Ingenia Communities Group · ASX:INA
Ingenia Communities — FY2021 Earnings Presentation
43 slides from Ingenia Communities's earnings presentation, Aug 18, 2021
Slide 1: FY21 Results Presentation (ASX media release)
ASX / MEDIA RELEASE 18 August 2021 FY21 Results Presentation Ingenia Communities Group (ASX:INA) provides its FY21 Results Presentation. Authorised for lodgement by the Board. ENDS For further information please contact: Donna Byrne General Manager Investor Relations & Sustainability P 02 8263 0507
Slide 2: FY2021 Full Year Results Presentation
Presented by Simon Owen and Scott Noble 18 AUGUST 2021 FY2021 FULL YEAR RESULTS PRESENTATION ARTIST IMPRESSION CLUBHOUSE AT INGENIA LIFESTYLE PARKSIDE, VIC 250 HOMES – FIRST SETTLEMENTS SCHEDULED DEC 21
Slide 3: Key highlights
Key highlights • Revenue of $295.6 million – up 21% on FY20 FINANCIALS • EBIT of $94.4 million – up 31% on FY20 • Underlying EPS of 23.6 cents – up 7% on FY20 • Operating cash flow of $137.6 million – up 105% on FY20 • Growing portfolio – $215 million acquisitions settled FY21 • Resident rental base
Slide 4: Key achievements and milestones
Key achievements and milestones 90 communities (19 added past 13 months) >950 employees (75% based in regional locations) 8,800 residents calling Ingenia home >500,000 guests $1.5 billion staying at an Ingenia Holiday Park assets owned/managed 4,220 >13,000 home sites owned or optioned for future de
Slide 5: Business overview
Business overview Leading owner, operator and developer of lifestyle, rental and holiday communities Book Value (by Portfolio at 30 June) $1.2b Portfolio EBIT (at 30 June) Ingenia Gardens Lifestyle Rental Lifestyle Development Lifestyle Rental Holidays & Mixed Use Lifestyle Development $108m New hom
Slide 6: Core focus growing lifestyle communities business
Core focus growing lifestyle communities business Strategy supported by ageing population and housing affordability • Land lease (lifestyle) communities service a growing demographic, providing • Ingenia’s communities are located in attractive outer metro and regional an attractive lifestyle proposi
Slide 7: Current active development sites
Current active development sites Leveraged to sea change / outer metro markets Current projects in market Suburb Median House Price growth1 Community Name Suburb LGA Price June 21 (past 12 months) Hervey Bay Urangan Fraser Coast Regional $453,000 25% Nature’s Edge Buderim Sunshine Coast $906,000 24%
Slide 8: Holidays business capitalising on unique opportunity for domestic travel
Holidays business capitalising on unique opportunity for domestic travel Recent acquisitions expand reach and leverage operational expertise • Holiday parks have experienced strong demand as international • Long-term fundamentals support continued demand for caravan and camping borders remain closed
Slide 9: Growing demand driving compression in capitalisation rates
Growing demand driving compression in capitalisation rates Focus from new and established groups increasing competition Long Term Tourism Development Pipeline 18,000 • Consolidation continuing, including recently announced acquisition by Stockland of boutique 16,000 South East Queensland developer H
Slide 10: Over $215 million in acquisitions, supporting earnings growth
Over $215 million in acquisitions, supporting earnings growth Further acquisitions FY22, diversifying cash flows and market exposure Community / Site Acquired FY21 • Dedicated focus on acquisitions has driven significant growth in 1 Sunnylake Shores, NSW Lifestyle community with expansion portfolio
Slide 11: Performance and capital management
PERFORMANCE AND CAPITAL MANAGEMENT
Slide 12: Key financials
Key financials Growth in earnings and cash flow as operating conditions improve FY21 FY20 Revenue growth driven by increase in rental sites, growth in home settlements and strong Revenue $295.6m $244.2m 21% performance from holiday communities EBIT 1 $94.4m $71.9m 31% Underlying profit and EBIT grow
Slide 13: EBIT growing as business expands
EBIT growing as business expands New segment structure providing greater visibility of business unit results EBIT FY21 FY20 Residential Communities Lifestyle Rental $16.5m $11.5m 43% Expanding rental base – driven by recent acquisitions, new home settlements and new rental cabins Lifestyle Developme
Slide 14: Capital management
Capital management Strong balance sheet with long term funding in place Debt Metrics 30 Jun 21 30 Jun 20 New debt facility with CEFC established February Loan to value ratio (covenant <55%) 22.2% 8.4% • $75 million, 7-year fixed rate debt facility with Clean Energy Finance Corporation (CEFC) establi
Slide 15: Growth in value across core portfolios
