Goodman Group · ASX:GMG
Goodman — Goodman Property Trust — H1 FY2023 Earnings Presentation
34 slides from Goodman's earnings presentation, Nov 10, 2022
Slide 1: Essential Infrastructure
ESSENTIAL GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 INFRASTRUCTURE
Slide 2: Contents
GOODMAN GOODMAN PROPERTY PROPERTYTRUST TRUST| |INTERIM INTERIMRESULT RESULT2023 2023 CONTENTS 03 06 16 OVERVIEW INVESTMENT SUSTAINABILITY PORTFOLIO 18 22 26 FINANCIAL CAPITAL SUMMARY RESULT MANAGEMENT & OUTLOOK PRESENTED BY: JOHN DAKIN Chief Executive Officer JAMES SPENCE Director – Investment Manag
Slide 3: Overview
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 OVERVIEW 3 Dicker Data, M20 Business Park
Slide 4: Industrial sector remains resilient amidst uncertain economic environment
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 INDUSTRIAL SECTOR REMAINS RESILIENT AMIDST UNCERTAIN ECONOMIC ENVIRONMENT Strong first half operating performance consistent with expectations + Full year guidance firmed, with forecast cash earnings of at least 6.9 cents per unit, up 4% on FY22 GMT is co
Slide 5: Investment portfolio
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 INVESTMENT PORTFOLIO + Portfolio occupancy of 99.6%, WALE of 6.4 years, following 143,384 sqm of stabilised leasing during the period occupancy + Underlying like-for-like net property income growth of 5.6% for the period + Stable property values, supporte
Slide 6: Investment Portfolio
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 INVESTMENT PORTFOLIO 6 NZ Post, Highbrook Business Park
Slide 7: Market update
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 MARKET UPDATE Auckland warehouse rents $psm Source: CBRE September 2022 $160 $140 AUCKLAND INDUSTRIAL AND WAREHOUSE SECTOR $120 + Customer demand for space continues to be supported by structural drivers, including e-commerce growth $100 + Businesses cont
Slide 8: New developments
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 NEW DEVELOPMENTS NET LETTABLE AREA 49,968 sqm TARGETING 5 Green Star Built rating Alongside the previously announced parcel processing facility for NZ Post, a 17,930 sqm facility for existing 23,300 sqm twin warehouse facility for Mainfreight at Savill Li
Slide 9: Work in progress
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 WORK IN PROGRESS TOTAL PROJECT COST NET LETTABLE AREA $635.7m 149,709 sqm YIELD ON COST YIELD ON ADDITIONAL COST 1 5.0% 8.1% NZ Post Albany – Bush Road (artist’s impression) BROWNFIELD PROPORTION WITH REDEVELOPMENT PROJECTS EXISTING CUSTOMERS 81% 84% WALE
Slide 10: Current development programme
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 CURRENT DEVELOPMENT PROGRAMME + Current development programme consists of WORK IN PROGRESS SUMMARY 149,709 sqm with a total project cost of $635.7 million and yield on cost of 5.0% Estate Lettable area Expected Leased (sqm) completion date CONSTRUCTION EN
Slide 11: Property portfolio
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 PROPERTY PORTFOLIO PROPERTY PORTFOLIO NET LETTABLE AREA1 OCCUPANCY WALE2 $4.9bn 1.1m sqm 99.6% 6.4 years 11 1 Total stabilised office and warehouse area 2 Includes leased developments
Slide 12: Stabilised portfolio leasing
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 STABILISED PORTFOLIO LEASING Highbrook Business Park LEASED IN 1H23 AVERAGE LEASE UP PERIOD1 RENTAL REVERSION2 RETENTION3 143,384 sqm 1.9 months 23.3% 83% CORE PORTFOLIO AVERAGE WAREHOUSE RATE4 AVERAGE NEW LEASE TERM AVERAGE INCENTIVE $156 psm 5.2 years 2
Slide 13: Rental profile
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 RENTAL PROFILE + Underlying like-for-like net property income growth of 5.6%1 STABILISED PORTFOLIO REVIEW PROFILE % of portfolio income4 + Average rental increase of 24% (FY23) and 17% (FY24) on new leases and renewals yet to commence2 100% + Approximatel
Slide 14: Customer base
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 CUSTOMER BASE + 237 customers across 169 buildings, with ~75% focused TOP 10 CUSTOMERS1 on warehousing or distribution % of portfolio, including subsidiary companies % of + Top 10 customers accounting for 38% of portfolio income income New Zealand Post 12
Slide 15: Portfolio valuations
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 PORTFOLIO VALUATIONS Desktop valuation advice supports the carrying value of the Trust’s property assets at 30 September 20221. Cap rate expansion has been offset by the value of new leasing and increases in market rents. Highbrook Business Park PORTFOLIO
