Arena Reit · ASX:ARF
Arena Reit — Shareholder Meeting (November 2016)
28 slides from Arena Reit's shareholder meeting presentation, Nov 17, 2016
Slide 1: Annual General Meeting – Chairman's Address and Managing Director's Presentation
17 NOVEMBER 2016 ANNUAL GENERAL MEETING – CHAIRMAN’S ADDRESS AND MANAGING DIRECTOR’S PRESENTATION Chairman’s Address Good morning ladies and gentlemen and welcome to the general meetings of unitholders in Arena REIT No. 1 and Arena REIT No. 2 (together, the Trusts) and the annual general meeting of
Slide 2: Agenda
Arena REIT (ASX:ARF) ASX Announcement 17 November 2016 Agenda The agenda for today’s meeting includes a brief presentation from me followed by a presentation from Arena’s Managing Director, Bryce Mitchelson on the operating performance of Arena in the 2016 financial year and the outlook for 2017. We
Slide 3: Chairman's address: strategy and outlook
Arena REIT (ASX:ARF) ASX Announcement 17 November 2016 supported our tenant’s operational performance and created opportunities to strategically grow and enhance the quality of the portfolio. In healthcare, the ageing population and growth in chronic disease have continued to underpin demand for lar
Slide 4: Board committees and conclusion
Arena REIT (ASX:ARF) ASX Announcement 17 November 2016 The Board has two committees, an Audit Committee and a Remuneration and Nomination Committee which are comprised of only the Independent Directors. The Board and its Committees have conducted annual performance evaluations. The Directors report
Slide 5: Arena REIT Annual General Meeting
Arena REIT Annual General Meeting | 17 November 2016 | www.arena.com.au 1
Slide 6: Agenda
Agenda 1 Chairman’s Address 3 2 Managing Director’s Presentation 7 3 Questions 16 4 Formal Business 17 5 Concluding Remarks 22 Arena REIT Annual General Meeting | 17 November 2016 | www.arena.com.au 2
Slide 7: Managing Director's Presentation
Arena REIT Annual General Meeting | 17 November 2016 | www.arena.com.au 3
Slide 8: Consistent track record of growth
Consistent track record of growth Strong growth in income and value since listing in June 2013 Distributions per security (DPS) Net Asset Value (NAV) per security 13.0 1.70 1.60 1.54 12.0 11.70* * 1.50 +16% 10.90 +7.4% cents per security 11.0 1.40 1.33 $ per security +9.0% 10.00 1.30 +18% 10.0 1.20
Slide 9: Investment objective and strategy
Investment objective and strategy Delivering predictable income with growth Objective Sectors Preferred Characteristics Outcome Childcare Relatively long lease terms Premises that have strategic To generate an importance to the operations attractive and of the tenant predictable Healthcare Hig
Slide 10: Corporate Governance
Corporate Governance Majority of independent directors with broad skill base Left to right: Dennis Wildenburg (Non-Executive Director), Bryce Mitchelson (Managing Director), David Ross (Non-Executive Chairman), Simon Parsons (Non-Executive Director), Gareth Winter (Executive Director of Arena REIT M
Slide 11: Arena REIT Annual General Meeting
Arena REIT Annual General Meeting | 17 November 2016 | www.arena.com.au 7
Slide 12: FY16 financial highlights
FY16 financial highlights Strong underlying performance Statutory 12.00 Contributors to FY16 EPS growth Operating 19% +0.20 -0.17 Profit 11.50 +0.18 -0.18 $72.6m 11.11 +0.43 11.00 +0.45 cents per security Net 10.50 Operating 16% 10.20 Profit 10.00 $25.6m 9.50 Earnings per 9.00 Security 9% FY15 EPS L
Slide 13: FY16 financial highlights: strengthened financial position
FY16 financial highlights Strengthened financial position $m Total Assets, Total Borrowing and Gearing Total Assets 14% 600 40% $514m 500 35% 33.3% 400 29.1% 300 30% Gearing 230bps 26.8% 26.8% 200 25% 100 0 20% Net Asset 30 June 2014 30 June 2015 30 June 2016 Value 16% Total Assets Borrowings Gearin
Slide 14: FY16 portfolio highlights
FY16 portfolio highlights Growth in income and defensive characteristics enhanced Like-for-like Lease expiry profile (by income) 50% (as at 30 June 2016) rental income 20bps growth 40% . Healthcare 3.6%* Childcare FY21 expiry 30% moved to FY26+ 20% Occupancy 1% 100% 10% 0% FY17 FY18 FY19 FY20 FY21 F