Growth in value across core portfolios Lifestyle cap rates continue to compress supported by recent transactions Av. Cap Rate Av. Cap Rate Jun 212 Portfolio Jun 211 Jun 201 Book Value Lifestyle Rental 5.91% 6.65% $436.2m Holidays 7.79% 8.18% $245.5m Mixed Use 7.77% 8.07% $225.4m Ingenia Gardens 9.25
Slide 16: Operating performance residential communities accelerating demand
OPERATING PERFORMANCE RESIDENTIAL COMMUNITIES ACCELERATING DEMAND
Slide 17: Ingenia Lifestyle Overview
Ingenia Lifestyle Overview Key Data1 30 Jun 21 30 Jun 20 Permanent sites 3,681 2,968 24% Holiday sites 43 55 NM Development sites2 4,220 3,015 40% 30 Jun 21 30 Jun 20 Book value2 $591.0m $427.4m 38% • Portfolio expanded as new communities acquired and developments progressed • Addition of 420 income
Slide 18: Ingenia Lifestyle Development
Ingenia Lifestyle Development Creating high quality communities to expand rental base Key Data FY21 FY20 Strong second half, delivering record home settlements New home settlements1 350 318 10% • Second half settlements grew strongly as sales accelerated, supported by buoyant residential markets pos
Slide 19: Greenfield strategy delivering high quality communities
Greenfield strategy delivering high quality communities Strong demand and price growth in key assets Greenfield strategy delivering high quality communities Emerging trends and resident focus • New communities generating higher rents and attracting lower cap rates on • Larger homes – three bedrooms,
Slide 20: Ingenia Lifestyle Rental
Ingenia Lifestyle Rental Residential homes providing stable, resilient cash flows Key Data FY21 FY20 The Group’s Lifestyle portfolio comprises land lease and rental homes providing both affordable and premium community living Total revenue1 $34.7m $24.7m 40% EBIT $16.5m $11.5m 43% • Residential rent
Slide 21: Ingenia Gardens (seniors rental)
Ingenia Gardens (seniors rental) Strong, stable, government supported rent Key Data FY21 FY20 Ongoing high occupancy supporting stable cash flows Total revenue $25.8m $25.0m • Significant majority of residents receive Commonwealth Pension and Rent Assistance EBIT $10.9m $10.2m • Residents attracted
Slide 22: Tourism holidays and mixed use
TOURISM HOLIDAYS and MIXED USE
Slide 23: Ingenia Holidays and Mixed Use
Ingenia Holidays and Mixed Use Providing diverse locations and revenue streams Key Data 30 Jun 21 30 Jun 20 Holiday cabins 937 781 20% Caravan and camp 2,213 1,562 42% sites Total holiday sites 3,150 2,343 34% Annual sites 1,055 535 97% Permanent sites 1,073 974 10% • Portfolio expanded as new parks
Slide 24: Ingenia Holidays and Mixed Use
Ingenia Holidays and Mixed Use Underlying demand for domestic travel remains strong Key Data FY21 FY20 Increasing demand for domestic travel (intra and interstate) supported strong performance in FY21, following easing of Residential rental income $9.6m $9.3m 3% COVID-19 restrictions Annuals rental
Slide 25: Capital Partnerships
CAPITAL Our pigtot is to create Australia’s best lifestyle and holiday communities.
Slide 26: Development Joint Venture with Sun Communities
Development Joint Venture with Sun Communities (NYSE: SUI) Growing portfolio and returns Revenue increasing – operating profit and fee streams Key Data FY21 FY20 • Growing sales providing increased development returns Fee income $2.1m $0.6m • Additional acquisitions and development progress (homes a
Slide 27: Funds Management
Funds Management Integration of Eighth Gate platform complete Key Data FY21 FY20 Fee income $2.2m $1.8m • Nine communities now valued at $149 million • Includes 1,570 income producing sites located in key locations across Distributions received $0.7m $0.2m Victoria, Queensland and NSW 30 Jun 21 30 J
Slide 28: Sustainability
SUSTAINABILITY Our visto is to create Australia’s best lifestyle and holiday communities. a
Slide 29: Sustainability
Sustainability ESG initiatives and reporting are a key focus Clean Energy Finance Corporation (CEFC) funding established Progressing Green Star initiatives February 2021 - providing clear energy targets and commitment • Construction of ‘green’ home at Plantations under pilot program – • Complements
Slide 30: Sustainability
Sustainability ESG initiatives and reporting are a key focus Creating a positive impact • Focus on resident and guest health and well-being at forefront of COVID-19 • Extending charitable contributions response • Support for Ronald McDonald House Charities Australia – partnership entering • Increasi
Slide 31: Outlook
OUTLOOK FRESHWATER BY INGENIA LIFESTYLE, QLD
Slide 32: Outlook
Outlook Business trading well but some near term uncertainty with lockdowns Underlying demand fundamentals remain strong - business well placed to respond to changes in travel restrictions, health advice and border closures • Stability of rent from the Group’s residential communities has continued u
Slide 33: Appendices
@ {— Appendices Our visio is to create Australia’s best lifestyle and holiday communities.
