Stockland · ASX:SGP
Stockland — FY2024 Earnings Presentation
34 slides from Stockland's earnings presentation, Aug 22, 2024
Slide 1: FY24 Results
FY24 Results 22 August 2024 Aura, QLD
Slide 2: Acknowledgement of Traditional Custodians
Stockland acknowledges the Traditional Custodians and knowledge-holders of the land on which we live, work and play. We recognise and value their continued and inherent connection to land, sea, culture and community. We also pay our respects to their Elders past and present and extend that respect t
Slide 3: Agenda
Agenda Group update Tarun Gupta MD & CEO Financial results and Alison Harrop capital management CFO Kylie O'Connor Investment Management CEO, Investment Management Andrew Whitson Development CEO, Development Tarun Gupta Summary and outlook MD & CEO 3 FY24 Results Figures are rounded to nearest milli
Slide 4: Group update
Group update Tarun Gupta MD & CEO Mt Atkinson, VIC
Slide 5: FY24 Results
FY24 Results FY24 Pre-tax FFO per security of 35.4 cents at the top end of guidance range Accelerated execution of strategy and redeployment of capital towards growth areas Positioned for increased production rates in the residential sector Expanded capital partnership platform High quality portfoli
Slide 6: Accelerated execution of strategy
Accelerated execution of strategy Reshape Accelerate Scale Sustainable portfolio pipeline partnerships growth • Increased residential sector capital allocation • ~$50bn5 development pipeline across the • Expanded platform with three capital • Disciplined capital management, – executed on meaningful
Slide 7: FY24 Result
FY24 Result Strong results at the top end of guidance range Pre-tax Funds From Operations Pre-tax FFO per security FY24 Highlights $843m 35.4 cents • Investment Management FFO up 4.5%; comparable FFO growth from (4.5)% on FY23; Post-tax FFO per security the IM portfolio up 3.5%2 Post-tax FFO of $786
Slide 8: ESG strategy
ESG strategy1 Innovative, scalable and Net Zero scope 1 & 2 by 20252 Social value3 target of $1bn commercially sustainable solutions 20% $219m of portfolio electricity consumption sourced of social value created over FY24, targeting from onsite solar $1bn by 2030 Progress against decarbonisation pat
Slide 9: Culture aligned with value creation
Culture aligned with value creation Purpose-driven, integrated platform supporting increased activity across the Group Purpose driven culture Digitally-enabled innovative solutions • High levels of team motivation, with employee engagement at 87%1 • Key developer of talent, with leadership programs
Slide 10: Financial results and capital management
Financial results and capital management Alison Harrop CFO Stockland Momenta, NSW Artist’s impression, subject to authority and planning approvals.
Slide 11: Funds from operations
Funds from operations Results at the top end of guidance $m FY24 FY23 Change Pre-tax FFO per security at 35.4 cents, reflecting: Investment Management FFO 630 603 4.5% Comparable FFO growth of 3.5%1 across the IM portfolio, and a 7.5% increase in management income • Growth in earnings contribution f
Slide 12: Balance sheet strength
Balance sheet strength Active balance sheet management Key Metrics FY24 FY23 Available liquidity (cash and undrawn facilities) $3.1bn $1.6bn • Ongoing capital recycling with ~$690m1 of non-core Town Centres Gearing4 24.1% 21.9% disposals over FY24 Gearing (look-through)4 25.0% 22.6% • Substantial av
Slide 13: FY24 operating cashflows
FY24 operating cashflows Operating Cashflow1 Operating Cashflow before land acquisitions1 Prudent cashflow management: $114m $900m • FY24 distribution reflects a payout ratio of 75% of post-tax $332m in FY23 $981m in FY23 FFO • FY24 cashflow reflects the Group’s positioning for an Cash movements bet
Slide 14: Investment Management
Investment Management Kylie O’Connor CEO, Investment Management Oakleigh Industrial Estate, VIC.
