Gpt Group · ASX:GPT
Gpt — The GPT Group — FY2015 Earnings Presentation
28 slides from Gpt's earnings presentation, Feb 18, 2016
Slide 1: GPT Annual Result February 2016
GPT Annual Result 0 18 February For personal use only 2016
Slide 2: Agenda
Agenda 1 For personal use only Section Speaker Page Group Strategy Bob Johnston 2 2015 Annual Result Highlights Bob Johnston 7 Financial Summary & Capital Management Anastasia Clarke 8 Retail Vanessa Orth 11 Office & Logistics Matthew Faddy 17 Funds Management Nicholas Harris 25 Summary & Outlook Bo
Slide 3: Group Strategy: Focus on core property sectors
Group Strategy Focus on core property sectors 2 For personal use only 1 Build on strong market position and high quality portfolio • Maintain investment focus on Retail, Office and Logistics sectors • Leverage expertise and scale to grow market position in each core sector • Targeting a Group Total
Slide 4: Group Strategy: Development pipeline
Group Strategy Development pipeline 3 For personal use only 2 Maximise value of development pipeline opportunities • Development pipeline of $3 - 4 billion underpins growth of core portfolio • Significant rezoning and mixed use outcomes inherent in the portfolio • Continue to build the logistics pla
Slide 5: Group Strategy: Funds management platform
Group Strategy Funds management platform 4 For personal use only 3 Consolidate our position as a leading fund manager • Renew GWOF and GWSCF fund management terms • Focus on performance, and position for growth in the medium term • Sell non-core assets ($280 million identified in GWOF) GPT Total Ret
Slide 6: Group Strategy: Financial and business management
Group Strategy Financial and business management 5 For personal use only 4 Maintain strong capital position and efficient operating model • Target gearing 25-35% • Maintain “A” credit ratings • Review of corporate overhead commenced Sources of Drawn Debt Management Expense Ratio CPI Bonds 0.66% 3% 0
Slide 7: Group Strategy: Summary
Group Strategy Summary 6 For personal use only • Retain focus on 3 core sectors Investment • Drive organic growth through asset management Portfolio • Target a Group Total Return of greater than 8.5% p.a. • Measured increase in exposure Development • Internal pipeline of $3 - 4 billion of investment
Slide 8: 2015 Annual Result Highlights
2015 Annual Result Highlights Strong business platform delivers solid results 7 For personal use only Delivering results from core business Investment Portfolio Performance 5.5% 11.5% 10.9% 3.8% FFO1 per security Total Return Total Portfolio Return Portfolio like for like growth (unlevered return) i
Slide 9: 2015 Annual Result Summary: Financial summary
2015 Annual Result Summary Financial summary 8 For personal use only 12 months to 31 December ($m) 2015 2014 Change (%) Net Profit After Tax 868.1 645.3 34.5% Less: Valuation increases1 (432.1) (249.5) Less: Distribution on exchangeable securities (1.7) (25.0) Add: Treasury items marked to market 74
Slide 10: 2015 Annual Result Highlights: Segment result
2015 Annual Result Highlights Segment result 9 12 months to 31 December ($m) 2015 2014 Change (%) For personal use only Retail NOI 251.7 248.7 Comparable growth +3.0% Office NOI 153.8 141.8 Comparable growth +6.3% Logistics NOI 91.4 85.9 Comparable growth +0.7% GPT share of Fund FFO 98.2 87.1 Invest
Slide 11: Capital Management: Strong capital position
Capital Management Strong capital position 10 For personal use only 31 Dec 2015 31 Dec 2014 Change Net tangible assets per security $4.17 $3.94 5.8% Total borrowings $2,948m $2,718m 8.5% Gearing (net debt to total tangible assets) 26.3% 26.3% - Look through gearing (net debt to total tangible assets
Slide 12: Retail Portfolio: 2015 highlights
Retail Portfolio 2015 highlights – High quality portfolio delivering strong results 11 For personal use only Portfolio Commentary 3.0% like for like income growth • 8.9% Total Portfolio Return for the 12 month period • Solid like for like income growth 6.5% • Strong retail sales specialty sales MAT
Slide 13: Retail: Cap rate compression contributing to valuation uplift
Retail Cap rate compression contributing to a valuation uplift of $133.7m 12 For personal use only • Strong cap rate compression of 29bps across the portfolio Valuation Uplift Property 2015 $m % Melbourne Central $64.8 6.1% Rouse Hill Town Centre $38.5 7.7% Westfield Penrith (50%) $22.8 4.0% Highpoi
Slide 14: Retail: Specialty sales up 6.5%
Retail Specialty sales up 6.5% in the year to December 2015 13 For personal use only Monthly Specialty Sales Growth1,2 Moving Annual Change in Retail Sales by Category1 6 monthly = 7.3% 6 monthly = 5.8% Quarterly = 5.4% 23.0% 9.3% 9.3% Specialty breakdown 7.8% 8.0% 7.3% 6.9% 6.3% 6.0% 14.8% 5.4% 13.
