BWP Trust · ASX:BWP
BWP Trust — Bunnings Warehouse Property Trust — Investor Presentation (August 2001)
29 slides from BWP Trust's investor presentation, Aug 29, 2001
Slide 1: Bunnings Property Management Limited 29-30 August 2001
Bunnings Property Management Limited 29 - 30 August 2001
Slide 2: Manager and Directors
Manager: Linda Kenyon Chairman: Bill Cairns (non-executive) Directors: Peter Mansell (non-executive) Robert McCuaig (non-executive) Gene Tilbrook 2
Slide 3: Introduction
Introduction • History • Geographic spread • Growth indicators • The tenant • Site selection/development process • Strengths • Annual results 2001 • Market performance • Revaluations • The future 3
Slide 4: History
History • IPO closed early and oversubscribed - September 1998 • original portfolio - $170 million, 20 properties • Trust listed on ASX - 16 September 1998 • one for three rights issue - March 2000 (undersubscribed; nine month overhang) • 2001: - renewed rollout - revaluations commenced 4
Slide 5: Geographic diversification (as at 30 June 2001)
Geographic diversification (as at 30 June 2001) Queensland 6 warehouses Western Australia 6 warehouses 2 sites South Australia 2 warehouses NSW / ACT 2 warehouses Victoria 13 warehouses 3 sites 5
Slide 6: Asset growth
Asset growth At cost Revaluations 300 200 $m 100 0 98/99 99/00 00/01 6
Slide 7: Projected asset growth - 5 properties per year
Projected asset growth - 5 properties per year (excludes revaluations) 500 400 300 $m 200 100 0 98/99 99/00 00/01 01/02 02/03 03/04 7
Slide 8: Projected asset growth - 7 properties per year
Projected asset growth - 7 properties per year (excludes revaluations) 500 400 $m 300 200 100 98/99 99/00 00/01 01/02 02/03 03/04 8
Slide 9: General principles
General principles • 20-40% gearing • hedging of at least 50% of actual or anticipated debt • return criteria 9
Slide 10: The tenant
The tenant BUNNINGS WAREHOUSE PROPERTY TRUST
Slide 11: The tenant (continued)
The tenant (continued) • Bunnings has nearly tripled its sales since 1995 Sales ($m) 1500 1,355 1000 480 500 0 1995 1996 1997 1998 1999 2000 2001 (forecast) 11
Slide 12: The tenant (continued)
The tenant (continued) • Bunnings’ profit has grown at a faster rate than its sales EBIT ($m) 150 129 100 50 27 0 1995 1996 1997 1998 1999 2000 2001 (forecast) 12
Slide 13: The sites
The sites • visible and accessible from a major arterial, highway or freeway • ready vehicle access • ample parking • appropriate council zoning • moderate construction costs Minchinbury, NSW • standardised design format 13
Slide 14: The sites (continued)
The sites (continued) • land with industrial value as opposed to commercial • clustering of complementary outlets nearby • significant catchment area • average warehouse site - 2.9 hectares • average warehouse size - 7,022 square metres 14
Slide 15: The sites (continued)
The sites (continued) Cannon Hill, Qld Morayfield, Qld 15
Slide 16: The sites (continued)
The sites (continued) Rockingham, WA Hoppers Crossing, Vic 16
Slide 17: Development process
Development process • Bunnings Building Supplies identifies a site • proposal and evaluation to BPML • review by BPML - usual investment criteria • if acquiring site: - buy direct - exercise option 17
Slide 18: Strengths
Strengths • the tenant: - proven trading record - strong income stream • leases: - long term: 5 + 5 + 5 years - annual CPI reviews - 5 year market reviews - some ratchet clauses • potential for long term capital appreciation • Trust not exposed to development risk • geographically diversified 18
Slide 19: Market rent reviews
Market rent reviews Year No. of properties 2003 18 2004 7 2005 4 2006 3 (proposed) 19
Slide 20: Results for year ended 30 June 2001
Results for year ended 30 June 2001 2001 2000 Total income $23.1m $18.6m Operating profit $16.5m $13.9m Distribution per unit 9.18c 9.56c Tax advantaged component 40.86% 54.73% Unit price at 30 June $1.15 $0.98 Management expense ratio (annualised) 0.8% 0.4% 20
Slide 21: Results for year ended 30 June 2001 (continued)
Results for year ended 30 June 2001 (continued) 2001 2000 Total assets $288.0m $244.1m Borrowings $92.7m $63.1m Unitholders’ equity $185.9m $173.2m Gearing (debt to total assets) 32.2% 25.9% Number of units on issue 182m 177m Number of unitholders 9,292 9,070 Net tangible asset backing per unit $1.0
Slide 22: Distributions of the Trust since listing
Distributions of the Trust since listing End of concessional 6 management fee 5 Cents per unit 4 3 2 1 0 Dec-98 Jun-99 Dec-99 Jun-00 Dec-00 Jun-01 22
Slide 23: BWP unit price history
$ Ju l-0 0.95 1.00 1.05 1.10 1.15 1.20 1.25 1.30 0 Au g- 00 Se p- 00 O ct- 00 No v-0 De 0 c- 00 Ja n- 01 BWP unit price history Fe 23 b- 01 M ar -0 1 Ap r-0 M 1 ay -0 1 Ju n- 01 Ju l-0 1 Au g- 01
Slide 24: Market performance
Market performance BWP total return index S&P/ASX 300 property accumulation index 130 S&P/ASX 300 accumulation index 125 120 115 110 105 100 95 90 0 1 01 00 00 1 00 00 01 01 0 1 t-0 r-0 -0 l-0 -0 g- v- b- p- c- n- n- ay ar Oc Ju Ap No Au Fe De Se Ja Ju M M 24
Slide 25: Revaluations
Revaluations Book value Current market % change Current (price plus costs) value valuation yield* Altona, Vic $7,182,000 $8,200,000 +14.17% 9.75% Fountain Gate, Vic $8,765,000 $10,500,000 +19.79% 9.50% N u n a w a d i n g , Vic $12,879,000 $14,800,000 +14.92% 9.50% S a n d o w n , Vic $8,237,000 $9,
Slide 26: Revaluations (continued)
Revaluations (continued) • inferred rental increases (market reviews due in 2003) • applied higher than market yield, reflecting two year delay and risk • re-visited underlying land value as cross-check • further 10 properties currently being revalued 26
Slide 27: Howard Smith / BBC
Howard Smith / BBC • some 17 properties • majority in NSW • Bunnings’ immediate focus is on operational issues (management, branding, culture, advertising, supply, etc.) • possible offers to BWPT - a lower priority issue • BPML to apply usual investment criteria 27
Slide 28: Howard Smith - geographic diversification
Howard Smith - geographic diversification Queensland 6 = BWPT Western Australia 2 = BBC 6 = BWPT South Australia 1 = BBC 2 = BWPT 0 = BBC NSW / ACT 2 = BWPT 11 = BBC Tasmania 0 = BWPT Victoria 1 = BBC 13 = BWPT 2 = BBC 28
Slide 29: www.bunningspropertytrust.com.au
www.bunningspropertytrust.com.au 29
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