Slide 1: Full-Year Results to 30 June 2020
For personal use only FULL-YEAR RESULTS TO 30 JUNE 2020 August 2020
Slide 2: Important Notice
I M P O RTA N T For personal use only NOTICE The information provided in this presentation should be considered together with the financial statements for the period and previous periods, ASX announcements and other information available on the Trust’s website. This presentation has been prepared by
Slide 3: Presentation Outline
P R E S E N TAT I O N O U T L I N E For personal use only Michael Wedgwood > Summary Managing Director BWP Management Limited > Results Andrew Ross > Portfolio Head of Property BWP Management Limited > Core portfolio David Hawkins > Alternative use properties Finance Manager BWP Management Limited >
Slide 4: Summary
SUMMARY For personal use only Mile End, SA SUMMAR Y | FULL-YEAR RESULTS TO 30 JUNE 2020 4
Slide 5: Full-Year Results at a Glance
2 0 2 0 F U L L-Y E A R R E S U LT S AT A G L A N C E For personal use only $155.8m $117.4m ⇧ $18.29cpu ⇧ $3.06 ⇧ 14.0% pa Total revenue 0.3%1 Dist. Profit 1.0%1,2 Ordinary dist.1.0%1,2 NTA 4.8%1 10 yr total return PORTFOLIO PORTFOLIO CAPITAL PERFORMANCE MANAGEMENT MANAGEMENT Construction work compl
Slide 6: COVID-19 Impact to June
C O V I D - 1 9 I M PA C T TO 3 0 J U N E 2 0 2 0 For personal use only > 98.8 per cent of rent > Bunnings and the significant majority of other received during March to tenants have been able to operate on an June 2020 unrestricted basis from the Trust’s properties > Bunnings reported 11.3 per cent
Slide 7: Climate Risk and Sustainability Actions
C L I M AT E R I S K A N D S U S TA I N A B I L I T Y For personal use only ACTIONS > 89 per cent of the Trust’s properties have LED lighting in one or more of the car park, nursery trading area, canopy trading area, or in the main store > 19 properties in portfolio have solar power generation insta
Slide 8: Results
R E S U LT S For personal use only Villawood, NSW R ESULTS | FULL-YEAR RESULTS TO 30 JUNE 2020 8
Slide 9: Financial Performance vs PCP
FINANCIAL PERFORMANCE VS PCP1 For personal use only FY20 PCP Total revenue $155.8m $156.3m Management expense ratio 0.64% 0.62% Other expenses $8.8m $7.3m Distributable profit2 (excluding revaluations) $117.1m $115.9m Number of units on issue 642.4m 642.4m Full-year ordinary distribution per unit 18
Slide 10: Financial Performance Half-Yearly
FINANCIAL PERFORMANCE 6 M O N T H LY For personal use only 6 months 6 months 6 months to Jun 2020 to Dec 2019 to Jun 2019 Total revenue $79.5m $76.2m $77.3m Management expense ratio1 0.64% 0.63% 0.62% Other expenses $4.6m $4.2m $3.8m Distributable amount2 $59.5m $57.9m $59.0m Property revaluation ga
Slide 11: Financial Summary Five Year Performance
FINANCIAL SUMMARY 5 YEAR PERFORMANCE For personal use only FY2020 FY2019 FY2018 FY2017 FY2016 Revenue $155.8m $156.3m $153.4m $152.5m $150.2m Distributable profit1 $117.5m $116.4m $114.4m $112.5m $107.9m Total assets $2,552.6m $2,382.3m $2,369.5m $2,312.8m $2,200.5m Borrowings $503.2m $412.7m $457.6
Slide 12: Portfolio
P O RT F O L I O For personal use only North Lakes, QLD POR TFOLIO | FULL-YEAR RESULTS TO 30 JUNE 2020 12
Slide 13: Bunnings Market Rent Review Outcomes
BUNNINGS MARKET RENT REVIEW For personal use only OUTCOMES > Seven Bunnings Passing rent Reviewed Effective Variance Property Location ($pa) rent ($pa) date (%) market rent Belrose, NSW1,2 2,111,952 2,035,000 9-Feb-18 (3.6) reviews were 2,3 Balcatta, WA 2,336,761 2,220,000 23-Sep-18 resolved during
Slide 14: FY2020 Rent Reviews
FY2020 RENT REVIEWS For personal use only First-half Second-half % of Rental Income3 CPI 25 16 49 Fixed 22 24 49 Market 2 1 2 Total 49 41 100 Two Bunnings market rent reviews from FY20181, one market rent review from FY20192 and 10 market rent reviews due during the 12 months to 30 June 2020 are bei
Slide 15: FY Like-for-Like Rental Growth
F Y 2 0 2 0 L I K E - F O R- L I K E R E N TA L G R O W T H For personal use only Average increase 2% Market 5.8%1 49% Fixed 3.0% 2.4% like-for-like rental growth 49% 1.6% CPI Year ended 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 30 June (%) Rental growth2 2.4 2.3 2.53 2.1 2.4 2.9 4.0 2.1 4.0
Slide 16: Capitalisation Rate Trends
C A P I TA L I S AT I O N R AT E T R E N D S For personal use only > One Bunnings Warehouse transaction in the last 6 months POR TFOLIO | FULL-YEAR RESULTS TO 30 JUNE 2020 16
Slide 17: June Revaluations
J U N E 2 0 2 0 R E VA L U AT I O N S For personal use only > June 2020 weighted average capitalisation rate 6.08 per cent (Dec 2019: 6.08 per cent) – 14 independent valuations (19 per cent of BWP portfolio value), average cap rate 6.00 per cent – 61 internal valuations, average cap rate 6.09 per ce
