Keppel REIT · SGX:K71U
Keppel REIT — K-REIT Asia — Q1 2010 Earnings Presentation
31 slides from Keppel REIT's earnings presentation, Apr 19, 2010
Slide 1: First Quarter 2010 Financial Results
FIRST QUARTER 2010 FINANCIAL RESULTS 19 April 2010 1
Slide 2: Important Notice
Important Notice The value of units in K-REIT Asia (“Units”) and the income from them may fall as well as rise. Units are not obligations of, deposits in, or guaranteed by, the Manager or any of its affiliates. An investment in Units is subject to investment risks, including the possible loss of the
Slide 3: Contents
Contents Operations Review Portfolio Analysis Capital Management Market Review & Outlook Going Forward Additional Information 3
Slide 4: Highlights
Highlights Net property income 28.4% y-o-y Stronger • 1Q2010 distributable income up by 13.8% y-o-y Earnings 96% Portfolio committed occupancy Better Performance • Singapore portfolio average rent(1) 1.7% q-o-q Increased Aggregate leverage reduced to 25.2%(2) Funding • No refinancing due until
Slide 5: Operations Review
<-REITASIA Operations Review
Slide 6: 1Q2010 Net Property Income 28.4% Y-o-Y
1Q2010 Net Property Income 28.4% Y-o-Y 1Q 2010 1Q 2009 Change Property Income $18.2m $14.8m $3.4m 23.2% Net Property Income $13.9m $10.8m $3.1m 28.4% Distributable Income to $17.8m $15.7m $2.1m 13.8% Unitholders Distribution Per Unit (“DPU”) - For the period 1.33cts 1.18cts(1) 0.15cts 12.7% - Annual
Slide 7: 1Q2010 Net Property Income 3.3% Q-o-Q
1Q2010 Net Property Income 3.3% Q-o-Q 1Q 2010 4Q 2009 Change Property Income $18.2m $17.0m $1.2m 7.0% Net Property Income $13.9m $13.4m $0.5m 3.3% Distributable Income to $17.8m $19.4m -$1.6m -8.2%(1) Unitholders Distribution Per Unit (“DPU”) - For the period 1.33cts 1.45cts -0.12cts -8.3%(1) - Annu
Slide 8: Healthy Balance Sheet
Healthy Balance Sheet Portfolio asset size rose 10.0% after acquisition of 50.0% interest in 275 George Street, Brisbane, Australia As at As at 31 March 2010 31 December 2009 Non-current Assets $2,267.1m $2,044.6m Total Assets $2,619.7m $2,631.6m Borrowings $581.8m $581.8m Total Liabilities $637.2
Slide 9: Portfolio Analysis
<-REITASIA Portfolio Analysis
Slide 10: First Overseas Acquisition
First Overseas Acquisition Portfolio NLA increased 17.3% q-o-q Portfolio asset size increased 10.0% q-o-q Acquired 275 George Street in Brisbane, Australia for S$209.4m First Newly completed 30-storey freehold Grade A office property overseas 99.4% occupied by long leases embedded with fix
Slide 11: Portfolio Lease Profile
Portfolio Lease Profile Majority of renewals and rent reviews due in 2010 completed Lease expiries and rent reviews well staggered from 2010-2013 Portfolio(1) Lease Profile (by NLA) as at 31 March 2010 15.5% 14.2% 12.9% 9.3% 8.8% 7.8% 4.4% 3.1% 2.5% 2.3% 2010 2011 2012 2013 2014 Leases Expiring
Slide 12: Singapore Portfolio Average Rent
Singapore Portfolio Average Rent Singapore portfolio average monthly rent in March 2010: $8.30 psf Singapore Portfolio Average Monthly Rent(1) $8.30 $8.06 $8.13 $8.16 $7.91 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 (1) The average rental of K-REIT Asia’s portfolio of properties in Singapore, excluding 27
Slide 13: Portfolio Occupancy Rate vs Market
Portfolio Occupancy Rate vs Market Portfolio occupancy increased 1.0% q-o-q to 96.0% as at 31 March 2010 Singapore portfolio occupancy of 95.5%(1) is higher than core CBD of 91.9%(1) 100.0% 99.4% 96.0% 93.5% 94.4% 91.5% Singapore Core CBD Occupancy = 91.9% Bugis Junction TowersKeppel Towers and
Slide 14: Long Lease Terms Provide Income Stability
Long Lease Terms Provide Income Stability Weighted average lease term to expiry for • Portfolio: 5.9 years • Top 10 tenants who account for 52.5% of portfolio’s NLA: 7.6 years Long lease terms(1) account for 41.3% of portfolio’s NLA % Portfolio with Long Lease Terms by Net Lettable Area (NLA) Lo
Slide 15: Blue-chip Tenants
Blue-chip Tenants Top 10 tenants comprise 52.5% of portfolio’s net lettable area Portfolio’s Top 10 Tenants by Net Lettable Area as at 31 March 2010 Telstra Corporation Limited 10.6% Deutsche Bank Aktiengesellschaft 6.4% I.E.Singapore 5.8% GE Pacific Pte Ltd 5.4% UBS AG 5.2% Keppel Land Internatio
