Bwp Trust · ASX:BWP
Bwp Trust — Bunnings Warehouse Property Trust — H1 FY2011 Earnings Presentation
24 slides from Bwp Trust's earnings presentation, Feb 10, 2011
Slide 1: Bunnings Warehouse Property Trust Half-year results 2010/11
For personal use only Bunnings Warehouse Property Trust Half-year results 2010/11 February 2011
Slide 2: Presentation outline
Presentation outline For personal use only • Overview Grant Gernhoefer • Results General Manager Bunnings Property Management Limited • Portfolio Andrew Ross • Capital management Portfolio Manager Bunnings Property Management • Outlook Limited • Governance www.bwptrust.com.au BUNNINGS WAREHOUSE PROP
Slide 3: Overview
Overview For personal use only BWP in good shape and looking for opportunities - BWP performs in line with the BWP unit price vs S&P/ASX 200 A-REIT index & All Ordinaries index benchmark S&P/ASX 200 A-REIT index for unit price and total returns for 12 months ended 31 Dec 10 (see charts - right and
Slide 4: Results – performance vs PCP
Results – performance vs PCP For personal use only Half-year 2011 Previous corresponding period Revenue $40.4 million 3.6% Net profit/(loss) including revaluations $54.2 million $41.1 million Distributable profit (excluding revaluations)1 $26.4 million 4.5% Half-year distribution2 6.18 cpu 1.3% Tota
Slide 5: Results – performance: monthly
Results – performance: 6 monthly For personal use only 6 months 6 months 6 months to Dec 10 to Jun 10 to Dec 09 Revenue $40.4m $39.5m $39.0m Net profit/(loss) including revaluations $54.2m $51.1m $41.1m Unrealised gain/(loss) in fair value of investment properties $28.2m $25.9m $15.9m Distributable
Slide 6: Results - distributions
Results - distributions For personal use only 14 12 10 6.72 6.56 6.39 6.17 4.87 5.98 5.87 cents per unit 8 5.35 4.86 4.97 4.68 6 4 6.22 6.42 6.55 6.70 6.18 5.79 6.10 5.15 5.51 4.70 4.50 4.80 2 0 1 2 3 4 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 Final DPU Interim DPU 1 BWP commenced
Slide 7: Portfolio – geographic spread
Portfolio – geographic spread For personal use only 54 Bunnings Warehouses 1 Bunnings distribution centre 1 Bunnings Warehouse development site 3 Industrial properties 9 2 Bulky goods showrooms* 1 * showrooms at Bayswater are on the same site as the Bayswater BWH 10 2 1 1 BWP rental
Slide 8: Portfolio - WALE
Portfolio - WALE For personal use only 8.9 year weighted average lease expiry (by rental income) Typical Bunnings Warehouse Property Trust lease features: – 15 years (plus 2 x 5 year options) – 5 yearly market rent reviews (majority uncapped) – annual CPI escalation – Wesfarmers covenant (BBB+ credi
Slide 9: Portfolio – FY11 market rent reviews
Portfolio – FY11 market rent reviews For personal use only Passing Reviewed Uplift Uplift Effective Property location rent ($’000) rent ($’000) ($’000) (%) date Mile End, SA1 1,411 1,8452 434 +30.8 22 Mar 10 Morley, WA 1,016 1,1683 152 +15.0 3 Jul 10 Vermont South, VIC 1,959 1,9593 - - 15 Aug 10 Nor
Slide 10: Portfolio - revaluations
Portfolio - revaluations For personal use only Stable cap rates - Consistent sales evidence (refer Appendix A for details): 2009/10 – 14 sales average yield 7.69%, WALE 9.7 years - 12% of BWP portfolio independently valued in December 2010 - Independent valuations adopted same cap rates as at 30 J
Slide 11: Portfolio – future revaluations and reviews
Portfolio – future revaluations and reviews For personal use only Future Bunnings Warehouse market rent reviews and portfolio property valuations FY11 FY12 FY13 FY14 FY15 BWH rent reviews 4 7 8 20 12 % of total1 7% 13% 15% 37% 22% Portfolio revaluations 16 24 19 16 24 % of total2 28% 45% 27% 28% 45%
Slide 12: Portfolio - acquisition
Portfolio - acquisition For personal use only Port Melbourne, Victoria ($24.0m purchase price, plus $1.4m acquisition costs) - 2.5 kilometres south-west of Melbourne CBD - 3.0ha site, 13,846m2 total retail area - lease commencement 17 March 2008 - 12 years + 4x5 year options - annual rent $1.65m -
Slide 13: Portfolio – developments completed
