Corporacion Inmobiliaria Vesta S.a.b. De C.v. · BMV:VESTA
Corporacion Inmobiliaria Vesta S.a.b. De C.v — Q4 2019 Earnings Presentation
44 slides from Corporacion Inmobiliaria Vesta S.a.b. De C.v's earnings presentation, 2020
Slide 1: Corporate Presentation 4Q19
CORPORATE PRESENTATION 4Q19
Slide 2: Disclaimer
DISCLAIMER This presentation has been prepared by Corporación Inmobiliaria Vesta, S.A.B. de C.V. (“Vesta” or the “Company”) solely for use at this presentation. This presentation was prepared solely for informational purposes and does not constitute, and is not to be construed as, an offer or solici
Slide 3: Vesta's Snapshot
VvesTA Vesta’s Snapshot Bw ma
Slide 4: Fully integrated industrial real estate owner, operator and developer
Fully integrated industrial real estate owner, operator and developer: Internally managed company. Offers innovative and customized solutions. Development approach to capture specific supply chain sectors and generate higher returns. 184 175 Class A industrial properties located in Mexico’s key trad
Slide 5: Strong corporate governance with best-in-class governance practices
STRONG CORPORATE GOVERNANCE WITH BEST-IN-CLASS GOVERNANCE PRACTICES Board of Directors Lorenzo Berho Corona Executive Chairman Stephen B Jose Manuel Craig Thomas J. Luis de la Wilfrido Oscar Francisco John Williams Dominguez Wieland McDonald Calle Castillo Cazares Uranga Foster Social and Investment
Slide 6: Highlights
1 Record-high results 2 Resilient balance 3 Growth without dilution 4 Highlights Increasing dividends Maximizing our stabilized 5 portfolio 6 Attractive discount 7 Vesta Parks development strategy 8 Focus on ESG www.vesta.com.mx
Slide 7: Record-high Results
VesTA Record-high Results
Slide 8: Strong foundation proven through key milestones that have accelerated growth
Strong foundation proven through key milestones that have accelerated growth Initial Stage Pre IPO Post IPO Vesta 20/20 Vison Level 3 Strategy 42.3 39.8 37.3 34.8 32.3 29.9 29.8 26.7 22.6 20.1 16.8 14.4 12.0 10.8 11.0 11.3 11.4 9.9 6.9 4.8 3.5 2.6 0.7 1.1 1.2 1.5 0.6 1998 1999 2000 2001 2002 2003 20
Slide 9: Stable and predictable cash flows and profitability
Stable and predictable cash flows and profitability Highly predictable rental income & stable occupancy rates Strong EBITDA growth with low margin volatility¹ (US$ in millions) (US$ in millions) 97.2% 94.7% 96.0% 85.0% 87.0% 95.3% 150 84.0% 83.7% 84.0% 84.1% 83.0% 94.2% 144 82.5% 82.8% 93.8% 133 121
Slide 10: Resilient balance
Resilient balance
Slide 11: Long term debt at fixed rates with sound liquidity position
Long term debt at fixed rates with sound liquidity position… 31/12/2019 Rate Maturity Secured Debt MetLife I $47.5 4.4% Apr-22 7 years average maturity & MetLife II $150.0 4.6% Aug-26 4.8% average interest rate MetLife III $118.0 4.8% Nov-27 MetLife Top Off $26.6 4.8% Aug-26 Total Secured Debt $342.
