Gpt Group · ASX:GPT
Gpt — The GPT Group — H1 2006 Earnings Presentation
41 slides from Gpt's earnings presentation, August 2006
Slide 1: Mid Year Results
Mid Year Results August 2006 GPT The GPT Group
Slide 2: Agenda
Agenda Highlights – Group highlights – Financial highlights Operating Performance Strategic Initiatives – Joint Venture update – Funds management platform Strategy
Slide 3: Group Highlights
Group Highlights
Slide 4: Highlights
Highlights Delivery of financial forecast – Results in line with EM forecast – Distribution growth 19.3% Strong balance sheet Solid results from existing operations Progress on strategic initiatives – JV fully invested – Launch of first wholesale fund Outlook remains positive
Slide 5: Financial Highlights
Financial Highlights rT The GPT Group
Slide 6: Reconciliation of Distributable Amount
Reconciliation of Distributable Amount Consolidated $m Profit after tax 696.5 (P&L) Less Fair value adjustments 454.6 Net gain on disposal of properties 2.0 Plus Revenue adjustments 20.5 Internalisation costs 7.1 Other (Net) 7.6 Realised operating income 275.1 (Note 3) Realised operating income Jun
Slide 7: Strong distribution growth
Strong distribution growth 15 [— 13.9 (Forecast) 13 [— 11 [7 10.5 10.1 10.3 gr 7K | | ! 5 June02 Dec02 June03 Dec03 June04 Dec04 June05 DecO05 June06 Dec 06 GPT The GPT Group
Slide 8: Total Return Above Index (June 2006)
Total Return Above Index (June 2006)
Slide 9: Diversified Asset Base
Diversified Asset Base* *At June 2006, adjusted for the creation of the GPT Wholesale Office Fund in July 2006. Office includes GPT investment in GWOF. JV equals contributed equity.
Slide 10: Strong Balance Sheet
Strong Balance Sheet* Total assets $11 billion Gearing of 32.8% Total borrowings $3.6 billion – $2,590 million AUD – €600 million (AUD equivalent $1,032 million) Interest cover 3.3** times Current effective interest rate 5.01% – Weighted average length of debt 2.9 years *At June 2006, adju
Slide 11: Significant increase in Net Asset Backing
Significant increase in Net Asset Backing* Net asset backing per security $3.47 Strong increase on Dec 2005 $3.16 Increase in net revaluations $462.2 million *Excludes provision for June quarter distribution payment (approximately 6.9 cents per security).
Slide 12: Interest Rate Hedge Profiles Limits Risk
Interest Rate Hedge Profiles Limits Risk At 30 June, adjusted for creation of GPT Wholesale Office Fund July 2006
Slide 13: Retail
The GPT Group
Slide 14: Retail
Retail Total assets $5.4 billion – Interests in 16 shopping centres – 9 Homemaker City centres Comparable income growth 3.5% Net revaluations $264.9 million
Slide 15: Retail
Retail Solid sales performance in moderating market* – Total centre comparable MAT growth 1.8% – Specialty comparable MAT growth 1.4% Regional specialty sales $9,117 sqm* – Regional specialty occupancy costs 15% Occupancy high and arrears low – Vacancy less than 1% GLA – Arrears less than 0.1%
Slide 16: Development Pipeline: Progress Continues
Development Pipeline: Progress Continues Macarthur Square – Completed July 2006 – $109 million development – Forecast year yield 8% Rouse Hill Town Centre underway – $470 million greenfield development – Target yield 7% – Excellent trade area demographics
Slide 17: Macarthur Square, Sydney
Macarthur Square, Sydney
Slide 18: Rouse Hill Town Centre
Rouse Hill Town Centre
Slide 19: Development Pipeline Remains Strong
Development Pipeline Remains Strong Rouse Hill (06-08) $470m Charlestown (07-08)* $350m Chirnside (07-08)* $100m Wollongong (08-09)* $300m 2006 2007 2008 2009 *Estimated timing and cost only
Slide 20: Office
The GPT Group Office
Slide 21: GPT Office Investment
GPT Office Investment 237.0 237.0 24.4 24.4 294.2 294.2 330.9 330.9 332.5 332.5 5.4 5.4 313.3 313.3 50.7 170.0 141.1 63.0 293.4 478.7 257.2 94.6 342.2 249.6 - 862.3 3,678.2 2,400.0 The GPT Group
Slide 22: Office
Office $2.4 billion investment – GPT assets $1.5 billion – Investment in GWOF $860 million Comparable income up 14.5% Strong net revaluations ($167.8 million) Over 96% space committed* 59,000 sqm leased to June 2006* – Terms agreed over an additional 21,700 sqm Manageable lease expiry pr
Slide 23: Artist's impression of Bourke Street, Melbourne
