Far East Consortium International Limited · HKEX:35
Far East Consortium International — 1H FY2020 Earnings Presentation
54 slides from Far East Consortium International's earnings presentation, November 2019
Slide 1: 2019/20 Interim Results
2019/20 Interim Results November 2019 1
Slide 2: Disclaimer
Disclaimer This document has been prepared by Far East Consortium International Limited (the “Company”) solely for information purposes. By accepting this document, you agree to maintain absolute confidentiality regarding the information disclosed in this document. This document does not constitute
Slide 3: Table of Contents
Table of Contents 1. FY2020 Interim Results Summary 2. Review of Operations 3. Prospects 4. Appendices 3
Slide 4: 1. FY2020 Interim Results Summary
1. FY2020 Interim Results Summary Consort Place, London 4 4
Slide 5: Strong Performance Through Diversification
Strong Performance Through Diversification HK$M 1H FY2020 1H FY2019 % change Revenue (HK$’M) 5,121 2,926 +75.0% Gross profit (HK$’M) 1,647 1,201 +37.1% Net profit attributable to shareholders (HK$’M) 715 616 +16.0% Adjusted cash profit(1) 959 598 +60.4% EPS (HK cents) - Basic & Diluted 30.4 26.8 +13
Slide 6: Strong Performance Through Diversification
Strong Performance Through Diversification Capital Raising / Property Sales Recurring Income Monetization Shareholder Return Car park and gaming Completed issuance of Continue to deliver a Robust sale of operations mitigating US$300m Perpetual sustainable and residential properties HK hotel performa
Slide 7: Defensive Recurring Revenue Despite Weak HK Hotel Performance
Defensive Recurring Revenue Despite Weak HK Hotel Performance • Car Park, TWC and regional hotels mitigating impact HK$’M 1H FY2020 1H FY2019 % change Recurring revenue Hotel Operations and Management 777 866 -10.3% - Dorsett Group 714 817 -12.6% - TWC Hotel Group 63 49 +28.6% Car Park Operations an
Slide 8: Jump in Adjusted Cash Profit
Jump in Adjusted Cash Profit HK$’M 1H FY2020 1H FY2019 % change Net profit attributable to shareholders 715 616 +16.0% Adjustments: Loss/(Gain) on investment property revaluation 25 (95) Gain on bargain purchase of TWC - (117) Depreciation and amortization 219 194 Adjusted cash profit(1) 959 598 +60
Slide 9: Foreign Exchange Movement Analysis
Foreign Exchange Movement Analysis • Assuming constant exchange rate, net profit attributable to shareholders and net assets would have been HK$20.7 million and HK$730 million higher respectively Average Rates as at 30.9.2019 31.3.2019 Change 1H FY2020 1H FY2019 Change rates for HK$/AUD 5.29 5.56 -4
Slide 10: Strong Progress in 1H FY2020
Strong Progress in 1H FY2020 Projects Completed New Launches New Hotels(1) Land Replenishment • The Star Residence – • Bourke Street, • The Towers at Elizabeth Melbourne Epsilon, Gold Coast Quay, Perth • Ritz-Carlton, Perth • Dorsett Place • Network Rail, Northern • Astoria Crest, Hong • Oakwood Pre
Slide 11: Monetization Plan: Unlock and Crystalize the Value of our Portfolios
Monetization Plan: Unlock and Crystalize the Value of our Portfolios 1 Spin-off and separate listing of 2Growth in hotel properties other Non-core assets • Properties businesses • Properties ➢ Significant portfolio of existing ➢ 21 Anderson Road, Singapore hotels ➢ Retail component of Elizabeth ➢ Gl
Slide 12: Hotel REIT: Unlocking Value
Hotel REIT: Unlocking Value • Interest rate environment conducive to establish a REIT platform Mandate • Global hospitality properties Dorsett Singapore Initial portfolio • Selected hotels in UK, Singapore, Australia and Malaysia Dorsett Shepherds Bush Ritz-Carlton, Perth FSTREI vs STI Returns: REIT
Slide 13: Gross Margins Stayed Healthy Across All Businesses Despite Headwinds
Gross Margins Stayed Healthy Across All Businesses Despite Headwinds 1H FY2020 1H FY2019 Gross profit Gross profit Gross profit Gross profit Revenue (before Revenue (after (before (after depreciation) depreciation) depreciation) depreciation) HK$’M HK$’M Margin HK$’M Margin HK$’M HK$’M Margin HK$’M
