Centuria Capital Group · ASX:CNI
Centuria Capital — Centuria Metropolitan REIT — H1 2016 Earnings Presentation
21 slides from Centuria Capital's earnings presentation, Feb 9, 2016
Slide 1: Centuria Metropolitan REIT 1H16 Interim Results
Centuria Metropolitan REIT 1H16 Interim Results 60 Marcus Clarke Street, Canberra, ACT 9 FEBRUARY 2016 CENTURIA METROPOLITAN REIT | CMA:ASX | 1H16 INTERIM RESULTS | PAGE 1
Slide 2: Half Year Highlights
1H16 Half Year Highlights CMA continued to deliver on its strategy: ˃ Forecast distributions of 4.25 cents per stapled security paid quarterly in line with guidance ˃ Secured 26 leasing transactions across 8,766 sqm1 (approximately 7.8% of total portfolio NLA) ˃ Portfolio occupancy increased to 97.3
Slide 3: Half Year Highlights continued
1H16 Half Year Highlights continued ˃ Maintained a disciplined capital structure ˃ Gearing at 32 per cent within the Fund’s 25-35 per cent target range ˃ Significant headroom on all debt covenants with no debt maturities until December 2019 ˃ Acquired 203 Pacific Highway St Leonards, a high quality
Slide 4: Financial Overview
1H16 Financial Overview Financial snapshot Statutory profit/(loss) ($m) 19.3 Distributable earnings1 ($m) 10.9 Distributable earnings per security (cents) 9.1 Annualised distributable earnings yield2 (%) 9.2 Distribution ($m) 10.1 Distribution per stapled security (cents) 8.5 Annualised distribution
Slide 5: NTA movement
1H16 NTA movement ˃ 8 cents (4.1%) increase in NTA per stapled security over 1H16 mostly driven by revaluation increase Movements in NTA Per Stapled Security $2.10 0.12 $0.11 $0.001 0.10 $2.05 ($0.01) $2.05 0.08 $2.00 0.06 $1.95 $1.97 ($0.02) 0.04 $1.90 0.02 $1.85 0.00 $1.80 -0.02 $1.75 -0.04 1 FY15
Slide 6: Portfolio Metrics
1H16 Portfolio Metrics Geographic diversification (by value) Asset type diversification (by value) Portfolio snapshot Number of assets (#) 13 16% 12% Book value ($m) 379.2 17% 43% WACR (%) 8.15 Occupancy1,2 (%) 97.3 FY16 expiries3 (%) 8.6 28% 84% WALE1,2 (years) 4.8 NSW QLD ACT SA Office Industrial
Slide 7: Portfolio Metrics
1H16 Portfolio Metrics ˃ Occupancy of 97.3 per cent1,2 ˃ Improved expiry profile since 30 June 2015 whilst maintaining a WALE of 4.8 years1,2 ˃ Approximately 76 per cent of rental revenue derived from ASX listed, multinational, national and government tenants Weighted Average Lease Expiry1,2 Tenant
Slide 8: Significant Leasing Success
1H16 Significant Leasing Success ˃ 26 lease transactions across 8,766 sqm1 (approximately 7.8% of total portfolio NLA) ˃ 15 new leases across 5,409 sqm (including 10 new leases across 3,913 sqm of previously vacant space) ˃ 11 renewals across 3,357 sqm ˃ Significant leasing success achieved in Canbe
Slide 9: Capital Transactions
1H16 Capital Transactions ˃ 203 Pacific Highway, St Leonards was acquired for $43.0 million1 in partnership with Centuria unlisted funds ˃ Independent valuation at acquisition of $43.5 million ˃ Positive acquisition opportunity for CMA leveraging the Centuria business platform ˃ 11 storey A grade as
Slide 10: Valuations
1H16 Valuations ˃ Two assets have been independently valued at 31 December 2015 ˃ 9 Help Street Chatswood ˃ Continued leasing success and ongoing transactional appetite for quality North Shore assets has resulted in an uplift in value of $3.5 million (7.2 per cent) to $52.0 million ˃ 3 Carlingford R
