Hektar Real Estate Investment Trust · MYX:HEKTAR

Hektar Real Estate Investment Trust — Q4 2018 Earnings Presentation

30 slides from Hektar Real Estate Investment Trust's earnings presentation, Feb 28, 2019

  1. Slide 1: 4Q/FY 2018 Results Presentation

    Creating The Places People Love HEKTAR REAL ESTATE INVESTMENT TRUST 4Q/FY 2018 RESULTS PRESENTATION 28 February 2019

  2. Slide 2: About Hektar REIT – Malaysia's First Retail-Focused REIT

    About Hektar REIT – Malaysia’s First Retail-Focused REIT 2 Creating The Places People Love Our vision is to own and manage world-class shopping centres for Malaysian consumers, based on international best practices. We aim to be the mall owner of choice for retailers, shoppers and developers. Organi

  3. Slide 3: Hektar REIT Financial Summary

    Hektar REIT Financial Summary 3 Fourth Quarter 2018 (4Q18) / Financial Year 2018 (FY18) October – December 2018 / 12 Months 2018 Dividend Per Unit FY18 Financial Performance vs. Previous Period 1Q 2018 : 2.30 sen FY18 Revenue RM135.1 million, up +7.6% 2Q 2018 : 2.30 sen FY18 Net Property Income RM78

  4. Slide 4: Dividend Details

    Hektar REIT Dividend Details 4 Distribution Details Fourth Quarter 2018 Distribution Period: 1 October 2018 – 31 December 2018 Quarterly DPU: 2.31 sen Notice of Entitlement: 28 February 2019 Ex-Dividend Date: 13 March 2019 Book Closure Date: 15 March 2019 Payment Date: 10 April 2019 Dividend Track R

  5. Slide 5: Comparative Yield

    Comparative Yield 5 Hektar REIT offered a competitive 8.1% dividend yield in FY2018  FY 2018 DPU: 9.01 sen  Dividend Yield based on DPU and FY2018 closing price of RM1.11 Dividend Per Unit FY18 Comparative Yields 1Q 2018 : 2.30 sen 2Q 2018 : 2.30 sen 3Q 2018 : 2.10 sen 4Q 2018 : 2.31 sen Total DPU

  6. Slide 6: Trading Performance

    Trading Performance 6 Trading Summary Trading Summary 2014 2015 2016 2017 2018 Opening Unit Price (RM) 1.50 1.49 1.52 1.58 1.19 Closing Unit Price (RM) 1.49 1.52 1.56 1.30 1.11 52-Week Highest Traded Price (RM) 1.55 1.56 1.70 1.67 1.26 52-Week Lowest Traded Price (RM) 1.42 1.47 1.48 1.16 1.10 Unit P

  7. Slide 7: Portfolio Performance

    7 Overall Occupancy at ~92.1% ► Visitor Traffic 32.1 million ► Rental Reversions +5.4% for FY18 ► Expiry Profile: 38% NLA expires in 2019 ► Step-Up & Turnover Rent Provisions► Portfolio Performance

  8. Slide 8: Portfolio Occupancy

    Hektar REIT Portfolio Occupancy 8 Average portfolio occupancy steady at 92.1% Portfolio Occupancy 2007-2018 Property '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 Subang Parade 99.8% 100.0% 94.8% 99.9% 99.8% 100.0% 99.3% 94.7% 93.0% 90.9% 88.2% Mahkota Parade 96.5% 93.6% 96.1% 94.5% 96.1% 97.8% 94.5%

  9. Slide 9: Portfolio Occupancy

    Hektar REIT Portfolio Occupancy 9 Subang Parade and Segamat Central occupancy flat or down due to Asset Enhancement planning & repositioning  Portfolio Average at 92.1% for December 2018