Slide 12: One of the largest and the most modern industrial portfolios in Mexico
…one of the largest and the most modern industrial portfolios in Mexico… (As of December 31, 2019, % of GLA) Consolidated: GLA = 29.8mm sf (2.77 mm m2) Buildings = 184 Land reserves = 43.9 mm sq.ft (4.1 mm m2) Stabilized portfolio occupancy 4Q19 =94.7% Clients = 175 84.7% of rental income is denomin
Slide 13: Strong client base diversified by industry and geography
…strong client base diversified by industry and geography with balanced combination of growth and defensive sectors … Balanced portfolio use Long-term and staggered lease maturity profile¹ (% of Occupied GLA, as of December 31, 2019) (% of Occupied GLA, as of December 31, 2019) 4.8 yrs weighted aver
Slide 14: Strong tenant credit profile
…strong tenant credit profile… Automotive Logistics Automotive 30.5% Logistics 28.3% Manufacturing 71.7% Energy 4.5% Recreational Aerospace Vehicles 6.0% 8.1% Medical Aerospace Devices 2.0% Paper 0.1% Plastics 3.5% Other 17.1% * Calculated over total occupied GLA www.vesta.com.mx
Slide 15: Exposure to most stable business component of automotive supply chain
…exposure to most stable business component of automotive supply chain… Post-crisis outcome: Tier 1 manufacturers have strengthened in a significant reduction of OEM suppliers driven by market consolidation where only the best and most profitable survived. OEM 5.4% Tier 1 53.4% Tier 2 15.6% Tier 3 4
Slide 16: Growth without dilution
VvesTA Growth without dilution
Slide 17: Strong buy-back program and increasing key financial metrics
Strong buy-back program and increasing key financial metrics Increasing FFO per share Increasing EBITDA per share 0.14 0.21 0.13 0.19 0.12 0.15 0.09 0.11 0.12 0.07 0.07 0.11 2014 2015 2016 2017 2018 2019 2014 2015 2016 2017 2018 2019 Lower number of shares 631 621 600 591 US$100 M buy-back fund 507
Slide 18: Increasing dividends
VvesTA Increasing dividends
Slide 19: Accretive development, acquisitions and leasing results in strong financial metrics
The accretive development, acquisitions, accelerated leasing activity and devesting, results in strong financial metrics to 7.0 % distribute an attractive yield 5.9% 6.0 % 1.99 5.1% 1.74 4.9% 5.0 % 1.68 1.80 1.53 3.8% 1.36 4.0 % 1.21 1.23 2.9% 3.0 % 0.088 0.080 2.0 % 1.6% 1.7% 1.5% 0.063 0.044 0.046
Slide 20: Maximizing our stabilized portfolio
Maximizing our stabilized portfolio
Slide 21: Development of our portfolio tends to decrease as stabilized GLA increases
The developmnet of our portfolio tends to decrease as our stabilized GLA increases while development costs remain flat GLA under construction Our growth comes from different types of buildings 3% 43% 44% 46% 46% 8% 2% 42% 97% 98% 38% 36% 36% 8% 34% 35% 33% 33% 9% 92% 15% 28% 92% 91% 23% 21% 21% 21%
Slide 22: Attractive discount
Attractive discount
Slide 23: Higher book Net Asset Value vs Market Price
Higher book Net Asset Value vs Market Price Average Discount/Premium 20. 0% 12.2% 9.8% Figures in US$ M 2018 2019 % change 0.0 % -0.6% Properties 1,817 1,841 1.3% 2012 2013 2014 2015 2016 2017 2018 2019 -12.7% Land 121 167 38.0% -20.0% -23.1% Cash 65 75 15.4% -33.6% Debt Cash Collateral 4 4 0.0% -35
Slide 24: Stable yields through increasing price per share
Stable yields through increasing price per share EBITDA yield Adjusted FFO yield (EBITDA per share/share price US$) (Adjusted FFO per share/share price US$) 9.6% 9.5% 13.8% 12.2% 7.8% 11.5% 7.2% 9.9% 8.2% 7.0% 4.5% 6.1% 5.7% 3.2% 3.2% 3.5% 2012 2013 2014 2015 2016 2017 2018 2019 2012 2013 2014 2015
Slide 25: Vesta Parks Growth Strategy
VesTA Vesta Parks Growth Strategy
Slide 26: Continued Organic Growth through Strategy development
Continued Organic Growth through development Strategy North • is a sustainable City Park Name GLA (000's sf) Stage gated industrial park with TJ Lagoeste 552 state-of-the-art class A TJ Tijuana III 619 buildings designed for TJ VP Alamar 602 35% Bajio advanced light CDJ VP Juarez Sur 720 66% Cit
Slide 27: Focus on ESG
VvesTA Focus on ESG Bw ma
Slide 28: Focus on sustainability
