Keppel REIT · SGX:K71U
Keppel REIT — K-REIT Asia — FY2007 Earnings Presentation
14 slides from Keppel REIT's earnings presentation, Jan 23, 2008
Slide 1: FY2007 Financial Results
FY2007 FINANCIAL RESULTS 23 January 2008 Contents Highlights Financial Results Operations Review & Portfolio Performance Market Outlook & Review Going Forward Proposed Rights Issue 2
Slide 2: Highlights
Highlights Distribution Per Unit (DPU) of 8.82 cents, up 30.5% from FY2006 Asset size 210% from $677m to $2.1 bil Net asset value per unit up 85.3% from $2.04 as at end-2006 to $3.78 as at end-2007 Full committed occupancy for portfolio as at 31 December 2007 3 Financial Results
Slide 3: Earnings Continue to Outperform; Balance Sheet Highlights
Earnings Continue to Outperform Distributable income outperforms by 42.5% year-on-year to reach $21.8m FY2007 FY2006 4Q2007 4Q2006 % Chg % Chg (1) (S$'000) Actual Pro forma Actual Actual Property Income 40,069 33,778 18.6 11,028 9,102 21.2 Property Expenses (11,807) (10,153) 16.3 (4,004) (2,888) 38.
Slide 4: Income Contribution by Asset; Consistent Growth in DPU
Income Contribution by Asset FY2007 FY2006 4Q2007 4Q2006 % Chg % Chg ($'000) Actual Pro forma Actual Actual (1) Prudential Tower 5,037 4,395 14.6 1,381 1,218 13.4 Keppel Towers & GE Tower 13,741 10,598 29.7 3,432 2,980 15.2 Bugis Junction Towers 9,484 8,632 9.9 2,211 2,016 9.7 Total Net Property Inc
Slide 5: Capital Management
Capital Management Debt Profile Fixed-rate mortgage loans of S$190m: 4.06% p.a. until May 2011 Floating-rate bridging loan of S$942m: 3.3% p.a. maturing in Sep 2008 As At 31-Dec-07 31-Dec-06 Gross Borrowings $1,132.1m $190.1m (1) Gearing 53.9% 27.4% (2) Interest Coverage Ratio 2.3 times 2.7 times (3
Slide 6: Significant Maiden Acquisition; High Quality Portfolio of Assets
Significant Maiden Acquisition Completion of yield-accretive acquisition of Keppel Land’s one-third interest in ORQPL in December 2007 Asset size 210% from $677m as at end-2006 to $2.1 bil as at end-2007, with ORQ (1/3 interest) accounting for 47% of the asset size Portfolio’s net lettable area up 5
Slide 7: Broad Tenant Diversity; Portfolio Lease Expiry & Rent Review Profiles
Broad Tenant Diversity Top 10 Tenants: Risk diversification: total 50.8% of NLA (114,426 sm) @ 31 Dec 2007 of 125 tenants as at 31 December 2007 Deutsche Bank 7.9% I.E. Singapore 7.2% Tenant Trade Sector by NLA @ 31 Dec 2007 GE Pacif ic 6.8% 2.4% 7.5% 8.3% UBS 6.5% 4.3% 7.9% 4.7% ABN Amro 5.4% 6.9%
Slide 8: Further Appreciation in Portfolio Rents
Further Appreciation in Portfolio Rents Average portfolio Average Portfolio Gross Rentals gross rent up 58% psf pm $6.20 from end-2006 $6.02* $6.00 $5.80 $5.60 Uptrend in rental $5.40 $5.20 rates remains intact $5.00 $4.80 $4.43 $4.60 $4.28 $4.40 $4.05 $4.20 $3.80 $4.00 $3.71 $3.65 $3.80 $3.60 $3.40
Slide 9: Upward Trend in Office Rents; Supply Remains Tight
Upward Trend in Office Rents Singapore economy: 2007 advance GDP growth estimate at 7.5% Strong growth in financial services and construction sectors Government expects Prime Office Occupancy and Rentals economy to grow at $16 100% healthy 4.5 – 6.5% in $14 98% 2008 $12 96% $10 Prime office space $8
Slide 10: Going Forward: Growth Strategy
Going Forward Growth Strategy Achieve better returns through Organic proactive management and active Growth leasing of properties Seek growth acquisitions in Acquisition Singapore and overseas that will Growth potentially value-add to the portfolio Identify asset enhancement Asset initiatives to bet
Slide 11: A Pan-Asian Commercial REIT
A Pan-Asian Commercial REIT Portfolio Size Grow portfolio by identifying and pursuing $2,102.0m quality commercial assets 2,000 in Singapore and other 1,500 Asian growth cities 1,000 $815.0m Ride on different market $630.7m $677.0m cycles to allow for risk 500 diversification across 0 countries List
Slide 12: Proposed Rights Issue of New Units
Proposed Rights Issue of New Units To raise up to $700m Issue price to be determined at launch at a discount of up to 20% to then-prevailing trading price Net proceeds to be used to repay part of the bridging loan Keppel Corporation and Keppel Land undertake to take up their respective provisional a
Slide 13: Additional Information: Distribution Details
Additional Information Distribution Details Distribution Period 1 July 2007 - 31 December 2007 Distribution Rate 4.99 cents per unit Taxable: 4.69 cents per unit Tax-exempt: 0.30 cent per unit Distribution Timetable Notice of Books Closure Date 23 January 2008 Last Day of Trading on "cum" Basis 28 J
Slide 14: Snapshot of K-REIT Asia
Snapshot of K-REIT Asia Manager K-REIT Asia Management Limited Property Portfolio 5 quality commercial office assets valued at $2.1 bil Listing and Trading Date 28 Apr 2006 on Singapore Stock Exchange (1) Market Capitalisation $526.5 million (as at 31 Dec 2007) Unit Price $2.13 (closing price on 31