Slide 11: Capital Management
1H16 Capital Management ˃ Conservative gearing maintained at 32 per cent Key debt metrics ˃ within the target range of 25-35 per cent Facility limit ($m) 140.0 ˃ Long dated and staggered debt maturity profile with 65% of Drawn amount ($m) 128.3 total debt hedged Undrawn capacity ($m) 11.7 ˃ Interest
Slide 12: Outlook
1H16 Outlook ˃ CMA is well positioned to deliver on its promise to securityholders despite global uncertainty and equity market volatility ˃ Attractive financial profile with contracted rental growth ˃ Conservative capital structure ˃ Potential for capital growth over time ˃ Tenant demand in metropo
Slide 13: Strategy
1H16 Strategy ˃ CMA’s strategy and ongoing focus remains unchanged > Acquire quality ‘fit for purpose’ metropolitan real estate assets delivering a stable and secure income stream > Execute initiatives to generate income and value uplift through active asset management, risk mitigation and repositio
Slide 14: Guidance Unchanged
1H16 Guidance Unchanged ˃ FY16 distributable earnings1 guidance of 17.9 cents per stapled security reaffirmed ˃ FY16 distribution guidance of 17.0 cents per stapled security delivered in equal quarterly payments > Distribution yield of 8.5 per cent2 > Currently trading at 2.9 per cent discount2 to $
Slide 15: Closing
1H16 Closing ˃ CMA’s portfolio is in a stronger position today than when the Fund listed in December 2014 ˃ Portfolio occupancy has increased ˃ Portfolio valuation has increased ˃ WALE has improved ˃ CMA is meeting its forecasts and delivering on its strategy ˃ CMA generates a distribution yield of
Slide 16: Appendices
Appendices 9 FEBRUARY 2016 CENTURIA METROPOLITAN REIT | CMA:ASX | 1H16 INTERIM RESULTS | PAGE 16
Slide 17: Appendix A – Income Statement
1H16 Appendix A – Income Statement $m 31-Dec-15 Revenue Gross property income 16.9 Straight lining of rental income (1) 0.8 Interest income 0.0 Total revenue 17.7 Expenses Direct property expenses (3.6) Responsible entity fees (0.9) Finance costs (1.8) Management and other administrative expenses (0
Slide 18: Appendix B – Distribution Statement
1H16 Appendix B – Distribution Statement $m 31-Dec-15 Statutory net profit 19.3 Straight lining of rental income (1) (0.8) Investment properties revaluation gain / (loss) (9.3) Loss on fair value of derivatives financial instrument 0.9 Lease incentives funded by vendors on property acquisitions 0.7
Slide 19: Appendix C – Balance Sheet
1H16 Appendix C – Balance Sheet $m 31-Dec-15 Cash 5.7 Investment properties 379.2 Other assets 0.8 Total assets 385.7 Interest bearing liabilities 127.3 Derivative financial instruments 1.6 Other liabilities 11.9 Total liabilities 140.8 Net assets 244.8 Stapled securities on issue (millions) 119.4 N
Slide 20: Appendix D – Investment Portfolio
1H16 Appendix D – Investment Portfolio State Dec 15 Valuation NLA (sqm) WALE1 (years) Occupancy1 Office 9 Help Street, Chatswood NSW 52.0 9,401 2.5 93.8% 203 Pacific Highway, St Leonards2 NSW 43.5 11,737 4.9 100.0% 3 Carlingford Road, Epping NSW 25.0 4,702 2.9 96.8% 44 Hampden Road, Artarmon NSW 8.0
Slide 21: Disclaimer
Disclaimer 9 FEBRUARY 2016 CENTURIA METROPOLITAN REIT | CMA:ASX | 1H16 INTERIM RESULTS | PAGE 21
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