Charter Hall Group · ASX:CHC
Charter Hall — FY2009 Earnings Presentation
46 slides from Charter Hall's earnings presentation, Aug 25, 2009
Slide 1: FY09 Annual Results
For personal use only Charter Hall Group FY09 Annual Results 25 August 2009
Slide 2: Agenda
Agenda For personal use only FY09 Summary Earnings Overview Charter Hall Property Trust Charter Hall Managed Funds Development Financials Capital Management Outlook and Guidance Questions Appendices Charter Hall Group FY09 Annual Results Presentation 2
Slide 3: FY09 Summary
For personal use only Section one FY09 Summary 225 St Georges Terrace, Perth WA
Slide 4: FY09 Summary
FY09 Summary For personal use only Over FY09, CHC has substantially de-risked its balance sheet and managed funds through asset sales and equity raising initiatives – Eliminated headstock debt – Asset sales of $228 million across CPOF, CPRF and DPF – Refinanced $1.1 billion of debt in FY09 Maintaine
Slide 5: FY09 Summary
FY09 Summary For personal use only FY09 FY08 Underlying Earnings1 $34.8m $52.7m Underlying EPS2 7.61cps 12.74cps DPS 4.96cps 12.60cps NPAT (AIFRS) ($82.2m) $67.5m AT 30 JUNE 09 AT 30 JUNE 08 AUM $3.4bn $3.9bn Total Group Assets $524m $802m Total Group Net Assets $494m $492m NTA $0.71 $1.19 Gearing3
Slide 6: Earnings overview
For personal use only Section two Earnings overview Atrium, 60 Union Street, Pyrmont NSW
Slide 7: Group Revenue
Group Revenue For personal use only FY09 revenue of $57.9 million1 CHL $88.5m CHPT $57.9m $46.9m $31.5m $41.6m $26.4m FY09 FY08 NOTE: 1. Revenue in this analysis excludes interest income and is net of property expenses Charter Hall Group FY09 Annual Results Presentation 7
Slide 8: Group Revenue
Group Revenue For personal use only Revenue composition FY09 revenue breakdown ($57.9 million) $41.6m Performance FY08 Development Fees Transaction Investment 2% FY09 Fees 3% $28.8m 1% Development $26.4m Management Fees 19% $20.4m CHPT Revenue Property 45% Management $12.3m and Other Fees 4% $7.5m $
Slide 9: Group EPS and DPS
Group EPS and DPS For personal use only Underlying EPS of 7.61 cents and DPS of 4.96 cents EPS 12.74c 12.60c DPS 7.61c 4.96c FY09 FY08 Charter Hall Group FY09 Annual Results Presentation 9
Slide 10: Charter Hall Property Trust
For personal use only Section three Charter Hall Property Trust 56 Anzac Street, Chullora NSW
Slide 11: Charter Hall Property Trust (CHPT)
Charter Hall Property Trust (CHPT) For personal use only 100% of the portfolio revalued over last six months 67 basis points (bps) like-for-like expansion in weighted average capitalisation rate during FY09 and 88bps over 18 months CHPT MARKET FIXED VALUERS’ LIKE FOR LIKE LIKE FOR LIKE CO-INVESTMENT
Slide 12: Reconciliation of fall in value of CHPT portfolio
Charter Hall Property Trust (CHPT) For personal use only Reconciliation of fall in value of CHPT property investment portfolio1 – CHPT portfolio falls from $498 million (as reported in August FY08 presentation) to $394 million – Net fall of $104 million comprises $24 million from net sales and $80 m
Slide 13: CHPT Portfolio Metrics
CHPT Portfolio Metrics For personal use only Weighted average lease expiries Sector diversification (years, by net income) (by value) CPOF 6.7 Industrial, 21% CPIF 9.8 Office, 34% CPRF 8.7 DPF 7.6 CHUF 8.2 Retail, 45% CHPT 8.2 Charter Hall Group FY09 Annual Results Presentation 13
Slide 14: CHPT Portfolio Metrics
CHPT Portfolio Metrics For personal use only Asset diversification Geographical diversification (by value) (by value) NZ, 3% CHUF, $48m, SA, 1% 12% WA, 19% CPOF, $122m, VIC, 29% DPF, $22m, 6% 31% CPRF, $140m, QLD, 27% 35% CPIF, $62m, NSW, 21% 16% Charter Hall Group FY09 Annual Results Presentation 1
Slide 15: CHPT Portfolio Metrics
CHPT Portfolio Metrics For personal use only Top 15 tenants Lease expiry profile (by income) Coles 9.8% VACANT 1.5% Woolw orths 6.0% FY10 4.2% Telstra 5.3% Westpac / St George 4.8% FY11 5.5% Commonw ealth Government 3.1% FY12 6.0% American Express 2.6% FY13 5.5% Harvey Norman 2.4% Bunnings 2.3% FY14
Slide 16: Charter Hall Managed Funds
For personal use only Section four Charter Hall Managed Funds 400 Kent Street Sydney NSW
Slide 17: Assets Under Management
Assets Under Management For personal use only Assets under management (AUM) of $3.38 billion Charter Hall AUM $3,384m Wholesale Investor Funds Retail Investor Funds $2,848m $536m Opportunistic Core Plus $781m $2,067m CHOF4 CHOF5 CPOF CPIF CPRF DPF CHUF CHIFs $423m $358m $1,390m $374m $303m $194m $19
Slide 18: Assets Under Management
Assets Under Management For personal use only Reconciliation of AUM change over FY09 +$48m ($330m) ($228m) $3,895m $3,384m FY08 Additions Valuation falls Sales FY09 Charter Hall Group FY09 Annual Results Presentation 18
Slide 19: Wholesale Investment Funds Update
