Axis Real Estate Investment Trust · MYX:AXREIT
Axis Real Estate Investment Trust — 2Q2018 Earnings Presentation
47 slides from Axis Real Estate Investment Trust's earnings presentation, Aug 7, 2018
Slide 1: Axis Real Estate Investment Trust Results Presentation 2Q2018
Axis Real Estate Investment Results Presentation 2Q2018 7 August 2018
Slide 2: 1H2018 Portfolio Highlights
1H2018 Portfolio Highlights Abels REAL ESTATE INVESTMENT TRUST Y Portfolio size increased by 2 to a total of 42 properties. Y Completed the sub-lease of land from Malaysia Airports Holdings Berhad for RM19.9 million on 7 February 2018. Y Completed the acquisition of Axis Shah Alam DC 4 for RM87.0 mi
Slide 3: 1H2018 Portfolio Highlights (cont'd)
1H2018 Portfolio Highlights (cont’d) Abels REAL ESTATE INVESTMENT TRUST v¥ Improvement of occupancy rate to 94% from 91% in December 2017. v Positive rental reversion of 5% year-to-date. Y Total revaluation gain of RM7.37 million recorded in 1H 2018. Y Total of 3.94 sen DPU declared for 1H2018. v Tr
Slide 4: 2Q2018 Return Comparatives
2Q2018 Return Comparatives Ais4ls REAL ESTATE INVESTMENT TRUST 7.00% + 6.90% 6.00% | 5.40% 5.00% + 3.73% 4.00% + 3.50% 3.25% 3.00% | 2.00% + 1,00% + 0.00% - : : : Axis-REIT EPF Dividend Return 10-yr MGS 12 Months FD Rate OPR Distribution Yield www.axis-reit.com.my
Slide 5: Finance Report
REAL ESTATE INVESTMENT TRUST - 1H2018 FINANCE REPORT
Slide 6: 1H2018 Summary
1H2018 Summary Total Net Income (“Realised”) (RM'000) Income Available for Distribution ("Realised") (RM'000) Earnings per Unit ("EPU") ("Realised") (Sen) Income Distribution Declared (RM'000) Distribution per Unit ("DPU") (Sen) Number of Investment Properties Units in Circulation (Units) Assets Und
Slide 7: Income Statement 2Q2018 vs 2Q2017
Aw%ls REAL ESTATE INVESTMENT TRUST Income Statement 2Q2018 vs 2Q2017 2Q2018 2Q2017 Changes / (RM’000) (RM’000) Movement No. of Properties 42 38 +4 Property Income 47,265 41,468 +14.0% Property Expenses (7,285) (6,221) +17.1% Net Property Income 39,980 35,247 +13.4% Profit Income / Other Income 185 1
Slide 8: Income Statement 1H2018 vs 1H2017
Income Statement 1H2018 vs 1H2017 No. of Properties Property Income - Note 1 Property Expenses — Note 2 Net Property Income Profit Income / Other Income Loss on disposal of property Non-Property Expenses — Note 3 Islamic Financing Cost —- Note 4 Net Income Before Taxation Income Tax Expense Net Inco
Slide 9: Income Statement 1H2018 vs 1H2017 Notes
Income Statement 1H2018 vs 1H2017 Abs4lS REAL ESTATE INVESTMENT TRUST Note 1 - Property Income Increase in property income as compared to preceding year corresponding period was mainly due to contribution of rental proceeds from newly acquired Kerry Warehouse (completed on 24 July 2017), Wasco Facil
Slide 10: Income Statement 1H2018 vs 1H2017 (cont'd)
Income Statement 1H2018 vs 1H2017 (cont'd) Absals REAL ESTATE INVESTMENT TRUST Note 4 - Islamic Financing Cost Increase in financing cost due to additional financing facilities utilised to fund the new acquisitions and the development of Axis Mega DC. Capitalisation of financing cost for Axis Mega D
Slide 11: Investment Properties: Gross Yield
Investment Properties: Gross Yield Average YTD Gross Yield = 9.5% oO ON DH BRB WN Oo 11 20 Crystal Plaza FCI Senai Wisma Kemajuan D21 Logistics Warehouse Strateq Data Centre D8 Logistics Warehouse Niro Warehouse Menara Axis Pasir Gudang Logistics Warehouse 1 Fonterra HQ Infinite Centre Seberang Prai
