Frasers Property Ltd. · SGX:TQ5
Frasers Property — Frasers Commercial Trust — FY2014 Earnings Presentation
35 slides from Frasers Property's earnings presentation, Oct 20, 2014
Slide 1: Frasers Commercial Trust 4QFY14 and Full Year Financial Results
Frasers Commercial Trust 4QFY14 and Full Year Financial Results 20 October 2014
Slide 2: Important notice
Important notice Certain statements in this Presentation constitute “forward-looking statements”, including forward-looking financial information. Such forward-looking statement and financial information involve known and unknown risks, uncertainties and other factors which may cause the actual resu
Slide 3: Contents
Contents 3 Results Portfolio review Capital management Moving Forward
Slide 4: Results
Results Z J Pease TRUST
Slide 5: Results – Key highlights
Results – Key highlights 5 China Square Central and Alexandra Technopark boosted the performance of 1 the Trust Better performance of China Square Central Higher contribution from underlying leases of Alexandra Technopark following the expiry of the master lease Off-set by weaker Australian
Slide 6: Results – Financial highlights: 9% rise in distributable income for 4QFY14
Results – Financial highlights 6 9% rise in distributable income for 4QFY14 1 Jul 2014 – 30 Sept 4QFY14 Y-o-Y Contributing factors 2014 (S$ ‘000) Change (%) Better performance of China Square Central due to higher occupancy and rental rates Gross Revenue 31,828 10% and higher revenue contribut
Slide 7: Results – Financial highlights: 11% rise in FY14 distributable income
Results – Financial highlights 7 11% rise in FY14 distributable income 1 Oct 2013 – 30 Sept FY14 Y-o-Y Contributing factors 2014 (S$ ‘000) Change (%) Better performance of China Square Central due to higher occupancy and rental rates and Gross Revenue 118,838 higher contribution from the under
Slide 8: Results – 4QFY14 Financial highlights
Results – 4QFY14 Financial highlights 8 Better performance of China Square Central and higher contribution from underlying leases of Alexandra Technopark TOTAL: S$23.8 million 4QFY14 Net Property Income (S$m) Singapore: S$12.7 million (53%) Australia: S$11.1 million (47%)
Slide 9: Results – FY14 Financial highlights
Results – FY14 Financial highlights 9 Better performance of China Square Central and higher contribution from underlying leases of Alexandra Technopark, offset by weaker performances of the Australian properties TOTAL: S$90.6 million FY14 Net Property Income (S$m) Singapore: S$46.6 million (51%) A
Slide 10: Results – Financial highlights
Results – Financial highlights 10 Achieved new high in DPU Higher property valuation led to increase in Fifth consecutive year of growth in DPU NAV per Unit since recapitalisation exercise NAV per Unit grew at 4.4% CAGR from FY10 DPU grew at 11.0% CAGR from FY10 – FY14 – FY14 DPU (Cents)
Slide 11: Results – Distribution payment
Results – Distribution payment 11 DRP will be implemented for the distribution for 4QFY14 Distribution Period 1 July 2014 to 30 September 2014 Distribution of 2.2145 cents per Unit comprising: a) taxable income distribution of 1.3237 cents; and Ordinary Unit Distribution Rate b) tax-exempt income
Slide 12: Portfolio review
Portfolio review FRASERS COMMERCIAL
Slide 13: Portfolio review – Valuation
Portfolio review – Valuation 13 Valuation of the Singapore properties up 3.9%, mainly driven by the higher valuation of Alexandra Technopark Excluding weaker AUD, valuation of the portfolio is up 1.8% Date of Local currency Translation as at Variance from 30 valuation Value 30-Sep-14 September
Slide 14: Portfolio review – Valuation
Portfolio review – Valuation 14 Balanced portfolio consisting of Singapore and Australian properties No one property consist of more than 32% of portfolio value Singapore Perth Canberra Singapore $ 1,216.2 67% Australia $ 608.7 33% Total $ 1,824.9 100% As at 30 September 2014. Excludes retail
Slide 15: Portfolio review – Occupancy Rates & WALE
Portfolio review – Occupancy Rates & WALE 15 Robust average occupancy rate of 96.5% Healthy WALE of 3.9 years^ Geographical occupancy and % of NPI contribution As at Key portfolio statistics 30 September 2014 Ave Occupancy 96.5% WALE by gross rental income 3.9 years^ As at 30 September 2014. E
Slide 16: Portfolio review – Lease expiry profile
Portfolio review – Lease expiry profile 16 16 Well spread lease expiry provides income stability Portfolio lease expiry by gross rental income* Number of leases expiring 61 84 65 12 13 NLA (sq ft) expiring 247,002 488,117 322,201 590,789 548,335 Expiries as % total NLA 10.8% 21.4% 14.1% 25.9% 24.1
Slide 17: Portfolio review – Lease expiry profile
Portfolio review – Lease expiry profile 17 Properties in Singapore poised to benefit from the uptrend in office rents Property Lease Expiry as a proportion of total Portfolio Gross Rental Income in FY15 Number of leases 37 5 14 5 expiring Average passing rent $6.2 $6.5 $3.2 AUD $610 for expiring l
Slide 18: Portfolio review – Rental reversions
Portfolio review – Rental reversions 18 Positive weighted average rental reversions for new and renewed leases that commenced in 4QFY141 and FY142 China Square 55 Market Alexandra Central Central Street Technopark Park 4QFY14: 18.4% 4QFY14: 15.3% 4QFY14: 6.0% 4QFY14: nil3 FY14: 13.7% FY14: 15.1% F
