Grand City Properties Sa · XETR:GYC
Grand City Properties Sa — Q1 2020 Earnings Presentation
29 slides from Grand City Properties Sa's earnings presentation, May 2020
Slide 1: Q1 2020 Financial Results Presentation
Q1 2020 FINANCIAL RESULTS PRESENTATION MAY 2020 DRESDEN
Slide 2: Table of Contents
TABLE OF CONTENTS NRW BERLIN DRESDEN LONDON Financial performance 1 Financial Highlights 2 3 Guidance 4 APPENDIX and Portfolio update
Slide 3: Financial Highlights – Stable and Robust Operational Performance
FINANCIAL HIGHLIGHTS – 1 STABLE AND ROBUST OPERATIONAL PERFORMANCE Net profit Resilient business Net rental income Revenue Adjusted EBITDA €56 million driving top-line and bottom-line €95 million €135 million €74 million EPS (Basic) €0.24 -3% +2% -56% -63% Prudent financial FFO I per share FFO I per
Slide 4: COVID-19 Update – Ability to Adapt is Key
2 COVID-19 UPDATE – ABILITY TO ADAPT IS KEY The dynamic and innovative DNA of the Company has been vital in GCP’s ability to adapt to fast-changing situations, which in turn has mitigated possible effects of the COVID-19 pandemic Management continues to see very limited direct impact of the Corona V
Slide 5: Business Profitability - Sustainable Operational Results
2 BUSINESS PROFITABILITY - SUSTAINABLE OPERATIONAL RESULTS Selected consolidated statement of profit or loss 1-3/2020 1-3/2019 NET RENTAL INCOME (IN € MILLIONS) ADJUSTED EBITDA (IN € MILLIONS) in € ‘000 unless otherwise indicated Revenue 135,331 139,089 94.2 94.5 Net rental income 94,510 94,238 74.0
Slide 6: FFO I + II
2 FFO I + II FFO I (IN € MILLION) in € ‘000 unless otherwise indicated 1-3/2020 1-3/2019 Adjusted EBITDA 73,978 72,589 Finance expenses (11,009) (11,787) 55 Current tax expenses (7,392) (6,988) 53 Contribution from / (to) joint ventures and minorities, Net (355) (1,148) FFO I 55,222 52,666 FFO I per
Slide 7: EPRA NAV – Value Creation
2 EPRA NAV – VALUE CREATION Mar 2020 Dec 2019 EPRA NAV (IN € MILLION) € ‘000 € Per share € ‘000 € Per share EPRA NAV EPRA NAV incl perpetual notes Equity per the financial statements 4,971,226 4,966,599 CAGR EPRA NAV Equity attributable to perpetual notes investors (1,014,027) (1,030,050) +10% Equit
Slide 8: Investment Property – Accretive Capital Growth
2 INVESTMENT PROPERTY – ACCRETIVE CAPITAL GROWTH INVESTMENT PROPERTIES (IN € MILLIONS) ACQUISITIONS of approx. €100 million in Q1 2020 including ca. 50 units at an average multiple of 21x and a further 200 units in the pre-letting stage Assets primarily located in London 7,972 7,844 DISPOSAL of over
Slide 9: Portfolio Overview
2 PORTFOLIO OVERVIEW DISTRIBUTION BY VALUE – MARCH 2020 Focus on value-add opportunities in densely populated metropolitan areas along with diversification among areas of sustainable economic fundamentals and demographic prospects PORTFOLIO OVERVIEW MARCH 2020 Area Annualized net In-place rent per V
Slide 10: Portfolio NRW – March 2020
2 PORTFOLIO NRW – MARCH 2020 GCP is well positioned in Germany’s largest metropolitan area… PORTFOLIO DISTRIBUTION POPULATION DENSITY IN NRW 21%* 4th of GCP’s largest city Portfolio in Germany COLOGNE DORTMUND GELSENKIRCHEN ESSEN WUPPERTAL * all breakdowns are by values
Slide 11: Best in Class Berlin Portfolio – March 2020
2 BEST IN CLASS BERLIN PORTFOLIO – MARCH 2020 PORTFOLIO OVERVIEW BERLIN 24% QUALITY LOCATIONS IN TOP TIER NEIGHBORHOODS OF BERLIN of GCP’s Portfolio Value 2/3 2/3 of the Berlin portfolio is 15% located in top tier neighborhoods: of GCP’s Charlottenburg, Wilmersdorf, Mitte, Kreuzberg, Friedrichshain,
Slide 12: High Quality London Portfolio – March 2020
2 HIGH QUALITY LONDON PORTFOLIO – MARCH 2020 LONDON PORTFOLIO WELL CONNECTED LONDON PORTFOLIO 15%* of GCP’s Portfolio Over 90% of the portfolio is The total London situated within a short walking portfolio, including pre- distance to an marketed units consists underground/overground station of over
Slide 13: Portfolio East and North – March 2020
2 PORTFOLIO EAST AND NORTH – MARCH 2020 …with further diversification in Germany’s fast growing Eastern and largest Northern cities EAST PORTFOLIO NORTH PORTFOLIO 13%* 5%* of GCP’s of GCP’s Portfolio Portfolio DRESDEN LEIPZIG HALLE HAMBURG BREMEN * all breakdowns are by values
Slide 14: Portfolio Potential
2 PORTFOLIO POTENTIAL CURRENT ANNUALIZED NET RENTAL INCOME VS MARKET POTENTIAL* +8% 454 Conservatively including rent +20% 426 cap levels in Berlin Only 3% of units subject to rent restrictions from Subsidization 355 ~9 years Average tenancy length Mar 2020 Annualized Full market potential annualize
Slide 15: Financial Policy
