Acsion Limited · JSE:ACS
Acsion — IPO Roadshow (November 2014)
63 slides from Acsion's IPO roadshow presentation, November 2014
Slide 1: Acsion Limited Roadshow presentation
Acsion Limited Property Fund Limited Roadshow presentation November 2014
Slide 2: Specialist commercial, retail and residential property developer and owner
Specialist commercial, retail and residential property developer and owner At listing, Acsion will be South Africa’s only specialist commercial property developer and owner listed on the JSE • Access to superior annual NAV growth • Dynamic and highly experienced management team with a proven 17 year
Slide 3: Meet the team
Meet the team Kiriakos Anastasiadis Pieter Scholtz Chief Executive Officer Chief Financial Officer Dimitri Thomas Yanni Anastasiadis Developments Director Leasing Director P 3 I Strictly private and confidential
Slide 4: Contents
Contents Page Introduction 5 Overview of Acsion Limited 7 Overview of properties developed and owned by Acsion, current development assets and future development opportunities 13 i. Internally developed and owned Properties 14 ii. Current development assets 25 iii. Future development opportunities 3
Slide 5: Introduction
Introduction Acsion Property Fund Limited
Slide 6: Introduction
Introduction • Acsion Limited (“Acsion”) is finalising a primary listing (“Listing”) on the Johannesburg Stock Exchange (“JSE”) to create a platform to accelerate the Company’s growth objectives and provide new investors the opportunity to participate in a unique, high growth investment proposition
Slide 7: Overview of Acsion Limited
Acsion Limited Overview of Acsion Limited
Slide 8: Acsion at a glance
Acsion at a glance A highly experienced and successful property developer, the focus of which is to deliver superior NAV growth through NAV uplift on completed properties, new developments completed and to a lesser extent, capital profits on property developments completed for sale, and purchase of
Slide 9: History and proven track record in the property sector
History and proven track record in the property sector Focused strategy to generate long-term sustainable capital growth Complete current Planning, development pipeline development and Future development construction of and acquisition Mall@Emba Mall@Lebo opportunities Mall@Carnival opens
Slide 10: Unique investment proposition
Unique investment proposition Acsion’s strength and significant success to date has been due to the following factors • Focus on the continuous identification and delivery of capital enhancing development opportunities • Track record of successfully developing in both metropolitan and rural growth a
Slide 11: Business strategy and vision
Business strategy and vision Strategy: as a property developer, Acsion’s focus is on superior NAV / capital growth versus traditional REITs • Acsion have increased NAV / capital by over 100% per annum over the last HISTORIC INCREASE IN NAV PER SHARE (EXCL. DEF TAX) ten years • Post listing, Acsion a
Slide 12: Higher risk development opportunities, low risk completed properties
Existing portfolio provides low risk returns, while development opportunities offer greater risk and returns • Acsion is constantly assessing all development opportunities and has the ability to adjust its strategy to respond to economic climate • This allows Acsion to scale back during a weak econo
Slide 13: Overview of properties and development assets
Overview of properties developed and owned by Acsion, current development assets, and further development Acsion Property Fund Limited opportunities
Slide 14: Properties developed and now owned by Acsion
i.Acsion Properties Property developed Fund Limited and now owned by Acsion
Slide 15: Portfolio overview
Portfolio overview Developed property portfolio: completed in-house by Acsion Weighted Independent WALE average gross Description Sector Location GLA (m²) Value per m² Vacancy Age (yrs) valuation (R‘m) (years) rate/m² (R) Mall@Carnival Retail Brakpan, Gauteng 1,525 72,338 21,082 4.2 4.9% 145 9 Mall@
Slide 16: Mall@Carnival: Dalpark, Brakpan
1. Mall@Carnival: Dalpark, Brakpan Cnr Heidelberg & Airport Roads, Dalpark Ext 5, Brakpan Investment highlights and tenant profile Photographs of the property • Well located regional mall on N17 highway • Excellent access to catchment area on N17, Heidelberg Rd and Airport Rd • Uniquely positioned o
Slide 17: Mall@Reds: Rooihuiskraal, Centurion
