Mirvac Group · ASX:MGR
Mirvac — FY2021 Earnings Presentation
43 slides from Mirvac's earnings presentation, Aug 12, 2021
Slide 1: FY21 Results: Reimagine Urban Life
results Reimagine Urban Life For personal use only FY21 12 August 2021
Slide 2: Acknowledgement of Country
FY21 RESULTS Page heading to go here Acknowledgement of Country For personal use only Mirvac pays respect to all Aboriginal and Torres Strait Islander peoples, Traditional Custodians of the lands and waters of Australia where we live, work and play. St Leonards Square, Sydney 12 AUGUST 2021 — 1
Slide 3: Agenda
FY21 RESULTS Agenda For personal use only overview financial capital commercial integrated residential summary Susan Lloyd-Hurwitz results allocation & mixed use investment Stuart Penklis & guidance CEO & Managing Director Courtenay Smith Brett Draffen Brett Draffen portfolio Head of Residential Sus
Slide 4: Overview
overview For personal use only Susan Lloyd-Hurwitz CEO & Managing Director NINE, Willoughby, Sydney 12 AUGUST 2021 — 3
Slide 5: Urban asset creation strategy continues to evolve
FY21 RESULTS Urban asset creation strategy continues to evolve For personal use only TRENDS THAT EXISTED BEFORE THE PANDEMIC MIRVAC IS WELL PLACED WITH OUR HAVE BEEN SUPERCHARGED AND ACCELERATED PURPOSE TO REIMAGINE URBAN LIFE > Work from anywhere/flexible working > Unique ability to create, reposit
Slide 6: ESG at the heart of everything we do
FY21 RESULTS ESG at the heart of everything we do For personal use only E S G Climate change Natural resources Our community Social inclusion Our people Trusted partner T A R G E Net positive carbon 2030 BY Net positive water Zero waste to landfill BY 2030 Net positive legacy $100m 2030 BY Highly en
Slide 7: Results momentum despite pandemic
FY21 RESULTS Results momentum despite pandemic For personal use only FY21 Operating profit FY21 DPS FY21 Operating cash flow NTA 1 $550m(9%) on pcp 9.9¢ +9% on pcp $635m +41% on pcp $2.67 +5% on pcp FY21 EPS FY21 ROIC FY21 Statutory profit 14.0¢ (9%) on pcp 7.2% +200 bps on pcp $901m +61% on pcp 34.
Slide 8: Outperformance over the year
FY21 RESULTS Outperformance over the year For personal use only Exchanged 8% increase in 80% Disposed at a 43% assets under leased 340 Adelaide Street, premium to book value management Brisbane to ~$25bn OFFICIALLY OPENED OUR 11% premium to book value OLDERFLEET, MELBOURNE CHERRYBROOK VILLAGE, FIRST
Slide 9: Momentum set to continue into our 50th year
FY21 RESULTS FY21 momentum set to continue into our 50th year For personal use only OPTIMISING PORTFOLIO EXECUTING CORE COMPETENCIES AND RECYCLING CAPITAL CLEAR RUNWAY FOR FUTURE GROWTH ~144,000 sqm leased ACROSS THE INVESTMENT PORTFOLIO 340 Adelaide Street, Brisbane ~$2.5bn ~22% Green Square, Sydne
Slide 10: Award winning residential and urban precinct curator
FY21 RESULTS Award winning residential and urban precinct curator For personal use only 2011–2015 2016–2021 2022+ VISION TO BE A LEADING CREATOR & CURATOR OF INCREASED COMMERCIAL DEVELOPMENTS EXTRAORDINARY URBAN PLACES AND EXPERIENCES FROM PREVIOUSLY PREDOMINANTLY RESIDENTIAL DEMONSTRATED CAPABILITY
Slide 11: Generating value through asset creation capability
FY21 RESULTS Generating value through asset creation capability For personal use only Our urban asset creation strategy continues to deliver significant ‘flywheel effect’ benefits, ASSET CREATION including over the last six years: & DEVELOPMENT > Development profit of $368m 1 > Development revaluati
Slide 12: Our culture & capability: a source of competitive advantage
FY21 RESULTS Our culture & capability A source of competitive advantage For personal use only WORK SAFE stay safe Health, safety & environment Our people Innovation Mirvac is committed to being a force for good > Comprehensive ongoing > Maintained strong people > Established industry- COVID-19 crisi
Slide 13: Financial results
financial results For personal use only Courtenay Smith Chief Financial Officer Locomotive Workshop, South Eveleigh, Sydney 12 AUGUST 2021 — 12
Slide 14: Earnings momentum over FY21
FY21 RESULTS Earnings momentum over FY21 For personal use only KEY PERFORMANCE DRIVERS FINANCIAL PERFORMANCE INTEGRATED INVESTMENT PORTFOLIO EPS GUIDANCE AND UPGRADES OVER FY21 > Improved cash collection and lower COVID-19 impact > Increased NOI due to development completions 14.0 – Cash collection
Slide 15: Progressing COVID-19 rental agreements & improving cash collection
