Grit Real Estate Income Group Limited · LSE:GR1T
Grit Real Estate Income — HY25 Earnings Presentation
50 slides from Grit Real Estate Income's earnings presentation, February 2025
Slide 1: HY25 Results Update
HY25 RESULTS UPDATE For the six months ended 31 December 2024 10 YEARS OF PIONEERING IMPACT AFRICAN REAL ESTATE
Slide 2: Vision Statement
| VISION STATEMENT WE ARE A FAMILY OF PARTNERSHIPS, SETTING THE GLOBAL BENCHMARK IN AFRICA FOR DEVELOPING SMART BUSINESS SOLUTIONS & IMPACT REAL ESTATE THAT GOES BEYOND BUILDINGS 2
Slide 3: Group Strategy
| GROUP STRATEGY The Group’s strategy is to hold controlling interests in high-quality, long-term, income producing assets in Africa with up to 20% of gross asset value (GAV) in risk-mitigated, client-led developments. Grit 2.0 further monetises our intellectual property through additional revenue g
Slide 4: 33 Assets in 11 Territories Across Africa
| STRONG & SUSTAINABLE PROPERTY PORTFOLIO WE ARE PAN-AFRICAN 33 ASSETS IN US$957m 11 TERRITORIES Value of Income-Producing Assets (on consolidation of GREA) ACROSS AFRICA COUNTRY EXPOSURE NIGERIA (3.3%) 2.9% Office MOZAMBIQUE (33.0%) 3.3% Retail MAURITIUS (5.4%) 30.6% ETHIOPIA (9.0%) Light Industria
Slide 5: Strong Sustainable Operations & Evidence of Grit 2.0 Strategy
| STRONG SUSTAINABLE OPERATIONS & EVIDENCE OF GRIT 2.0 STRATEGY Key Deliverables for HY25 Impact for shareholders Completion of US$100m $ Recapitalisation of GREA on 27 Nov 2024 (addressing FY24 Audit Material Uncertainty) capital injection Successful implementation of Broll Expected cost savings st
Slide 6: Executive Summary: Headwinds
| KEY HIGHLIGHTS EXECUTIVE SUMMARY: Headwinds Challenging HY25 results due to: NO. KEY HEADWINDS KEY DRIVER/IMPACT Interest rates remaining 1 Rising Finance Costs higher for longer External Asset revaluations due to rental reversions, Factors currency declines, macro-economic 2 Impacted NAV environm
Slide 7: Executive Summary: Tangible signs of an early recovery
| KEY HIGHLIGHTS EXECUTIVE SUMMARY: Tangible signs of an early recovery WE SAID WE DID KEY PROGRESS MADE 13% increase in Grit Proportionate Predominantly driven by higher yielding, more defensive Net operating income improvement US$ NOI asset classes incl Data Centres & Healthcare GREA identified as
Slide 8: Resilient Portfolio and Operational Performance
RESILIENT PORTFOLIO AND OPERATIONAL PERFORMANCE 8
Slide 9: High-Quality Tenants, Hard Currency, Long-Term Leases
| STRONG & SUSTAINABLE PROPERTY PORTFOLIO HIGH-QUALITY TENANTS, HARD CURRENCY, LONG-TERM LEASES 94% Rank Tenant Industry Income % Lease Currency Income in Hard Currency 1 US Embassy Consular 15.7% US$ 2 Total Energy 9.7% US$ 91% 3 Vodacom Communications 6.2% US$ EPRA Occupancy* 4 LUX Hospitality 4.9
Slide 10: Update on Mozambique
UPDATE ON MOZAMBIQUE The News as Reported What We See on The Ground Grit continues to leverage on its Family of Partnerships, establishing rapport 1 with on the ground personnel and understanding latest developments on a daily basis Leasing activity remains supportive, with some pressure on rental r
Slide 11: HY25 Financial Review
HY25 FINANCIAL REVIEW 11
Slide 12: Summary of HY25 Results
| HEALTHY ASSET PERFORMANCE SUMMARY OF HY25 RESULTS [object File] Value of Property Portfolio NOI HY25 – Proportionate basis EPRA 6M Fair value 6M YOY Comparable Topped Up 31 December 2024 Reported NOI3 NIY Change movements Reported Change change NIY US$'000 % US$'000 US$ '000 % % % % Retail 209,817