Slide 12: Investment Properties: Net Yield
Investment Properties: Net Yield oon DH BF WDN BWNnN = 0 15 16 17 18 19 20 FCI Senai 13.6% Crystal Plaza 13.5% Strateq Data Centre 12.4% D8 Logistics Warehouse 11.2% Niro Warehouse 10.7% D21 Logistics Warehouse 10.5% Wisma Kemajuan 10.3% Fonterra HQ 9.9% Emerson Industrial Facility, Nilai 9.7% Seber
Slide 13: Income Available for Distribution
Income Available for Distribution AdS4lS REAL ESTATE INVESTMENT TRUST 30.00 - Adjusted Income Before Taxation/ Income Available For Distribution 25.00 + Gain on disposal 1.35 20.00 > 15.00 | RM mill 22.12 10.00 ~ 5.00 + 0.00 + T T 1Q 2017 2Q 2017 3Q 2017 4Q 2017 1Q2018 2Q2018 13
Slide 14: Summary of Realised EPU and DPU
Summary of Realised EPU and DPU Ais4ls REAL ESTATE INVESTMENT TRUST 10.00 5 9.23 9.25 8 9.00 + 8.64 0.10 8.71 a1 8.35 349 Ol 8.00 -70 8.00 + 7.73 7.64 7 E%pgZ90 0 7.00 + 6.00 + se 5.00 + 4.00 + 3.00 + 2.00 + 1.00 + 2007 2009 2010 2011 2012 2013 2014 2015 2018 ®™ Gain on disposal @DPU ™EPU (realised)
Slide 15: Statement of Financial Position
Statement of Financial Position Ais4ls REAL ESTATE INVESTMENT TRUST 30/06/18 31/12/17 Changes / (RM’000) (RM’000) Movement Investment Properties 2,655,103 2,482,200 +172,903 Fixed Assets 2,412 2,477 -65 Other Assets 53,303 64,932 -11,629 TOTAL ASSETS 2,710,818 2,549,609 161,209 Borrowings 990,079 84
Slide 16: Statement of Financial Position
Statement of Financial Position Abs4lS REAL ESTATE INVESTMENT TRUST Note 1 - Investment Properties The acquisitions of Wasco Land 2 of RM35.0 million and Axis Shah Alam DC 4 of RM87.0 million was completed on 9 February 2018 and 4 June 2018 respectively. During the year, a total of RM4.1 million was
Slide 17: Statement of Financial Position: Borrowings
Statement of Financial Position AdS4lS Borrowings sess eme ens P| 2009 | 2010 | 2011 | zora | 2013 | 2or4 | 201s | 2ore | 2017 | 2018 | Total Financing (RM’000) 308,932 416,609 311,338 548,920 528,004 683,769 731,814 780,665 842,594 | 2 iy Total Assets (RM’000) 907,745 1,208,897 1,298,431 1,589,408
Slide 18: Gearing Levels and Placements Undertaken
Statement of Financial Position A®AlS Gearing Levels Placements Undertaken [i 40% - 38% 36% 36% 36% 37% 6 34% 35% 35% 3% 33% 31% 33% 33% 32% 33% 30% 29% 27% 29% 27% 25% 24% 20% 15% 10% 0% + ss er 9” 6 6f” CX nl f wowwaxis-reit.com.my 18 S & f
Slide 19: Unitholders' Capital
Unitholders’ Capital AdS4lS 3,000.0 2,500.0 2,000.0 1,500.0 RM mil 1,000.0 500.0 REAL ESTATE INVESTMENT TRUST 2,141.5 aa 2 1,589.4 6.5 052.3) 1,060. 907.7 726.4 728.2 | |735.4 |751.0 581.8 a8 540.3 339.6 23.3 i a 34,9 31-Dec-05 31-Dec-07 31-Dec-09 31-Dec-11 31-Dec-13 31-Dec-15 31-Dec-17 30-Jun-18 =T
Slide 20: Non-distributable Reserve
Statement of Financial Position A®AlS Non-distributable Reserve Non-distributable reserve mainly comprises the gain in fair value of approximately RM339 million to date. Crystal Plaza 45,564 Seberang Prai Logistics Warehouse 4,080 Menara Axis 36,732 Niro Warehouse 3,766 Axis Mega Distribution Centre
Slide 21: Property Report
REAL ESTATE INVESTMENT TRUST 2Q2018 PROPERTY REPORT
Slide 22: Overview
