Slide 1: 1H18 Results Presentation
1H18 RESULTS PRESENTATION 1H18 RESULTS ǀ FEBRUARY 2018 ǀ PAGE 1
Slide 2: Key Performance Metrics for 1H18
KEY PERFORMANCE METRICS FOR 1H18 CAPITAL OPERATIONAL FINANCIAL MANAGEMENT 2,434 lots $21.9m 1H18 operating profit after tax 21.1% gearing under contract with a value of Up 11% Down 0.3% $648.4m 4.5cps EPS $158.3m net debt 1,077 lot settlements Up 11% Down 2% $41.7m EBITDA with $47.7m 1H18 net operat
Slide 3: Results Overview
Slide 4: Group Financial Summary
GROUP FINANCIAL SUMMARY Strategic Initiatives continue to drive earnings growth KEY PERFORMANCE STATISTICS 1H18 1H17 VAR (%) » Group revenue1 of $127.5m – down 17% Lot sales 1,342 1,488 (10%) ̵ Decrease in revenue predominantly due to the Lot settlements 1,077 1,408 (24%) joint venturing of the Newh
Slide 5: Focus on Driving Shareholder Returns
FOCUS ON DRIVING SHAREHOLDER RETURNS Consistent growth in earnings driven by our focused strategy, market conditions and new projects » Business well established across seven states and territories ̵ Provides good geographic spread with well located projects across key growth corridors » 1H18 Operat
Slide 6: Capital Management
CAPITAL MANAGEMENT Continued execution of capital management strategy » Strong capital position and flexible balance sheet » 2,184in 1H18 ROCE1 steady at 13% ̵ Expect further improvement during 2H18 » Gearing2 of 21.1%, at the lower end of target range of 20% - 30% » Improved cash interest coverage3
Slide 7: Operating Performance
Slide 8: Group Operating Performance
GROUP OPERATING PERFORMANCE EBITDA1 COMPOSITION BY BUSINESS TYPE (%) Peet’s diversified portfolio of projects has allowed it to capitalise on the Development Funds Management JVs eastern states’ strength 12% » Approximately 70% of entire land bank was in development during 1H18 ̵ More than 80% of th
Slide 9: Group Sales and Settlement Activity
GROUP SALES AND SETTLEMENT ACTIVITY SALES COMPOSITION BY GEOGRAPHY (LOTS) » Group sales for 1H18 of 1,342 lots – down 10% WA VIC QLD NSW/ACT NT SA ̵ WA market conditions impacted overall sales activity 11% ̵ Increased sales activity expected in 2H18 due to new project 13% 19% commencements and sales
Slide 10: Contracts on Hand
CONTRACTS ON HAND Contracts on hand underpin momentum into 2H18 » Contracts on hand1 have increased 11% since 30 June 2017 to 2,434 lots with a 19% increase in value to $648m ̵ Contract value underpinned by price growth across VIC, QLD and ACT/NSW CONTRACTS ON HAND1 (LOTS) CONTRACTS ON HAND1 (VALUE)
Slide 11: FM Operating Performance
FM OPERATING PERFORMANCE » Management and performance fees of $21.4m during 1H18 KEY PERFORMANCE STATISTICS 1H18 1H17 VAR (%) − EBITDA1 margin 70%, up 2% on 1H17 Lot sales 739 881 (16%) » 1H18 sales impacted by WA market conditions Lot settlements 700 844 (17%) » Earnings from investments increased
Slide 12: JV Operating Performance
JV OPERATING PERFORMANCE KEY PERFORMANCE STATISTICS 1H18 1H17 VAR (%) » EBITDA1 of $5.5m – down 17%, impacted by − Timing of settlements from Googong (ACT/NSW) and Lot sales 372 385 (3%) Lightsview (SA) Lot settlements 232 265 (12%) » Increased earnings from QLD and ACT/NSW expected 2H18 Revenue $20
Slide 13: Development Operating Performance
DEVELOPMENT OPERATING PERFORMANCE » Revenue of $79.2m – down 27% KEY PERFORMANCE STATISTICS 1H18 1H17 VAR (%) − Decrease in revenue predominantly due to the joint venturing of the Newhaven (VIC) project at the end of 1H17 Lot sales2 231 222 4% − Settlements down in 1H18 due to timing of title issuan
Slide 14: Debt Management
Slide 15: Debt Management
DEBT MANAGEMENT Strong capital management strategy outcomes CAPITAL MANAGEMENT METRICS 1H18 FY17 FY16 FY15 Cash at bank $70.9m $88.4m $73.4m $57.7m » Net debt steady at $158m1 − Bank debt down 46% to $82m Bank debt $81.8m $151.7m $169.2m $185.9m − Further diversification of funding sources Peet bond
Slide 16: Group Cash Flow Summary
GROUP CASH FLOW SUMMARY Cash generated from operations applied to deliver production from new and existing projects to meet demand » Majority of land bank in FM or capital efficient structures (PDA’s) » FY18 distributions to be fully cash covered » Cash borrowing costs expected to be lower due to re