Slide 13: Ongoing Administration Expense Reductions and Group Cost Optimisations
| STRONG & FOCUSED COST CONTROLS ONGOING ADMINISTRATION EXPENSE REDUCTIONS AND FURTHER GROUP COST OPTIMISATIONS HY24 • Head count freeze & staff reductions 1.92% • Senior staff & Board salary reductions Admin cost to Income producing assets • Reduced travel costs (HY24 US$8.9m) on like-for-like basi
Slide 14: Administrative Outsourcing Partnership
| STRONG AND FOCUSED COST CONTROLS Administrative outsourcing partnership Property and facilities management (non-core) ** Existing Grit Strategic objectives: countries of operation Cost reduction Simplification Economies of scale Grit Group retains core activities: Strategic leasing Asset managemen
Slide 15: Ongoing Strong Capital Recycling Focus
| ONGOING STRONG CAPITAL RECYCLING FOCUS ASSET RECYCLING – STRONG MOMENTUM MAINTAINED Additional US$200m of non-core assets identified US$73.2m disposals currently in advanced discussions EXECUTED Core sectors Focus sectors Non-core sectors ASSET RECYCLING Tamassa Lux Resort Industrial Hospitality O
Slide 16: Higher LTV and Covenant Waivers as a Result of GREA Consolidation
| HIGHER LTV AND COVENANT WAIVERS AS A RESULT OF GREA CONSOLIDATION DEBT DECREASE OVER 6 MONTHS FOLLOWING GREA RECAPITALISATION: ITS DELAY REQUIRED BRIDGING FACILITIES, CONTRIBUTING TO HIGHER FINANCE COSTS New GREA developments, accompanied by a lower interest rate environment, are expected to annua
Slide 17: Operating in High Interest Rate Environment
| OPERATING IN HIGH INTEREST RATE ENVIRONMENT GREA DEBT CONSOLIDATION ALONGSIDE HIGH COST OF DEBT IMPACTED HY25 RESULTS 11.0% 1,200m Income producing assets WACD 10.0% 10.0% 1,000m Interest rate outlook is improving in conjunction with increased Group Income Producing Assets (US$) 9.4% 9.0% hedging
Slide 18: Enhanced Hedging Strategy & Treasury Management
| ENHANCED HEDGING STRATEGY & TREASURY MANAGEMENT INTEREST RATE RISK MANAGEMENT Hedge positions have been effective, but hedge maturities reset protection levels in 2024 UPDATED POLICY: amended to target 75% floating rate risk hedge. Net increase in hedged debt of US$35m achieved at Dec-24, aggregat
Slide 19: Interest Rate Sensitivity
| ENHANCED HEDGING STRATEGY & TREASURY MANAGEMENT INTEREST RATE SENSITIVITY change vs current WACD (basis Impact of Hedges on all debt WACD Impact (US$ ‘000) points) At 31 December 2024 (including hedges) 9.39% +50bps 9.67% 28 1,485 +25bps 9.55% 12 882 -25bps 9.22% (16) (865) -50bps 9.06% (33) (1,71
Slide 20: Medium-Term Strategy: Managing Asset Yields & Cost of Debt
| RISING FINANCE COSTS MEDIUM-TERM STRATEGY: MANAGING ASSET YIELDS & COST OF DEBT Debt Funding and Asset Strategy key to distributable earnings recovery 11.0% 1,000m WACD EPRA NIY 950m Global rate hikes have impacted all property companies. 10.0% 10.0% 900m Ongoing Management actions include: 9.4% I
Slide 21: Group Strategy in Numbers
| GRIT 2.0 STRATEGY GROUP STRATEGY IN NUMBERS Medium-Term Return Targets Shareholder Value Creation Targeted Asset Yield Asset Yield spread over WACD c.9% c.2% Annual NAV growth 4% to 7% Admin cost ratio target Development Income 1.0% >c.10.5% of total income producing assets Target dividend payout
Slide 22: Concluding Remarks: Progress Underway
CONCLUDING REMARKS: PROGRESS UNDERWAY 22
Slide 23: Conclusion: Focus Areas and Targets Remain on Track
| GRIT 2.0 STRATEGY CONCLUSION: FOCUS AREAS AND TARGETS REMAIN ON TRACK Proportionate NOI Consistently strong 01 Strong Sustainable Operations +13.0% Leasing activity Strong Property Fundamentals Business Simplification Additional Disposal target Core expertise focus Evidence of 02 “Shrink to grow”