Overview Auge IS REAL ESTATE INVESTMENT TRUST As at 30 June 2018 the occupancy rate of Axis REIT’s portfolio stands at 94% with stable weighted average lease expiry period of 5.5 years (based on rental). The Manager achieved positive rental reversion of 5% for YTD 30 June 2018. With the acquisition
Slide 23: Key Portfolio Metrics
Key Portfolio Metrics Als REAL ESTATE INVESTMENT TRUST As at 30 June 2018, the portfolio has 42 assets comprising 8,856,124 sq. ft.and 148 tenants. No. of Properties Property Income (RM’‘000) 47,265 44,948 +5.15% Property Expenses (RM’000) 7,285 6,798 +7.16% Net Property Income (RM’‘000) 39,980 38,1
Slide 24: Space Under Management
( sq ft) Space Under Management 10,000,000 9,000,000 8,000,000 7,000,000 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 Aw%als REAL ESTATE INVESTMENT TRUST 8,856,124 7,606,863 887,781 7,015,242 6,859,474 5,463,599 1464124 4,288,054 4,449,580 3,679,796 2,858,121 2,175,522 1,656,943 186,5
Slide 25: Portfolio Occupancy Rate
il Portfolio Occupancy Rate Abs4lS REAL ESTATE INVESTMENT TRUST As at 30 June 2018, only 10 out of 42 properties carry vacancy, while one is undergoing development. 31 properties enjoy 100% occupancy. Occupancy As at 30 June 2018 Vacancy As at 30 June 2018 Space available Occupancy Multi-tenants pro
Slide 26: Properties Below 90% Occupancy
Properties Below 90% Occupancy Als REAL ESTATE INVESTMENT TRUST Occupancy rates of properties below 90% as at 30 June 2018 Fonterra HQ 85% Wisma Academy Parcel 81% Infinite Centre Wisma Kemajuan Axis Technology Centre Menara Axis Axis Business Park Quattro West Axis Business Campus Axis Aerotech Cen
Slide 27: Diversified Portfolio: NLA by Industry Sector
Diversified Portfolio Als REAL ESTATE INVESTMENT TRUST NLA by Industry Sector Services Others 506 Healthcare & Lifestyle 3% Engineering/Building Materials 22% Financial Services 1% Automotive 3% www.axis-reit.com.my 27
Slide 28: Portfolio Diversification by Type and NLA
Diversified Portfolio Als REAL ESTATE INVESTMENT TRUST Portfolio Diversification by Type and NLA | § Office § Office/ Industrial = Hypermarkets = Warehouse Logistic = Manufacturing Facilities - Light Industrial www.axis-reit.com.my 28
Slide 29: Breakdown by State
Breakdown by State Selangor 56.66% Johor 24.32% Penang 8.45% Others 10.57% 29
Slide 30: Lease Expiry Profile
Lease Expiry Profile Property Petaling Jaya Klang Shah Alam Johor Nilai Penang TOTAL Property Office Office Industrial Warehouse Logistics Manufacturing Facilities TOTAL Year 2018 398,398 527,167 438,362 1,363,927 Year 2018 87,631 311,367 828,310 136,619 1,363,927 % of Total NLA % of Total NLA 1,00
Slide 31: Top Tenants
Top 10 Tenants Auge IS REAL ESTATE INVESTMENT TRUST Nestle Products Sdn Bhd LF Logistics Services (M) Sdn Bhd = Yongnam Engineering Sdn Bhd Wasco Coatings Malaysia Sdn Bhd Tenaga Nasional Berhad Tesco Stores (Malaysia) Sdn. Bhd. POS Logistics Berhad Schenker Logistics (Malaysia) Sdn Bhd Teraju Sinar
Slide 32: Property Development Report
REAL ESTATE INVESTMENT TRUST 2Q2018 PROPERTY DEVELOPMENT REPORT
Slide 33: Axis Aerotech Centre @ Subang Aerotech Park
Axis Aerotech Centre @ Subang Aerotech Park Ads4ls i
Slide 34: Axis Aerotech Centre @ Subang Aerotech Park
Axis Aerotech Centre @ Subang Aerotech Park A%.¢IS REAL ESTATE INVESTMENT TRUST NOW —— a 1 a 2g BSG aS i a. = i SS SY Se ay ~ 8 hel es
Slide 35: Axis Aerotech Centre @ Subang Aerotech Park
