Scentre Group · ASX:SCG
Scentre — H1 2018 Earnings Presentation
29 slides from Scentre's earnings presentation, Aug 21, 2018
Slide 1: Half Year Results 2018
HALF YEAR RESULTS 2018 Westfield Plenty Valley, VIC
Slide 2: Results Overview
RESULTS OVERVIEW 2 Westfield Plenty Valley, VIC SCENTRE GROUP HALF YEAR RESULTS 2018 2
Slide 3: Half Year Results
HALF YEAR RESULTS 30 Jun 2018 Funds From Operations (FFO) $657.2 million + 3.0% “We continue to provide FFO per security 12.38 cents + 3.1% the best locations for Distribution per security 11.08 cents + 2.0% retailers to connect with customers” SCG share of AUM $37.6 billion + 3.9% PETER ALLEN CEO A
Slide 4: Operating Performance
OPERATING PERFORMANCE 30 Jun 2018 Comparable Net Operating Income (NOI) + 2.5% “High quality retail space Portfolio Leased > 99.5% that enjoys high traffic Lease Deals Completed Number 1,377 flow is in demand with occupancy across our Lease Deals Completed Area 217,610 sqm portfolio at more than Tot
Slide 5: Our Purpose: Creating Extraordinary Places, Connecting + Enriching Communities
OUR PURPOSE CREATING EXTRAORDINARY PLACES, CONNECTING + ENRICHING COMMUNITIES Westfield Chermside, QLD SCENTRE GROUP HALF YEAR RESULTS 2018 5
Slide 6: Highlights
HIGHLIGHTS Customer Experience and Retail Product – Launched ‘Westfield Local Heroes’ a new community recognition and grants programme – Leveraging our CX Loop, we are continuously listening and responding to customer needs. This has enabled us to curate a product and service mix that remains releva
Slide 7: Retailer In-Store Sales
RETAILER IN-STORE SALES Comparable in-store sales growth psm 1 – Total specialty in-store sales were up 2.1% for the half year and 1.6% for the year 6 months to 30 Jun 2018 12 months to 30 Jun 2018 – > 400 sqm in-store sales were up 3.6% for the half year and 3.6% for the year Fashion 3.3% 1.9% Foot
Slide 8: Retailer In-Store Sales by Region
RETAILER IN-STORE SALES Comparable specialty in-store sales growth psm by region 1 7.6% 4.7% 4% 3.7% 2.8% 2.5% 2.4% 2.1% 1.9% 2% 1.6% 1.3% 0.9% 0.7% 0.1% 0% (0.2%) (0.3%) 6 Months MAT (1.1%) -2% NSW QLD VIC WA SA ACT NZ Total 8 1. Total stable portfolio 8 SCENTRE GROUP HALF YEAR RESULTS 2018
Slide 9: Active Developments
ACTIVE DEVELOPMENTS – Commenced the NZ$790 million (SCG share: NZ$400m) redevelopment of Westfield Newmarket in 2018 – $1.1 billion (SCG share: $810m) of developments forecast to complete in 2018 adding more than 106,000 sqm of lettable area to the portfolio – Opened the $80 million (SCG share: $40m
Slide 10: Future Developments
FUTURE DEVELOPMENTS 1 Albany (NZ) 2 Barangaroo (NSW) 3 Booragoon (WA)1 7 4 Eastgardens (NSW) 5 Knox (VIC) 6 Marion (SA) 7 Stirling (Innaloo) (WA) 8 Sydney (NSW) Westfield Stirling, WA 3 11 9 St Lukes (NZ) 7 12 6 2 4 1 8 10 9 10 Tea Tree Plaza (SA) 5 11 Warringah Mall – stage 2 (NSW) 12 Whitford City
Slide 11: Scentre Group Portfolio
SCENTRE GROUP PORTFOLIO As at 30 Jun 2018 Total Centres 39 Gross Lettable Area (sqm) 3.6m SCG share of AUM $37.6bn 5 centres JV Partner share of AUM Assets Under Management (AUM) $15.2bn $52.8bn Brisbane $6.1bn 2 WHOLLY OWNED 3 JOINT VENTURES Cap Rates Range Average 3 Perth Adelaide Sydney 14 centre
Slide 12: Finance Update
FINANCE UPDATE 12 Westfield Chatswood, NSW SCENTRE GROUP HALF YEAR RESULTS 2018 12
Slide 13: Financial Performance
FINANCIAL PERFORMANCE Funds From Operations $m Net Operating Income 6 months to 30 Jun 2018 924.2 6 months to 30 Jun 2017 907.2 Growth % 3.1% Management Income 23.2 22.6 First Half 2018 Project Income 42.2 43.6 FFO growth per security Income 989.6 973.4 1.7% Delivering 12.38 cents per security Overh
Slide 14: Financial Position
FINANCIAL POSITION Balance Sheet – Proportionate $37.6bn $m 30 Jun 2018 31 Dec 2017 Total Property Investments 37,611.9 36,228.8 Total Assets 39,187.7 37,536.0 Property Investments Total Liabilities 14,864.8 14,081.0 Net Assets before Minority Interest 24,322.9 23,455.0 $23.4bn Minority Interest (93
Slide 15: Debt Management
DEBT MANAGEMENT Capital Structure Debt metrics Total interest bearing liabilities 30 Jun 2018 $13.0bn 31 Dec2017 $12.3bn $3.3bn 31.9 % Gearing (look through basis) 31.9% 32.1% New and Gearing Weighted average interest rate 4.4% 4.4% extended bank Weighted average debt maturity 4.9 years1 4.6 years l
Slide 16: Debt Management: Maturity Profile and Liquidity