  10. Slide 10: Visitor Traffic

    Hektar REIT Visitor Traffic 10 Portfolio visitor traffic reached 32.1 million in FY18  Tracked by computerised counting systems installed in all 6 malls Visitor Traffic 2014-2018 Visitor Traffic 2009-2018 Property '14 '15 '16 '17 '18 Subang Parade 9.5 million 9.8 million 9.2 million 9.9 million 7.8

  11. Slide 11: Visitor Traffic

    Hektar REIT Visitor Traffic 11 Strong performance by the Northern malls (Kedah)  Kulim recorded a +81.8% increase followed by Central Square with a +18.4% increase  Both malls were refurbished in 2017 and 2015 respectively

  12. Slide 12: Rental Reversions

    Hektar REIT Rental Reversions 12 Fourth Quarter Rental Reversions flat (-0.6%) +24.8%  Weighed down by Subang Parade & Segamat  Positive reversions from 5 out of 5  Renewed/New Tenants: Disney Babe, Oonli Central down due to Asset Enhancement planning and positioning +17.4%  Strong performance b

  13. Slide 13: Rental Reversions

    Hektar REIT Rental Reversions 13 Portfolio Rental Reversions was a +5.4% in FY2018, reflecting a rebound in trend  Strongest performer: Kulim Central +16.4%  Mahkota Parade (+15%), Wetex Parade (+11.8%) and Central Square (+11.5%)  Subang Parade & Segamat Central reversions down due to Asset Enha

  14. Slide 14: Expiry Profile

    Hektar REIT Expiry Profile 14 Tenancy Expiry by Property, Year End December Period End Tenancies Expiring NLA Expiring NLA as % of Monthly December Expiring (sq ft) % of Total NLA Rental Income* 201 9 62 1 66,558 33% 44% 2020 30 85,388 1 7% 24% 2021 21 1 98,773 39% 32% Period End Tenancies Expiring

  15. Slide 15: Expiry Profile

    Hektar REIT Expiry Profile 15 Tenancy Expiry by Property, Year End December, 2019-2021 Period End Tenancies Expiring NLA Expiring NLA as % of Monthly December Expiring (sq ft) % of Total NLA Rental Income* 201 9 28 78,267 25% 36% 2020 20 41 ,1 1 3 1 3% 1 6% 2021 16 1 81 ,480 58% 48% Period End Tenan

  16. Slide 16: Expiry Profile

    Hektar REIT Expiry Profile 16 Tenancy Expiry for Portfolio 2019-2021  For 2019, a total of 245 tenancies expire, representing 45% of monthly rental income or 38% of NLA Portfolio Expiry Profile 2019-2021 Period End Tenancies Expiring NLA Expiring NLA as % of Monthly December Expiring (sq ft) % of T

  17. Slide 17: Tenancy Provisions

    Hektar REIT Tenancy Provisions 17 Hektar adopts step-up and turnover rent provisions  Step-Up Provisions for fixed rental increase are present in 20% of all tenancies  Turnover Rent provisions exist in 86% of all tenancies  Data for NLA-tenants only (492 in December 2018) Step-Up Provisions Turno

  18. Slide 18: Top Ten Tenants

    Hektar REIT Top Ten Tenants 18 Top 10 Tenants contributed 30.4% of the total monthly rental income  Top 2 anchors: Parkson contributed 9.6% and The Store contributed 5.9%  No other tenant contributes more than 2.9% of monthly rental income NLA % of % of Monthly Tenant Trade Sector (sq. ft.) total

  19. Slide 19: Financial Results

    19 4Q18 Gross Revenue up +1.3% from preceding period ► 4Q18 Realised Income higher +1.8% from preceding period ► FY18 Revenue up +7.6% v FY17 ► FY18 Net Property Income up +6.8% v FY17 ► Financing Renewed: 92% of Debt expires in 2024 ► Financial Results

  20. Slide 20: Portfolio Facts

    Hektar REIT Portfolio Facts 20 Subang Mahkota Wetex Central Kulim Segamat Financial Year 2018 Parade Parade Parade Square Central Central & Classic Hotel State Selangor Melaka Johor Kedah Kedah Johor Title Freehold Leasehold Freehold Freehold Freehold Leasehold (2101) (2116) Primary Trade Area (Popu