Slide 16: Diverse Tenant Mix
Diverse Tenant Mix Tenant Business Sector by Net Lettable Area as at 31 March 2010 Accounting & consultancy services Legal Telecommunications 3.2% 0.9% & muliti-media 11.0% F&B 0.2% Energy & natural resources 4.3% Shipping & marine services 7.0% Banking, insurance & 127 tenants in financial services
Slide 17: Capital Management
<-REITASIA Capital Management
Slide 18: Healthy Financial Position
Healthy Financial Position 25.2% aggregate leverage as at 31 March 2010 As at As at 31 March 2010 31 December 2009 Gross Borrowings(1) $581.1m $581.1m Aggregate Leverage 25.2% 27.7% All-in Interest Rate 4.26% 4.23% Interest Coverage Ratio(2) 3.6 times 3.2 times Weighted Average Term to Expiry 1.0
Slide 19: No Immediate Financing Needs
No Immediate Financing Needs No refinancing due until March 2011 54.3% of assets unencumbered $1bn multi-currency Medium Term Note Programme Cash and cash equivalents of $286.2m Aggregate Leverage will decrease to 15.2%(1) Debt Expiry Profile $'mn 450.0 Revolving term loan 400.0 350.0 300.
Slide 20: Market Review & Outlook
-REITASId Market Review & Outlook
Slide 21: Stabilising Occupancy and Rental Levels
Stabilising Occupancy and Rental Levels Pace of rental decline easing as business confidence returns S$ psf 97.6% 97.1% 96.2% 95.4% 93.1% 91.5% 91.9% 91.2% 91.2% 18.7 18.8 18.8 16.0 16.1 16.1 15.0 12.9 12.3 10.5 10.2 8.6 8.8 8.1 8.0 7.5 6.8 6.7 Mar-08 Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09
Slide 22: Sustained Economic Recovery
Sustained Economic Recovery Singapore GDP Growth in 2010 to range between 7.0% to 9.0% Singapore GDP growth 2010 forecast range between 7.0% to 9.0% Positive 13.1% y-o-y GDP growth in 1Q2010 economic Positive spin-offs for office sector as Singapore transforms into a global city, outlook diver
Slide 23: Going Forward
<-REITasia Going Forward
Slide 24: Key Thrusts
Key Thrusts Prudent Acquisition Capital Active Asset Growth Management Management Pursue Manage K-REIT Asia’s Identify potential asset opportunities for assets and cost enhancement initiatives strategic structure more for K-REIT Asia’s property acquisitions in effectively portfolio to maximise Singa
Slide 25: Additional Information
-REITASId Additional Information
Slide 26: Snapshot of K-REIT Asia
Snapshot of K-REIT Asia Manager K-REIT Asia Management Limited Property Portfolio 6 commercial assets valued at $2.3 billion Total Portfolio NLA 1,523,068sf (1) Listing Date 28 April 2006 on Singapore Stock Exchange Market Capitalisation $1.5 billion Unit Price $1.10 (2) Number of Units in Issue 1,3
Slide 27: 275 George Street Brisbane, Australia
275 George Street Brisbane, Australia 30-storey freehold Grade A building newly completed in April 2009 Long weighted average lease expiry of 9.2 years 99.4% leased with fixed annual rental escalations embedded in the lease agreements Key tenants are leading Australian companies Telstra Corp
Slide 28: Portfolio Information
Portfolio Information Bugis Junction Keppel Towers and As at 31 March 2010 One Raffles Quay Prudential Tower 275 George Street(2) Towers GE Tower Attributable NLA (sf) 247,475 430,112 445,120 175,675 224,686 Ownership 100.0% 100.0% 33.3% 73.4% 50.0% Number of tenants 8 59 31 22 7 UniCredit Bank AG,
Slide 29: Portfolio of Quality Assets
Portfolio of Quality Assets 275 George Street One Raffles Quay One Raffles Quay Brisbane, Australia North Tower South Tower Bugis Junction Prudential Tower Keppel Towers GE Tower Towers 29
Slide 30: Awards and Accolades
Awards and Accolades Singapore Corporate Awards 2009 • Best Investor Relations Award (Silver) “$300m to less than $1b market capitalisation” category • Best Annual Report Awards (Silver) “REITs and Business Trusts” category BCA - Green Mark Gold Award • Awarded to One Raffles Quay ISO 14000 ce
Slide 31: Thank you
Thank you For queries, please contact Ms Casiopia Low Investor Relations & Research Tel: 6433 7622 Fax: 6835 7747 Email: casiopia.low@kreitasia.com http://www.kreitasia.com 31