Slide 15: FY16 portfolio revaluation uplift
FY16 portfolio revaluation uplift Driven by growing appreciation of long and attractive lease structures Childcare Healthcare Total FY16 Portfolio Portfolio Portfolio valuation 11.5% Number of assets 196 7 203 uplift $51.1 million Value ($m) 413.2 78.2 491.4 Valuation movement ($m) 40.5 10.6 51.1 We
Slide 16: Tenant diversification enhanced
Tenant diversification enhanced Partnering with existing tenants to improve portfolio quality Tenant diversification (by income) at 30 June 2016 3% Goodstart Early Learning 6% 5% Primary Health Care 4% Affinity Education 6% 42% Other G8 Education Oxanda Education 16% Petit Early Learning Green Leave
Slide 17: Four childcare developments completed in FY16
Four childcare developments completed in FY16 High initial yield on cost drives earnings growth and margins Weighted average initial yield on cost 8.7% Weighted average yield Murwillumbah, NSW Clifton Hill, VIC on completion value 6.3% Development margin $7.5 million Kawana, QLD Richmond, VIC Arena
Slide 18: FY17–18 development pipeline of 14 projects
FY17–18 development pipeline of 14 projects^ Forecast cost of $52 million and weighted average yield on cost of 8% Arena’s internal origination capability sourcing Origination off-market opportunities that grow earnings and enhance portfolio quality Detailed demographic and market analysis tools Ana
Slide 19: Positive outlook for FY17
Positive outlook for FY17 Distribution guidance of 11.7 cents per security (+7.4%)* Structured Accretive Prudent Efficient Quality annual development capital business portfolio rental growth pipeline management model All properties are Upside from full Attractive portfolio Gearing of 26.8%^ Internal
Slide 20: Arena REIT Annual General Meeting
Arena REIT Annual General Meeting | 17 November 2016 | www.arena.com.au 16
Slide 21: Arena REIT Annual General Meeting
Arena REIT Annual General Meeting | 17 November 2016 | www.arena.com.au 17
Slide 22: Ordinary Business: Resolution 1 Remuneration Report
Ordinary Business Resolution 1: Non-binding advisory vote on the Remuneration Report To consider and, if thought fit, to pass the following as an advisory resolution of the Company: ‘That the Remuneration Report for the financial year ended 30 June 2016 be adopted.‘ Proxy votes For Open Against Excl
Slide 23: Resolution 2: Re-election of Mr Simon Parsons
Other Business Resolution 2: Re-election of Mr Simon Parsons as a director of the Company To consider and, if thought fit, to pass the following as an ordinary resolution of the Company: ‘That Mr Simon Parsons, who was appointed on incorporation of the Company on 16 October 2014 in accordance with A
Slide 24: Resolution 3: Performance rights to Mr Bryce Mitchelson
Other Business Resolution 3: Grant of performance rights to Mr Bryce Mitchelson To consider and, if thought fit, pass the following resolutions as separate ordinary resolutions of the Company and each of the Trusts: ‘That for the purposes of ASX Listing Rule 10.14 and for all other purposes, the gra
Slide 25: Resolution 4: Performance rights to Mr Gareth Winter
Other Business Resolution 4: Grant of performance rights to Mr Gareth Winter To consider and, if thought fit, pass the following resolutions as separate ordinary resolutions of the Company and each of the Trusts: ‘That for the purposes of ASX Listing Rule 10.14 and for all other purposes, the grant
Slide 26: Arena REIT Annual General Meeting
Arena REIT Annual General Meeting | 17 November 2016 | www.arena.com.au 22
Slide 27: Important Notice
Important Notice This presentation has been prepared by Arena REIT (Arena) comprising Arena REIT Limited (ACN 602 365 186), Arena REIT Management Limited (ACN 600 069 761 AFSL No. 465754) as responsible entity of Arena REIT No.1 (ARSN 106 891 641) and Arena REIT No.2 (ARSN 101 067 878). The informat
Slide 28: Arena