Singapore Exchange Ltd. · SGX:S68
Singapore Exchange — Sabana Industrial REIT — FY2023 Earnings Presentation
34 slides from Singapore Exchange's earnings presentation, Jan 23, 2024
Slide 1: 2H 2023 and FY 2023 Results Presentation
2H 2023 and FY 2023 RESULTS PRESENTATION 23 January 2024 1 For the period ended 31 December 2023
Slide 2: Disclaimer
Disclaimer This presentation shall be read in conjunction with the financial information of Sabana Industrial Real Estate Investment Trust (“Sabana Industrial REIT” or the “REIT”) for the six months from 1 January 2023 to 30 June 2023 (“1H 2023”) and the published 1Q and 3Q Interim Business Updates
Slide 3: Agenda
Agenda 01 Key Updates and Highlights 02 Financial Performance 03 Capital Management 04 Portfolio Performance 05 Market Outlook & Strategy 3
Slide 4: Key Updates and Highlights
01 Key Updates and Highlights
Slide 5: FY 2023 at a Glance
2H 2023 and FY 2023 FY 2023 at a Glance For the year ended 31 December 2023 Financial Gross Revenue Capital Aggregate Leverage2 Performance $111.9m Management 34.3% +17.9% y-o-y 31 Dec 2022: 32.4% Net Property Income Average All-In Financing Cost $55.0m 3.89% +3.2% y-o-y 31 Dec 2022: 3.86% Total Amo
Slide 6: Key Performance Highlights
2H 2023 and FY 2023 Key Performance Highlights Achieved stable income available for distribution per unit in FY 2023, notwithstanding ongoing internalisation and accounts receivable impairment1. Total declared DPU for FY 2023 is 2.76 cents 2H 2023 NPI increased by 5.9% y-o-y to $27.8 million, uplift
Slide 7: Key Performance Highlights
2H 2023 and FY 2023 Key Performance Highlights Achieved significant construction progress on 1 Tuas Avenue 4 asset enhancement initiative, on track to obtain Temporary Occupation Permit by 1H 2024 Continued to implement green initiatives across selected portfolio properties during the year; with alm
Slide 8: Impact of Internalisation Process on Manager's Business as Usual
2H 2023 and FY 2023 Impact of Internalisation Process on Manager’s Business as Usual • No waiver from a review event for the REIT’s existing financing arrangements of totally unsecured loans has since been granted by relevant lenders of the REIT at this juncture1 • Emphasis of matter2 in respect of
Slide 9: Additional Costs Incurred up to December 2023
2H 2023 and FY 2023 Additional Costs Incurred up to 31 December 2023 • $1.37 million of expenses incurred in connection with (and up to) the requisition of the 7 August 2023 Extraordinary General Meeting (“EGM”) • Additional $3.27 million of internalisation expenses incurred in respect of implementa
Slide 10: Key Financial Highlights
2H 2023 and FY 2023 KEY FINANCIAL HIGHLIGHTS Gross Revenue 2H 2023 Results • Gross revenue increased by 13.1% y-o-y to $56.6 million, uplifted by positive rental reversions FY 2023 $111.9m (+17.9% y-o-y) across the portfolio as overall occupancy rate remained stable 2H 2023 $56.6m (+13.1% y-o-y) • N
Slide 11: Key Portfolio Highlights
2H 2023 and FY 2023 KEY PORTFOLIO HIGHLIGHTS Portfolio Occupancy Occupancy1 • Overall portfolio occupancy at 91.2% as at 31 December 2023, surpassing JTC’s 3Q 2023 FY 2023 91.2% (unchanged) industrial average of 88.9%2 • 85.8% of the portfolio by gross rental income contributed by multi-tenanted pro
Slide 12: Gross Revenue at All-Time High
