Metro Holdings Ltd · SGX:M01
Metro — FY2008 Earnings Presentation
55 slides from Metro's earnings presentation, May 28, 2008
Slide 1: Metro Holdings Limited FY2008 Results Briefing
METRO HOLDINGS LIMITED FY2008 Results Briefing 28 May 2008
Slide 2: Contents
CONTENTS About Metro Property Development & Investment Retail Operations Financial Highlights Market Outlook Growth Strategies 2
Slide 3: Who We Are
WHO WE ARE We are… A property development and investment group, backed by an established retail track record - Strong presence in China, Indonesia and Singapore 3
Slide 4: Our Vision
OUR VISION Building on the synergies of our rich retail experience, strong foothold in China, and our strategic partnerships, Metro aims to be… A leading property development and investment group in the region 4
Slide 5: The Humble Origins
THE HUMBLE ORIGINS Founded in 1957 by former chairman, Mr Ong Tjoe Kim Listed on the Main Board of the SGX-ST in 1973 2-prong growth pillars: Property development and investment – special emphasis on China Retail operations Focused on the Group’s growth in key markets in the region, such as: China I
Slide 6: Our Regional Presence
OUR REGIONAL PRESENCE List of Properties • Metro City, Beijing • 1 Financial Street, Beijing* • Metropolis Tower, Beijing* • ECMall, Beijing* • Metro City, Shanghai XINJIANG BEIJING • Metro Tower, Shanghai • GIE Tower, Guangzhou • Gurney Park, Penang SHANGHAI List of Investments GUANGZHOU • Shui On
Slide 7: Property Development & Investment
Property Development & Investment
Slide 8: Property Development & Investment
PROPERTY DEVELOPMENT & INVESTMENT 1 Financial Street, Beijing First foray into China in 1988 Developed, owned and subsequently divested 27% stake in Ngee Ann City Divested Gurney Plaza in 2007 Owns and manages several prime retail and office properties in first-tier cities in China Metro City, Signi
Slide 9: Property Investment – Portfolio Summary
PROPERTY INVESTMENT – Portfolio Summary Completed Properties: Location % owned Tenure Site Area Lettable No. of Occupancy Valuation by Grp (sqm) Area (sqm) Tenants Rate (%) (S$’m) (100%) Metro City, Shanghai, 36 yr term 60% 15,342 38,000 111 99.4 209 Shanghai PRC from 1993 Metro City, Beijing, 40 yr
Slide 10: Property Investment – Portfolio Summary
PROPERTY INVESTMENT – Portfolio Summary Properties under Development: Location % owned Tenure Site Area Potential Expected Completion by Grp (sqm) Lettable Area (sqm) Gurney Plaza Penang, 49% Freehold 7,660 12,500 End 2008 Extension, Malaysia Penang 1 Financial Beijing, 50 yr term Street, 45% 12,420
Slide 11: Property Investment: Property Valuation
PROPERTY INVESTMENT Property Valuation: FY2007 (S$’m) FY2008 (S$’m) Increase (%) Metro City, Shanghai 198 209 + 5.55 Metro City, Beijing 339 345 + 1.77 GIE Tower, Guangzhou 88 92 + 4.54 Metro Tower, Shanghai 164 173 + 5.49 Metro City, Beijing 11
Slide 12: Property Investment: Occupancy Rates
PROPERTY INVESTMENT Occupancy Rates: FY2007 (%) FY2008 (%) Metro City, Shanghai 99.4 99.4 Metro City, Beijing (1) 30.0 81.1 GIE Tower, Guangzhou (2) 91.6 68.1 Metro Tower, Shanghai 96.7 97.9 (1) Metro City, Beijing, was fully opened in September 2007 (2) The decline in occupancy rate from 91.6% in F
Slide 13: Property Investment: Expiry Profile
PROPERTY INVESTMENT Expiry Profile by Gross Rental Income: 1H2009 (%) 2H2009 (%) Metro City, Shanghai 17.68 9.00 Metro City, Beijing - - GIE Tower, Guangzhou 4.76 14.82 Metro Tower, Shanghai 33.73 0.92 Metro City, Beijing 13
Slide 14: Metro City, Shanghai
METRO CITY, SHANGHAI Strategically located at Xujiahui, Shanghai Major retail, leisure and transportation hub with high shopper traffic from south central Puxi 9-storey lifestyle entertainment centre offering 38,000 square metres of retail space Directly linked to underground MRT Established its pos
Slide 15: Metro City, Shanghai – Top Tenants
