Frasers Property Ltd. · SGX:TQ5
Frasers Property — Frasers Commercial Trust — 3QFY13 Earnings Presentation
34 slides from Frasers Property's earnings presentation, Jul 24, 2013
Slide 1: Frasers Commercial Trust 3QFY13 Financial Results
Frasers Commercial Trust 3QFY13 Financial Results 24 July 2013
Slide 2: Important notice
Important notice Certain statements in this Presentation constitute “forward-looking statements”, including forward-looking financial information. Such forward-looking statement and financial information involve known and unknown risks, uncertainties and other factors which may cause the actual resu
Slide 3: Contents
Contents 3 Results Portfolio review Capital management Moving Forward
Slide 4: Results
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Slide 5: Results – Key highlights
Results – Key highlights 5 1 Better performance of the properties Higher rentals achieved for the properties Achieved positive rental reversions of between 0.5% to 17.4%1 for leases which commenced in 3QFY13 Contribution from additional 50% interest in Caroline Chisholm Centre Off-set by divestments
Slide 6: Results – Financial highlights: 31% rise in distributable income for 3QFY13
Results – Financial highlights 6 31% rise in distributable income for 3QFY13 3QFY13 Y-o-Y 1 Apr 2013 – 30 Jun 2013 Contributing factors (S$ ‘000) Change (%) Higher contribution from Caroline Chisholm Centre due to acquisition of remaining 16% 50% interest, higher rental rates achieved for the proper
Slide 7: Results – Financial highlights: 19% rise in YTD distributable income
Results – Financial highlights 7 19% rise in YTD distributable income 1 Oct 2012 – 30 Jun YTDFY13 Y-o-Y Contributing factors 2013 (S$ ‘000) Change (%) Higher contribution from Caroline Chisholm Centre due to acquisition of remaining 50% interest, higher rental rates achieved for the properties and u
Slide 8: Results – Financial highlights: Net Property Income
Results – Financial highlights 8 Higher NPI from China Square Central, Caroline Chisholm Centre, Central Park and lower interest costs, offset by divestments in 1QFY13 and 4QFY12 Net Property Income (S$m) TOTAL: S$23.1 million 3QFY13 Singapore: S$11.1 million (48%) Australia: S$12.0 million (52%) *
Slide 9: Continuous growth in DPU
Results – Financial highlights 9 Continuous growth in DPU 28.8% DPU growth for 3QFY13 DPU (Cents) 28.8% * Adjusted for Unit consolidation
Slide 10: Results – Distribution payment
Results – Distribution payment 10 Distribution to be paid on 29 August 2013 Distribution Period 1 April 2013 to 30 June 2013 Distribution of 2.1851 cents per Unit comprising: Ordinary Unit Distribution Rate a) taxable income distribution of 1.4122 cents; and b) tax-exempt income distribution of 0.77
Slide 11: Portfolio review
Portfolio review — hie, Fei 7 (outa TRUST
Slide 12: Valuation: Balanced portfolio of Singapore and Australian properties
Portfolio review – Valuation 12 Balanced portfolio consisting of Singapore and Australian properties No one property consist of more than 33% of property value Singapore Perth Canberra Singapore $ 1,081.1 63% Australia $ 636.2 37% Total $ 1,717.3 100% As at 30 June 2013. Excludes retail turnover ren
Slide 13: Occupancy Rates & WALE
Portfolio review – Occupancy Rates & WALE 13 Strong average occupancy rate of 98.1% Healthy WALE of 4.6 years Geographical occupancy and % of NPI contribution As at Key portfolio statistics 30 June 2013 Ave Occupancy 98.1% WALE by gross rental income 4.6 years As at 30 June 2013. Excludes retail tur
Slide 14: Lease expiry profile
Portfolio review – Lease expiry profile 14 14 More than 48% of lease expiry in FY2017 and beyond provides income stability Portfolio lease expiry by gross rental income Lease expiries reduced to 7.1% excluding the master lease at Alexandra Technopark expiring in FY14 Number of leases expiring 21 46
Slide 15: Lease expiry profile: Low passing rents
Portfolio review – Lease expiry profile 15 Low passing rents presents potential for higher income Represents the expiry of Property Lease Expiry as a proportion of total master lease of Alexandra Portfolio Gross Rental Income Technopark Ave passing rent for expiring leases Number of leases expiring
Slide 16: Lease expiry profile of Alexandra Technopark underlying leases
Portfolio review – Lease expiry profile of Alexandra Technopark underlying leases 16 16 Manager completed the early renewal of 511,000 square feet of space expiring in FY14 and FY15 Leases extended to FY16 and FY18 Lengthen lease expiry profile and provide income stability Alexandra Technopark under
Slide 17: Rental reversions
Portfolio review – Rental reversions 17 Positive rental reversions for new and renewed leases commenced during the quarter^ Lower weighted average rental reversion due to the negative rental reversion for a lease contracted in 2008, during the peak of the rental cycle 17.4% 9.9% 0.5% China Square 55
Slide 18: Mid-term rent reviews