2 FINANCIAL POLICY GCP FINANCIAL POLICY THE STRAIGHT BONDS AND THE CONVERTIBLE BOND ARE UNSECURED AND HAVE THE BELOW COVENANT PACKAGE: Strive to achieve A- global rating in the long term Overview of Covenant Package LTV limit at 45% Covenant Type GCP Covenant limit and Q1 2020 results Limitation on
Slide 16: Capital Structure
2 CAPITAL STRUCTURE INTEREST HEDGING STRUCTURE MAR 2020 FINANCING SOURCE MIX LTV DEVELOPMENT fixed & swapped 6% 8% Bank Debt 45% Board of Directors’ limit capped 7% 93% 5% variable Hedged 34% 33% Straight Bond 36% 36% 3% 3% Convertible 34% 33% 57% 56% Equity 88% Perpetuals Dec Dec Dec Mar 2017 2018
Slide 17: Solid Liquidity Position with Conservative Financial Platform
2 SOLID LIQUIDITY POSITION WITH CONSERVATIVE FINANCIAL PLATFORM DEBT AND INTEREST COVER RATIOS – Q1 2020 UNENCUMBERED ASSETS LIQUIDITY POSITION 6.7x 5.3x €6.2 bn over €1.5 billion March 2020 including €600mn debt issuance in April 2020 77% of value ICR* DSCR** LARGE POOL OF UNENCUMBERED ASSETS HIGHE
Slide 18: Maintenance, Capex and Modernization
2 MAINTENANCE, CAPEX AND MODERNIZATION Repositioning capex REPOSITIONING CAPEX AND MAINTENANCE Increasing property quality (IN € PER AVG SQM) • In the current COVID-19 environment, Support value creation 5.2 maintenance & repair works are ongoing to Measures include: 5.0 ensure tenant satisfac
Slide 19: Guidance
3 GUIDANCE Updated FY Previous FY 2020 Guidance Guidance Guidance updated due to €600 million bond issued in April 2020, Q1 finalized disposals and postponed FFO I (in € millions) 213-220 220 – 226 acquisitions. With the COVID19, GCP has put its FFO I per share (in €) 1.27-1.31 1.31 - 1.35 planned a
Slide 20: Appendix
20 APPENDIX GRAND CITY Properties S.A
Slide 21: Berlin Rent Cap – Limited Effect on the Total Portfolio
4 BERLIN RENT CAP – LIMITED EFFECT ON THE TOTAL PORTFOLIO Berlin Mietendeckel (rent cap) was passed on January 30, 2020 and was implemented on February 23, 2020 - The law limits existing rents to 120% of the rent cap (including modernization & location-based adjustments). - Landlords will be require
Slide 22: ESG - Outperformer
4 ESG - OUTPERFORMER GCP publishes its Corporate Responsibility Report annually, demonstrating the Company’s commitment to sustainability by presenting to investors, business partners, employees and other stakeholders its activities and achievements and to embed the high ESG criteria of the Company.
Slide 23: Proven Ability to Access Capital Markets
4 PROVEN ABILITY TO ACCESS CAPITAL MARKETS Proven track record Over €6 billion of capital raised since 2012, with a proven track record in 4 different instruments: Equity, Perpetual notes, Convertible bonds and Straight bonds across a broad spectrum of investors & markets €1,308 Mn €1,201 Mn €600 mi
Slide 24: Analyst Coverage
4 ANALYST COVERAGE Analyst Research Target Price 32 31.7 28 29.0 28.0 24 25.2 25.0 25.0 25.0 24.5 24.0 24.0 20 22.0 22.0 22.0 21.1 21.0 21.0 20.0 19.0 16 16.0 15.5 12 8 4 0 Citigroup UBS First Berlin Credit Suisse Kepler Commerzbank Hauck & J.P. Morgan Berenberg Bankhaus HSBC Deutsche Bank Bank of A
Slide 25: Share Development and Structure
4 SHARE DEVELOPMENT AND STRUCTURE GCP - Share Price and Total Return Since First Equity Placement (19.7.2012) Share price/conversion price throughout the Company’s issuances 24.81 *Refers to the conversion price of the convertible bonds issuance Frankfurt Stock Exchange **Effective conversion price
Slide 26: Management
4 MANAGEMENT Christian Windfuhr Mr. Windfuhr is Grand City Properties’ CEO. Before joining Grand City Mr. Windfuhr served as CEO of Maritim Hotels, with 40 hotels in Germany. Prior to this he served as CEO of Mövenpick. He achieved CEO the financial turnaround of Mövenpick, drove international expan
Slide 27: Management – Senior Management (continued)
4 MANAGEMENT Senior Management (continued) Uwe Schillinger Mr. Schillinger is GCP’s Director for Technical Service and responsible for the Facility Management. He has 12 years experience in facility management and joined GCP in 2006. Mr. Schillinger is an Head of Facility Management engineer in elec
Slide 28: Credit Rating Matrix
4 CREDIT RATING MATRIX Financial risk profile Moody's 12-18 Month Forw ard View As of 1 2 3 4 5 6 Min Modest Intermediate Significant Aggr High 5/31/2019 [2] - e- Lever- Real Estate / REIT Industry Grid [1] imal ssive aged Factor 1 : Scale (5%) Measure Score 1 a) Gross Assets (USD Billion) $10.7 - $
Slide 29: Contact and Disclaimer
CONTACT Katrin Petersen Head of Communications E-mail: katrin.petersen@grandcity.lu www.grandcityproperties.com DISCLAIMER IMPORTANT: This presentation has been provided for information purposes only and is being circulated on a confidential basis. This presentation shall be used only in accordance
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