  21. Slide 21: Income Statement: Quarter Comparative

    Hektar REIT Income Statement: Quarter Comparative 21 Realised Net Income up +1.8%  Revenue 4Q18 up +1.3% vs 4Q17  Realised Income up +1.8% vs 4Q17 Income Statement 4Q18 4Q17 Variance Fourth Quarter 2018 (Audited) (RM '000) (RM '000) (%) Revenue 33,881 33,441 +1.3% Direct Cost & Property Expenses (

  22. Slide 22: Income Statement: Year-To-Date Comparative

    Hektar REIT Income Statement: Year-To-Date Comparative 22 Net Property Income up +6.8% v FY17  Revenue up +7.6% vs FY17  Trust Expenses & Interest Expenses increased in FY18 Income Statement FY18 FY17 Variance Year-To-Date (Audited) (RM '000) (RM '000) (%) Revenue 135,107 125,543 +7.6% Direct Cost

  23. Slide 23: Balance Sheet

    Hektar REIT Balance Sheet 23 Balance Sheet As at 31.12.2018 As at 31.12.2017 Unit Price Statistics (Audited) (RM '000) (RM '000) Non-Current Assets As at 31 Dec 2018 Investment Properties 1,221,500 1,194,569 Plant & Equipment 141 94 No. of Units Outstanding Capital Work in Progress 6,129 15,359 461,

  24. Slide 24: Debt Profile

    Hektar REIT Debt Profile 24 Debt Summary February 2019 Facilities Amount % Total  Facilities: Al-Murabahah, Term Loan (TL), # Facility (RM'000) Debt Security Expiry Cost Short-Term Revolving Credit (STRC) 1 MOD 1 184,000 32.7% Subang Parade Feb-24 4.74%  Financier: Maybank 2 MOD 2 150,000 26.6% Ma

  25. Slide 25: Valuation

    Hektar REIT Valuation 25 Portfolio valuation reached RM1.22 billion Portfolio Asset Size 2007-2018 (RM ‘000) in FY 2018  Increase of 2.3% from FY2017  Property Yield at 6.4%  Valuation at RM602 per square foot  Subang Parade remains the largest component at 36% of portfolio total  Portfolio Siz

  26. Slide 26: Asset Enhancement Initiatives

    Asset Enhancement Initiatives

  27. Slide 27: Classic Hotel @ Wetex Parade

    Classic Hotel @ Wetex Parade 27  Premier business-class hotel in Muar overlooking scenic Muar river  Integrated with Wetex Parade  Opened in 1996, refurbished 2007/8  Hektar Property took over operations and refurbished property for RM8.6 million including adding new retail spaces  Refurbished

  28. Slide 28: Kulim Central was refurbished in 2017, creating an additional 22,000 sq. ft. of NLA

    28 Kulim Central was refurbished in 2017, creating an additional 22,000 sq. ft. of NLA

  29. Slide 29: Kulim Central, Kulim, Kedah

    Kulim Central, Kulim, Kedah 29 Kulim Central was refurbished in late 2017  Capital Expenditure: RM22 million  Scope: Exterior / Interior / New Lots  New NLA: 22,000 sq. ft. Performance December 2018 Visitor Traffic +81.8% Occupancy 93.5% Rental Reversions +16.4% New / Renewed Tenancies: 19 NLA :

  30. Slide 30: Investor Communications

    Creating The Places People Love Investor Communications Hektar Asset Management Sdn Bhd D1-U3-10, Solaris Dutamas No1, Jalan Dutamas 1 50480 Kuala Lumpur MALAYSIA Tel: +6 03 6205 5570  Fax: +6 03 6205 5571  Web: www.HektarREIT.com  Email: ir@HektarREIT.com Please visit the Investor Relations sec

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