Slide 15: Investment Management: Solid operational metrics
Investment Management Solid operational metrics Investment Management FFO of $630m comprising: • Strong comparable FFO growth of 3.5%1 across the portfolio, including 6.8%1 comparable FFO growth in Logistics Asset value3 • Sustained tenant demand driving positive leasing spreads in Logistics and Tow
Slide 16: Investment Management: Sustained income growth offsetting market impacts
Investment Management Sustained income growth offsetting market impacts Net valuation movement: $(310)m 1,2 Logistics Workplace Town Centres 2.8% decrease on 30 June 2023 book value Net valuation movement1: Net devaluation movement1: Net devaluation movement1: +$71m, +2.1% $(334)m, (17.1)% $(46)m, (
Slide 17: Logistics
Logistics High quality Eastern seaboard portfolio • Strong comparable FFO growth of 6.8%1, driven by • Tenant demand for well-located metropolitan assets Portfolio value • Improved leasing spreads2 at +37.9%, up from 21.1% in FY23 • Occupancy at 98.2%3, with active asset management to position portf
Slide 18: Workplace
Workplace Value-add portfolio delivering solid results • Majority of the $1.7bn Workplace portfolio is currently being positioned for future development • Positive comparable FFO growth of 3.2%1, driven by rental escalations on existing leases Portfolio value • Limited scale of the portfolio leading
Slide 19: Town Centres
Town Centres Resilient performance from essential-based portfolio $m FY24 FY23 • FY24 comparable FFO growth of 2.1%1 Town Centres FFO $359m $379m • Achieved positive re-leasing spreads of 3.3%2 while maintaining sustainable occupancy Asset value $4,495m5 $5,201m costs and stable tenant retention rat
Slide 20: Investment Management: Scalable operations supporting a growing platform
Investment Management Scalable operations supporting a growing platform Growing platform: Five capital partnerships with high -quality partners established over FY22-24 MPark, Macquarie Park, NSW Artists impression Halcyon Greens, QLD Lyra, VIC Springfield Rise, QLD The Gables, NSW The M_Park Trust
Slide 21: Investment Management: FY25 focus
Investment Management FY25 focus Capture income generation opportunities 1 • Secure positive rental reversion, particularly across Logistics portfolio • Actively position Town Centres portfolio to drive productivity and resilience • Maintain flexibility over lease structures to enable future develop
Slide 22: Development
Development Andrew Whitson CEO, Development Grand Central, Tarneit, VIC
Slide 23: Development FFO underpinned by residential development
Development Development FFO underpinned by residential development Strong performance in residential development partly offset by a lower level of development activity on behalf of third parties: • FY24 MPC settlements of 5,6371 lots at 23.2% development operating profit margin • FY24 LLC settlement
Slide 24: Commercial Development
Commercial Development Disciplined activation of Commercial Development opportunities • ~$13bn1 Commercial Development pipeline, sourced from existing asset base and through well-timed restocking, driving strong embedded value Stockland The Gables, NSW Grandview Childcare Centre, VIC • Disciplined m
Slide 25: Masterplanned Communities: Settlements above target
Masterplanned Communities Settlements above target • Delivered 5,6371 settlements in FY24 at a development operating profit margin of 23.2% • Settlements were above expectations for 5,300-5,500 lots in FY24 FY24 Development FY24 Development FFO EBIT • Default and cancellation rates above historical
Slide 26: Masterplanned Communities: Improvement over 2H24
Masterplanned Communities Improvement over 2H24 Net sales by quarter 2,036 1,974 1,947 1,891 1,868 • Net sales of 4,777 lots, reflecting an improvement in 2H24 vs 1H24 1,799 382 180 314 324 250 1,562 1,545 327 1,375 1,363 • Enquiry levels also up over 2H24, aided by a more stable interest rate envir
Slide 27: Masterplanned Communities: Market outlook
Masterplanned Communities Market outlook Australian residential market: 12-month outlook State Price Volumes Market commentary • Residential market fundamentals continue to be supportive • Sales volumes constrained by planning approvals limiting • Population growth remains elevated amid ongoing hous
Slide 28: Land Lease Communities
Land Lease Communities Increased settlements delivering strong FFO results • Delivered 444 home sites settlements in FY24, in line with target and up 16.2% from FY23 • FY24 development operating profit margin of 23.0%1 positively impacted by the deferral of launch costs for three FY24 Development FY
Slide 29: Land Lease Communities: New launches driving increased sales volumes
Land Lease Communities New launches driving increased sales volumes Net sales by quarter • FY24 net sales of 481 homes, partly driven by an increase in new project launches • Strong demand for Land Lease Communities: 131 135 • Reflected in continued price growth on LLC development product 111 104 93
Slide 30: Residential Development: Increase in pipeline activation
Residential Development Increase in pipeline activation driving returns Well positioned to take advantage of strong market fundamentals and eventual recovery in VIC Increasing the activation of our pipeline while market supply of land lots remains constrained Activation of our pipeline over time inc
Slide 31: Development: FY25 focus
Development FY25 focus Activate residential pipeline 1 • Well-positioned to take advantage of strong market fundamentals • Expect to launch up to eight new communities from the existing pipeline during FY251 • Scalable operations provides capacity to increase production, including the integration of
Slide 32: Summary and outlook
Summary and outlook Tarun Gupta MD & CEO B by Halcyon, QLD
Slide 33: Summary and outlook
Summary and outlook Outlook: • Accelerated execution of strategy and redeployment of capital towards targeted growth areas • Strong starting positions in MPC and LLC, with 3,415 and 351 contracts on hand respectively, and eight new communities expected to launch from the existing pipeline during FY2
Slide 34: Important Notice
Stockland Corporation Limited ACN 000 181 733 Stockland Trust Management Limited ACN 001 900 741; AFSL 241190 As a responsible entity for Stockland Trust ARSN 092 897 348 Important Notice This Presentation and its accompanying Annexures (“Presentation”) has been prepared and issued by Stockland Corp