FY21 RESULTS Progressing COVID-19 rental agreements & improving cash collection For personal use only > Net $20m reduction in EBIT due to COVID-19 impact, $48m in FY20 CASH COLLECTION IMPROVING OVER FY21 > Net billings $817m with 98% collected in FY21 1 100% – Office and Industrial sectors maintaini
Slide 16: Financial results
FY21 RESULTS FY21 financial results For personal use only INTEGRATED INVESTMENT PORTFOLIO > Improvement in cash collection and lower COVID-19 rental relief along with NOI growth from recently FY21 ($m) FY20 ($m) completed commercial office developments Investment EBIT 576 545 6% > Higher asset and f
Slide 17: Distributions funded from operating cash flow
FY21 RESULTS Distributions funded from operating cash flow For personal use only > Distributions continue to be adequately funded from operating cash flows DISTRIBUTIONS FUNDED BY EARNINGS AND OPERATING CASH FLOWS 1 > Higher FY21 operating cash flows due to capitalisation of Olderfleet, 477 Collins
Slide 18: Capital management
FY21 RESULTS Capital management For personal use only Credit ratings Moody’s/ Fitch Gearing 1 Cash & undrawn facilities Average debt maturity profile A3 /A- Stable outlook 22.8% $867m 6.6yrs Average borrowing cost 2 FY21 operating cash flow 3.4% $635m No significant debt maturities Until FY23 Access
Slide 19: Capital allocation
For personal use only capital allocation Brett Draffen 275 Kent Street, Sydney Chief Investment Officer 12 AUGUST 2021 — 18
Slide 20: Capital allocation focused on urbanisation of major cities
FY21 RESULTS Capital allocation focused on urbanisation of major cities For personal use only > Capital allocation focused on generating strong returns from the long term urbanisation megatrend OPTIMISING PORTFOLIO WITH NON-CORE ASSET SALES in key Australian gateway cities Asset Sector Status > Stra
Slide 21: Growing asset & funds management through capital partnerships
FY21 RESULTS Growing asset & funds management through capital partnerships For personal use only 23% CAGR Strong track record of unlocking long-term value for our partners through the CONTINUED GROWTH IN EXTERNAL AUM since FY15 delivery of market leading new developments, adding value to existing as
Slide 22: Commercial & mixed use
commercial & For personal use only mixed use Brett Draffen Chief Investment Officer Harbourside, Sydney (artist impression) 12 AUGUST 2021 — 21
Slide 23: Commercial & Mixed Use
FY21 RESULTS Commercial & Mixed Use For personal use only The dedicated Commercial and Mixed Use division focuses on complex, mixed use precincts that shape and define our future cities TOTAL RETURN 1 > FY21 Commercial and Mixed Use EBIT of $33m and development revaluation gain of $121m benefited fr
Slide 24: Completing the precinct: Pitt Street, Sydney
FY21 RESULTS Completing the precinct: 55 Pitt Street, Sydney For personal use only 5.5 4 6 TARGETS Sydney core prime ~63,000sqm Ground level lobby NABERS NABERS Green Star Sustainability Targeting all Platinum Office building Net leasable area fronting Pitt Street Energy Water focus electric buildin
Slide 25: Locomotive Workshop progressing the evolution of South Eveleigh Precinct
FY21 RESULTS Locomotive Workshop progressing the evolution of the ~$1.8bn South Eveleigh Precinct For personal use only The Locomotive Workshop is currently the last asset within the South Precinct Timeline Eveleigh Precinct developed by Mirvac, located ~3km South of the Sydney CBD and just one stop
Slide 26: Progressing next generation of value accretive developments
FY21 RESULTS Progressing next generation of value accretive developments For personal use only $28bn FY22 FY24 Expected end value 2 & beyond Elizabeth Enterprise, Badgerys Creek, Industrial SYD (Stage 1 & 2) 80 Ann Street, Voyager, Yarra’s Edge, Locomotive Workshop, South Eveleigh, BNE 1 MEL 1 SYD I
Slide 27: Integrated investment portfolio
integrated investment For personal use only portfolio Campbell Hanan Head of Integrated Investment Portfolio 200 George Street, Sydney 12 AUGUST 2021 — 26
Slide 28: Integrating our investment portfolio to unlock synergies
FY21 RESULTS Integrating our investment portfolio to unlock synergies For personal use only The Integrated Investment Portfolio (IIP) is the amalgamation of all the recurring income OFFICE INDUSTRIAL businesses including Office, Retail, Industrial and Build to Rent Integrated cross disciplined servi
Slide 29: Office portfolio positioned to cater for the future of workspaces
FY21 RESULTS Office portfolio positioned to cater for the future of workspaces For personal use only RESILIENT MODERN OFFICE PORTFOLIO WITH LONG WALE AND LIMITED NEAR TERM EXPIRIES LIMITED NEAR TERM LEASE EXPIRIES 2 > Office NOI up 5% on pcp to $366m, driven by recently completed development contrib