Axis Aerotech Centre @ Subang Aerotech Park A%:¢1S a) Details of purchase of the sub-lease of land from MAHB Size Purchase price Tenure 7.02 acres RM19,876,428 (based on RM65 psf) 49 years, expiring 31 December 2066 b) Details of lease agreement with Upeca Net Lettable Area Estimated Construction Co
Slide 36: Investments Report
REAL ESTATE INVESTMENT TRUST 2Q2018 INVESTMENTS REPORT
Slide 37: Completed Acquisitions
REAL ESTATE INVESTMENT TRUST Completed Acquisitions AdS4lS Axis Shah Alam Distribution Centre 4 - Seksyen 28, Shah Alam, Selangor Completion Date : 4 June 2018 Land Area : Approx. 10.11 acres Land Tenure : Freehold Occupancy : 100% Purchase Price : RM87 million Starting Net Property Yield : 7.0% WAL
Slide 38: Ongoing Acquisitions
Ongoing Acquisitions Manufacturing Facilities - Indahpura, Johor Target Completion Date Land Area Land Tenure Occupancy Purchase Price Starting Net Property Yield WALE (Average) 2H2018 Approx. 5.8 acres Freehold 100% RM38.7 million 6.8% Approx. 7 years 38 www.axis-reit.com.my
Slide 39: Ongoing Acquisitions
Ongoing Acquisitions Aw%ls REAL ESTATE INVESTMENT TRUST Manufacturing Facility - Senawang, Negeri Sembilan Target Completion Date Land Area Land Tenure Occupancy Purchase Price WALE 2H2018 Approx. 4.21 acres Freehold 100% RM18.5 million Approx. 8 years 39 www.axis-reit.com.my
Slide 40: Total Estimated Value of Acquisition Targets
• • • Total Estimated Value of Acquisition Targets RM 190 million 40
Slide 41: Investor Relations Report
REAL ESTATE INVESTMENT TRUST 2Q2018 INVESTOR RELATIONS REPORT
Slide 42: Unit Price Performance: KLCI vs AXREIT
Unit Price Performance AdS4lS REAL ESTATE INVESTMENT TRUST KLCI vs AXREIT: 1 Jan 2014 - 30 Jun 2018 130% 4 120% + 110% + 100% + 90% + 80% + 70% - 60% | —KICl ——— AXREIT SO 0 0 no no 0 nO WO A AM A A A A 0d 0 0d oY SY AY As As Fo oY a a a oY a Ah OF PPP gg FP oP gh PP gh IN SAIN OIE EE GAEL GAIEIE OE
Slide 43: Volume Movement
Volume Movement Ais4ls REAL ESTATE INVESTMENT TRUST AXREIT: 1 Jan 2014 - 30 Jun 2018 45,000,000 40,208,000 39,783,200 40,000,000 35,000,003,826,000 32,708,200 30,000,000 27,806,000 27,347,800 25,000,000 23,451,400 23,438,700 491,600 21,092,600 21,028,800 20,026,000 20,000,000 616,000 16,046,400 16,4
Slide 44: Top Unitholders
Top 10 Unitholders Name of Unitholder CITIGROUP NOMINEES (TEMPATAN) SDN BHD EMPLOYEES PROVIDENT FUND AMANAHRAYA TRUSTEES BERHAD AMANAH SAHAM BUMIPUTERA KUMPULAN WANG PERSARAAN (DIPERBADANKAN) LEMBAGA TABUNG HAJI TEW PENG HWEE @ TEOH PENG HWEE ALEX LEE LAO PERMODALAN NASIONAL BERHAD AMANAHRAYA TRUSTE
Slide 45: Analysis of Unitholders with >2million Units
Analysis of Unitholders with >2million Units AdxelS REAL ESTATE INVESTMENT TRUST Top 5 Increases in Unitholdings Changes vs Last Quarter GREAT EASTERN LIFE ASSURANCE (MALAYSIA) BERHAD (PAR 4) 0.7% EMPLOYEES PROVIDENT FUND 0.6% HSBC (M) TRUSTEE BHD FOR ZURICH INSURANCE MALAYSIA BERHAD (LIFE 0.6% PAR)
Slide 46: Investor Visibility & Liquidity
Investor Visibility & Liquidity Als REAL ESTATE INVESTMENT TRUST No. of CDS Accounts 5,000 4,607 4,579 4,500 1 4,098 4,184 4,000 3,500 28 3,000 2,702 2/85 2,420 2,500 2,000 1,500 1,000 500 3,790 3,718 3,776 3891 3,934 4,01 3309 28"! 9 3009 3176 3,200 3,219 3, Held 2Q20 Total no. of unitholders Total
Slide 47: Thank You
REAL ESTATE INVESTMENT TRUST THANK YOU WA www.axis-reit.com. my
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