Slide 16: Sustainability
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 SUSTAINABILITY 16 M20 Business Park – including one of the two DC fast chargers installed within the portfolio in 2022
Slide 17: Building a sustainable portfolio
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 BUILDING A SUSTAINABLE PORTFOLIO DEVELOPING SUSTAINABLY + Brownfield redevelopments account for 81% of current work in progress + 90% of Roma Road demolition material diverted from landfill MEASURING PORTFOLIO EMISSIONS + GMT customers have been asked to
Slide 18: Financial Result
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 FINANCIAL RESULT 18 Mainfreight, Savill Link
Slide 19: Financial highlights
GOODMAN GOODMAN PROPERTY PROPERTYTRUST TRUST| |INTERIM INTERIMRESULT RESULT2023 2023 FINANCIAL HIGHLIGHTS For the six months ended 30 September 2022 Highbrook Business Park OPERATING EARNINGS AFTER TAX1 CASH EARNINGS2 DISTRIBUTIONS AVAILABLE LIQUIDITY $54.6 million 3.52 cpu 11.0% increase 7.0% incre
Slide 20: Net property income
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 NET PROPERTY INCOME NET PROPERTY INCOME BRIDGE + Underlying like-for-like net $m property income growth of 5.6%2 90 -0.0 + Income from acquisitions and +2.8 88.2 developments, in addition to like- for-like rental growth, has offset 85 +2.6 the impact of v
Slide 21: Cash earnings
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 CASH EARNINGS CASH EARNINGS CALCULATION $m + Cash earnings for the six months to 30 September 2022 of 1H23 1H22 % change 3.52 cents per unit2, a 7.0% increase on 1H22 Operating earnings before tax1 64.3 60.2 + Distributions of 2.95 cents per unit, a 7.3%
Slide 22: Capital Management
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 CAPITAL MANAGEMENT 22 Gateway warehouses, Highbrook Business Park
Slide 23: Gearing
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 GEARING LOAN TO VALUE RATIO + Gearing within preferred range of 20-30% % and significantly below covenant maximum of 50% Covenant maximum 50% + LVR of 23.2% at 30 September 2022 with fully committed LVR of 27.7% 40% + $635.7 million development work in pr
Slide 24: Managing funding risk
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 MANAGING FUNDING RISK MATURITY PROFILE + Liquidity and diversity of funding extended through $m capital management initiatives + Inaugural Green Bond issued in April 2022 securing $150 million of new debt funding to finance eligible development projects:
Slide 25: Managing interest rate risk
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 MANAGING INTEREST RATE RISK HEDGING PROFILE + High level of hedging provides protection in a rising % interest rate environment 100% + Weighted average debt cost of 3.6% 90% 80% 70% 60% 50% 40% BORROWING METRICS 30% 30-Sep-22 31-Mar-22 20% 12 month forwar
Slide 26: Summary & Outlook
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 SUMMARY & OUTLOOK 26 M20 Business Park
Slide 27: Summary & Outlook
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 SUMMARY & OUTLOOK + We remain cautious and patient given market volatility, geopolitical risks and a slowing global economy. We are in a strong position to withstand the impact of these risks with our low leverage and capital position + The strength and c
Slide 28: Questions
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 QUESTIONS 28 Highbrook Business Park
Slide 29: Thank you / Disclaimer
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 THANK YOU DISCLAIMER The information and opinions in this presentation were prepared by Goodman (NZ) Limited on behalf of Goodman Property Trust or one of its subsidiaries (GMT). GMT makes no representation or warranty as to the accuracy or completeness o
Slide 30: Appendix
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 APPENDIX 30 Highbrook Business Park
Slide 31: Work in progress
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 WORK IN PROGRESS WORK IN PROGRESS Lettable area Development Estate Completion date Leased sqm Riverside Warehouses Highbrook Business Park 8,100 Nov-22 100% NZ Blood Highbrook Business Park 3,290 Dec-22 100% Stanley Black & Decker Highbrook Business Park
Slide 32: Profit or loss
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 PROFIT OR LOSS 32
Slide 33: Balance sheet
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 BALANCE SHEET 33
Slide 34: Cash flows
GOODMAN PROPERTY TRUST | INTERIM RESULT 2023 CASH FLOWS 34
Goodman Property Trust — H1 FY2023 Earnings Presentation on 6ix