Slide 34: Underlying profit
Appendix 1 Underlying profit FY21 FY20 ($m) ($m) Lifestyle Development 46.1 39.9 Lifestyle Rental 16.5 11.5 Ingenia Gardens 10.9 10.2 Tourism – Holidays & Mixed Use 28.7 18.3 Fuel, food & beverage 1.3 0.6 Capital Partnerships 4.1 1.3 Portfolio EBIT 107.6 81.8 Corporate costs (13.2) (9.9) EBIT 94.4 7
Slide 35: EBIT and underlying profit by segment
Appendix 2 EBIT and underlying profit by segment Residential Communities Tourism Other Capital Lifestyle Lifestyle Ingenia Holiday & Fuel, Food ($m) Partnerships1 Total Development Rental Gardens Mixed Use and Beverage and Corporate Rental income - 31.8 23.1 67.5 - 0.2 122.6 Lifestyle home sales 143
Slide 36: Cash flow
Appendix 3 Cash flow FY21 FY20 ($m) ($m) Opening cash at 1 July 10.8 20.2 Rental and other property income 159.5 116.1 Property and other expenses (120.9) (102.7) Net cash flow associated with lifestyle home development 100.7 59.5 Net borrowing costs paid (6.0) (9.3) Government subsidy 4.8 2.9 All o
Slide 37: Consolidated balance sheet
Appendix 4 Consolidated balance sheet 30 Jun 21 30 Jun 20 ($m) ($m) Cash 18.8 10.8 Inventories 13.6 36.2 Investment properties 1,231.3 943.9 Investment in Joint Venture 32.8 15.9 Other financial assets 13.9 13.9 Assets held for sale 9.6 32.6 Other assets 34.4 39.5 Total assets 1,354.4 1,092.8 Borrow
Slide 38: Reconciliation: Underlying profit to statutory profit bridge
Appendix 5 Reconciliation: Underlying profit to statutory profit bridge FY21 Underlying to Statutory Profit Bridge 160.0 140.0 58.8 (47.8) 120.0 100.0 $m (14.3) 77.2 80.0 72.8 (5.1) 2.8 1.2 60.0 40.0 20.0 0.0 Underlying Profit FY21 Cap Rate & Other Realisation of Transaction costs/Stamp Valuation of
Slide 39: Capitalisation rates have progressively tightened
Appendix 6 Capitalisation rates have progressively tightened Rentals and Holiday/Mixed Use Communities 11.50% Murray River,NSW 10.50% Albury,NSW 9.50% Implied cap rate % Grange,Jun16 8.50% Green Wattle,QLD Inverloch,VIC Capricorn Palms,QLD 7.50% Rivershore ,QLD Middle Rock,NSW Lake Munmorah,NSW Newp
Slide 40: Appendix 7: Latitude One
Appendix 7: Latitude One Successful first greenfield project now complete Latitude One is a finalist in the 2021 Retirement Living Awards Development of the Year AUGUST 2017 FEBRUARY 2020 JUNE 2021 Capitalisation rate 6.02% Capitalisation rate 5.25% 39
Slide 41: Contact Us
Contact Us Scott Noble Donna Byrne Ingenia Communities Group Chief Financial Officer General Manager Investor Relations & Sustainability Level 3, 88 Cumberland Street Tel: +61 2 8263 0538 Tel: +61 2 8263 0507 Sydney NSW 2000 snoble@ingeniacommunities.com.au dbyrne@ingeniacommunities.com.au www.ingen
Slide 42: Disclaimer
Disclaimer This presentation was prepared by Ingenia Communities Holdings Limited (ACN 154 444 925) The f orward looking statements included in this presentation involve subjective judgment and and Ingenia Communities RE Limited (ACN 154 464 990) as responsible entity f or Ingenia analysis and are s
Slide 43: ave
ave as Ingenia Our visto is to create Australia’s best lifestyle and holiday communities.
Ingenia Communities Group — FY2021 Earnings Presentation on 6ix