Wholesale Investment Funds Update For personal use only Core Plus Office Fund (CPOF) – CPOF recently completed two projects in Brisbane and Perth, each with 10 year AUM $1,390m WALEs and a combined $30 million of margin/profit that has mitigated revaluation Change in AUM1 ($210m) falls and enhanced
Slide 20: Wholesale Opportunistic Funds Update
Wholesale Opportunistic Funds Update For personal use only Charter Hall Opportunity Fund No.4 (CHOF4) – Fund equity of $165 million fully allocated AUM $423m CHC Stake 3% – Six active projects remaining, with two currently under construction • Two office, three bulky goods retail and one residential
Slide 21: Retail Equity Funds Update
Retail Equity Funds Update For personal use only Diversified Property Fund (DPF) – Recently completed three asset sales and successfully renewed five leases that AUM $194m were nearing lease expiry, extending the WALE to 7.6 years Change in AUM1 ($55m) CHPT Stake 26% – Focus on executing further ass
Slide 22: Development
For personal use only Section five Development 130 Stirling Street Perth WA
Slide 23: Development Book
Development Book For personal use only Total value of development book of $825 million, representing projects managed in off-balance sheets funds – Predominantly in CHOF4 (3% co-investment stake held by CHC) and CHOF5 (15% co-investment stake held by CHC) Value of projects ‘underway’ of $740 millon1
Slide 24: Financials
For personal use only Section six Financials Sydney Wharf Pyrmont NSW
Slide 25: Income Statement
Income Statement For personal use only $M FY09 FY08 Direct net property income 2.0 31.8 Co-investment distributions 24.4 9.5 Other trust income - 0.2 Total CHPT income 26.4 41.6 Development investment income 1.5 7.5 Funds management income – Base fees 15.8 10.4 Funds management income – Development
Slide 26: Underlying Earnings Reconciliation
Underlying Earnings Reconciliation For personal use only FY09 +$17.6m +$1.8m 7.61cps 4.96cps +$97.6m $34.8m $24.7m $82.2m AIFRS loss Property and CIP investment Other items Underlying Distribution Investments FV impairment Earnings adjustments Charter Hall Group FY09 Annual Results Presentation 26
Slide 27: Operating Cashflow Reconciliation
Operating Cashflow Reconciliation For personal use only Underlying earnings and distribution covered by net operating cashflow +$10.6m ($4.3m) $41.1m $34.8m $24.7m FY09 underlying Decrease in trade Other FY09 net cashflow Distribution earnings debtors from operating activities Charter Hall Group FY0
Slide 28: Balance Sheet
Balance Sheet For personal use only PROFORMA 30 JUNE 2009 30 JUNE 2008 JUNE 20091 ($M) ($M) ($M) Cash 32.7 1.9 16.2 Direct property - 15.0 439.6 Indirect property investments 394.1 433.6 243.5 Other investments 43.3 43.3 50.3 Receivables and other assets 29.7 29.7 52.3 Total assets 499.8 523.5 801.9
Slide 29: Capital management
For personal use only Section seven Capital management WORKZONE, 202 Pier Street, Perth WA
Slide 30: Capital Management
Capital Management For personal use only DEBT FACILITY1 CHC CPOF CPRF CPIF DPF Asset values ($m)2 467 1,228 282 377 195 Net debt drawn ($m) - 605 78 133 112 Duration (years)3 2.0 2.7 2.0 2.4 2.4 GEARING METRICS Current LVR3 nil 49% 28% 35% 58% LVR Covenant4 25% 57% 55% 55% 65% LVR headroom5 N/A 13%
Slide 31: Capital Management
Capital Management For personal use only Debt expiry profile by fund1 $350m $333m DPF $300m $285m CPIF $250m CPRF $200m CPOF $165m $150m $97m $100m $60m $50m $0m 1HFY10 2HFY10 1HFY11 2HFY11 1HFY12 2HFY12 1HFY13 NOTE: 1. Analysis excludes development related debt. Charter Hall Group FY09 Annual Resul
Slide 32: Outlook and Guidance
For personal use only Section eight Outlook and Guidance
Slide 33: Outlook and Guidance
Outlook and Guidance For personal use only CHC is well positioned to pursue opportunities as the market recovers – Well capitalised after successfully executed capital management initiatives – Property specialist with products across the risk-return spectrum Managed funds positioned for recovery – S
Slide 34: Questions
For personal use only Questions
Slide 35: Appendices
For personal use only Section ten Appendices 11 Exhibition Street Melbourne Vic
Slide 36: Appendix A – CHPT Co-Investments
Appendix A – CHPT Co-Investments For personal use only 30 JUNE 2008 – AUG 08 MOVEMENT 30 JUNE 09 – PROFORMA CHPT Fair Value Acquisitions/ CHPT CHPT stake investment Movement (Sales) CHPT stake investment (%) ($m) ($m) ($m) (%) ($m) Direct properties 17 (2) (15) - CPOF 23% 193 (32) (40) 18% 122 CPIF
Slide 37: Appendix B - Capital Management
Appendix B - Capital Management For personal use only FACILITY1 ASSET DRAWN DEBT2 LVR HEAD VALUES ($M) MATURITY CURRENT LVR COVENANT3 ROOM % 4 NOTES: ($M) CHC 1. Analysis excludes any development related debt Group facility 467 nil Jul-11 0% 25% N/A facilities. CPOF 2. Drawn debt shown net of cash.
