Slide 1: 2017 Annual General Meeting of Vicinity Centres - Addresses and presentation
16 November 2017 Market Announcements Office ASX Limited 20 Bridge Street SYDNEY NSW 2000 Dear Sir/Madam 2017 Annual General Meeting of Vicinity Centres - Addresses and presentation Please find attached copies of the Chairman’s and CEO and Managing Director’s addresses and presentation to be deliver
Slide 2: 2017 Annual General Meeting addresses
ASX Announcement 16 November 2017 2017 Annual General Meeting addresses Chairman’s address Mr Peter Hay Simple and transparent business model, with strong focus on portfolio improvement At Vicinity Centres (Vicinity, ASX:VCX), our business model is simple and transparent, based on a consistent strat
Slide 3: Two years of delivering on strategy since forming in June 2015
As part of improving the quality of our portfolio, our development pipeline enables us to continue to revitalise our assets, keeping up with changing consumer trends and introducing the latest retail concepts. We have a $2 billion pipeline of identified projects, around half of which is Vicinity’s s
Slide 4: Our focus and progress on strategy delivery throughout FY17
Our focus and progress on strategy delivery throughout FY17, together with the initiatives outlined on this slide, position Vicinity strongly going forward. CEO and Managing Director transition Before I hand over to Angus to provide you with an overview of our results for FY17, on behalf of the Boar
Slide 5: Portfolio metrics and retail sales performance
Our portfolio metrics were solid for the period reflecting the dedication of our leasing and centre management teams, and also the positive impact from asset divestments, acquisitions and completed developments. Comparable net property income growth was 2.5% and overall portfolio occupancy increased
Slide 6: Our response to changing retail trends
Our response to changing retail trends So how are we responding to these changing retail trends? For our consumers we continue to introduce new and dynamic retailers and innovative concepts. We are significantly re-weighting our retail mix from mid-level women’s apparel towards food and services and
Slide 7: Queen Victoria Building
Queen Victoria Building Queen Victoria Building is a historically significant federation style building constructed in the late 19th century, replacing the original Sydney markets on the site. Today it is a centrepiece of retail experience in the heart of the Sydney CBD with 33 million visitors ever
Slide 8: Chadstone – the evolution continues
Chadstone – the evolution continues We are in the final stages for selecting an operator of the proposed 4 to 4.5 star 250-room hotel at Chadstone. With limited quality competition in the region, when completed, the hotel is expected to be utilised by business travellers, tourists and visitors to bo
Slide 9: A focus on creating shared value for Vicinity and our stakeholders
A focus on creating shared value for Vicinity and our stakeholders I am proud to say that we have been making great progress on implementing our sustainability strategy and this has been recognised by a number of sustainability rating organisations. The Global Real Estate Sustainability Benchmark as
Slide 10: Chairman’s address (continued) FY17 in review
Chairman’s address (continued) Mr Peter Hay FY17 in review In summary, in FY17 we delivered solid underlying earnings and our net profit was underpinned by strong valuations, despite a soft retail sales environment. We further enhanced our portfolio quality through acquisitions, divestments and cont
Slide 11: Board renewal
Board renewal You may recall that the Board committed at last year’s annual general meeting to reduce its overall number of Directors over a two year period. In support of this commitment, Mr Charles Macek and Ms Debra Stirling will both retire with effect from the conclusion of today’s meeting and
Slide 12: 2017 Annual General Meeting
2017 Annual General Meeting 16 November 2017
Slide 13: Chairman’s address
Chairman’s address Peter Hay Chadstone, VIC
Slide 14: Agenda
Chairman’s address – Peter Hay Agenda CEO and Managing Director’s address – Angus McNaughton Formalities of the Meeting – Peter Hay Close of Meeting
Slide 15: Your Board
Your Board Peter Hay (Chairman) Charles Macek David Thurin Debra Stirling Karen Penrose Peter Kahan Tim Hammon Trevor Gerber Wai Tang Angus McNaughton (CEO and Managing Director) Vicinity Centres | 2017 Annual General Meeting | 16 November 2017 4
Slide 16: Simple and transparent business model, with strong focus on portfolio improvement
Simple and transparent business model, with strong focus on portfolio improvement Creating value and sustainable growth by owning, managing and developing quality Australian retail assets Invest in quality Australian assets across the retail spectrum Focus on long-term value creation and sustainable
Slide 17: A leading owner, manager and developer of Australian retail property
A leading owner, manager and developer of Australian retail property Scale benefits and active management enhance the consumer and retailer experience Assets under management $25.3 billion Annual retail sales $17.9 billion Development pipeline $2.0 billion1 Gross lettable area 2.8 million sqm Tenant