METRO CITY, SHANGHAI Top 10 Tenants: Name of Tenant Trade Sector % of total lettable area Buynow Computer Electronics & IT 19.26% World Physical Fitness & Leisure & Entertainment/ 10.27% Beauty Centre Sport & Fitness Tenant Mix by Lettable Area Kodak Cinema World Leisure & Entertainment/ (as at Marc
Slide 16: Metro Tower, Shanghai
METRO TOWER, SHANGHAI Located next to Metro City, Shanghai Grade A 26-storey office building offering almost 40,000 square metres of space Expansion needs of a strong multi national tenant base have ensured almost full occupancy of the building Metro City, Beijing 16
Slide 17: Metro Tower, Shanghai – Top Tenants
METRO TOWER, SHANGHAI Top 10 Tenants: Name of Trade Sector % of lettable Tenant area Microsoft IT Services & 25.16% Telecommunications Tenant Mix by Lettable Area Exxon Mobil Petroleum & Chemicals 20.69% (as at March 31, 2008) Swatch Group Consumer Products 8.54% KFC F&B 8.51% AIA Banking, Insurance
Slide 18: Metro City, Beijing
METRO CITY, BEIJING Newest addition to the Group’s property arm Located in the Chaoyang District in East Beijing 6-level retail mall with almost 85,000 square metres of space Gaining ground as a premier lifestyle retail destination for the surrounding Beijing residents Anchor tenant, Parkson departm
Slide 19: Metro City, Beijing – Top Tenants
METRO CITY, BEIJING Top 10 Tenants: Name of Trade Sector % of Tenant lettable area Parkson Department Store Department 29.62% Store Walmart Supermarkets 21.27% Supercentre Gome Electronics & IT 3.77% Tenant Mix by Lettable Area Electrical Lucky Time F&B/Food Court (as at March 31, 2008) Food Court 3
Slide 20: GIE Tower, Guangzhou
GIE TOWER, GUANGZHOU Located in the central business district of Dongshan, Guangzhou The Group owns over 28,000 square metres of Grade A office space in this 35-storey building Metro City, Beijing 20
Slide 21: GIE Tower, Guangzhou – Top Tenants
GIE TOWER, GUANGZHOU Top 10 Tenants: Name of Trade Sector % of Tenant lettable area Jin Yu Restaurant F&B 12.68% Ericsson IT Services & 11.89% Tenant Mix by Lettable Area Telecommunication (as at March 31, 2008) Swiss Ya Pei Pharmaceutical 4.17% Roche Pharmaceutical 4.17% Evergreen Others 3.53% 16.5
Slide 22: Gurney Park, Penang
GURNEY PARK, PENANG Gurney Plaza Extension – retail component of Gurney Park Extension of 12,500 square metres is currently under construction Completion is expected by end 2008 Gurney Plaza Extension G Hotel – the hotel component of Gurney Park, is located next to the vibrant Metro City, Gurney Pla
Slide 23: Property Investment – Shui On Land
PROPERTY INVESTMENT – SHUI ON LAND The Group owns about 1.8% of Shui On Land Ltd (“SOL”), with shares valued at about US$71 million SOL is a leading property developer in China, focused on city core, large-scale, urban mixed use developments and integrated residential development projects In additio
Slide 24: Property Investment – ICT Plaza
PROPERTY INVESTMENT – ICT PLAZA The Group has invested US$28 million in International Commerce and Trade Plaza (“ICT Plaza”), a 290,000 square metres wholesale commercial trade centre in Urumqi, Xinjiang, China Urumqi, the gateway to the Central Asian region, is the commercial and trade centre of Xi
Slide 25: Property Investment – Crowne Plaza
PROPERTY INVESTMENT – CROWNE PLAZA The Group holds bonds worth about US$15 million, issued by the majority owners of the 360-room 5-star Crowne Plaza hotel in Beijing, China Other investments include a mixed use retail/hotel proposed development also in Beijing, China Metro City, Beijing Crowne Plaz
Slide 26: 1 Financial Street, Beijing
PROPERTY DEVELOPMENTS WITH STRONG PARTNERS 1 Financial Street, Beijing Joint development with HSBC NF China Real Estate Fund / Nan Fung Located in the Financial Street Area, Xi Cheng District, Beijing’s central business district Currently under construction, 1 Financial Street will comprise three po
Slide 27: Metropolis Tower, Beijing
