Centuria Capital Group · ASX:CNI
Centuria Capital — HY23 Earnings Presentation
42 slides from Centuria Capital's earnings presentation, Feb 7, 2023
Slide 1: HY23 Results
07 FEBRUARY 2023 ASX: CNI UNLISTED: ALLENDALE SQUARE, PERTH WA LISTED: 56-88 LISBON STREET, FAIRFIELD NSW Centuria Capital Group HY23 RESULTS UNLISTED: ANGLESEA MEDICAL CENTRE, HAMILTON NZ UNLISTED: WEST VILLAGE PRECINCT, WEST END QLD UNLISTED: MELVILLE LFR CENTRE, MELVILLE WA UNLISTED: FLAVORITE GL
Slide 2: Agenda
ACKNOWLEDGEMENT OF COUNTRY Our group manages property throughout Australia and New Zealand. Accordingly, Centuria pays its respects to the traditional owners of the land in each country, to their unique cultures and to their elders past, present and emerging. AGENDA 1. Group overview 2. Financial re
Slide 3: Group overview
Group overview SECTION ONE VARSITY LAKES DAY HOSPITAL, VARSITY LAKES QLD
Slide 4: Centuria Capital Group: A leading Australasian ASX funds manager
Centuria Capital Group: A leading Australasian ASX 200 funds manager $21.2bn GROUP AUM1,2 $20.4bn REAL ESTATE AUM $6.5bn $13.9bn $0.8bn LISTED REAL ESTATE UNLISTED REAL ESTATE INVESTMENT BONDS $3.9bn $2.4bn $0.2bn $8.5bn $2.8bn $2.6bn CENTURIA LIFE CENTURIA CENTURIA ASSET PLUS SINGLE MULTI ASSET MUL
Slide 5: Delivering growth and creating value
Delivering growth and creating value Disciplined execution of strategy $21.2bn 7.4cps 5.8cps 91% Group AUM HY23 OEPS1 delivered HY23 DPS delivered Recurring revenues +5.4% increase above HY22 DPS of HY23 total group revenues $1.0bn $1.7bn 14.5cps 11.6cps HY23 gross Development FY23 OEPS FY23 DPS gui
Slide 6: Unlisted real estate momentum lifts Group AUM to $21.2bn
Unlisted real estate momentum lifts Group AUM to $21.2bn Weighting to unlisted real estate (including alternatives) – generates resilient earnings AUM & organic real estate activity Group AUM reaches Real estate AUM Unlisted AUM Gross real estate a new peak of grows to increases to activity $21.2bn
Slide 7: Developing a flexible and relevant sustainability framework
Developing a flexible and relevant sustainability framework Conscious of climate change (environment), valued stakeholders (social) and responsible business principles (governance) Select HY23 Initiatives Released 2022 Sustainability Report COF and CIP developments target minimum 5 star Green Star r
Slide 8: Financial results
Financial results SECTION TWO UNLISTED: MENTAL HEALTH CLINIC, WEST PERTH WA
Slide 9: Operating earnings and distributions
Operating earnings and distributions Operating NPAT1 Statutory NPAT3 Earnings and distributions $58.5m $74.3m (cents per security) OEPS2 Statutory EPS3 7.4cps 9.3cps 14.50 14.50 HY23 12.70 performance 12.00 12.00 DPS 5.8cps +5.4% increase above HY22 DPS OEPS 11.60 11.00 14.5cps 9.25 9.70 10.00 FY23
Slide 10: Resilient platform supporting profitability
Resilient platform supporting profitability HY23 HY22 Higher property funds management fees from a OPERATING PROFIT BY SEGMENT 1 record period of property transactions in FY22, ($m) ($m) offsetting lower transaction fees in HY23 1 Property funds management1 40.4 40.1 2 HY23 Performance fees in line
Slide 11: Transaction fee income from $1.7bn of total transaction activity
Transaction fee income from $1.7bn of total transaction activity $1.0bn of HY23 gross real estate activity $1.0bn of HY23 gross real estate activity2 Transaction fee income1 from $1.7bn Real Estate $349m of total transaction activity Finance 19 real estate finance loans $369m Acquisitions exchanged