Slide 24: Thank You
THANK YOU Investor Queries: ir@grit.group 24
Slide 25: Disclaimer
DISCLAIMER This report has been prepared by Grit Real Estate Income Group Limited ("Grit" or the “Company”) solely for your information and should not be considered to be an offer or solicitation of an offer to buy or sell or subscribe for any securities, financial instruments or any rights attachin
Slide 26: Annexures
ANNEXURES 26
Slide 27: Grit 2.0 - Simplifying the Group and Operations
GRIT 2.0 - SIMPLIFYING THE GROUP AND OPERATIONS 27
Slide 28: Simplified Group Operating Structure
| SIMPLIFIED GROUP OPERATING STRUCTURE SIMPLIFIED GROUP OPERATING STRUCTURE Now Positioned For The Future A significant reduction in Associate accounted assets has been achieved. The Group’s assets are now arranged in sector silos. Key Benefits: - Simplified Reporting - Optimization of Cost - Enhanc
Slide 29: GREA & Substructure Update
GREA & SUBSTRUCTURE UPDATE 29
Slide 30: GREA Highlights & Milestones in FY2024
| SIMPLIFIED GROUP OPERATING STRUCTURE GREA HIGHLIGHTS & MILESTONES IN FY2024 CONSOLIDATION RECAPITALISATION STRONG EXECUTION Grit increased GREA recapitalisation stake in GREA US$100m ENEO commissioned PIC $48m only awaiting final May 2024 53.3% regulatory approvals Supported by Grit, PIC & GEPF De
Slide 31: ENEO at Tatu City Case Study
| ENEO CASE STUDY ENEO AT TATU CITY Case Study: GREA development execution Nairobi, Kenya Property Description: Offices & retail GLA: 25,752 m² Completion Date: May 2024 Tenants: CCI Global, IWG, GRIT, Naivas Express, Tamarind, Prime Bank Local Job Creation c. 7,600 Value creation US$48.5m US$35.4m
Slide 32: Bora Africa Highlights
| SIMPLIFIED GROUP OPERATING STRUCTURE BORA AFRICA HIGHLIGHTS 100% owned now by in FY24. Well Positioned for development opportunities INVESTMENT GRADE African real estate partner to • Light Industrial • Logistics • ICT-related (including BPO, Data Centers & Digital Infrastructure) POSITIVE ENGAGEME
Slide 33: Low Risk, Sovereign Strategy
| SIMPLIFIED GROUP OPERATING STRUCTURE Low Risk, Sovereign Strategy Combined Assets & pipeline KEY BENEFITS FOR GRIT GROUP: • Portfolio Optimization o Extension of WALE o US$ income o Exposure to low-risk sovereign paper • Ability to capture development fees • Access to asset management fees • Scale
Slide 34: Summary of Results (31 December 2024)
| RESILIENT PROPERTY PERFORMANCE SUMMARY OF RESULTS (31 December 2024) Restated 6 Months ended 6 Months ended Increase/ Decrease 31 Dec 2024 31 Dec 2023 Property portfolio net operating income (proportionate8) US$35.1m US$31.1m +13.0% EPRA cost ratio (including associates) 2 14.2% 14.7% -0.5% Net fi
Slide 35: Portfolio Key Metrics - Sectoral
| PORTFOLIO OVERVIEW Portfolio Key Metrics - Sectoral (as at 31 December 2024) Corporate % ATTRIBUTABLE TO GRIT Office Retail Hospitality Light Industrial Data Centre Medical Total Accommodation Number of Properties/Investments 10 5 8 2 6 1 1 33 Grit attributed Asset Value (US$m) 262.78 238.14 209.8
Slide 36: Annexures
ANNEXURES 36
Slide 37: Grit Core Asset Portfolio
| GRIT CORE ASSET PORTFOLIO VDE Housing Estate Club Med Cap Skirring Value: US$ 44.0m Value: US$ 31.6m Commodity House Phase 1 Commodity House Phase 2 Value: US$ 57.4m Value: US$ 21.7m Vodacom Building Tullow Oil Value: US$ 41.3m Value: US$ 24.5m 37
Slide 38: Grit Core Asset Portfolio
