Lifestyle Communities Ltd · ASX:LIC
Lifestyle Communities — FY2020 Earnings Presentation
41 slides from Lifestyle Communities's earnings presentation, 2020
Slide 1: Results Presentation Year ended 30 June 2020
personal use only Results Presentation Year ended 30 June 2020
Slide 2: Contents
Contents Appendix Overview 5 A.1 Model of Living 30 Operations Update 11 A.2 Growing Recurring Revenue 31 Financial Results 20 A.3 Dividend Policy 32 personal use only Outlook 25 A.4 Sales and Settlements 33 Summary 27 A.5 Investment Property Analysis 34 A.6 Investment Property Analysis 35 A.7 Defer
Slide 3: Our story
1.1 Our story 2012 personal use only Major capital raising of 2004 $36m to drive future growth Development of first community at Brookfield. First homeowner 2020 moves in June 2005 Over 3,500 homeowners. Acquire land for 22nd community. New home referral rate >48% 1 Community 2 Communities 7 Communi
Slide 4: A business for purpose
1.2 A business for purpose An affordable housing option for Australians aged over 50 personal use only A sustainable financial model where homeowners can prosper An empowering and engaging customer service offering that reimagines traditional retirement A BUSINESS FOR PURPOSE LIFESTYLE COMMUNITIES H
Slide 5: Financial Summary
Financial Summary Net profit after tax attributable to shareholders FY20 ($ Million) $42.8 FY19 ($ Million) $55.1 1.3 Overview Total assets $596.7 $465.8 FY20 Results snapshot Equity $291.4 $254.7 Dividend 5.5 cents per share 5.5 cents per share Net debt $128.6 $95.0 personal use only Net debt to ne
Slide 6: FY20 Highlights
1.4 Overview FY20 Highlights personal use only • 280 new sales and 253 new home settlements • 102 resale settlements of which 80 settlements attracted a deferred management fee • Profit after tax attributable to shareholders decreased from $55.1m to $42.8m driven by lower settlement numbers and lowe
Slide 7: The Lifestyle Culture
1.5 The Lifestyle Culture VATIO NO POWER personal use only N M IN ME ENES E SIV NT • All recruitment processes driven to match S RESPON candidates against our values and culture CA • Our ROADMAP performance management RE process ensures that our team are accountable to personify our culture ON PASSI
Slide 8: Portfolio overview and land acquisition strategy
1.6 Portfolio overview and land acquisition strategy 22 Communities in planning, development or under management Lifestyle Communities undertakes a personal use only detailed vetting of each potential site, and prioritises acquisitions based on Shepparton Focus remains on Melbourne and Geelong’s the
Slide 9: Lifestyle Communities's cluster strategy
1.7 Lifestyle Communities’s cluster strategy South East example personal use only • Lifestyle Communities now has 7 communities in its South East cluster • There are a number of advantages of the cluster strategy, including: – builds brand recognition Officer – drives referral Pakenham – allows us t
Slide 10: Portfolio snapshot FY20
Lifestyle Communities’s portfolio continues 1.8 Overview to grow organically through recycling capital Portfolio snapshot FY20 Homes occupied or sold and awaiting settlement personal use only Total homes in Homes sold and Homes sold and Communities communities occupied awaiting settlement No. % Exis
Slide 11: Operations Update
personal use only Section 2 Operations Update Lifestyle Bittern’s clubhouse lounge
Slide 12: Sales and settlements
2.1 Sales and settlements A BUSINESS FOR PURPOSE • 280 new home sales No. of • Shepparton sold out during the period Community Homes Sold % Sold personal use only • Actively selling new communities at Mount Duneed, Kaduna Park, Shepparton 300 300 100 Wollert North, and Plumpton Ocean Grove 220 211 9
Slide 13: Sales rates
2.2 Sales rates A BUSINESS FOR PURPOSE • Sales rates driven by a continued focus Sales profile from date of first sale personal use only on delivering a high level of homeowner experiences and innovation driving referral 210 • Greater utilisation of video and digital content building greater connect
Slide 14: Sales milestones and customer buying triggers