Slide 14: Sustainable and Progressive Dividend Supported by Long Term NAV per Share Growth
Sustainable and Progressive Dividend Supported by Long Term NAV per Share Growth 10-Year NAV CAGR : 10.9% 10-Year DPS CAGR: 22.0% 13.29 13.21 22.0 22.0 12.41 10.79 18.5 9.79 16.0 16.0 9.12 9.02 15.0 8.45 13.0 6.70 5.84 6.00 4.73 7.0 6.0 6.0 3.0 Interim Dividend Final Dividend Total NAV/share (HK$)(1
Slide 15: Robust Balance Sheet
Robust Balance Sheet As at As at Notes: (1) Include an amount of approximately 30.9.2019 31.3.2019 HK$545 million which is reflected as liabilities due within one year even HK$'M HK$'M though such sum is not repayable within one year, as the relevant banks Bank loans, notes and bonds and/or financia
Slide 16: Comfortable Liquidity Position
Comfortable Liquidity Position • Existing liquidity available of HK$7,349 million (cash position and undrawn facilities) far exceeds the committed capex of HK$1,852 million • Presales of HK$11.6bn provides a clear vision of future cash inflow stream • Ability to further raise liquidity by leveraging
Slide 17: A Strong and Diversified FEC
A Strong and Diversified FEC Property Hotel Operations and Car Park Operations Gaming Operations Development Management and Facilities • 25% interest in the Integrated • A diverse portfolio of quality • One of the largest hotel Management Resort Component of the operators in Asia Queen’s Wharf Brisb
Slide 18: Long-term Growth Track Record Supported by Clear Strategy
Long-term Growth Track Record Supported by Clear Strategy 10-Year CAGR Total revenue: 14.7% Net profit attr. to shareholders : 34.9% HK$’M 6,842 Property Development 5,831 5,110 5,005 5,121 Hotel Operations and Management Recurring 4,066 3,995 Revenue 3,732 28.0% Car Park Operations and Facilities M
Slide 19: Balanced and Diversified Portfolio
Balanced and Diversified Portfolio Business diversification allows FEC to take advantage of property cycles in different countries Total Assets by Geography(1) Total Assets by Business Segment(1) Continental Europe UK 2% Car park 6% Treasury & Others (2) Hotel operations operations and 13% and manag
Slide 20: 2. Review of Operations: Property Development
2. Review of Operations Property Development The Star Residences - Epsilon, Gold Coast 20
Slide 21: Completed Projects During 1H FY2020
Completed Projects During 1H FY2020 The Towers at Elizabeth Quay, Perth The Towers at Elizabeth Quay, Perth Astoria Crest, Sham Shui Po The Garrison, Tai Wai 21
Slide 22: New Launch - The Star Residence – Epsilon (Tower 2), Gold Coast
New Launch - The Star Residence – Epsilon (Tower 2), Gold Coast A New Opportunity to Live in One of the World’s Most Exciting and Luxurious Integrated Resorts Executive summary In the middle of The Star Gold Location Coast’s world-class integrated resort in Broadbeach, Gold Coast Expected attr. SFA
Slide 23: New Launch - Dorsett Place Waterfront Subang
New Launch - Dorsett Place Waterfront Subang (JV with Mayland) Extracting Value from Hotel Peripheral Land Executive summary Location Central Business District, Subang Jaya Expected attr. SFA 529,000 sq.ft. Expected attr. GDV HK$791 million • Three 21-storey blocks with 1,989 fully- serviced suites
Slide 24: New Launch - Cuscaden Reserve, Singapore
New Launch - Cuscaden Reserve, Singapore An Enviable Address in the Heart of One of the Finest Cities in the World Executive summary Cuscaden Road, a super prime location in Orchard Location area Expected attr. SFA 19,000 sq.ft. Expected attr. GDV HK$387 million • 192 Residential Apartments • Nestle
Slide 25: Upcoming Project - Bourke Street, Melbourne
Upcoming Project - Bourke Street, Melbourne An Exciting Mixed-Use Development Next to Our Previous Projects Executive summary 640 Bourke Street, an exciting mixed use development providing for a Location variety of uses including retail, café, commercial office, public gallery spaces and childcare f
Slide 26: Upcoming Project - Consort Place, London