Portfolio review – Mid-term rent reviews 18 18 More than 35% of leases have built-in step-up rents FY13 - Fixed % and other fixed lease rent reviews FY13 – 16 - Portfolio fixed % reviews GROSS RENTAL INCOME Average Total Property Leases step-up rent Property Portfolio China Square 4 8.4% 3.5% 0.7% C
Slide 19: Stability of income
Portfolio review – Stability of income 19 Master lessees/ blue chip tenants with long leases contribute 66% of total gross rental income Master Leases % (Gross Rental Tenant Lease Expiry Income) Alexandra Technopark – Orrick Investments Pte Ltd Aug 2014 20.6% Blue Chip Tenants with Long Leases % (Gr
Slide 20: Asset updates
Portfolio review – Asset updates 20 Precinct Master Plan initiatives completed - Temporary occupancy permit (“TOP”) obtained
Slide 21: Asset updates: China Square Central AEI
Portfolio review – Asset updates 21 China Square Central – Asset Enhancement Initiatives (“AEI”) works completed, awaiting TOP AEI provides a contemporary, elegant and conducive working environment for tenants Before Before After Before After After
Slide 22: Singapore asset updates
Portfolio review – Singapore asset updates 22 China Square Central – 55 Market Street – Alexandra Technopark – robust leasing activities healthy occupancy rate High occupancy rate Occupancy 91.7% 100.0%* 98.4% (underlying occupancy) Average underlying passing gross rent: S$3.38psf New leases , MOL B
Slide 23: Australia asset updates
Portfolio review – Australia asset updates 23 Central Park – Long Caroline Chisholm Centre –full WALE of 3.9 years occupancy with long WALE of 12.0 years Occupancy 99.0% 100.0% Property occupied by a single tenant, i.e. the Commonwealth of Australia as represented by Centrelink (Aaa rated*) until Ju
Slide 24: Capital management
Capital management i, FRASERS A S| iRssens TRUST
Slide 25: Capital Management – Debt statistics
25 Capital Management – Debt statistics 25 Healthy interest coverage ratio of 4.24 times Low all-in interest rate of 2.8% Statistics Borrowings and assets by currency As at 30 June 2013 1,200 1,081 Total Assets (S$’000) 1,783,567 1,000 Gross Borrowings (S$’000) 705,213 800 Units on Issue and Issuabl
Slide 26: Portfolio reshaping – effects of CPPU net redemption/conversion on DPU
26 Portfolio reshaping– effects of CPPU net redemption/conversion on DPU 26 Redemption of CPPUs is accretive to Unitholders Completed: 157.1 mil CPPUs S$8.7 mil savings in DPU uplift in 1 April 2013 redeemed1 CPPU distribution2 3QFY13 Completed: 2.2 mil CPPUs S$0.1 mil savings in DPU uplift in 1 Jul
Slide 27: Capital Management and debt statistics
27 Capital Management and debt statistics 27 Well spread debt maturity profile Hedged about 51.0% of gross borrowings Debt maturity Debt composition – floating vs. hedged Post debt prepayment and divestment of Japanese properties 1 Hedging debt As at As a % of: 30 June 2013 Total Gross Borrowings 51
Slide 28: Yield spread
Yield spread 28 FCOT is still trading above 300bps spread compared to 10Y Singapore Govt. Securities FCOT Yield v.s. 10 year Singapore Govt. Securities yield1 FCOT yield2 is more than 300 bps above the 10Y Singapore Govt. Securities yield 1 Source: 10 year Singapore Government Securities yield from
Slide 29: Moving forward
Moving forward i, FRASERS A S| iRssens TRUST
Slide 30: Solid fundamentals – demand, supply and outlook
2. Solid fundamentals – demand, supply and outlook 30 Office supply-demand dynamics1 As at Q2 2013, office supply remains stable with no major office completions added to the office stock Office net absorption for Q2 2013 was 268,316 sf Total net absorption for 1H 2013 was 394,362 sf Occupancy rates
Slide 31: Solid fundamentals – positive market outlook: Singapore office rents
2. Solid fundamentals – positive market outlook 31 Singapore office rents trend – Grade B rents more resilient Singapore Grade A and Grade B office rents 1 CBRE Singapore Market View, Q2 2013: Rents have remained stable in Q2 2013 Rents are expected to remain relatively stable for the remaining 6 mo
Slide 32: Premium Grade office rents forecast to remain stable
2. Solid fundamentals – positive market outlook 32 Premium Grade office rents forecast to remain stable for the forseeable short term Perth CBD supply1 Perth CBD average net face rents1 Market conditions 2 – Perth CBD vacancy rate for the office market remains the lowest of all capital in Australia
Slide 33: Delivering growth
Delivering growth 33 33 Various initiatives to deliver growth in distributable income DPU Uplift in distributable Positive rental income from the reversions redemption of CPPUs Precinct Master Plan and Asset Grow portfolio in Enhancement Singapore and Initiatives at Australia China Square Central
Slide 34: Thank you
Thank you Frasers Centrepoint Asset Management (Commercial) Limited Level 21 | 438 Alexandra Road | Alexandra Point | Singapore 119958 Tel: +65 6276 4882| Fax: +65 6276 8942| Email: fcot@fraserscentrepoint.com www. fraserscommercialtrust.com
Frasers Commercial Trust — 3QFY13 Earnings Presentation on 6ix