2. Mall@Reds: Rooihuiskraal, Centurion Cnr Rooihuiskraal & Hendrik Verwoerd Drive, Rooihuiskraal Ext 15, Centurion Investment highlights and tenant profile Photographs of the property • Established regional shopping centre based in the heart of Rooihuiskraal, Centurion on a main arterial route • Den
Slide 18: Mall@Emba: eMbalenhle, Mpumalanga
3. Mall@Emba: eMbalenhle, Mpumalanga Cnr eMbalenhle Avenue & Old Provincial Road, eMbalenhle, Mpumalanga Investment highlights and tenant profile Photographs of the property • Only formal retail offering in its primary catchment area with approximately 300,000 residents - primary employer in the are
Slide 19: Mall@Lebo: Lebowakgomo, Limpopo
4. Mall@Lebo: Lebowakgomo, Limpopo Cnr R513 & R 579, Lebowakgomo, Limpopo Investment highlights and tenant profile Photographs of the property • Only major retail offering within a 50km radius catering for approximately 300,000 residents in its primary catchment area • Strong underpin by national te
Slide 20: Moreleta Square: Moreleta Park, City of Tshwane
5. Moreleta Square: Moreleta Park, City of Tshwane Cnr Garsfontien & Rubenstein St, Moreleta Park, Pretoria Investment highlights and tenant profile Photographs of the property • Long lease expiry underpinned by national tenant • Well-established community shopping centre in the Moreleta Park node •
Slide 21: Simarlo: Hennopspark, Centurion
6. Simarlo: Hennopspark, Centurion Cnr Jakaranda & Edward Str, Hennopspark, Centurion Investment highlights and tenant profile Photographs of the property • Close proximity to N14 freeway and Hendrik Verwoerd Drive • Suitable for vehicle workshops, distribution and light industrial use • Each unit c
Slide 22: Portfolio profile: Sector and geographic summary
Portfolio profile: Sector and geographic summary Sector profile by revenue Sector profile by GLA 1% 3% 26% Light industrial Light industrial Retail - metropolitan Retail Retail - rural 71% 99% Geographic profile by revenue Geographic profile by GLA 11% 13% 13% Gauteng 13% Gauteng Mpumalanga Mpumalan
Slide 23: Portfolio profile: Tenant profile
Portfolio profile: Tenant profile Tenant profile by revenue Tenant profile by GLA 17% 11% Large national, large Large national, large listed, major franchises listed, major franchises 15% National, listed, National, listed, franchises, professional franchises, professional 22% firms firms 61% Other
Slide 24: Lease expiry profile, rental escalations, gross rental
Lease expiry profile, rental escalations, gross rental Lease expiry profile by GLA Lease expiry profile by gross rental 45.0% 42.6% 35.0% 52.5% post 39.7% post 30.7% 40.0% Feb 2018 30.0% Feb 2018 35.0% 25.0% 30.0% 21.0% 19.8% 25.0% 20.0% 16.6% 20.0% 17.6% 15.6% 15.0% 15.0% 12.1% 9.0% 9.9% 10.0% 10.0
Slide 25: Current development assets
Acsion ii. Current Property development Fund Limited assets
Slide 26: Current development assets
Current development assets The existing development assets provide further scale and sectoral and geographic diversification together with NAV / capital uplift as the developments are completed Construction start Estimated Description Status Use Total GLA (m2) Committed tenants date completion date
Slide 27: Current development assets (continued)
Current development assets (continued) The existing development assets provide further scale and sectoral and geographic diversification together with NAV / capital uplift as the developments are completed Construction start Estimated Total GLA (m2) Committed tenants Description Status Use date comp
Slide 28: Mall@Carnival Phase III
1. Mall@Carnival Phase III Cnr Heidelberg & Airport Roads, Dalpark Ext 5, Brakpan Investment highlights Location of the development • Tenant driven expansion comprising a combination of new tenants and expanding existing tenants • Entrenches Mall@Carnival’s position as the preferred one stop retail
Slide 29: Benmore student housing and mixed-use high rise development
2. Benmore student housing and mixed-use high rise development Benmore, Gauteng Investment highlights Location of the development • Total land size of approximately 1 ha in the heart of Sandton’s densely populated, ultra high-income residential Benmore node. Close proximity to South Africa’s “golden
Slide 30: Mall@Moutsiya
3. Mall@Moutsiya Cnr R568 & R573, Walkraal, Limpopo Investment highlights Location of the development • Highly visible and easily accessible location with direct thoroughfare onto the Moloto Road, a major regional arterial road through the Elias Motsoaledi municipality in Limpopo • Primary catchment
Slide 31: Mall@Ruimte Phase I