2.3 Sales milestones and customer buying triggers A BUSINESS FOR PURPOSE Sales launch • Major customer event personal use only St Kaduna Mount Ocean • Local press marketing Leonards Plumpton Wollert Park Duneed Grove • Database engagement 250 200 Sales Lounge opens on-site • First impression LIFESTY
Slide 15: Our go-to-market strategy
2.4 Our go-to-market strategy A BUSINESS FOR PURPOSE personal use only The onset of Covid-19 presented both challenges and opportunities as we adapted our sales and marketing plans. • Marketing implemented a much higher spend on digital and reduced face-to-face events and local area marketing LIFEST
Slide 16: Land acquisitions & development update
2.5 Land acquisitions & development update A BUSINESS FOR PURPOSE personal use only • First homeowners settled in • Civil program tracking to plan • Land settlement expected to December 2019 • Sales lounge open on-site occur in the middle of 2021 • Access road now complete • First frames due to go u
Slide 17: Developments in progress
2.6 Developments in progress 5 Communities in development phase A BUSINESS FOR PURPOSE personal use only LIFESTYLE COMMUNITIES Construction fully complete and First homeowners settled in May 2020. final homes settling Clubhouse under construction Clubhouse due for completion in Civil works in full s
Slide 18: Mount Duneed project fly-through
18 LIFESTYLE LIFESTYLE COMMUNITIES A BUSINESS COMMUNITIES A BUSINESS FOR PURPOSE FOR PURPOSE personal use only Visit www.bit.ly/ProjectFlyThrough 2.7 Mount Duneed project fly-through
Slide 19: Sustainability
2.8 Sustainability Our progress so far includes: personal use only • 2,500+ affordable homes occupied, 1,900+ in our development pipeline • Recycled water systems and stormwater catchment for water re-use • Solar program generating an increasing proportion of our electricity needs reducing overall n
Slide 20: Financial Results
personal use only Se ct io n 3 Financial Results Our resident alpaca chilling out at Lifestyle Warragul
Slide 21: Financial results
3.1 Financial results Annuity income will continue to increase through new home settlements, rental increases and resales of existing homes A BUSINESS FOR PURPOSE personal use only There are two components to the Homes Home sites under management annuity stream: 2,600 2,537 (2) 1. Site Rental Fee LI
Slide 22: Income statement
3.2 Income statement A BUSINESS FOR PURPOSE • Net profit decreased due to lower new home settlements and FY20 FY19(1) % personal use only lower investment property revaluation gains Income statement ($’000) ($’000) Movement • New home settlements reduced from 337 in FY19 to 253 in Home settlement re
Slide 23: Balance sheet
3.3 Balance sheet A BUSINESS FOR PURPOSE personal use only • Additional cash surplus retained due to uncertainty FY20 FY19(2)) % Balance sheet highlights regarding Covid-19 ($’000) ($’000) Movement • The value of inventory held has increased due to: Cash and cash on deposit 16,381 4,982 228.8% – the
Slide 24: Cash flow
3.4 Cash flow A BUSINESS FOR PURPOSE personal use only • Receipts from customers reduced due to a lower number FY20 FY19 of settlements in FY20 – 253, compared to 337 in FY19 Cash Flow Highlights ($’000) ($’000) • Included in payments to suppliers and employees is Receipts from customers 138,783 153
Slide 25: Outlook
Section 4 Outlook personal use only A rendered image of the beautiful landscaping planned for Lifestyle Kaduna Park
Slide 26: Settlement progress
4.1 Settlement progress New sales A BUSINESS FOR PURPOSE • Lifestyle Communities has a focused strategy to service a niche - providing good quality affordable housing to the over 50s Community FY21 FY22 FY23 personal use only • Currently funded and resourced to acquire at least two new sites Q1 Q2 Q
Slide 27: Summary
Summary personal use only Streetscape at Lifestyle Chelsea Heights
Slide 28: Summary
5.1 Summary • Enquiries, sales and settlements impacted by A BUSINESS FOR PURPOSE Covid-19 restrictions between March 2020 and June 2020 personal use only • FY20 delivered 253 new home settlements and 80 resale settlements that attracted a DMF • 280 new home sales in FY20 means we enter FY21 with 25