Upcoming Project - Consort Place, London A Mixed-Use Development Site in Canary Wharf Executive summary At the heart of one of London’s most Location dynamic new quarters: South Quays with excellent public transport connectivity Expected attr. SFA 390,000 sq.ft. Expected attr. GDV HK$4,089 million •
Slide 27: Upcoming Project - Northern Gateway, Manchester
Upcoming Project - Northern Gateway, Manchester Land Acquisition Paves the Way for the One of the Largest Residential Schemes in the UK First Phases of the Scheme Executive summary • 530 family homes and first-time buyer The site covers approximately 155 hectares to apartments in the Collyhurst Vill
Slide 28: Upcoming Project - Holland Road, Singapore
Upcoming Project - Holland Road, Singapore A New Freehold and Luxury Condominium Executive summary Close to Orchard and Singapore Botanic Garden and is limited by Holland Village, Location Farrer Road, and Dempsey Cluster, which are known among both locals and expats Expected attr. SFA 192,000 sq.ft
Slide 29: 2. Review of Operations: Hotel Operations & Management
2. Review of Operations Hotel Operations & Management Dorsett Shepherds Bush London 29 29
Slide 30: Strong Hotel Pipeline: Well-Balanced Hotel Portfolio
Strong Hotel Pipeline: Well-Balanced Hotel Portfolio • 14 new hotels under construction with 3,430 rooms (including one Ritz- Carlton) in the next 5 years in Australia, UK and Malaysia As at 30.9.2019 As at 31.3.2024 • Acquisition of Oakwood Premier AMTD Singapore completed in 7,472 11,375 • Novembe
Slide 31: Significant Hidden Value in Hotel Portfolio
Significant Hidden Value in Hotel Portfolio • HK$17.8bn of revaluation surplus not reflected on the Balance Sheet(1) 26.3 HK$bn 22.8 20.4 18.3 18.2 17.9 18.2 17.0 16.3 17.8 15.6 11.7 13.4 11.0 10.4 7.7 11.0 11.0 10.7 9.5 6.0 5.0 9.3 8.5 7.2 6.9 7.3 7.2 7.2 7.1 7.3 5.4 5.7 2009 2010 2011 2012 2013 20
Slide 32: New Acquisition: Kai Tak Development
New Acquisition: Kai Tak Development - Enhancing Recurring Cashflow Kai Tak Development • The HK Government’s most significant investment in infrastructure in recent decades MTR Shatin to Central Link • Total area: over 320 hectares covering the ex-airport site Sung Wong Toi Station (in progress) Ex
Slide 33: New Acquisition: Oakwood Premier AMTD Singapore
New Acquisition: Oakwood Premier AMTD Singapore Acquired in November 2019 • Currently managed by Oakwood • Obtained hotel license in January 2019 • 268 guest rooms – opportunities to optimize • Located in the heart of Singapore’s vibrant CBD • Purchased in partnership with AMTD (51% shareholding) 33
Slide 34: New Launch: Ritz-Carlton Perth
New Launch: Ritz-Carlton Perth Opened on 15 November 2019 • FEC bringing back Ritz-Carlton to Australia • 205 guest rooms, built at the highest standard • Located at Elizabeth Quay, a landmark waterfront development that connects Perth city with the Swan River to create a dynamic new entertainment a
Slide 35: New Launch: J-Hotel Scheduled to Open Soon
New Launch: J-Hotel Scheduled to Open Soon • 154 rooms feature modern contemporary décor with an edgy twist • Dorsett Hospitality International’s 1st boutique hotel in Kuala Lumpur • Central location within the heart of Kuala Lumpur’s thriving business, shopping and entertainment district • Café as
Slide 36: 2. Review of Operations: Car park operations
2. Review of Operations Car park operations 36 36
Slide 37: Organic Growth and Regional Diversification
Organic Growth and Regional Diversification • No. of Bays: +6,652 bays 30-Sep-19 31-Mar-19 No. of No. of No. of Bays No. of Bays Car Park Car Park • Revenue for 1H FY2020: HK$397m, +11% YoY Australia • Organic growth in Australia, UK and Hungary with new Owned and managed 22 4,038 22 4,038 managemen
Slide 38: Care Assist – Deploying Car Park Management Technology
Care Assist – Deploying Car Park Management Technology 38
Slide 39: Steadily Growing Facilities Management Services
Steadily Growing Facilities Management Services APM PROPERTY SERVICES PROPERTY DEVELOPER Maxx Apartments Emblem Apartments, Hawthorn VIC OWNERS STUDENT SERVICES SHOPPING CENTRE BUILDING CORPORATION ACCOMODATION MANAGEMENT MANAGEMENT MANAGEMENT PROJECT Active Contracts RESIDENTIAL PROPERTY MANAGEMENT
