regional and Metro ▪ Track record of delivering value by driving occupancy and rate growth ▪ Le eraging NSR’s scale, enhanced operating efficiencies and marketing and technology platforms ▪ Regional (Townsville, ex Storage King) portfolio:
Slide 35: Case Study – Queenstown
CASE STUDY – QUEENSTOWN Acquisitions focused on value-add opportunities in new and existing markets Queenstown Centre ▪ Queenstown centre, acquired July 2023, provides an additional 4,100m2 of NLA ▪ Modern two-storey offering plus single level satellite site to meet differing needs of the local mark
Slide 36: Asset Portfolio
ASSET PORTFO L IO Geographically diversified footprint, superior operating systems and management platform ▪ Largest owner/operator of self-storage in Australasia ▪ Deeply experienced management team delivering scale over 20 years through organic growth, acquisitions, developments and expansions ▪ C
Slide 37: Portfolio Metrics
PORTFOLIO METRICS 30 June 2022 30 June 2023 AUST NZ MGMT TOTAL AUST NZ MGMT TOTAL Freehold Centres 178 33 2 213 188 33 1 222 Leasehold Centres 13 - - 13 12 - - 12 Total Centres 191 33 2 226 200 33 1 234 Freehold NLA (sqm) 925,900 171,700 16,000 1,113,600 1,022,300 182,200 14,400 1,218,900 Leasehold
Slide 38: Board of Directors & Executive
BOARD OF DIRECTORS & EXECUTIVE Anthony Keane Howard Brenchley Inma Beaumont Scott Smith Independent Non-Executive Chairman, Independent Non-Executive Director, Independent Non-Executive Director and Independent Non-Executive Director, Chairman of the Nomination Committee Chairman of Audit and Risk C
Slide 39: Notes
NOTES 39