Dexus Convenience Retail Reit · ASX:DXC
Dexus Convenience Retail Reit — HY23 Earnings Presentation
24 slides from Dexus Convenience Retail Reit's earnings presentation, Feb 6, 2023
Slide 1: Dexus Convenience Retail REIT ASX release: 2023 Half Year Results presentation
Dexus Convenience Retail REIT (ASX:DXC) ASX release 6 February 2023 2023 Half Year Results presentation and property synopsis Dexus Convenience Retail REIT (ASX: DXC) releases its 2023 Half Year Results presentation. An investor conference call will be webcast today at 10.00am on www.dexus.com/inves
Slide 2: 2023 Half Year Results
2023 Half Year Results 6 February 2023 Dexus Asset Management Limited ACN 080 674 479 AFSL 237 500 as responsible entity for Dexus Convenience Retail REIT
Slide 3: Acknowledgement of country
Acknowledgement of country Dexus Convenience Retail REIT acknowledges the Traditional Custodians of the lands on which our business and assets operate, and recognises their ongoing contribution to land, waters and community. We pay our respects to First Nations Elders past, present and emerging. Art
Slide 4: Agenda
Agenda 1 Introduction and highlights page 4 2 Financials and transactions page 7 3 Summary page 12 Appendices page 14 3 2023 Half Year Results Presentation
Slide 5: Introduction and highlights
Introduction and highlights
Slide 6: HY23 highlights
HY23 highlights Resilient portfolio supporting solid property income growth Financial & property performance Capital management Divested 6 assets for $25.4 million1 Resilient property income 1.3% average discount to book 2.4% like-for-like income growth Sale proceeds used to repay debt Narrowed FY23
Slide 7: Income certainty backed by high-quality tenant covenants
Income certainty backed by high-quality tenant covenants 109 $822m 84% 5.90% 99.4% 89% properties portfolio value weighted to metro WACR occupancy of property income across Australia and highway assets (by income) derived from (by value) 10 major tenants Contracted fixed rental increases Longer-term
Slide 8: Financials and transactions
Financials and transactions
Slide 9: HY23 financial result
HY23 financial result Resilient portfolio income partly offsetting impact of higher net finance costs Profit & loss HY23 HY22 Change › Full-period contributions from acquisitions in Property FFO ($m) 23.9 21.3 12.1% HY22, partly offset by divestments Management fees ($m) (2.7) (2.5) 10.8% › Like
Slide 10: Balance sheet and capital management
Balance sheet and capital management Prudent approach in an uncertain macroeconomic environment Key metrics 31 Dec 2022 30 Jun 2022 Debt maturity profile (total facility limit) $150m Minimal near-term expiries Gearing1 34.1% 35.0% 104 $100m 88 2 81 Cost of debt 3.4% 2.6% 50 $50m 40 Average maturity
Slide 11: Portfolio valuation movements
Portfolio valuation movements Predictable cashflows providing valuation support › 1.8% ($14.9m) total decrease on prior book values › Contracted rental growth partially offsetting 16bps of cap rate expansion › Expect relative valuation resilience for service station and convenience retail assets due
Slide 12: Asset divestments
Asset divestments Solid outcomes in a challenging market $25.4m 1.3% 7.06% total average discount average divestments to book value cap rate1 Property Property type Settlement 2215 David Low Way, Peregian Beach, QLD Metropolitan 19-Sep-22 Mobil X, Paradise SA 4545 Flinders Highway, Reid River, QLD R
Slide 13: Summary
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Slide 14: Summary
Summary Strong appeal in defensive and growth attributes of convenience retail Providing secure portfolio income in an uncertain environment marked by inflationary pressures, rising interest rates and softening transaction volumes Well placed to deliver consistent property income growth underpinned
Slide 15: Appendices
Appendices
Slide 16: Portfolio tenancy mix
Portfolio tenancy mix Tenant % portfolio income Chevron 37% 7-Eleven 12% Viva Energy 12% EG Australia 9% Mobil 4% OTR 4% United 4% Ampol 3% Coles Express 2% BP 2% Top 10 89% Other 11% Total 100% Puma, Cluden QLD 15 2023 Half Year Results Presentation
Slide 17: Fund-through developments
Fund-through developments Optionality to significantly increase convenience retail offering Est. total spend Est. yield on cost Future pipeline (uncommitted) ($m)1 (%) Glasshouse Mountains Dual $35m 5 – 6% Service Centre, QLD Glasshouse Mountains Dual Service Centre (Southbound site), QLD 1. Future
Slide 18: Market dynamics
Market dynamics Fuel sales volumes remain robust Transaction volumes slowed Sales volumes of petroleum products1 National service stations transaction volumes Automotive gasoline Automotive LPG Diesel oil Total Total Transaction Volume Average Yield Millions ‘000 litres 50 $600 7.0% 45 $500 40 6.0%
Slide 19: DXC WALE and electric vehicle take-up
DXC WALE and electric vehicle take-up › Electric vehicles (EV) currently represent ~3% of CSIRO forecast scenarios for domestic EV penetration rates new car sales and <1% of the Australian vehicle fleet 100% DXC WALE › Internal combustion engine (ICE) vehicles expected to represent the majority of 8
Slide 20: Consolidated profit & loss statement
Consolidated profit & loss statement $’000 HY23 HY22 Net property income1 26,815 23,776 Interest income 22 146 Total revenue 26,837 23,922 Management fees (2,725) (2,460) Finance costs (5,459) (3,172) Corporate costs (547) (441) Total expenses (8,731) (6,073) Net operating income (EBIT) 18,106 17,84
Slide 21: FFO reconciliation
FFO reconciliation $’000 HY23 HY22 Statutory net profit after tax for the period 3,101 39,979 Adjusted for: Net fair value (gain) / loss on investment properties 14,892 (18,473) Net fair value (gain) / loss on derivatives 113 (3,657) Incentive amortisation and rent straight-line (2,514) (2,767) Debt
Slide 22: Consolidated balance sheet
Consolidated balance sheet $’000 31 Dec 2022 30 Jun 2022 Cash and cash equivalents 5,693 5,178 Investment properties 822,295 850,050 Other assets 16,092 17,894 Total assets 844,080 873,122 Borrowings (282,802) (299,611) Provisions (7,947) (11,256) Other liabilities (10,314) (7,737) Total liabilities
Slide 23: Important information
Important information This presentation (“Material”) has been prepared by Dexus Asset Management Limited (ACN 080 674 479, AFSL No. 237500) ("DXAM") as the responsible entity of Convenience Retail REIT No. 1 (ARSN 101 227 614), Convenience Retail REIT No. 2 (ARSN 619 527 829) and Convenience Retail
Slide 24: Dexus
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