2H 2023 and FY 2023 GROSS REVENUE AT ALL-TIME HIGH 120 25 23 properties 21 properties 18 properties • Gross Revenue reached a 100 20 high of $111.9m since initial public offering 80 No. of portfolio properties 15 • Highest Net Property Income since 2016 at millions 60 $55.0m, despite the divestment
Slide 13: Sustained Positive Rental Reversions
2H 2023 and FY 2023 SUSTAINED POSITIVE RENTAL REVERSIONS 30% 27.1% 25% 20% 17.5% 17.4% 17.4% 16.8% 16.6% 15% 13.6% 12.9% 10.2% 10.5% 10% 9.4% 7.8% 6.2% 5% 4.0% 3.1% 0% 1Q 2021 2Q 2021 3Q 2021 4Q 2021 1Q 2022 2Q 2022 3Q 2022 4Q 2022 1Q 2023 2Q 2023 3Q 2023 4Q 2023 FY 2021 FY 2022 FY 2023 Achieved 12
Slide 14: Key Property Highlights
2H 2023 and FY 2023 KEY PROPERTY HIGHLIGHTS Rejuvenation of New Tech Park to Future Proof Progress of 1 Tuas Avenue 4 AEI and Enhance Asset Quality Future-proofing New Tech Park Significant progress of 1 Tuas Avenue 4 AEI project • Upgrading electricity capacity to cater to tenants from expansionary
Slide 15: Updates on ESG Initiatives and Recognition
2H 2023 and FY 2023 UPDATES ON ESG INITIATIVES AND RECOGNITION Completion of installation Solar PVs at Improvement in Corporate three of the four properties under first Governance ranking as REIT climbed phase five positions • Solar PV system at 10 Changi South Street ▪ Ranked 30th of 43 Singapore-l
Slide 16: Financial Performance
02 Financial Performance
Slide 17: Distribution Statement
2H 2023 and FY 2023 Distribution Statement 2H 2023 2H 2022 Variance FY 2023 FY 2022 Variance ($’000) (%) (%) Gross Revenue (1) 56,598 50,057 13.1 111,875 94,907 17.9 NPI (1) 27,806 26,254 5.9 54,974 53,283 3.2 Finance Costs (1) (2) (6,216) (5,730) (8.5) (12,315) (10,848) (13.4) Total Income Availabl
Slide 18: Balance Sheet
2H 2023 and FY 2023 BALANCE SHEET As at As at ($’000) 31 December 2023 31 December 2022 Investment properties(1) 979,987 962,179 Other assets 24,894 21,013 Total assets 1,006,091 983,192 Borrowings, at amortised cost(2) 315,370 288,921 Other liabilities 114,183 108,484 Total liabilities 429,553 397,
Slide 19: Capital Management
03 Capital Management
Slide 20: Capital Management
2H 2023 and FY 2023 CAPITAL MANAGEMENT Every potential 50 bps increase in interest rates may result in a $0.38m decrease in distributable income or 1.1% reduction (equivalent to 0.03 cents) on DPU(1) per annum Key Credit Metrics Debt Maturity Profile As at As at 120 31 December 31 December Secured $
Slide 21: Distribution Details
2H 2023 and FY 2023 DISTRIBUTION DETAILS Sabana Industrial REIT Code: M1GU Distribution Period DPU (cents) 1 July 2023 to 31 December 2023 1.15 Distribution Timetable Last date that the Units are quoted on a “cum”- distribution basis Monday, 29 January 2024 Ex-date Tuesday, 30 January 2024 Books clo
Slide 22: Portfolio Performance
04 : Portfolio =a Performance “
Slide 23: Portfolio Overview
2H 2023 and FY 2023 PORTFOLIO OVERVIEW • Diversified portfolio of 18 industrial properties across four industrial segments in Singapore. We have a wide tenant base of both local and international companies • Most of our buildings enjoy strong connectivity being in close proximity to expressways, com
Slide 24: Portfolio Overview
2H 2023 and FY 2023 PORTFOLIO OVERVIEW Key Portfolio Attributes Portfolio Occupancy As at As at 31 December 31 December 92.6% 93.9% 91.8% 91.2% 2023 2022 Portfolio GFA 4.2m sq ft 4.2m sq ft Total portfolio occupancy(1) 91.2% 91.2% Weighted average master lease term to 5.1 years 6.0 years expiry(2) W