Slide 18: Two years of delivering on strategy since forming in June 15
Two years of delivering on strategy since forming in June 2015 Portfolio enhancement strategy significantly advanced and capital position strengthened Successful delivery of merger synergies and integration Improvement in metrics over past two years3 $1.7b of divestments Interests in 19 assets sold
Slide 19: Active capital management supporting future growth
Active capital management supporting future growth FFO and AFFO adopted as principal policy measures effective from FY18 Funds from operations (FFO) to be adopted as primary earnings measure from FY18 FFO measure excludes lost rent from undertaking developments Revised distribution policy based on a
Slide 20: CEO and Managing Director’s address
CEO and Managing Director’s address Angus McNaughton DFO South Wharf, VIC
Slide 21: FY17 summary
FY17 summary Solid result reflecting implementation of strategy Solid operating and financial results $1,583.6m 15.5% Statutory net profit after tax Total return1 Strong asset valuation gains of $853m, up 6.0% Completed major redevelopment at Chadstone 4.6% 17.3 cps Underlying EPS growth2 Distributi
Slide 22: Retail sales performance
Retail sales performance Ongoing active tenancy remixing to higher demand categories, whilst retail sales environment remains challenging Retail sales environment Sales growth driven by population, employment and house price growth Subdued consumer confidence, low wages growth and rising costs of li
Slide 23: Retail trends continue to evolve
Retail trends continue to evolve Capturing opportunities from structural changes Changing consumer preferences Driven by demographic shifts and technological change Shift in spending towards experiences Physical stores enabling delivery of unique and relevant experiences Strong demand from internati
Slide 24: Our response to changing retail trends
Our response to changing retail trends Building a resilient portfolio and a focus on enhancing the retail experience Our consumers – creating unique and relevant experiences Introducing the latest retail concepts and responding to changing consumer needs Our retailers – delivering compelling value f
Slide 25: Swap of premium Sydney retail assets with GIC
Swap of premium Sydney retail assets with GIC Vicinity adds three strongly performing Sydney CBD assets to portfolio Strategic exchange of premium Sydney centres 49% interest in Chatswood Chase Sydney divested for $562.3m1 to GIC 50% interests in Queen Victoria Building, The Galeries and The Strand
Slide 26: Queen Victoria Building
Queen Victoria Building Annual retail sales $276.7 million Specialty MAT/sqm $25,393 Annual consumer visitation 33.0 million Gross lettable area 13,668 sqm Retail stores 164 Note: Data as at September 2017. Source: IPOH Pty Ltd. Vicinity Centres | 2017 Annual General Meeting | 16 November 2017 15
Slide 27: The Galeries
The Galeries Annual retail sales $189.8 million Specialty MAT/sqm $20,212 Annual consumer visitation 21.3 million Gross lettable area 14,849 sqm Retail stores 77 Note: Data as at September 2017. Source: IPOH Pty Ltd. Vicinity Centres | 2017 Annual General Meeting | 16 November 2017 16
Slide 28: The Strand Arcade
The Strand Arcade Annual retail sales $123.9 million Specialty MAT/sqm $25,030 Annual consumer visitation 5.0 million Gross lettable area 5,797 sqm Retail stores 70 Note: Data as at September 2017. Source: IPOH Pty Ltd. Vicinity Centres | 2017 Annual General Meeting | 16 November 2017 17
Slide 29: Chadstone’s leading position reinforced
Chadstone’s leading position reinforced A world-class retail, dining and entertainment destination Major $666m redevelopment1 completed in June 2017 Significantly broadened and enhanced retail mix Introduced first LEGOLAND® Discovery Centre in southern hemisphere Well embraced by consumers and retai
Slide 30: Chadstone – the evolution continues
Chadstone – the evolution continues High quality hotel and significant additional remix opportunities Hotel development ($120m)1 planned to start in FY18 In final stages of selection process for hotel operator Proposal for 250 rooms over 13 levels with 4 to 4.5 star rating Targeting business travell
Slide 31: Mandurah Forum redevelopment on program
Mandurah Forum redevelopment on program Improving product offer and experience, first retail stage opened $350m major redevelopment1 First retail stage opened in July 2017 New Target store and over 60 specialty stores Same-store specialty sales averaged over 7% growth in August and September 2017, c
Slide 32: The Glen redevelopment progressing well with first stage open
The Glen redevelopment progressing well with first stage open Major redevelopment to capitalise on high income trade area $460m major redevelopment1 Latest format David Jones New contemporary food gallery with casual dining hub and an outdoor dining precinct Complete refurbishment of existing centre
Slide 33: DFO Perth construction progressing well
