Slide 1: 1H19 Results Presentation
1H19 RESULTS PRESENTATION
Slide 2: Key Performance Metrics
PEET 1H19 RESULTS KEY PERFORMANCES METRICS $23.1m 1H19 operating 1,804 lots under profit after tax contract with a value of New Wholesale Fund 22.2% gearing up 5% $456m established in 1H19 4.74cps EPS 1,417 Three new projects to $190m net debt up 6% lot settlements commence selling in 2H19 Investmen
Slide 3: Group Strategic Model
PEET 1H19 RESULTS GROUP STRATEGIC MODEL BUILDING A LONG-TERM HIGHER VALUE FUNDS MANAGEMENT BUSINESS » Funds Management strategy delivering consistent results and margins - Institutional/Wholesale co-investment strategy delivering emerging profits ̵ Investment earnings up 161% compared to 1H18 - New
Slide 4: Significant Funds Management Value Not Captured in NTA
PEET 1H19 RESULTS SIGNIFICANT FUNDS MANAGEMENT VALUE NOT CAPTURED IN NTA APPROXIMATELY $2.1BN1 IN ASSETS UNDER MANAGEMENT, WITH 60% COMPRISING THIRD PARTY CAPITAL FUNDS MANAGEMENT AND JV » GDV2 of $11.2bn ̵ Significant pipeline of 38,480 lots, representing c.80% of land bank, providing long-term ear
Slide 5: Peet Has Managed the Cycle Well
PEET 1H19 RESULTS PEET HAS MANAGED THE CYCLE WELL THE GROUP HAS A LONG HISTORY OF SUCCESSFULLY NAVIGATING THROUGH MARKET CYCLES » Peet has taken a proactive approach in identifying and implementing strategies to manage current market challenges - Avoided acquiring land holdings across Melbourne and
Slide 6: Overview
v | OVERVIEW
Slide 7: Group Financial Summary
PEET 1H19 RESULTS GROUP FINANCIAL SUMMARY KEY PERFORMANCE STATISTICS STRATEGIC INITIATIVES CONTINUE TO DRIVE EARNINGS GROWTH 1H19 1H18 VAR (%) » Group revenue1 of $117.1m – down 8% Lot sales4 964 1,342 (28%) Lot settlements4 1,417 1,077 32% » 1H19 revenue was lower predominantly due to: Revenue 1 (8
Slide 8: Focus on Driving Shareholder Returns
PEET 1H19 RESULTS FOCUS ON DRIVING SHAREHOLDER RETURNS CONSISTENT GROWTH IN EARNINGS DRIVEN BY OUR FOCUSED STRATEGY AND NEW PROJECTS » Business well established across seven states and territories - Provides good geographic spread with well located projects across key growth corridors - Expanding ma
Slide 9: Group Balance Sheet
PEET 1H19 RESULTS GROUP BALANCE SHEET CONTINUED EXECUTION OF CAPITAL MANAGEMENT STRATEGY CAPITAL MANAGEMENT METRICS 1H19 FY18 FY17 » The Group has a flexible2,184 and diverse funding profile Cash at bank $48.0m $76.7m $88.4m - Long term debt maturity profile including Corporate Bonds Bank debt $90.4
Slide 10: Group Cash Flow Summary
PEET 1H19 RESULTS GROUP CASH FLOW SUMMARY CASH GENERATED FROM OPERATIONS APPLIED TO DELIVER PRODUCTION FROM CURRENT PROJECT PIPELINE TO MEET DEMAND » Operating cash flows (before acquisitions) lower than 1H19 1H18 CASH FLOWS RELATED TO OPERATING ACTIVITIES $M $M previous period due to: - Divestment
Slide 11: Performance
PERFORMANCE
Slide 12: Group Operating Performance
PEET 1H19 RESULTS GROUP OPERATING PERFORMANCE EBITDA1,2 COMPOSITION BY BUSINESS TYPE (%) PEET’S DIVERSIFIED PORTFOLIO OF PROJECTS HAS ALLOWED IT TO CAPITALISE ON THE EASTERN Development Funds Management JVs STATES’ STRENGTH » Contribution from eastern states’ projects represented 81% of EBITDA1,2 14
Slide 13: Group Sales and Settlement Activity
PEET 1H19 RESULTS GROUP SALES AND SETTLEMENT ACTIVITY SALES COMPOSITION BY GEOGRAPHY (LOTS) » Group sales for 1H19 of 964 lots1 – down 28% WA VIC QLD NSW/ACT SA - Sales activity impacted by changing lending conditions, completion of several VIC projects during 1H18, and moderation of market conditio
Slide 14: Contracts on Hand
PEET 1H19 RESULTS CONTRACTS ON HAND CONTRACTS ON HAND1 (LOTS) 2,500 2,257 2,186 CONTRACTS ON HAND UNDERPIN MOMENTUM INTO 2H19 2,000 1,804 » Contracts on hand1 have decreased by 20% since 30 June 2018 to 1,804 lots due to: 1,500 - Higher settlements during 1H19 1,000 - Lower sales activity as a resul
Slide 15: FM Operating Performance
PEET 1H19 RESULTS FM OPERATING PERFORMANCE KEY PERFORMANCE STATISTICS 1H19 1H18 VAR (%) » 1H19 revenue of $14.8m impacted by Lot sales2 474 739 (36%) - Lower project management fee income as a result of lower sales activity due to changing lending conditions and a moderation of Lot settlements2 938
Slide 16: JV Operating Performance
PEET 1H19 RESULTS JV OPERATING PERFORMANCE KEY PERFORMANCE STATISTICS 1H19 1H18 VAR (%) » EBITDA1 of $5.9m – up 7% Lot sales2 205 372 (45%) Lot settlements2 262 232 13% » Share of equity accounted profits increased to $2.4m during 1H19 – up 60% Revenue $18.8m $20.2m (7%) Share of net profit of equit
Slide 17: Development Operating Performance