Slide 18: June Independent Revaluations
J U N E 2 0 2 0 I N D E P E N D E N T R E VA L U AT I O N S For personal use only Dec 2019 Dec 2019 Jun 2020 Jun 2020 Valuation Jun 2020 Cap rate Property State Cap Rate Valuation Cap Rate Valuation movement Term Certain movement (%) ($m) (%) ($m) ($m) (years) Australind WA 6.00 23.4 6.00 24.2 0.00
Slide 19: Core Portfolio
CORE For personal use only P O RT F O L I O Artarmon, NSW COR E POR TFOLIO | FULL-YEAR RESULTS TO 30 JUNE 2020 19
Slide 20: Core Portfolio Summary
C O R E P O RT F O L I O For personal use only SUMMARY 68 4.1 years properties portfolio WALE 3.3 ha 14,054m2 average land average lettable area area 76% 82% upgrade metro located properties or properties occupied <12yrs 5.90% weighted average cap rate COR E POR TFOLIO | FULL-YEAR RESULTS TO 30 JUNE
Slide 21: Weighted Average Lease Expiry Profile
W E I G H T E D AV E R A G E L E A S E E X P I R Y For personal use only PROFILE 25% 20% 15% % of Rental Income 10% 5% 0% FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 FY29 FY30 Beyond Showrooms BWH >12 years occupancy BWH <12 yrs occupancy or upgrades COR E POR TFOLIO | FULL-YEAR RESULTS TO 30 JUNE 2020
Slide 22: Lease Expiries Next Three Years
LEASE EXPIRIES NEXT THREE YEARS For personal use only > Five year options exercised for Fountain Gate (VIC), Port Melbourne (VIC), Northland (VIC), Vermont South (VIC), Coburg (VIC) during year > Hawthorn (VIC) option exercised post year-end Lease Rent Property Options Comments expiry ($’000pa) Mt G
Slide 23: Villawood Upgrade Completed
V I L L AW O O D U P G R A D E For personal use only COMPLETED > Upgrade cost of $5.0 million at a funding rate of 3.7 per cent (specified formula in lease) > Upgrade increases the total retail area by 1,792 square metres incorporating an expansion the timber trade sales and nursery areas > Complete
Slide 24: Port Melbourne Upgrade
P O RT M E L B O U R N E For personal use only UPGRADE > Upgrade cost of $6.6 million at a funding rate of 5.5 per cent > Upgrade increases the total retail area by 2,303 square metres incorporating an expansion of the main store and the timber trade sales areas > Anticipate completion mid-2021 > On
Slide 25: Alternative Use Properties
A LT E R N AT I V E For personal use only U S E P R O P E RT I E S Hoxton Park, NSW ALTER NATIVE USE PR OPERTIES | FULL-YEAR RESULTS TO 30 JUNE 2020 25
Slide 26: Alternative Use Properties Update
A LT E R N AT I V E U S E P R O P E RT I E S U P D AT E For personal use only Property Lease expiry1 Comments Concept and feasibility finalised for multi-tenanted industrial development; Cairns Expired re-leasing campaign re-launched Morley Expired Various options being considered for re-positioning
Slide 27: Capital Management
C A P I TA L For personal use only MANAGEMENT Greenacre, NSW CAPITAL MANAGEMENT | FULL-YEAR R ESULTS TO 30 JUNE 2020 27
Slide 28: Debt Facilities
D E B T FA C I L I T I E S For personal use only > Average borrowings for the year $461.9 million (up 0.8 per cent on prior corresponding period) – 3.4 per cent per annum weighted average cost of debt after hedging (2019: 4.3 per cent per annum) – Borrowing costs for the year $15.5 million (down 20.
Slide 29: Debt Duration
D E B T D U R AT I O N For personal use only Debt maturity profile as at 30 June 2020 Volume (A$M) 300.0 63.9 200.0 71.1 150.0 100.0 110.0 41.5 100.0 68.5 0.0 FY FY FY FY FY FY 21 22 23 24 25 26 Bonds Drawn bank facilities Undrawn bank facilities CAPITAL MANAGEMENT | FULL-YEAR R ESULTS TO 30 JUNE 20
Slide 30: Interest Rate Hedging
I N T E R E S T R AT E H E D G I N G For personal use only Hedge book profile by Jun 2020 Dec 2020 Jun 2021 Dec 2021 Jun 2022 half-year ending Active swaps ($m) 85 85 70 40 - Swap rates (%) Maximum 4.12 4.12 2.60 2.60 - Minimum 2.39 2.39 2.39 2.60 - Weighted average1 2.79 2.79 2.51 2.60 - > Includin
Slide 31: Outlook
OUTLOOK For personal use only Rydalmere, NSW OUTLOOK | FULL-YEAR RESULTS TO 30 JUNE 2020 31
Slide 32: Outlook
OUTLOOK For personal use only Macro economic environment Investment > Continuing COVID-19 outbreaks may require > Primary focus on leasing vacancies in the further rent abatements and/or deferments for portfolio, progressing store upgrades, and some Code of Conduct tenants extending existing leases
Slide 33: Questions?
For personal use only QUESTIONS? FULL-YEAR RESULTS TO 30 JUNE 2020 33
Slide 34: Further Information
For personal use only F U RT H E R I N F O R M AT I O N bwptrust.com.au Responsible entity: BWP Management Limited Tel: +61 8 9327 4356 Email: investorrelations@bwptrust.com.au FUR TH ER INFOR MATION | FULL-YEAR RESULTS TO 30 JUNE 2020 34