4. Mall@Ruimte Phase I Cnr R55 & Marais Road, just off the N14 Freeway, Monavoni, Gauteng Investment highlights Location of the development • Located on an extremely busy arterial route accessible from the N14 freeway and the R55 – nearby petrol station sells 1 million litres of fuel a month • Phase
Slide 32: Commercial@Ruimte
5. Commercial@Ruimte Cnr R55 & Marais Road, just off the N14 Freeway, Monavoni, Gauteng Investment highlights Location of the development • Located on an extremely busy arterial route accessible from the N14freeway and the R55 – nearby petrol station sells 1 million litres of petrol per month • Phas
Slide 33: Hyde Park Terrace
6. Hyde Park Terrace 56 on First Road, Hyde Park, Gauteng Investment highlights Location of the development • High-end residential development in the heart of one of Sandton’s most exclusive areas • Total land size of 2.5 ha • 500m away from Hyde Park shopping centre • Development opportunity: 39 un
Slide 34: Residential@Moutsiya
7. Residential@Moutsiya Walkraal, Limpopo Investment highlights • Total land size of 40 ha • Partnership with local residents and the local municipality to approach prospective buyers with access to housing subsidies from the Department of Human Settlements • Proclamation of land at final stages wit
Slide 35: Further development opportunities
Acsion iii. Further Property development Fund Limited opportunities The value to be derived from these developments, and other future development opportunities, is not included in the tangible NAV of Acsion and has been reflected in the value of goodwill as shown on the Acsion balance sheet
Slide 36: Mall@Maputo
1. Mall@Maputo Circular de Maputo, Maputo (adjacent to the Stadium and University) Investment highlights Location of the development • Located in northern Maputo and adjacent to the main Maputo ring road, with a total land size of 8.9 ha • Memorandum of Understanding signed with Mozambican Ministry
Slide 37: Offices@Lusaka and 101 on the Park
2. Offices@Lusaka 3. 101 on the Park Lusaka, Zambia Katherine Street, Sandton Investment highlights Investment highlights • Strong African economy with limited available infrastructure for • Demand for high quality residential accommodation in the heart of Sandton multinational companies • Opportuni
Slide 38: Mall@PietRetief
4. Mall@PietRetief Corner N2 and Brand Street, Piet Retief, Mpumalanga Investment highlights • Ideally located to cater for primary Piet Retief catchment area as well as secondary catchment areas of Retiefville, Kempville, Harmony Park and Ethandakhukanya given limited formal retail offerings in the
Slide 39: Operations
Acsion Property Fund Limited Operations
Slide 40: Management
Management The Acsion team Kiriakos Anastasiadis – Chief Executive Officer (61) • Kiriakos is the founder and managing director of Acsion and the Development Company • Visionary for the future growth strategy of the group both locally and abroad • Kiriakos holds a MSc in Structural Engineering and i
Slide 41: Management reporting structure
Management Reporting structure Chief Executive Officer Kiriakos Anastasiadis Developments Director Leasing Director Chief Financial Officer Portfolio Manager (major subsidiaries) (major subsidiaries) Pieter Scholtz Gavin Balsdon Yanni Anastasiadis Dimitri Thomas Development support Portfolio managem
Slide 42: Debt management
Debt management 30-Aug-2014 Gearing1 7.0% Fixed portion of debt 0% Weighted average cost of finance2 7.4% Weighted average maturity3 7.0 years Gearing limit 45% Maturity profile of debt Debt providers 16% 21% 1 - 5 years Investec Bank 5 years and longer Nedbank 79% 84% 1. Gearing ratio: total extern
Slide 43: Governance and board composition
Acsion Property Governance andFund boardLimited composition
Slide 44: Governance
Governance • The board will consist of 6 members, two of whom are Executive Directors, with the remaining four members being Independent Non-Executive Directors • The board will comply fully with the King III Code of Governance for South Africa 2009 (King III) • The board is well balanced, and consi
Slide 45: Governance
Governance David Green BA LLB (University of the Free State) David is an admitted Advocate in the Supreme Court of South Africa. He has been chairman of the SA Listed Property Association, and was the founding chairman of the Rosebank Business Improvement District. He was chairman of the SAPOA conve
Slide 46: Governance