DEBT MANAGEMENT Maturity Profile 1,2 Facilities & liquidity 1,2 3.0 2.5 % $bn Bonds 2.0 USD 23% 3.5 EUR 26% 4.0 1.5 GBP 10% 1.5 AUD 4% 0.6 1.0 Total 63% 9.6 0.5 Bank Facilities Drawn 19% 2.8 - 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 Undrawn 18% 2.7 Total 37% 5.5 Bonds Drawn Facilities
Slide 17: Outlook 2018 Forecast
OUTLOOK 2018 FORECAST Funds From Operations Growth approx. + 4% “The Group reconfirms Distribution per security 22.16 cents, + 2% its full year forecast FFO growth of Comparable NOI Growth + 2.5% to + 3% approximately 4% Weighted Average Interest Rate approx. 4.4% and distribution growth of 2%” PETE
Slide 18: Appendix
APPENDIX 18 Westfield Kotara, NSW SCENTRE GROUP HALF YEAR RESULTS 2018 18
Slide 19: Developments: Westfield Carousel, WA
DEVELOPMENTS Active project WESTFIELD CAROUSEL, WA Overview Project Cost $350m (SCG share: $350m) Commencement Q1 2017 Completion Q3 2018 Highlights Incremental Project GLA 27,500sqm Westfield Carousel, WA Completed Centre GLA 110,000sqm New Anchors David Jones, H&M, new entertainment, dining and le
Slide 20: Developments: Westfield Coomera, QLD
DEVELOPMENTS Active project WESTFIELD COOMERA, QLD Overview Project Cost $470m (SCG share: $235m) Commencement Q2 2017 Completion Q4 2018 Highlights Completed Centre GLA 59,000sqm Westfield Coomera, QLD New Anchors Event Cinemas, Kmart, Target, Coles, Woolworths, new dining and leisure precinct Spec
Slide 21: Developments: Westfield Kotara, NSW
DEVELOPMENTS Active project WESTFIELD KOTARA, NSW Overview Project Cost $160m (SCG share: $160m) Commencement Q3 2017 Completion Q4 2018 Highlights Incremental Project GLA 6,250sqm Westfield Kotara, NSW Westfield Kotara, NSW Completed Centre GLA 82,000sqm New Anchors H&M, Zara, new Kmart, JB Hi Fi S
Slide 22: Developments: Westfield Newmarket, NZ
DEVELOPMENTS Active project WESTFIELD NEWMARKET, NZ Overview Project Cost NZ$790m (SCG share: NZ$400m) Commencement Q1 2018 Completion Q4 2019 Highlights Incremental Project GLA 52,000sqm Westfield Newmarket, NZ Completed Centre GLA 88,150sqm New Anchors David Jones, Farmers, Countdown, Event Cinema
Slide 23: Developments: Westfield Tea Tree Plaza, SA
DEVELOPMENTS Active project WESTFIELD TEA TREE PLAZA, SA Overview Project Cost $50m (SCG share: $25m) Commencement Q3 2017 Completion Q4 2018 Highlights Incremental Project GLA 3,500sqm Westfield Tea Tree Plaza, SA Completed Centre GLA 99,000sqm Dining & Leisure Expanded HOYTS with two LUX cinemas i
Slide 24: Leasing & Retail Solutions
LEASING & RETAIL SOLUTIONS 30 Jun 2018 Comparable Net Operating Income grew by 2.5% in the Portfolio Leased > 99.5% first half of 2018. This was primarily driven by Average Specialty Store Rent (psm) $1,638 contracted annual rent escalations of approx. CPI+2% Specialty Occupancy Cost 17.8% Lease Dea
Slide 25: Profit & FFO
PROFIT & FFO Reconciliation from Profit to FFO Profit FFO FFO Financial 6 months to 6 months to Statement $m 30 Jun 2018 Adjustments 1 30 Jun 2018 Notes 1. FFO adjustments relate to property A B C = A +B revaluations, mark to market of interest Net operating income 892.2 32.0 924.2 Note 3(iii) rate
Slide 26: Balance Sheet
BALANCE SHEET Balance Sheet – Proportionate 1 $m Consolidated Equity Accounted 30 Jun 2018 A B C = A +B Cash 200.8 6.7 207.5 1. Period end AUD/NZD exchange rate Property Investments 1.0919 at 30 June 18 – Shopping centres 33,847.6 2,741.4 36,589.0 2. Includes $705.3m (31 December 17: – Development p
Slide 27: Cash Flow
CASH FLOW Cash flows from operating activities – look throughbasis $m 30 Jun 2018 Receipts in the course of operations (including GST) 1,448.9 Payments in the course of operations (including GST) (464.0) Net operating cash flows from equity accounted entities 59.8 Income and withholding taxes paid (
Slide 28: Interest Rate Hedging Profile
INTEREST RATE HEDGING PROFILE $ Fixed rate debt Derivatives $ debt payable $ swap payable NZ$ swap payable NZ$ collar payable 31 December 1 $m Fixed rate $m Fixed rate NZ$m Fixed rate NZ$m Strike rate 2018 (580.0) 3.25% (8,147.3) 2.86% (460.0) 3.18% (70.0) 3.39%/5.25% 2019 (430.0) 3.31% (8,035.4) 2.
Slide 29: Important Notice
IMPORTANT NOTICE All amounts in Australian dollars unless otherwise specified. The financial information included in this document is based on the Scentre Group’s IFRS financial statements. Non IFRS financial information included in this document has not been audited or reviewed. This document conta