Artist’s impression of 818 Bourke Street, Melbourne
Slide 24: Development
Development 818 Bourke Street, Melbourne – Located in Docklands, Melbourne – Adjacent to National@Docklands – Cost approx $100 million (forecast yield 7.5%) Quality campus style asset – A-grade quality building – 21,700 sqm office space over six levels 10,650 sqm committed to Ericsson – 10 yea
Slide 25: Hotel/Tourism
Hotel/Tourism
Slide 26: Hotel/Tourism
Hotel/Tourism $842 million investment – Four Points by Sheraton, Sydney – Voyages Resorts Income up 2% (like with like) Performance weaker following strong 2005 result – Weak leisure demand – Increased marketing costs – Cyclone Larry impacts – One off costs Ongoing focus on driving revenue/r
Slide 27: Industrial/Business Parks
Industrial/Business Parks
Slide 28: Industrial/Business Park
Industrial/Business Park Portfolio grown to $607 million portfolio Comparable income up 8% High occupancy – 97% – Long average lease term – 5.8 years Net revaluations $12.2 million
Slide 29: Significant Growth Secured
Significant Growth Secured Acquisitions ($150 million) – Portfolio of six assets acquired February 2006 – Wetherill Park, NSW – Port Adelaide, SA – Macquarie Park, NSW Quad 4 underway – Due for completion end 06 Austrak, Somerton – Labelmakers facility (22,200 sqm) complete – Coles Myer Nation
Slide 30: Joint Venture
Joint Venture
Slide 31: Joint Venture Highlights
Joint Venture Highlights On track to achieve full investment by Dec 2006 – $5.0 billion completed at June 30 – $0.8 billion currently under contract On track to deliver JV EM forecasts for 2006 Well positioned to deliver strong earnings growth in 2007 – First year of full investment – Addition
Slide 32: Joint Venture June 2006 Snapshot
Joint Venture June 2006 Snapshot Assets acquired* $5.8 billion Gearing 76% Average yield 6.8% Cost of debt 4.8% Debt Hedging 5.4 yrs weighted average Yield Spread 200 bps * Completed and under contract
Slide 33: Joint Venture German Residential
Joint Venture German Residential* Key Facts GLA 2.2m sqm Units* 35,078 Value $2.4b Value p/sqm € 622 Average Yield 6.5% * Includes residential + commercial units *Settled and under contract
Slide 34: Joint Venture European Retail
Joint Venture European Retail* Key Facts Assets 42 GLA 364,304 sqm Value $1.0b Average Yield 6.5% *Settled and under contract
Slide 35: Joint Venture European Light Industrial
Joint Venture European Light Industrial* Key Facts Assets 85 GLA 1.27m sqm Value $1.2b Average Yield 6.4% *Settled and under contract
Slide 36: Joint Venture US Multifamily
Joint Venture US Multifamily $500m interest in a $1.2b multifamily portfolio – Stable cashflows, tenant diversity – Improving fundamentals – Significantly below replacement cost Investment structure – One third equity interest $412m 6.3% yield – 10 Year mezzanine debt $84m 10.25% yield
Slide 37: Joint Venture US Multifamily
Joint Venture US Multifamily Management by Alliance Key Facts Top Ten multi-family manager Properties Incentivised fee structure 66 (11 US States) Apartments 19,500 Value $496m* *JV one third equity interest + mezzanine debt
Slide 38: Joint Venture US Retail
Joint Venture US Retail Key Facts Assets 6 GLA 3.7m sq ft Value* $478m Average Yield 7.8% *JV 90% interest
Slide 39: Joint Venture Results
Joint Venture Results Achievements – past 12 months – JV fully invested by Dec 2006 – Well diversified, but focused portfolio – Investment strategy delivered • Stable cash-flows • Attractive spreads • 75% gearing, non-recourse debt • Interest rates substantially hedged – Well positioned to deliver
Slide 40: Funds Management
Funds Management Key strategic initiative – Diversifies capital sources – Leverages GPT skill base – Balance sheet management First fund launched July 2006 – $2.1 billion GPT Wholesale Office Fund – Strong demand – Excellent register (domestic and international investors) – GPT co-investment 40%
Slide 41: GPT Strategy
GPT Strategy Core portfolio – Ongoing active management to drive returns – Expansion through acquisitions and developments Joint Venture – Continued focus on converting pipeline assets, stable cashflows/locked in funding spreads – Maximising value – trading, securitisation, refinancing GPT pos