Slide 25: Well-Diversified Portfolio
2H 2023 and FY 2023 WELL-DIVERSIFIED PORTFOLIO Breakdown of Master-leased and Breakdown of Asset Types Multi-tenanted Properties By Gross Rental Income(1) By Gross Rental Income(1) 9.5% 14.2% 27.8% 55.9% 6.8% 85.8% High-Tech Industrial Chemical Warehouse & Logistics Master Lease Multi-tenanted Wareh
Slide 26: Proactive Lease Management
2H 2023 and FY 2023 PROACTIVE LEASE MANAGEMENT Out of approx. 430,000 sq ft of leases expiring in FY 2024, 42.7% have either been renewed or are under lease documentation Lease Expiry by Gross Rental Income 30% as at 31 December 2023 25% 20% 15% 22.5% 23.4% 13.4% 10% 11.6% 15.3% 5% 5.4% 3.6% 3.8% 0%
Slide 27: Leasing Update
2H 2023 and FY 2023 LEASING UPDATE 1H 2023 2H 2023 FY 2023 Renewal (sq ft) 290,797 256,243 547,040 (No. of Leases) (19) (19) (38) New Leases (sq ft) 242,859 164,830 407,689 (No. of Leases) (21) (21) (42) Rental Reversion (%) Retention Rate (%) 20.1% 84.8% 16.6% 14.7% 65.6% 56.0% 1H 2023 2H 2023 FY 2
Slide 28: Diverse Base of Tenants
2H 2023 and FY 2023 DIVERSE BASE OF TENANTS Trade Sectors By Gross Rental Income as at 31 December 2023 Electronics 27.8% Logistics & Supply Chain Management 20.2% Healthcare 11.5% F&B and Retail 9.3% Chemical 6.9% Data Centre & Telecommunication 6.3% R&D and Technology 5.0% Engineering 3.5% • 174 d
Slide 29: Long Weighted Average Leasehold for Underlying Land
2H 2023 and FY 2023 LONG WEIGHTED AVERAGE LEASEHOLD FOR UNDERLYING LAND Long Underlying Land Leases, with an Average of 27.4 Years by GFA 48.0% 21.7% 13.3% 10.0% 7.0% 0.0% 0.0% 2032 - 2036 2037 - 2041 2042 - 2046 2047 - 2051 2052 - 2056 2057 - 2061 Beyond 2061 Percentage of unexpired land lease term
Slide 30: Market Outlook & Strategy
05 Market Outlook & Strategy
Slide 31: Market Outlook & Strategy
Market Outlook & Strategy Singapore Economic Outlook Industrial Property Outlook Sabana Industrial REIT ▪ Singapore’s GDP growth was 1.2% in ▪ Based on a CBRE research report, new logistics ▪ The REIT’s performance in 2024 is expected to be 2023 and is projected to grow 1.0 to supply will average 2.
Slide 32: Contact Us
Sabana Real Estate Investment Management Pte. Ltd. (Company registration no: 201005493K, Capital markets services licence no: CMS100169) 151 Lorong Chuan #02-03 New Tech Park Singapore 556741 Tel: +65 6580 7750 Fax: +65 6280 4700 www.sabana-reit.com Contact Us For enquiries, please contact: Ms Low H
Slide 33: Extraordinary General Meeting
APPENDIX EXTRAORDINARY GENERAL MEETING • The Manager refers to its announcement of 12 January 2024 in relation to the requisition by Quarz Capital ASIA (Singapore) Pte. Ltd. of an extraordinary general meeting of Sabana Industrial REIT (the “Requisition”) Date Key Updates 12 January 2024 Announcemen
Slide 34: Update on Litigation in Relation to 33 & 35 Penjuru Lane
APPENDIX UPDATE ON LITIGATION IN RELATION TO 33 & 35 PENJURU LANE Date Key Updates 17 November 2023 Announcement on application to court in relation to the filing of Originating Claim (“OC”) against Kleio One-Solution Pte. Ltd. 19 December 2023 Announcement on Kleio One-Solution Pte. Ltd. (the “Defe
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