Slide 15: Retail: Strong sales growth underpinning positive leasing results
Retail Strong sales growth underpinning positive leasing results 14 For personal use only Portfolio Highlights Highpoint Delivery of Level 1 Asian Dining and Entertainment Precinct opened July 15 Charlestown Square Delivery of an International Mini Major precinct, due to open September 16 Melbourne
Slide 16: Retail: Digital initiatives informing portfolio and tenant strategies
Retail Digital initiatives informing portfolio and tenant strategies 15 For personal use only Using digital technology and data… MARKET SHARE GAIN AND RETURN ON INVESTMENT SHOPPER INSIGHTS ASSET RESPONSE DATA SOURCES DATA ANALYSIS …to drive market share and investment returns
Slide 17: Retail: Evolving retail mix as part of development pipeline
Retail Evolving retail mix as part of the retail development pipeline 16 For personal use only Forecast GPT’s GWSCF’s Property Development Opportunity Total Cost Share Share GPT Assets Casuarina Square $34m $17m $17m Leisure and Entertainment Rouse Hill Town Centre $300m $300m - Dept. Store, special
Slide 18: Office Portfolio: 2015 highlights
Office Portfolio 2015 highlights – Portfolio delivering strong results 17 For personal use only Portfolio Commentary 6.3% like for like income growth • 12.8% Total Portfolio Return with all assets recording positive revaluations • Occupancy increased by 4.6% to 96.0% 133,925 sqm • Portfolio cap rate
Slide 19: Office: Leasing success resulting in high occupancy
Office Leasing success resulting in high occupancy 18 For personal use only • 133,925 sqm of leases signed, and 39,670 sqm of deals at Heads of Agreement stage − Average incentive of 28% (19% including effective deals) • Space requirements led by Property and Business Services and Information and Te
Slide 20: Office: Leasing and cap rate compression driving 12.8% Total Portfolio Return
Office Leasing and cap rate compression driving 12.8% Total Portfolio Return 19 For personal use only • Cap rate compression, market rental growth and a reduction in downtime from forward solving expiries has resulted in $212.7 million of revaluations for the period. Valuation Uplift 2015 Property $
Slide 21: Office: Actively resolving future expiries
Office Actively resolving future expiries 20 For personal use only Lease Expiry Profile by Income 17.2% Expiry as at Dec-14 Expiry as at Dec-15 13.2% 8.8% 9.6% 9.4% 9.9% 8.3% 7.2% 8.3% 4.9% 2016 2017 2018 2019 2020 MCT: MCT: MCT: 750 Collins*: CBW: DHS ACCC Allianz AMP IAG 5,870 sqm 7,560 sqm 7,260
Slide 22: Logistics Portfolio: 2015 highlights
Logistics Portfolio 2015 highlights – Portfolio well positioned 21 For personal use only Portfolio Commentary 0.7% like for like income growth • 13.7% Total Portfolio Return for 12 month period • High portfolio WALE of 8.2 years due to significant leasing and new investment product completed during
Slide 23: Logistics: 13.7% Total Portfolio Return
Logistics 13.7% Total Portfolio Return 22 For personal use only Revaluations of $99.5m1 driven by cap rate compression, leasing and sales DEVELOPMENT INVESTMENT ASSET SALES PORTFOLIO $20.3 million $45.3 million $33.9 million Development Enhancing and re-leasing Non-core asset sales • $300m completed
Slide 24: Logistics: Focus on development deliveries and land opportunities
Logistics Focus on development deliveries and land opportunities 23 For personal use only Development completions – $300 million end value Asset End Value WALE Completion Date Coles RRM, Erskine Park $135.0m 20 years June 2015 Rand, Erskine Park $84.3m 20 years February 2015 3 Murray Rose, Sydney Ol
Slide 25: Logistics: Good progress on reducing near-term expiry profile
Logistics Good progress on reducing near-term expiry profile 24 For personal use only • Minimal expiry over next 12 months: two expiries in Dec 2016 • 2017 expiries reduced from 24% to 18% Lease Expiry Profile by Income Expiry as at Dec-14 24.0% Expiry as at Dec-15 18.2% 12.6% 10.2% 10.2% 8.8% 7.5%
Slide 26: Funds Management: Strong contribution to overall Group return
Funds Management Strong contribution to overall Group return 25 For personal use only GPT Total Return from Funds Management • FM business generated a 14.0% total return to 3.0% 14.0% the Group over the year 4.8% • FUM increased by 4.6% during the year to 6.2% $10.0 billion • GPT Wholesale Office Fu
Slide 27: Summary & Outlook
Summary & Outlook 26 For personal use only Well positioned to deliver growth High portfolio occupancy with structured rent increases Organic growth opportunities through internal development pipeline Strong balance sheet 2016 Guidance FFO per security growth of 4-5%
Slide 28: Disclaimer
Disclaimer 27 For personal use only The information provided in this presentation has been prepared by The GPT Group comprising GPT RE Limited (ACN 107 426 504) AFSL (286511), as responsible entity of the General Property Trust, and GPT Management Holdings Limited (ACN 113 510 188). The information