Slide 19: Portfolio review – Robust leasing activities
Portfolio review – Robust leasing activities 19 Committed, new and renewed tenants in 4QFY14 include: Tenant Industry Property Global Law Alliance Legal China Square Central Lion Trust (Singapore) Financial Services China Square Central Keshik Capital Financial Services China Square Central Kusto
Slide 20: Portfolio review – Mid-term rent reviews
Portfolio review – Mid-term rent reviews 20 20 More than 34% of leases have built-in step-up rents FY15 - Fixed % and other fixed lease rent reviews FY15 – 18 - Portfolio fixed % reviews GROSS RENTAL INCOME Average Total Property Leases step-up rent Property Portfolio China Square 5 3.0% 6.6% 1.5%
Slide 21: Portfolio review – Stability of income
Portfolio review – Stability of income 21 Blue chip tenants with long leases contribute 46% of total gross rental income Blue Chip Tenants with Long Leases % (Gross Lease Rental Tenant Expiry Income) Commonwealth of Australia (Centrelink) Jul-25 16.7% Hewlett-Packard Singapore Pte Ltd Nov-17 11.6%
Slide 22: Portfolio review – Asset updates
Portfolio review – Asset updates 22 25 August 2014 - Master lease was not renewed Further boost to future master lease Underlying multi-tenant leases continue to exist NPI and DPU growth expired at FCOT now receives rents directly from underlying Alexandra multi-tenants, instead of fixed net
Slide 23: Portfolio review – Singapore asset updates
Portfolio review – Singapore asset updates 23 China Square Central – 55 Market Street – full Alexandra Technopark – high occupancy rate occupancy rate^ healthy occupancy rate Occupancy 98.8% 100.0%^ 96.9% WALE 2.2 years 1.7 years 2.2 years* New leases, Keshik Capital, Kusto Group, Global Law Itron
Slide 24: Portfolio review – Australia asset updates
Portfolio review – Australia asset updates 24 Central Park – Healthy Caroline Chisholm Centre –full occupancy WALE of 3.7 years with long WALE of 10.8 years Occupancy 88.6% 100.0% Property occupied by a single tenant, i.e. the Commonwealth of Australia as represented by Centrelink (Aaa rated*) unt
Slide 25: Capital management
Capital management FRASERS COMMERCIAL
Slide 26: Capital Management – Debt statistics
26 Capital Management – Debt statistics 26 Healthy interest coverage ratio of 4.34 times Low all-in interest rate of 2.7% Borrowings in AUD provide natural hedge for the Australian properties Statistics Borrowings and assets by currency As at 30 September 2014 1,400 1,216 Total Assets (S$’00
Slide 27: Capital Management and debt statistics
27 Capital Management and debt statistics 27 Successfully refinanced all borrowings All existing facilities have been refinanced with unsecured facilities Weighted average debt maturity lengthened to 4.3 years No refinancing required until FY17 Debt maturity Debt maturity Weighted average
Slide 28: Moving forward
Moving forward
Slide 29: Solid fundamentals – positive market outlook
2. Solid fundamentals – positive market outlook 29 Singapore office rents trend – Upward rental growth is projected to remain in the next few quarters Singapore Grade A and Grade B office rents1 1 Source: CBRE Research
Slide 30: Solid fundamentals – demand, supply and outlook for Singapore CBD office
2. Solid fundamentals – demand, supply and outlook for Singapore CBD office 30 Office supply-demand dynamics and vacancy rates 1 With no new major office developments completed, islandwide office vacancy rate tightened on the back of reasonable office demand in Q3 2014 Islandwide office net abso
Slide 31: Solid fundamentals – Demand likely to pick up on back of rising office rents
2. Solid fundamentals – Demand likely to pick up on back of rising office rents 31 Singapore business park rents trend – Rents are stablising for city fringe business park Singapore Business Park (city fringe) rents1 1 Source: CBRE Research
Slide 32: Solid fundamentals – demand, supply and outlook for business & science park
2. Solid fundamentals – demand, supply and outlook for business & science park 32 Manufacturing Indices1 Vacancy was lower from 11.8% in the previous quarter to 11.6% in Q3 2014 Demand remains stable, supported by the IT and finance-related services industries Increasing rent divergence betwee
Slide 33: Perth CBD office supply and rents
Perth CBD office supply and rents 33 Premium Grade net face rents is approximately A$810 psm per annum Perth CBD office supply1 Perth CBD office average net face rents1 Market conditions 1 Perth CBD office market vacancy rate was 11.8% according to the Property Council of Australia Premium Gra
Slide 34: Delivering growth
Delivering growth 34 34 Organic and in-organic initiatives to deliver growth in distributable income Continue to grow portfolio organically and inorganically Alexandra Technopark – significant contribution from underlying leases will boost future income and DPU Positive rental reversions
Slide 35: Thank you
Thank you Frasers Centrepoint Asset Management (Commercial) Limited Level 21 | 438 Alexandra Road | Alexandra Point | Singapore 119958 Tel: +65 6276 4882| Fax: +65 6276 8942| Email: fcot@fraserscentrepoint.com www. fraserscommercialtrust.com
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