Governance Sonja Griesel CA(SA), B.Com (University of the Free State), B.Compt. (Hons.) (University of South Africa), M.Com. (Accounting) (University of Johannesburg) Sonja has lectured Financial Accounting, Auditing and Tax at the Central University of Technology (Free State) from 1985 until 1987,
Slide 47: Summary financial information
Acsion Property Summary financial Fund information Limited
Slide 48: Forecast statement of comprehensive income
Forecast statement of comprehensive income 4 Months ending 2015 12 Months ending 2016 Revenue 144,368,299 448,165,290 Rendering of services 32,000 83,200 Rental Income 106,269,100 334,630,195 Interest received (trading) 214,127 478,485 Lease accrual 3,611,829 2,173,138 Utility recoveries 34,241,243
Slide 49: Key assumptions for statement of comprehensive income
Key assumptions for statement of comprehensive income • Structural vacancy: • Carnival – 2.5% • Reds – 4.0% • Emba – 3.0% • Lebo – 2.0% • Moreleta – 3.0% • Simarlo – 15.0% • Renewals: space-by-space and where it is assumed that a lease will not be renewed, a vacancy period of 3-6 months has been inc
Slide 50: Pro forma statement of financial position
Pro forma statement of financial position Notes Before listing R’m Listing R'm 3 Non-current assets 1 Investment property 2 3,246.3 3,246.3 Defined development assets 4 339.6 339.6 Goodwill 950.0 950.0 Other non-current assets 0.7 0.7 Current assets Cash and cash equivelants 19.1 216.1 Other current
Slide 51: Pro forma statement of financial position – notes
Pro forma statement of financial position – notes Notes to the pro forma statement of financial position: 1. Developed Investment Properties valued as per independent valuation as set out on page 15 2. Current Development Assets are valued in terms of a directors’ valuation at net realisable value a
Slide 52: Valuation of the current development assets
Valuation of the current development assets The current development assets will result in the unlock of NAV / capital uplift for Acsion shareholders Total Anticipated Estimated NPV of NAV / Costs costs per Development date of Balance value on Discount Years to capital incurred to Development feasibi
Slide 53: Proposed Offer summary
Acsion Property Proposed Offer summary Fund Limited
Slide 54: Summary of the Acsion Offer
Summary of the Acsion Offer Issuer Acsion Limited Offer size R200 million Offer structure Primary issue Offer price R10.10 – R10.80 per share Indicative market R4.2 – R4.5 billion capitalisation Blended cap rate on developed properties: 8.26% Pricing metrics Development assets: developed value / lan
Slide 55: Conclusion
Conclusion A unique investment opportunity in an NAV focused property developer • Unique opportunity for investors to participate in the JSE’s only focused development company alongside a highly experienced management team with a 17 year proven track record of delivering NAV / capital uplift for its
Slide 56: Annexures
Acsion Property Fund Limited Annexures
Slide 57: Annexure I: Case study
Acsion Property Annexure I: CaseFund studyLimited
Slide 58: Case study: Development of Mall@Carnival Phase I & II
Case study Development of Mall@Carnival Phase I & II • In 2002, Acsion identified a need for a substantial retail offering in the Brakpan area given the areas’ high density, rising income population and the distance to and accessibility of other retail offerings in the catchment area • Given the dra
Slide 59: Case study: Return calculation
Case study Return calculation R’000 Feb 2005 Feb 2006 Feb 2007 Feb 2008 Feb 2009 Feb 2010 Feb 2011 Feb 2012 Feb 2013 Feb 2014 Project Cash Flows Investment (20,033) (94,574) (5,570) 374 (1,878) (15,083) (101,466) (126,193) (1,638) (5,227) Operational cash flows 2,543 9,669 26,220 28,022 30,160 31,85
Slide 60: Annexure II: Valuation considerations
Acsion Property Annexure II: Valuation Fund Limited considerations
Slide 61: Trading multiples: Price / NAV
- 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 Bonvests Hldgs (Singapore) Cheuk Nang Hldgs (Hong Kong) Lippo China Res (Hong Kong) Price / NAV Orascom Developm (Switzerland) Trading multiples Nan Hai Corp Ltd (Hong Kong) Radium Life Tech (Taiwan) Inversiones Cent (Peru) Lee Kim Tah Hdgs (Singapore) Sourc
Slide 62: Annexure III: Contact details
Acsion Property Annexure III: Contact Fund details Limited
Slide 63: Contact details
Contact details Acsion contact details Name Office Mobile E-mail Kiriakos Anastasiadis +27 12 656 8957 +27 83 283 9999 anastasi@anaprop.co.za Pieter Scholtz +27 12 656 8957 +27 82 934 0900 pieter@anaprop.co.za Dimitri Thomas +27 12 656 8957 +27 82 692 1633 dimitri@anaprop.co.za Yanni Anastasiadis +2