Slide 30: Office portfolio generating outperformance
FY21 RESULTS Office portfolio generating outperformance For personal use only KEY DRIVERS OF OUTPERFORMANCE ANNUALISED TOTAL RETURN PERFORMANCE Mirvac Office Portfolio vs Australian Office Benchmark > Newly developed prime buildings with minimal maintenance capex outlays, longer WALE and high-qualit
Slide 31: Urban retail will gradually recover as cities reactivate
FY21 RESULTS Urban retail will gradually recover as cities reactivate For personal use only CONVENIENCE-BASED CENTRES CONTINUE TO PERFORM, WITH IMPACT TO CBD SALES BY CATEGORY EX CBD* ASSETS EXPECTED TO CONTINUE NEAR TERM MAT Growth vs 2019 > Net cash collections continue to improve to 94% for the y
Slide 32: Growing industrial exposure through our development capability
FY21 RESULTS Growing industrial exposure through our development capability For personal use only INDUSTRIAL CONTINUES TO BENEFIT FROM ECONOMIC TAILWINDS INCLUDING INCREASED ONLINE RETAIL SALES, INVESTMENT IN AUTOMATION AND RESILIENCE IN INVENTORIES $2.0bn > High occupancy of 100% 1 and maintained a
Slide 33: Build to Rent: LIV delivering a unique rental experience
FY21 RESULTS Build to Rent: LIV delivering a unique rental experience For personal use only 80% > We are seeing continued success at our first build to rent property, LIV Indigo, Sydney LEASING AT LIV INDIGO SINCE LAUNCH leased Olympic Park, which is now 80% leased 250 > Globally build to rent has p
Slide 34: Residential
residential For personal use only Stuart Penklis Head of Residential Forme, Tullamore, Melbourne (artist impression) 12 AUGUST 2021 — 33
Slide 35: Settlements exceed expectations driven by a strong MPC market
FY21 RESULTS Settlements exceed expectations driven by a strong MPC market For personal use only > Completed 2,526 settlements with 82% from MPC in FY21 and a further 184 settlements in July 2021, comfortably exceeding FY21 MAJOR SETTLEMENTS FY21 guidance of >2,200 lots Project Product Lots > Achiev
Slide 36: Strong demand drove an increase in pre-sales to $1.2bn
FY21 RESULTS Strong demand drove an increase in pre-sales to $1.2bn For personal use only > Momentum in the market and high-quality apartment releases has driven a 25% increase in pre-sales to $1.2bn, from $971m, in FY20 – MPC pre-sales have increased >100% from FY20 – More than $300m of apartment p
Slide 37: Strong sales across locations, products & price points
FY21 RESULTS Strong sales across locations, products & price points For personal use only > Released over 3,300 lots, including an acceleration of over 1,500 MPC lots in response to stimulus demand > ~90% of sales coming from masterplanned communities following sustained strong demand > Strong owner
Slide 38: Apartment living proving an attractive alternative
FY21 RESULTS Apartment living proving an attractive alternative as established market prices For personal use only continue to climb APARTMENT PROJECT LAUNCHES ACROSS ALL APARTMENT GROWING MOMENTUM OVER THE PAST 12 MONTHS CAPITAL CITIES EXPECTED IN NEXT 12 MONTHS > 78% of purchases were owner-occupi
Slide 39: FY22 continues to be driven by MPC strength with strong outlook beyond
FY21 RESULTS FY22 continues to be driven by MPC strength with strong outlook beyond For personal use only > Pipeline of ~26,500 lots 1, 79% of which are MPC lots 2 MAJOR PROJECT SETTLEMENT PROFILE 3 > Diversified MPC products of land, built-form homes and terraces FY22 FY23 FY24 FY25 FY26+ to cater
Slide 40: Summary & guidance
For personal use only summary & guidance Susan Lloyd-Hurwitz Tullamore, Melbourne CEO & Managing Director 12 AUGUST 2021 — 39
Slide 41: FY22 outlook & guidance
FY21 RESULTS FY22 outlook & guidance For personal use only We have a resilient business with increasing momentum, that continues to deliver strong, visible cash flows, sustainable distribution growth and attractive returns for our securityholders CONTINUED MOMENTUM INTO FY22 OPERATING EPS AND DPS >
Slide 42: Important notice
FY21 RESULTS Important notice For personal use only Mirvac Group comprises Mirvac Limited (ABN 92 003 280 699) and Mirvac Property Trust An investment in Mirvac stapled securities is subject to investment and other known and unknown risks, (ARSN 086 780 645). This presentation (“Presentation”) has b
Slide 43: Thank you
thank Reimagine Urban Life you For personal use only 80 Ann Street, Brisbane CONTACT MIRVAC GROUP Katherine Lipa, Senior Investor Relations Manager | investor.relations@mirvac.com Level 28, 200 George Street, Sydney NSW 2000