Slide 12: Balance sheet positioned to capitalise on future growth opportunities
Balance sheet positioned to capitalise on future growth opportunities Increased funding optionality, access to new debt instruments, ample headroom to debt covenants HY23 FY22 OPERATING BALANCE SHEET ($m) ($m) 17.3% Assets $1.79 Operating gearing ratio3 (FY22: 13.2%) Cash and cash equivalents Receiv
Slide 13: Managing debt across the platform
Managing debt across the platform1 21 $8.2bn Total lending facilities Quality lenders across Australasian platform 2.4yrs 1.9yrs Weighted average debt Weighted average duration hedge duration 48% Weighted average hedging profile LISTED: 6-8 MUNROE LANE, ALBANY, AUCKLAND NZ 1. Not representative of a
Slide 14: Divisional overview
Divisional overview SECTION THREE UNLISTED: FLAVORITE GLASSHOUSE, WARRAGUL VIC
Slide 15: Continued growth across diversified portfolio
Continued growth across diversified portfolio $20.4bn real estate platform1,2 Daily needs Large format Real estate Office Industrial Healthcare Agriculture retail (“DNR”) retail (“LFR”) finance $7.51bn $6.06bn $1.78bn $1.72bn $1.58bn $1.12bn $0.42bn AUM AUM AUM AUM AUM AUM AUM (FY22: $7.37bn) (FY22:
Slide 16: Diversifying fund and capital allocation across Centuria's platform
Diversifying fund and capital allocation across Centuria’s platform DAILY LARGE REAL • Diversified fund SECTOR OFFICE INDUSTRIAL NEEDS HEALTHCARE FORMAT ESTATE AGRICULTURE structures and capital RETAIL RETAIL FINANCE sources across all FUND TYPE / AUM sectors CAPITAL $7.5 $6.1 $1.8 $1.7 $1.6 $1.1 $0
Slide 17: High quality long-term income streams
High quality long-term income streams Integrated management capabilities lead to strong asset management success Top tenants by income (%)1,2 6.3 year weighted avg. lease expiry (WALE) by income1,2 ~425 15.0 assets1,2 Government 12.7% 12.5 ~2,550 Woolworths Limited 2.9% ASX/NZX Listed tenants1,2 7.5
Slide 18: $1.7bn development pipeline to seed funds
$1.7bn development pipeline to seed funds $0.2bn $1.7bn pipeline1 Development fees and CNI strategically uses its HY23 development Est. value on completion profits provide growing balance sheet to seed and completions Committed: $1.0bn2 income expand its property funds Future: 0.7bn3 ($73.9m4 carryi
Slide 19: Unlisted property: AUM grows to $13.9bn
Unlisted property: AUM grows to $13.9bn (+7% above FY22) SECTORS 0.3 0.2 0.4 0.4 ~12,000 $1.0bn $0.4bn 0.8 1.1 Office Industrial HY23 gross 1.6 4.7 1.6 5.0 Healthcare Australasian investors real estate activity1 HY23 unlisted capital FY22 HY23 Daily needs retail raising inflows $13.0bn $13.9bn Large
Slide 20: Generating new direct unlisted investment opportunities
Generating new direct unlisted investment opportunities Demand for alternative sectors and real estate finance Strong support from Centuria’s direct unlisted Centuria unlisted funds represented on all major investors, advisers and domestic bank private investment platforms used by financial advisers
Slide 21: Listed property: $6.5bn of AUM
Listed property: $6.5bn of AUM Strong leasing activity across Centuria’s listed industrial and office portfolios ASX: Australia’s largest pure-play ASX: COF Australia’s largest pure-play CIP CENTURIA industrial REIT CENTURIA office REIT INDUSTRIAL REIT OFFICE REIT STUDLEY COURT, DERRIMUT VIC 818 BOU
Slide 22: Institutional AUM growth to $2.1bn