METROPOLIS TOWER, BEIJING Joint development with ECM Group and HSBC NF China Real Estate Fund Located in ZhongGuanCun, Haidian District in North West Beijing ZhongGuanCun, also known as Beijing’s “Silicon Valley”, is an IT-orientated zone with many universities, science academies and research instit
Slide 28: ECMall, Beijing
ECMALL, BEIJING Located next to Metropolis Tower 6-storey, 4-basement retail mall currently under construction Scheduled to commence operations in the first quarter of 2009 Expected to offer 29,000 square metres of leaseable retail space Tenure 40 yr term from 2001 Project Cost (combined with Expect
Slide 29: Retail Operations
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Slide 30: Retail Operations
RETAIL OPERATIONS The Metro shopping brand is an established household name in the retail industry. Currently, Metro serves customers through a chain of three Metro department stores and four specialty “Accessorize” shops in Singapore, and five Metro department stores in Jakarta and Bandung, Indones
Slide 31: Retail Operations
RETAIL OPERATIONS Upgraded merchandise selections for customers in all our retail operations, through close collaboration with international and local business partners: Singapore: - Indonesia: - Metro Paragon Metro Pondok Indah Metro Woodlands Metro Senayan Square Metro Sengkang Metro Bandung Super
Slide 32: M @ Pacific Place
M @ PACIFIC PLACE Premier Store – M signifies the epitome of Metro, a concept store of branded and fashion merchandise. The first ever in Indonesia, this new store spanning 10,060 square metres was opened in April 2008. It is located in the central financial district of Jakarta, next to the Stock Ex
Slide 33: Financial Highlights
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Slide 34: Financial Highlights: Profit & Loss Accounts
FINANCIAL HIGHLIGHTS Profit & Loss Accounts: FY2007 (S$’000) FY2008 (S$’000) Change (%) Turnover 214,168 224,409 + 4.78 Profit Before Tax 81,701 86,482 + 5.85 Net Profit Attributable to 68,683 65,968 - 3.95 Shareholders 34
Slide 35: Financial Highlights: Financial Ratios
FINANCIAL HIGHLIGHTS Financial Ratios: FY2007 FY2008 Earnings per share after tax and minority 10.89 10.46 interests (cents) Return on shareholders’ funds (%) 9.51 7.89 Return on total assets (%) 6.81 5.63 Interim net dividend per share (cents) - 0.8 Final net dividend per share (cents) 1.64 1.0 Spe
Slide 36: Turnover
TURNOVER S$’m 224.4 Turnover increased by 4.78% 225 from FY07 to FY08, due to: initial rental income from Metro 220 City Beijing, 214.2 215 higher rental income from Metro City Shanghai, and 210 a one-time recognition of 202.6 205 service charges of S$4 million 200 195 190 FY2006 FY2007 FY2008 36
Slide 37: Turnover by Business Segments
TURNOVER BY BUSINESS SEGMENTS FY2008 S$48.0m 21.4% FY2007 S$34.7m 16.2% S$176.4m 78.6% Property Retail S$179.5m 83.8% Property Retail 37
Slide 38: PBT by Business Segments
PBT BY BUSINESS SEGMENTS FY2008 S$10.9m FY2007 12.6% S$13.0m 16.0% S$75.6m 87.4% S$68.7m Property Retail 84.0% Property Retail 38
Slide 39: Net Profit Attributable to Shareholders
NET PROFIT ATTRIBUTABLE TO SHAREHOLDERS Total: S$’m Net profit decreased by 3.95% 160 154.4 from FY07 to FY08, due to: 140 An increase in tax charge in 120 FY2008 100 118.0 Total: Total: Decrease offset by higher gain 80 68.7 66.0 on fair value adjustments on 60 29.1 31.9 investment properties 40 20
Slide 40: Dividend Payout
DIVIDEND PAYOUT Payout Rate Gross Cents Per Share 45.0% 40.9% 18.0 Total: 17.0 37.7% 40.0% 16.0 37.5% 14.0 35.0% 32.5% 12.0 30.0% 10.0 15.0 8.0 25.0% Total: 5.0 Total: 5.0 Total: 5.0 6.0 4.0 20.0% 3.0 3.0 3.0 2.0 2.0 2.0 16.3% 2.0 2.0 15.0% 2.0 0.0 FY2004 FY2005 FY2006 40 FY2007 FY2008
Slide 41: Balance Sheet Highlights
BALANCE SHEET HIGHLIGHTS FY2007 (S$’000) FY2008 (S$’000) Change (%) Property, plant and 109,980 11,874 - 89.2 equipment Investment Properties 356,759 498,568 + 39.7 Non-current Assets 266,208 417,409 + 56.8 Current Assets 378,610 306,073 - 19.1 Total Assets 1,111,557 1,233,924 + 9.9 Current Liabilit
Slide 42: Market Outlook
Market Outlook