PEET 1H19 RESULTS DEVELOPMENT OPERATING PERFORMANCE KEY PERFORMANCE STATISTICS 1H19 1H18 VAR (%) » 1H19 EBITDA of $21.6m – down 15% Lot sales1 285 231 23% - Impacted by englobo land settlement in 1H18 Lot settlements1 217 145 50% - Margin slightly down to 29% for the period Land only 193 118 64% Med
Slide 18: Market Overview & Project Pipeline
Slide 19: Residential Market Overview
PEET 1H19 RESULTS RESIDENTIAL MARKET OVERVIEW MELBOURNE » Strong economic growth, with forecast significant investment in infrastructure by Government » Recent contraction of sales volumes driven by affordability and tightening lending conditions » Economic outlook and population growth to underpin
Slide 20: Residential Market Overview
PEET 1H19 RESULTS RESIDENTIAL MARKET OVERVIEW CANBERRA » Solid economic outlook supported by long term fundamentals » Steady population growth supporting increased demand » Tight vacancy rate and limited land supply to support sales momentum over the long-term ADELAIDE » Market indicators remain sol
Slide 21: National Reach
NATIONAL REACH Notes: 1 Not all projects are shown on map
Slide 22: Overview of Peet's Land Bank
PEET 1H19 RESULTS OVERVIEW OF PEET’S LAND BANK LAND BANK REPRESENTS APPROXIMATELY 17 YEARS’ LOT SUPPLY BASED ON CURRENT SALES RATES » Sizeable and diversified land bank across all mainland states and LAND BANK COMPOSITION BY BUSINESS TYPE (LOTS1) territories 60,000 - Pipeline of approximately 50,200
Slide 23: New Projects Supporting Growth
PEET 1H19 RESULTS NEW PROJECTS SUPPORTING GROWTH PIPELINE OF APPROXIMATELY 50,200 LOTS PROVIDING VISIBILITY OF FUTURE EARNINGS » Up to five new land projects and four medium density townhouse sites to commence development within the next two years - Approximately 90% of the lots in these projects si
Slide 24: 1H19 Annexures
Slide 25: Priorities and Strategic Focus
PEET 1H19 RESULTS PEET PRIORITIES AND STRATEGIC FOCUS STRATEGIC POSITIONING PROVIDES SOLID MEDIUM-TERM EARNINGS VISIBILITY » Portfolio well positioned to target longer-term growth and value creation » Accelerating production where possible and appropriate, and active management of product mix » Sele
Slide 26: Outlook
PEET 1H19 RESULTS PEET OUTLOOK » Market conditions and the availability of credit for customers are expected to remain difficult for the next 12 months - The Victorian residential property market conditions continue to moderate as the current cycle changes - The Group’s VIC land bank currently repre
Slide 27: Annexures
Slide 28: Summary Income Statement
PEET 1H19 RESULTS SUMMARY INCOME STATEMENT 1H19 1H18 Var $M $M (%) Funds Management 14.8 21.4 (31%) Development 73.3 79.2 (7%) Joint Venture 18.8 20.2 (7%) Share of net profit of equity accounted investments 8.6 3.3 161% Other1 1.6 3.4 (53%) Revenue 117.1 127.5 (8%) EBITDA 36.3 41.7 (13%) Finance co
Slide 29: Summary Balance Sheet
PEET 1H19 RESULTS SUMMARY BALANCE SHEET 1H19 FY18 $M $M Assets Cash and cash equivalents 48.0 76.7 Receivables 124.6 123.1 Inventories 523.9 494.8 Investments accounted for using the equity method 235.4 222.8 Other 11.3 11.5 Total assets 943.2 928.9 Liabilities Payables 90.0 82.1 Land vendor liabili
Slide 30: Land Bank – Funds Management Key Projects
PEET 1H19 RESULTS LAND BANK – FUNDS MANAGEMENT KEY PROJECTS PROJECT LIFECYCLE PROJECT NAME STATE GDV1 LOTS REMAINING2 2019 2020 2021 2022 2023 Alkimos WA $1,241m 2,429 Selling Burns Beach WA $240m 392 Selling Eglinton WA $250m 1,041 Planning Start up Selling Golden Bay WA $172m 798 Selling Lakelands
Slide 31: Land Bank – Company-Owned Key Projects
PEET 1H19 RESULTS LAND BANK – COMPANY-OWNED KEY PROJECTS PROJECT LIFECYCLE PROJECT NAME STATE GDV1 LOTS REMAINING2 2019 2020 2021 2022 2023 Brigadoon WA $41m 97 Selling Chase, Baldivis WA $49m 294 Selling Mundijong WA $162m 773 Planning Start up Other WA $646m 3,933 Planning Gladstone QLD $86m 333 S
Slide 32: Land Bank – Joint Venture Key Projects
PEET 1H19 RESULTS LAND BANK – JOINT VENTURE KEY PROJECTS PROJECT LIFECYCLE PROJECT NAME STATE GDV1 LOTS REMAINING2 2019 2020 2021 2022 2023 Wellard WA $135m 752 Selling Brabham WA $783m 3,333 Planning Start up Selling Pier Street WA $69m 146 Planning Start up Selling Completion Redbank Plains QLD $2
Slide 33: Disclaimer
PEET 1H19 RESULTS DISCLAIMER While every effort is made to provide accurate and complete information, Peet does not warrant or represent that the information in this presentation is free from errors or omissions or is suitable for your intended use. This presentation contains forward-looking stateme