Portfolio – developments completed For personal use only Broadmeadows, Victoria ($5.9m) - 3,824m2 expansion of the fully-enclosed covered area of the Bunnings Warehouse completed in December 2010 - incremental annual rent $0.47m - new 10 year lease with one 10 year option - annual CPI escalation -
Slide 14: Portfolio – developments committed
Portfolio – developments committed For personal use only Fyshwick, ACT ($15.0m) Rocklea, Qld ($3.8m) - estimated completion June 2012 - estimated completion October 2011 - redevelopment and expansion of - expansion of main trade area, existing Bunnings Warehouse onto timber drive through and new
Slide 15: Capital management – debt facilities
Capital management – debt facilities For personal use only As at 31 Dec 10 Limit ($m) Drawn ($m)1 Expiry ANZ 100 48.9 31 Jul 2013 CBA 100 49.9 14 Jan 2012 WBC 80 45.5 2 Nov 2013 NAB 50 50.0 Evergreen2 330 194.3 1 amount drawn includes accrued interest of $0.7 million as at 31 December 2010 2 facilit
Slide 16: Capital management
Capital management For personal use only Balance sheet strength supported by: - low gearing - 18.0% at 31 Dec 10 (18.0% covenant gearing) - strong lease covenant in Bunnings/Wesfarmers - solid rental base with growth from CPI and programmed rent reviews - low level of committed capex Maintaining
Slide 17: Capital management – interest rate hedging
Capital management – interest rate hedging For personal use only $192.0m hedged (99%) at 5.86% weighted average 3.37 years weighted average maturity, including delayed starts (2009: 3.03 years) Hedge book profile by half-year ending: Dec 10 Jun 11 Dec 11 Jun 12 Dec 12 Jun 13 Dec 13 Active swaps
Slide 18: Capital management – borrowing costs
Capital management – borrowing costs For personal use only Net borrowing costs for half-year (incl. fees and margins): - $9.2m (up 0.7% on Dec 09) - average borrowings $194.3m (p.c.p. $200.9m) - 9.4% of borrowings after hedging (Dec 09: 9.0%) Effective rate of borrowings (9.4%) impacted by: - fu
Slide 19: Outlook
Outlook For personal use only Positive signs for growth: Existing portfolio - CPI/fixed rent reviews for 24 leases in 2H FY11 - tenant driven upgrades (Rocklea $3.8m, Fyshwick $15.0m) Acquisitions - some quality assets available - yields stabilising - BWP remains focussed on quality Funding -
Slide 20: Governance - structure
Governance - structure For personal use only Responsible Entity: Bunnings Property Management Limited Subsidiary of Wesfarmers Limited but…majority external directors John Austin (Chairman): Leighton Properties (Chairman), MREEF, Ringmer Pacific (NED), Peter Mansell: Ampella Mining (Chairman)
Slide 21: Further information
Further information For personal use only Visit: www.bwptrust.com.au Responsible entity: Bunnings Property Management Limited Tel: (08) 9327 4356 Email: ggernhoefer@bwptrust.com.au The information provided in this presentation should be considered together with the financial statements for the perio
Slide 22: Appendix A: Sales evidence
Appendix A: Sales evidence For personal use only Bunnings Warehouse Sale price $m Yield % Date Rothwell QLD 16.70 7.93 Mar 09 Nerang QLD 16.35 7.60 Jun 09 Campbelltown NSW 21.35 7.66 Jun 09 Nowra NSW 11.60 7.75 Jun 09 Rockdale1 NSW 25.35 8.15 Dec 09 Mill Park VIC 16.45 7.75 Apr 09 Box Hill VIC 21.50
Slide 23: Appendix B: Valuations
Appendix B: Valuations For personal use only Process – entire portfolio revalued every 6 months – independent valuations on a 3 year cycle for each property – balance of portfolio – directors’ valuation using recognised valuation methodology – directors’ valuations methodology reviewed by an indep
Slide 24: Appendix C: Market rent reviews
Appendix C: Market rent reviews For personal use only Typical Bunnings Warehouse market rent review clause – assumes free and open market with vacant possession (a percentage with caps and collars) – has regard to the rent paid by Bunnings at other Bunnings Warehouses – has regard to the rental va
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