Slide 17: Market Overview & Project Pipeline
Slide 18: Residential Market Overview
RESIDENTIAL MARKET OVERVIEW MELBOURNE » Strong economic growth, with forecast high investment in infrastructure by government » Strong population growth expected to continue » Economic outlook and population growth to support dwelling demand − Employment growth expected to continue − Volumes expecte
Slide 19: National Reach
NATIONAL REACH 51,462 $14.0bn END-VALUE LOTS 1 projects 57 nationally Notes: 1 Not all projects are shown on map
Slide 20: Overview of Peet's Land Bank
OVERVIEW OF PEET’S LAND BANK Land bank represents approximately 17 years’ lot supply based on current sales rates » Diversified land bank across all mainland states and LANDBANK COMPOSITION BY BUSINESS TYPE (LOTS1) territories 60,000 − Pipeline of approximately 51,500 lots with an on completion valu
Slide 21: New Projects Supporting Growth
NEW PROJECTS SUPPORTING GROWTH Pipeline of approximately 51,500 lots providing visibility of future earnings » Targeting medium term earnings growth driven by current portfolio - Not dependent on acquisitions » Three new projects to commence development/sales in 2H18 FY14 FY14 Result » Result Up to
Slide 22: Outlook
Slide 23: Priorities and Strategic Focus
PRIORITIES AND STRATEGIC FOCUS Portfolio well positioned to target on-going growth and value creation Accelerating production where possible and appropriate, and active management of product mix Selective acquisition of projects to restock pipeline with a focus on securing low cost projects, and pre
Slide 24: Outlook
OUTLOOK Outlook generally supported by market fundamentals with sustained low interest rates and economic growth Positive outlook underpinned by contracts on hand and new project commencements Conditions across Victoria, Queensland and New South Wales/ACT are expected to remain supportive Well-place
Slide 25: 1H18 Annexures
Slide 26: Summary Income Statement
SUMMARY INCOME STATEMENT 1H18 1H17 Var $M $M (%) Funds Management 21.4 21.9 (2%) Development 79.2 108.2 (27%) Joint Venture 20.2 17.7 14% Share of net profit of equity accounted investments 3.3 2.9 14% Other1 3.4 2.4 42% Revenue 127.5 153.1 (17%) EBITDA 41.7 44.0 (5%) Finance costs2 (10.6) (13.9) (2
Slide 27: Summary Balance Sheet
SUMMARY BALANCE SHEET DEC17 JUN17 $M $M Assets Cash and cash equivalents 70.9 88.4 Receivables 119.2 131.3 Inventories 483.5 486.2 Investments accounted for using the equity method 222.4 213.4 Other 12.6 14.5 Total assets 908.6 933.8 Liabilities Payables 69.2 69.5 Land vendor liabilities 27.0 33.8 B
Slide 28: Land Bank – Funds Management Key Projects
LAND BANK – FUNDS MANAGEMENT KEY PROJECTS PROJECT LIFECYCLE PROJECT NAME STATE GDV1 LOTS REMAINING2 2018 2019 2020 2021 2022 Alkimos WA $1,221m 2,418 Selling Burns Beach WA $250m 465 Selling Golden Bay WA $211m 943 Selling Lakelands WA $207m 1,117 Selling Yanchep Golf Estate WA $412m 1,575 Selling O
Slide 29: Land Bank – Company-Owned Key Projects
LAND BANK – COMPANY-OWNED KEY PROJECTS PROJECT LIFECYCLE PROJECT NAME STATE GDV1 LOTS REMAINING2 2018 2019 2020 2021 2022 Brigadoon WA $48m 109 Selling Chase, Baldivis WA $60m 331 Selling Mundijong WA $160m 759 Planning Start up Other WA $647m 3,939 Planning Gladstone QLD $86m 339 Selling Boystown Q
Slide 30: Land Bank – Joint Venture Key Projects
LAND BANK – JOINT VENTURE KEY PROJECTS PROJECT LIFECYCLE PROJECT NAME STATE GDV1 LOTS REMAINING2 2018 2019 2020 2021 2022 Wellard WA $386m 1,599 Selling Brabham3 WA $767m 3,333 Planning Start up Selling Pier Street WA $69m 146 Start up Selling Completion Redbank Plains QLD $215m 983 Selling Googong4
Slide 31: Disclaimer
DISCLAIMER While every effort is made to provide accurate and complete information, Peet does not warrant or represent that the information in this presentation is free from errors or omissions or is suitable for your intended use. This presentation contains forward-looking statements, including sta