Focus on sustainability ESG for Vesta is… "To contribute to the competitiveness of our clients and well being of society while minimizing the environmental impact of our developments" 27 *In 2017 and 2018 we developed an environmental assessment to identifying our best practices, opportunities for i
Slide 29: ESG: Environment
ESG Environment Our Emissions 7.8% of our GLA has Leed Certification. • SCOPE 1: Derived form diesel fuel use We have a Sustainable Construction Manual, totaled 48 tons of CO2e. that defines 5 key aspects: • SCOPE 2: Derived form electric energy • SUSTAINABLE SITES consumption for our operations tot
Slide 30: ESG: Social
ESG Social Investment Collaboration 100% of the regions with at least 1 social 36 hours of training per employee. project. +400 VOLUNTEERS 17 social investment projects Well Building Standard Certification. 10 states Health and Well Being Programs and 3 lines of action: Incentives for employees. EDU
Slide 31: ESG: Governance
ESG Governance Integrity… • 10 Members (Board of Directors) who At Vesta, integrity refers to behaving in an guarantee the best corporate governance honest and responsible wat, with respect and practices in Vesta. disciplined; it means being congruent between • 6 Operating Committees that support ou
Slide 32: Appendix
VvesTA Appendix
Slide 33: Historical Results
Historical Results 35 36 36 36 36 32 34 31 28 29 27 25 26 22 23 20 19 20 21 21 17 19 16 16 17 15 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 Revenue 95.4% 96.6% 96.1% 95.6% 95.5% 96.8% 96.9% 96.5% 96.8% 96.7% 96.9%
Slide 34: Historical Results
Historical Results LTV 36% 35% 35% 35% 34% 35% 34% 32% 30% 32% 26% 26% 26% 25% 25% 24% 23% 23% 23% 23% 23% 23% 23% 24% 24% 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 Net Debt / EBITDA 6.5x 5.9x 5.8x 5.5x 5.9x 5.7x 5.6x
Slide 35: Historical Results
Historical Results Debt/EBITDA 6.7x 6.9x 6.5x 6.2x 6.0x 6.3x 6.3x 6.2x 6.0x 5.7x 5.4x 5.8x 5.5x 5.7x 5.8x 5.9x 5.9x 5.3x 5.1x 5.0x 4.8x 4.7x 4.5x 4.7x 4.5x 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 EBITDA/Interest Exp
Slide 36: Case Studies: Querétaro Aerospace Park
Case Studies Querétaro Aerospace Park Construction start 2006 GLA 2.18 million sf 13 buildings www.vesta.com.mx
Slide 37: Case Studies: Douki Seisan Park
Case Studies Douki Seisan Park Construction start 2013 GLA 2.13 million sf 8 buildings www.vesta.com.mx
Slide 38: Case Studies: Vesta Park Toluca II
Case Studies Vesta Park Toluca II Construction start 2013 GLA 1.47 million sf 6 buildings www.vesta.com.mx
Slide 39: Positive industry trends driving growth
Positive industry trends driving growth Industrial Real Estate Inventory Industrial market absorption¹ (m2 in millions) (m2 in millions) Bajio Central North 90.0 80.0 CAGR ‘10–2019: 5.6% 74.1 77.1 30% 8.4 68.4 71.5 25% 70.0 1.0 62.7 60.0 52.6 20% 1.0 47.0 48.7 50.2 50.5 50.0 15% 5.5 40.0 10% 1.8 30.
Slide 40: High occupancy and growing new deliveries
High occupancy and growing new deliveries (4Q’19) Stock Availability Net Absorption Vacancy Rate Average Rent 2019 (m2) (m2) YTD (m2) % USD/m2/month Aguascalientes 2,260,000 46,330 54,570 2.1% 4.0 Guadalajara 4,260,000 169,122 148,360 4.0% 4.6 Guanajuato 5,840,000 505,160 79,510 8.7% 4.2 Querétaro 5
Slide 41: Why Mexico?
Why Mexio? 76 open airports (12 national 64 international) 117 maritime ports • In 2016 Mexico was the sixteenth largest recipient of Foreign Direct 27 thousand kilometers of railways Investment globally with more tan US$27,400 million. 370 thousand kilometers of roads • Stable macroeconomic environ
Slide 42: Recognized quality of Mexico's automotive manufacturing
Recognized quality of Mexico´s automotive manufacturing has enabled OEMS to choose Mexico as a unique manufacturing platform www.vesta.com.mx
Slide 43: Industry trends
Industry trends 4.0 Industrial Revolution 4.0 and Mexico • Ability to anticipate client demand • Mexico is a world-class Manufacturing Hub, • New paradigm known as the 4th Industrial exporting more than one billion dollars per Revolution day • Convergence of technologies • 50% of these exports are m
Slide 44: Thank you!
Thank you! www.vesta.com.mx
Corporación Inmobiliaria Vesta, S.A.B. de C.V. — Q4 2019 Earnings Presentation on 6ix