Slide 29: Appendix
Appendix personal use only A rendered image of the outdoor pool at Lifestyle St Leonards
Slide 30: Model of living
A.1 Model of living A BUSINESS FOR PURPOSE Homeowners at Lifetsyle Communities own their own personal use only home and lease the land upon which their homes are located, via a weekly site fee. Homes typically priced at 75-80% 75-80% of the median house price in the target catchment LIFESTYLE COMMUN
Slide 31: Growing recurring revenue stream
A.2 Growing recurring revenue stream Lifestyle Communities’s business has two core elements A BUSINESS FOR PURPOSE personal use only 1. Creating communities 2. Managing communities A mix of equity and debt capital is used to develop greenfield Completed communities generate recurring revenue streams
Slide 32: Dividend policy
A.3 Dividend policy A BUSINESS FOR PURPOSE As a general principle, Lifestyle Communities intends to pay dividends out of post-tax operating cashflow personal use only generated from community management including: • Operating cash flow generated from community management (net rental and DMF) • Appor
Slide 33: Sales and settlements
A.4 Sales and settlements A BUSINESS FOR PURPOSE New home settlements Net sales Resale home settlements personal use only Communities FY20 FY19 FY20 FY19 FY20 FY19 Existing Communities – Sold out Brookfield in Melton 14 11 Seasons in Tarneit 3 3 Warragul 10 9 Casey Fields in Cranbourne (1) 10 11 LIF
Slide 34: Investment property analysis
A.5 Investment property analysis A BUSINESS FOR PURPOSE personal use only Community Valuation Summary (On completion) Rental Metrics DMF metrics (extracts from valuations) Net rental per home (3) (from DMF terminal Average sale value Last valuation date Rental cap. rate 1 valuation adjusted) DMF dis
Slide 35: Investment property analysis
A.6 Investment property analysis A BUSINESS FOR PURPOSE Investment properties per Community Valuation Summary financials 30 June 2020 personal use only Investment properties at Total Homes Homes Occupied cost (1) ($m) At fair value ($m) Mature Communities Brookfield in Melton 228 228 6.76 38.48 Seas
Slide 36: Deferred management fees
A.7 Deferred management fees A BUSINESS FOR PURPOSE Casey Chelsea Berwick Brookfield Seasons Warragul Fields Shepparton Heights Hastings Lyndarum Officer Geelong Waters Bittern Total personal use only Historical resales(1) 137 30 66 52 18 45 34 9 14 7 8 2 422 Average tenure (years) 6.5 5.6 4.5 4.2 3
Slide 37: Fair value breakdown
A.8 Fair value breakdown At Lifestyle Communities our homeowners purchase a proportionate share of the clubhouse, pool, recreational facilities, and all associated infrastructure when they purchase their home.This helps us Investment Properties Carrying Value at 30 June 2019 399,750 Land Acquisition
Slide 38: Cash flow analysis FY20
A.9 Cash flow analysis FY20 A BUSINESS FOR PURPOSE Supplementary Cash Flow Fully settled Berwick Ocean Mount Kaduna Wollert Communities Analysis for FY20 Communities(3) Shepparton Geelong Waters Bittern Grove Duneed Park North Plumpton in planning(4)) Total personal use only Total Number of Homes 1,
Slide 39: Cash flow analysis FY19
A.10 Cash flow analysis FY19 A BUSINESS FOR PURPOSE Supplementary Cash Flow Fully settled Berwick Ocean Mount Kaduna Wollert Analysis for FY19 Communities(3) Shepparton Geelong Waters Bittern Grove Duneed Park North Plumpton Tyabb Total personal use only Total Number of Homes 1,395 300 164 216 209 2
Slide 40: Important notice and disclaimer
Important notice and disclaimer warranty, express or implied, beliefs of LIC’s management cautioned not to place undue is made as to the fairness, as well as assumptions made reliance on forward-looking personal use only accuracy, completeness or by and information currently statements and LIC assum
Slide 41: Lifestyle Communities Limited
personal use only Lifestyle Communities Limited Level 1, 9-17 Raglan Street South Melbourne VIC 3205 Ph: (03) 9682 2249 www.lifestylecommunities.com.au