Slide 43: Market Outlook – China: Beijing Prime Office
MARKET OUTLOOK – CHINA Beijing – Prime Office Market: Robust demand in 1Q08 Lifted take-up volume noticeably above 1Q07 figures Vacancy rates dropped in tandem with high demand, settling at an average of 9.3% CBD and Financial Street districts experienced increased levels of transaction activity Hig
Slide 44: Market Outlook – China: Beijing Prime Retail
MARKET OUTLOOK – CHINA Beijing – Prime Retail Market: Rental boom from upcoming Olympic Games 4 prime retail properties offering 260,000 square metres of space came on stream in 1Q08 (1) Despite quantum of new supply, average vacancy rate dropped to 6.5% on the back of strong leasing demand Source:
Slide 45: Market Outlook – China: Shanghai Prime Office
MARKET OUTLOOK – CHINA Shanghai – Prime Office Market: Capitalise on demand-supply imbalance Demand in the market remained strong, and office pre-leasing continued to be a must for large space occupiers wishing to secure offices on contiguous floors (1) Average office rent in Shanghai continued to s
Slide 46: Market Outlook – China: Shanghai Prime Retail
MARKET OUTLOOK – CHINA Shanghai – Prime Retail Market: Positive rental growth for retail space 409,691 square metres (GFA) of primary retail space was transacted in 1Q08 in the city (1) average price was RMB11,385/sqm – an increase of 27% q-o-q Fast maturing high-end retail hubs such as Xujiahui and
Slide 47: Market Outlook – China: Guangzhou Prime Office
MARKET OUTLOOK – CHINA Guangzhou – Prime Office Market: Comparatively quiet rental market Approximately 240,000 square metres of prime office space was added to Guangzhou’s existing office stock in 1Q 2008 (1) Overall vacancy rate rose to 19.4% by end of March 2008 Rents reported q-o-q growth of 2.3
Slide 48: Market Outlook – Singapore
MARKET OUTLOOK – SINGAPORE Active local retail sector in 2007 Retail sales total S$23.83 billion – 7.1% higher than last year Boosted by robust growth in the economy and tourist arrivals Slightly slower growth in early 2008 at 1.5% (Feb) Retail sector, while expected to continue facing challenges, i
Slide 49: Market Outlook – Indonesia
MARKET OUTLOOK – INDONESIA Increasing acceptance of New retail formats and modern retail shopping formats retailers gaining acceptance: 3.7% 4.7% 4.9% 5.3% 8.2% 10.2% 11.6% 100% Foreign department stores, 18.2% 20.1% 20.3% 21.0% such as Metro, share overall 80% 22.2% 22.2% 22.8% market dominance wit
Slide 50: Market Outlook – Indonesia
MARKET OUTLOOK – INDONESIA Retail sales anticipated to grow through to 2011: Backed by strong domestic consumption Nominal retail sales growth has averaged 11% per annum Growth expected to continue over the next 5 years to 2011 Expected growth in retail sales averaging 11% p.a. to 2011 30.0% 300,000
Slide 51: Growth Strategies
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Slide 52: Growth Strategies
GROWTH STRATEGIES Property Development Retail Operations & Investment Continue to leverage on : Emphasis on : - Rich Retail Experience - Addition of new retail - Strong Foothold in China outlets - Strategic Partnerships - Upgrade Merchandise - Strong Balance Sheet of Selection Metro Group - Improve
Slide 53: Growth Strategies: Property Development and Investment
GROWTH STRATEGIES Property Development and Investment Leverage on Rich Retail Experience Optimise tenant mix Continual enhancement of net lettable area Enhance rental yield Capitalise on Strong Foothold in China Opportunistic search for new projects Strategic Partnerships Careful selection of partne
Slide 54: Growth Strategies: Retail Operations
GROWTH STRATEGIES Retail Operations Addition of new retail outlets Plans for new outlet at City Square Mall, Singapore Plans to open more outlets in Singapore when suitable real estate opportunities present themselves Commitment to open new outlet at Grandaria City, Jakarta, Indonesia, in 2009 Upgra
Slide 55: Thank You
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