Institutional AUM growth to $2.1bn Unlisted mandates and partnerships support new investment opportunities $2.1bn Office Healthcare Industrial Daily needs retail $1.9bn $1.7bn 0.5 WESTSIDE PRIVATE HOSPITAL, ADENEY PRIVATE HOSPITAL, TARINGA QLD KEW VIC HY23 AUM 0.2 $2.1bn1 1.2 0.2 95-105 SOUTH GIPPSL
Slide 23: Agriculture: Diversification into a compelling sector
Agriculture: Diversification into a compelling sector Agriculture AUM $650-$700m by FY23 year end Centuria Agriculture AUM Highlights and opportunities $0.65-$0.7bn HY23 Group agriculture AUM exceeds $0.4bn $0.4bn AUM $0.42bn Finalising negotiations on further $0.35bn glasshouse assets on long term
Slide 24: Centuria Bass Credit AUM exceeds $1.1bn
Centuria Bass Credit AUM exceeds $1.1bn Leveraging Centuria’s multi-sector real estate expertise and distribution channels Centuria Bass Credit AUM Highlights and opportunities $1.1bn Strong AUM growth to over $1.1bn $1.1bn $0.8bn Real Estate Finance ~$350m of HY23 real estate finance AUM activity a
Slide 25: Healthcare: Growing in a competitive sector
Healthcare: Growing in a competitive sector $1.7bn high quality Australasian healthcare platform Centuria Healthcare AUM Highlights and opportunities $1.7bn $1.7bn $1.7bn of group healthcare AUM1 $1.7bn Open-ended CHPF AUM of $0.6bn1, healthy Healthcare AUM1 $1.1bn investor demand, $27m raised in la
Slide 26: Strategy
Strategy SECTION FOUR CENTURIA BASS UNLISTED: ONE RICHARDSON, SOUTH PERTH WA (ARTIST IMPRESION)
Slide 27: Strategy
Strategy Adapt to market changes by unlocking fresh, new products to investors A resourceful, well-performing specialist Australasian fund Grow alternative sectors e.g. agriculture, healthcare, credit where we can expand platform meaningfully manager Vision Maintain growth momentum in both our direc
Slide 28: Appendices
Appendices SECTION FIVE UNLISTED: LAMATTINA FARM, MORNINGTON PENINSULA VIC
Slide 29: Centuria Capital Group
Centuria Capital Group A leading Australasian real estate funds manager Integrated Active Generating platform management investment opportunities Geography Sectors Fund types Capital Integrated in-house Balance Platform sources capability sheet support Listed Funds Asset Australia Office Listed Cash
Slide 30: AUM momentum from organic growth and select mergers
AUM momentum from organic growth and select mergers $21.2bn Assets under $20.6bn management $17.4bn $8.8bn Unlisted real estate $6.2bn 13.0 13.9 11.0 $4.9bn 4.0 38% 1.9 2.6 4.0 5.5 6.8 6.5 Listed real estate CAGR1 2.1 2.7 Investment bonds 0.9 0.9 0.8 0.9 0.8 0.8 FY18 FY18 FY19 FY20 FY21 FY22 HY23 Pr
Slide 31: Group AUM movement
Group AUM movement1 ($bn) Note: Assets under management (AUM) as at as at 31 December 2022. All figures above are in Australian dollars (currency exchange ratio of AU$1.000:NZ$1.0711 as at 31 December 2022). Numbers presented UNLISTED: WOOLWORTHS, MELBOURNE SQUARE, MELBOURNE VIC may not add up preci
Slide 32: A $20.4bn leading Australasian real estate platform
A $20.4bn leading Australasian real estate platform1 WA 22% 88 properties valued at $4,303m NSW 23% 111 properties valued at $4,574m NT VIC 18% 79 properties valued at $3,535m QLD WA QLD 18% 101 properties valued at $3,484m SA SA 5% 26 properties valued at $913m NSW ACT 2% ACT 5 properties valued at
Slide 33: $20.4bn real estate platform
$20.4bn1 real estate platform Diverse geographies, sectors, fund types capital sources Geography1 Sectors 0.4 0.2 0.4 0.2 0.8 Office 1.1 Industrial 2.5 2.5 1.6 1.6 Healthcare Australia Daily needs retail 1.7 7.3 7.5 New Zealand FY22 1.7 HY23 FY22 HY23 Large format retail $19.8bn $20.4bn $19.8bn $20.