Slide 38: Appendix C - Development Book
Appendix C - Development Book For personal use only OFF BALANCE SHEET PROJECTS FUND SECTOR COMPLETION VALUE COMPLETION DATE CURRENTLY UNDERWAY ($M) (CY) Projects Currently Available for Sale 275 George St, Brisbane, Qld (50%) CHOF4 Office 163 2009 Projects Currently Underway Alluvion, 54-58 Mounts B
Slide 39: Appendix D – Revenue Contribution
Appendix D – Revenue Contribution For personal use only FY09 UNDERLYING CHPT CPOF CPIF CPRF CHOFs CHUF DPF CHIFs CIP Other Total REVENUE ($m) CHPT Rental income 2.0 2.0 Co-investment income 7.5 3.3 8.9 3.4 1.3 24.4 Other income CHPT Revenue 2.0 7.5 3.3 8.9 3.4 1.3 26.4 CHL Development investment inc
Slide 40: Appendix E – Property Portfolio
Appendix E – Property Portfolio For personal use only CORE PLUS OFFICE FUND (CPOF) 30 JUNE 09 MKT CAP MKT CAP MCR CHANGE VALUER’S WALE MIN. RENT VALUE RATE RATE DISCOUNT (YEARS) REVIEWS 30 JUNE 09 30 JUNE 08 (%) RATE/ IRR (%) (%) (%) (%) ($M) AMEX Atrium, Pyrmont, NSW 142.4 7.50% 6.00% 1.50% 9.25% 9
Slide 41: Appendix E – Property Portfolio
Appendix E – Property Portfolio For personal use only CORE PLUS INDUSTRIAL FUND (CPIF) 30 JUNE 09 MKT CAP MKT CAP MCR VALUER’S WALE MIN. RENT VALUE RATE RATE CHANGE DISCOUNT REVIEWS 30 JUNE 09 30 JUNE 08 RATE/ IRR ($M) (%) (%) (%) (%) (YEARS) (%) Chatswood Business Park, 372 Eastern Valley 28.8 8.50
Slide 42: Appendix E – Property Portfolio
Appendix E – Property Portfolio For personal use only CORE PLUS RETAIL FUND (CPRF) 30 JUNE 09 MKT CAP MKT CAP MCR VALUER’S WALE MIN. RENT VALUE RATE RATE CHANGE DISCOUNT REVIEW 30 JUNE 09 30 JUNE 08 RATE/ IRR ($M) (%) (%) (%) (%) (YEARS) (%) Bunnings, Stafford, Qld 20.0 7.50% 6.75% 0.75% 9.00% 10.0
Slide 43: Appendix E – Property Portfolio
Appendix E – Property Portfolio For personal use only DIVERSIFIED PROPERTY FUND (DPF) 30 JUNE 09 MKT CAP MKT CAP MCR VALUER’S WALE MIN. RENT VALUE RATE RATE CHANGE DISCOUNT REVIEW 30 JUNE 09 30 JUNE 08 RATE/ IRR ($M) (%) (%) (%) (%) (YEARS) (%) 46-50 Kings Park Road, West Perth, WA 29.0 8.50% 7.75%
Slide 44: Further information
For personal use only Further information David Harrison Joint Managing Director +61 2 8904 4033 davidh@charterhall.com.au David Southon Joint Managing Director +61 2 8908 4025 davids@charterhall.com.au Jelte Bakker Chief Financial Officer +61 2 8908 4035 jelteb@charterhall.com.au
Slide 45: Disclaimer
Disclaimer For personal use only This presentation has been prepared by Charter Hall Group (Charter Hall Limited (ABN 57 113 531 150) and Charter Hall Funds Management Limited (ABN 31 082 991 786) (AFSL 262861) as the Responsible Entity for Charter Hall Property Trust (ARSN 113 339 147)). It is a pr
Slide 46: For personal use only
For personal use only Sydney Melbourne Brisbane Perth Adelaide Auckland charterhall.com.au