| GRIT CORE ASSET PORTFOLIO Hollard Building Capital Place Value: US$ 21.8m Value: US$ 18.9m 5th Avenue Corporate Offices Anfaplace Mall Value: US$ 16.9m Value: US$ 64.6m Mukuba Mall Cosmopolitan Mall Value: US$ 62.4m Value: US$ 56.9m 38
Slide 39: Grit Core Asset Portfolio
| GRIT CORE ASSET PORTFOLIO Capital Place Kafubu Mall Mall de Tete Value: US$ 18.8m Value: US$ 13.2m Buffalo Mall Zimpeto Square Value: US$ 10.0m Value: US$ 3.4m 39
Slide 40: GREA Core Asset Portfolio
| GREA CORE ASSET PORTFOLIO (GRIT OWNS 53.3% OF GREA) Artemis Curepipe Hospital The Precinct Value: US$ 24.7m Value: US$ 34.0m Adumuah Place Metroplex Shopping Centre Value: US$ 2.7m Value: US$ 18.4m 40
Slide 41: DH Africa Asset Portfolio
| DH AFRICA ASSET PORTFOLIO Ethiopia-Elevation Acacia Estate Value: US$ 77.0m Value: US$ 70.6m Rosslyn Grove Value: US$ 59.7m 41
Slide 42: Bora Africa Asset Portfolio
| BORA AFRICA ASSET PORTFOLIO Africa Data Center Phase 1 Orbit Africa Value: US$ 28.6m Value: US$ 25.9m Imperial Distribution Centre Bollore Warehouse Value: US$ 17.0m Value: US$ 9.9m Eneo at Tatu Central Value: US$ 48.5m 42
Slide 43: Elevation
| GREA PROVEN TRACK-RECORD OF ACCRETIVE AFRICAN DEVELOPMENTS ELEVATION Addis Ababa, Ethiopia Property Description: Diplomatic Residential GLA: 15 201 m² No. of units 112 apartments No. of Parking Bays: 132 Parking Bays Valuation FY24: US$77.0m Completion Date: November 2021 Anchor Tenants: US Embass
Slide 44: Rosslyn Grove
| GREA PROVEN TRACK-RECORD OF ACCRETIVE AFRICAN DEVELOPMENTS ROSSYLN GROVE Nairobi, Kenya Property Description: Diplomatic Accommodation GLA: 16 038 m² No. of Parking Bays: 145 Parking Bays Valuation FY24: US$59.7m Start Date: October 2020 Completion Date: July 2022 Single Tenant: US Embassy Lease T
Slide 45: Africa Data Centre
| GREA PROVEN TRACK-RECORD OF ACCRETIVE AFRICAN DEVELOPMENTS AFRICA DATA CENTRE Lagos, Nigeria Property Description: Data Centre GLA: 994 m² No. of Parking Bays: 9 Parking Bays Valuation FY24: US$28.6m Start Date: March 2021 Completion Date: November 2021 Single Tenant: Africa Data Centres (100% Occ
Slide 46: Adumuah Place
| GREA PROVEN TRACK-RECORD OF ACCRETIVE AFRICAN DEVELOPMENTS ADUMUAH PLACE Accra, Ghana Property Description: Corporate Offices and Retail Space GLA: 2 125 m² Valuation FY24: US$2.7m No. of Parking Bays: 85 Open Parking Bays Completion Date: April 2022 Appolonia Development Company and C&J Anchor Te
Slide 47: The Precinct
| GREA PROVEN TRACK-RECORD OF ACCRETIVE AFRICAN DEVELOPMENTS THE PRECINCT Grand Baie, Mauritius Property Description: Office Site Area: 35 931 m² GLA: 9646 m² Valuation FY24: US$34.0m Start Date: June 2021 No. of Parking Bays: 257 Parking Bays Completion Date: February 2023 Grit, GREA, Dentons, Work
Slide 48: Artemis Curepipe Hospital
| GREA PROVEN TRACK-RECORD OF ACCRETIVE AFRICAN DEVELOPMENTS ARTEMIS CUREPIPE HOSPITAL Curepipe, Mauritius Property Description: Multi-speciality Hospital GLA: 5 460m² Valuation FY24: US$24.7m Start Date: June 2021 No. of Parking Bays: 85 Parking Bays Completion Date: February 2023 Single Tenant: Ar
Slide 49: ENEO at Tatu Central
| GREA PROVEN TRACK-RECORD OF ACCRETIVE AFRICAN DEVELOPMENTS ENEO AT TATU CENTRAL Nairobi, Kenya Mixed-use Development of Corporate Offices & Property Description: Retail Site Area: 9 197 m² GLA: 25 711 m² Start Date: June 2022 No. of Parking Bays: 539 Parking Bays Latest Valuation: US$48.5m Complet
Slide 50: Thank You
THANK YOU 50
Grit Real Estate Income Group — HY25 Earnings Presentation on 6ix