Slide 34: CIP: Australia's largest pure play industrial REIT
COF: Australia’s largest pure CIP: Australia’s largest APL: Targeting long term play office REIT domestic pure play industrial total returns REIT • Delivered HY23 FFO of 8.1 cents per unit • Delivered HY23 FFO of 8.5 cents per unit • Delivered HY23 Distributions of 7.05 cents per unit • Delivered HY
Slide 35: $1.7bn development pipeline to seed funds
$1.7bn development pipeline to seed funds HY23 COMMITTED PIPELINE FUTURE PIPELINE TOTAL SECTOR COMPLETIONS (est. value on completion)2 (est. value on completion)2,3,4 PIPELINE $M GLA $M GLA $M GLA $M GLA • Development fees Office 27 4,500 179 21,100 - - 179 21,100 and profits provide Industrial 149
Slide 36: Centuria LifeGoals
Centuria LifeGoals FLOWS HY23 HY23 ASSETS UNDER HY23 FY22 $0.8bn MANAGEMENT ($m) ($m) CHANGE (%) APPLICATIONS REDEMPTIONS ($M) ($M) AUM Prepaid funeral plans (Guardian)2 542.8 536.6 1.18% 14.0 -21.5 Unitised bonds (Centuria Life) 226.6 230.7 -1.78% 2.1 -10.1 Centuria LifeGoals 43.1 39.6 8.84% 4.0 -1
Slide 37: Reconciliation of statutory profit to operating profit
Reconciliation of statutory profit to operating profit HY23 ($m) HY22 ($m) Statutory net (loss)/profit after tax 74.3 112.7 Statutory EPS (cents)1 9.3 13.8 ADJUSTED FOR NON-OPERATING ITEMS (Gain) on fair value movements in derivatives and investments (23.7) (47.8) Transaction and other costs 1.7 0.9
Slide 38: Diverse recurring revenues contribute to Group profits
Diverse recurring revenues contribute to Group profits HY23 recurring revenues of 91% Group revenues ($m) 180 91% Recurring revenues3 160 87% Performance fees Recurring revenues2 $14.6m 140 Other income Distribution income HY23 recognised performance fees1 120 Development management fees 100 Develop
Slide 39: Co-investments reconciliation
Co-investments reconciliation CARRYING CARRYING Strong alignment to Centuria’s VALUE DISTRIBUTION VALUE DISTRIBUTION 31 DEC 22 INCOME HY23 31 DEC 21 INCOME HY22 listed REITs CO-INVESTMENTS FUND TYPE ($M) ($M) ($M) ($M) CNI is the largest unitholder of Centuria Industrial REIT (ASX: CIP)1 Listed 315.
Slide 40: Definitions
Definitions Operating Segments: Group has six reportable comprises transaction costs, mark-to-market movements CNI, CCG or the Group: Centuria Capital Group operating segments. These reportable operating on property and derivative financial instruments, and all comprises of Centuria Capital Limited
Slide 41: Disclaimer
Disclaimer This presentation has been prepared by Centuria Capital Limited and Centuria Funds Management Limited as responsible entity of Centuria Capital Fund (together the stapled listed entity CNI). Centuria Property Funds Limited (ABN 11 086 553 639, AFSL 231 149) ('CPFL') and Centuria Property
Slide 42: Australia
AUSTRALIA Sydney Head Office Melbourne Office (02) 8923 8923 (03) 9616 6500 Level 41, Chifley Tower Level 47 2 Chifley Square 101 Collins Street Sydney NSW 2000 Melbourne VIC 3000 Brisbane Office Perth Office (07) 3905 7000 (08) 9321 7133 Level 2 Level 27, 348 Edward Street 140 St Georges Terrace Br