Slide 40: 2. Review of Operations: Gaming and Entertainment
2. Review of Operations Gaming and Entertainment Concept of Queen’s Wharf Brisbane 40
Slide 41: TWC Performing Well
TWC Performing Well 5 months ended • Three full-services casinos in the Czech Republic 1H FY2020/ under the registered brand American Chance 30.9.2018/ As at 30.09.2019 Casinos As at 30.09.2018 Revenue(1) (HK$’M) 119 88 • Strong marketing and loyalty program contribute to continued growth Revenue pe
Slide 42: Strategic Alliance with The Star
Strategic Alliance with The Star The Star (Stock code: SGR.AX) Dividend Per Share A$ Cents 1H 2H • Acquired 4.99% stake in FY2019 • Very close collaboration with The Star so far 10.0 and reviewing together other potential areas 13.0 of collaboration 8.5 • 2H FY2019 dividend at A$10.0 cents vs. 10.5
Slide 43: Queen's Wharf Brisbane Integrated Resort to Open in 2H FY2023
Queen’s Wharf Brisbane Integrated Resort to Open in 2H FY2023 Integrated Resort Residential Component FEC’s Stake 25% FEC’s Stake 50% Total: 1,841 Total: 849 Tower 4: 667 Rosewood: 150 Residential Units Hotel Rooms Tower 5: 672 Dorsett: 359 Tower 6: 502 Grand Hotel: 340 Expected Attr. Tower 4: 27,16
Slide 44: 2. Review of Operations: Mortgage Platform
2. Review of Operations Mortgage Platform The Towers at Elizabeth Quay, Perth 44
Slide 45: BC Group: Growing Mortgage Platform
BC Group: Growing Mortgage Platform Latest Update Loans and Advances 853 • Fast growing platform offering mortgage financing in A$m Australia to non-resident • Funding primarily provided by leading financial 626 institutions and institutional investors. FEC has committed to provide up to A$75m, as a
Slide 46: 3. Prospects
3. Prospects The Star Residences - Epsilon, Australia 46 46
Slide 47: Short and Medium Term Outlook
Short and Medium Term Outlook • 14 hotels under construction • Total presales of HK$11.6bn to be booked • Headwinds in HK offset by new hotels: in coming 3 to 4 years - Ritz-Carlton Perth / Oakwood • Total pipeline / Inventory of HK$51.4bn contribution from November 2019 • Continue to replenish the
Slide 48: Company Awards Demonstrate Recognitions
Company Awards Demonstrate Recognitions Caring Company Caring Company Logo Partnership Expo 2019 Overall Best IR Company (Small Cap) 3 Years IR Awards Winning Company Best IR Company Best IR in Corporate Transaction 2019 5rd Investor Relations Awards by Best Investor Meeting HKIRA Best Digital IR Be
Slide 49: 4. Appendices
4. Appendices 49 The Towers at Elizabeth Quay, Perth
Slide 50: Strong Pipeline for Sustainable Growth
Strong Pipeline for Sustainable Growth Projects under presale Location Cumulative presales Expected attr. SFA(1) Expected attr. GDV (1) Expected Cumulative presale (1) Approximate saleable residential floor areas and As at 30.9.2019 (HK$'M) (sq.ft.) (HK$'M) Completion(2) expected gross development v
Slide 51: Hotel Operating Performance
Hotel Operating Performance Dorsett Group 1H FY2020 1H FY2019 YoY change Hong Kong Occupancy rate 82.5% 94.0% -11.5ppts Average room rate (HK$) 659 730 -9.7% RevPAR (HK$) 544 686 -20.7% Malaysia Occupancy rate 72.6% 76.7% -4.1ppts Average room rate (MYR) 195 188 3.7% RevPAR (MYR) 142 144 -1.4% Mainl
Slide 52: Significant Hidden Value in FEC's Hotel Portfolio
Significant Hidden Value in FEC’s Hotel Portfolio Capital Value Book Value Rev aluation Surplus City / Country Description Rooms @ 31.3.2019 @ 31.3.2019 @ 31.3.2019 (1) Acquisition completed (HK$'M) (HK$'M) (HK$'M) on 18.11.2019 Hotels in operation Hong Kong 1 Dorsett Wanchai Hong Kong Near Wanchai
Slide 53: Details of Investment Properties
Details of Investment Properties Total Total Current Investment Properties Pipeline Investment Properties GFA (sq. ft.) GFA (sq. ft.) FEC Building, Central, Hong Kong(1) 3,000 West Side Place, Melbourne 116,000 (1) FEC Building, Nathan Road, Hong Kong 38,700 Bourke Street, Melbourne 6,900 Basement t
Slide 54: Thank You
Thank You Questions & Answers FEC Official WeChat 54
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