DFO Perth construction progressing well Developing Perth’s first DFO $150m project1 Joint venture to develop Perth’s first DFO centre 120 specialty stores and over 1,500 car spaces Construction and leasing progressing well Ground services and slab works well advanced Installation of steel structure
Slide 34: A focus on creating shared value for Vicinity and our stakeholders
A focus on creating shared value for Vicinity and our stakeholders Our sustainability progress has been globally recognised Sustainability leader in Australia and Asia Pacific1 Retail property company #1 in Australia and Asia Pacific1 #1 retail property company in Australia and Asia Pacific region #
Slide 35: A day in the life of Vicinity
A day in the life of Vicinity Video Vicinity Centres | 2017 Annual General Meeting | 16 November 2017 24
Slide 36: Chairman’s address (continued)
Chairman’s address (continued) Peter Hay QueensPlaza, QLD
Slide 37: FY17 in review
FY17 in review Another active period Solid underlying earnings Strong valuation gains Enhanced portfolio quality Maintained strong balance sheet On-market buy-back of up to 5% of securities announced and ~2.2% acquired to date1 Earnings measure and distribution policy change2 from FY18 1. Announced
Slide 38: FY18 guidance and focus
FY18 guidance and focus Our focus remains on building quality and strength across our business Well positioned to create long-term value and sustainable growth Retail environment expected to remain challenging over the next 12 months Ongoing focus on improving portfolio quality and driving efficienc
Slide 39: Questions
Questions Halls Head Central, WA
Slide 40: Formalities of the Meeting
Formalities of the Meeting Peter Hay Mandurah Forum, WA
Slide 41: 1. Financial Reports
1. Financial Reports To receive Financial reports and consider Securityholders are asked to receive and consider the financial reports of Vicinity Centres (comprising the Company and the Trust) and the reports of the Directors and Auditor for the year ended 30 June 2017. Note: Securityholders are no
Slide 42: 2. Non-binding advisory vote on Remuneration Report
2. Non-binding advisory vote on Remuneration Report Item 2 Non-binding advisory vote on Remuneration Report To consider and, if thought fit, pass the following resolution as an ordinary resolution of the Company: That the Remuneration Report for the Company for the financial year ended 30 June 2017
Slide 43: 2. Proxy votes
2. Proxy votes Item 2 Non-binding advisory vote on Remuneration Report 3,278,209,136 valid proxy votes have been lodged for this resolution with the following voting instructions For Open Against 3,244,441,117 98.97% 5,512,639 0.17% 28,255,380 0.86% The Chairman intends to vote all undirected proxie
Slide 44: 3. Re-election of Directors of the Company
3. Re-election of Directors of the Company Item 3(a) Re-elect Mr Peter Kahan as a Director of the Company To consider and, if thought fit, pass the following resolution as an ordinary resolution of the Company: That Mr Peter Kahan being a Director who retires with effect from the conclusion of the M
Slide 45: 3. Proxy votes
3. Proxy votes Item 3(a) Re-elect Mr Peter Kahan as a Director of the Company 3,297,219,127 valid proxy votes have been lodged for this resolution with the following voting instructions For Open Against 3,105,337,001 94.18% 5,514,657 0.17% 186,367,469 5.65% The Chairman intends to vote all undirecte
Slide 46: 3. Re-election of Directors of the Company
3. Re-election of Directors of the Company Item 3(b) Re-elect Ms Karen Penrose as a Director of the Company To consider and, if thought fit, pass the following resolution as an ordinary resolution of the Company: That Ms Karen Penrose being a Director who retires with effect from the conclusion of t
Slide 47: 3. Proxy votes
3. Proxy votes Item 3(b) Re-elect Ms Karen Penrose as a Director of the Company 3,299,074,618 valid proxy votes have been lodged for this resolution with the following voting instructions For Open Against 3,266,677,987 99.02% 5,497,543 0.17% 26,899,088 0.82% The Chairman intends to vote all undirect
Slide 48: 4. Proposed equity grant to incoming CEO and Managing Director
4. Proposed equity grant to incoming CEO and Managing Director Item 4 Approval of proposed equity grant to incoming CEO and Managing Director To consider and, if thought fit, pass the following as an ordinary resolution of the Company and the Trust: That, for the purposes of ASX Listing Rule 10.14 a
Slide 49: 4. Proxy votes
4. Proxy votes Item 4 Approval of proposed equity grant to incoming CEO and Managing Director 3,281,385,145 valid proxy votes have been lodged for this resolution with the following voting instructions For Open Against 3,246,274,687 98.93% 5,326,828 0.16% 29,783,630 0.91% The Chairman intends to vot
Slide 50: Close of Meeting
Close of Meeting
Slide 51: Contact details and disclaimer
Contact details and disclaimer For further information please contact: Penny Berger Troy Dahms Head of Investor Relations Senior Investor Relations Manager T +61 2 8229 7760 T +61 2 8229 7763 E penny.berger@vicinity.com.au E troy.dahms@vicinity.com.au Disclaimer This document is a presentation of ge