Slide 1: Welcome to the GPT Group Annual Results 2014
Good morning, and welcome to the GPT Group Annual Results for 2014. In recognition of GPT’s commitment to a Reconciliation Action Plan, I would like to acknowledge and pay respect to the traditional owners of the land, the Gadigal people of the Eora Nation, and also pay my respect to the Elders both
Slide 2: CEO overview of 2014 results
Good morning everyone and thankyou for joining us. Our disciplined, consistent and transparent approach has again delivered great outcomes for securityholders. The core business has driven EPS growth of 4.1% and a Total Return of 9.6%. During the year we completed $2.0 billion of asset trans
Slide 3: Economic conditions and 2015 guidance
Economic fundamentals remain mixed. Business confidence and consumer sentiment remain subdued though helped by the recent interest rate cut and lower fuel prices. Despite this, NSW and Victoria have continued a positive growth trend reflecting a re- balancing of the economy into non-mining sec
Slide 4: Operating performance for 2014
Good morning. I’ll start with the operating performance of the Group for 2014. The statutory profit for the year was $645.3 million, which was up 12.9% on 2013. This was driven by the $249.5 million uplift in the value of the investment portfolio, partially offset by the $89.1 million negative mar
Slide 5: Segment composition of the result
Focusing now on the segment composition of the result. Retail income was down 5.9%, primarily as a result of the sale of Erina Fair and three Homemaker assets completed in 2013. The retail portfolio had impressive comparable income growth of 2.9% over the period. Office income was 1.6% lower, wi
Slide 6: Management divisions' contribution to performance
Over the past couple of years the contribution to overall performance from the management divisions has increased significantly In 2014 we had a $36.2 million contribution to FFO from the management divisions, up 31%. This was driven by strong growth in the contribution from the funds manageme
Slide 7: Strong capital position and NTA growth
Importantly the Group remains in a very strong capital position. Net tangible assets increased 15 cents to $3.94, driven by the $249.5 million uplift to the value of the investment portfolio. Gearing, as a proportion of total tangible assets, is 26.3% and look-through gearing is 28.2%. During
Slide 8: Debt maturity and cost management
We continue to actively manage the maturity and cost of our debt book with a further 15 year US Private Placement undertaken in the first half and a six year medium term note issued in the second half. Whilst swap rates have fallen significantly over the year we have recently seen a widening in
Slide 9: Active portfolio management strategy
Good morning The Results we announce today demonstrate that our strategy of actively managing the composition of the portfolio to drive leading performance is paying off. Over the past two to three years, we have transacted more than $4 billion in assets to ensure we have the right properties
Slide 10: Capital value growth and total portfolio returns
2014 saw an acceleration in capital value growth, driving stronger total returns across real estate markets. GPT delivered a Group Total Return in excess of our target in 2014. The key contributor was the investment portfolio, which achieved a 9.3% Total Portfolio Return. The weighted average
Slide 11: Retail portfolio performance
Turning to the retail portfolio. GPT’s key operating metrics have improved across the board in 2014. Importantly, specialty sales growth was up 4.2% over the year, which is one of the highest among our peers. The key driver of sales growth is investing in the right assets in strong growth ca
Slide 12: Retail development pipeline
Over the past 12 months we have continued to improve the quality and performance of the portfolio through active remixing and progressing the $1.3 billion retail development pipeline. The focus of Anthony McNulty and the development team has been twofold; Firstly, expanding assets to maximise th
Slide 13: Office portfolio leasing
2014 was a big year for leasing for GPT and that played a key role in the successful completion of our portfolio repositioning strategy. Twelve months ago, 19% of the portfolio was either vacant or expiring during the year. Today, we have only 6% vacancy which reflects our portfolio management c
Slide 14: Office portfolio location and market outlook
We are in a strong position, with our office portfolio predominantly located in the country’s best performing markets, and exclusively along the eastern seaboard. The portfolio has 88% exposure to Sydney and Melbourne. In Sydney, the market is experiencing positive net absorption, a reduction
Slide 15: Logistics portfolio performance
The investments we have made over the past few years growing our logistics development capability and growing the logistics portfolio have begun yielding meaningful results for the Group. The portfolio has delivered a Total Portfolio Return of 12.7% and $80 million in net revaluation gains and d
Slide 16: Logistics development and land banks
Over the past 12 months we have disposed of assets, acquired land banks and invested in our development projects, all of which has assisted in driving our performance. We have been strategically recycling capital into our development business, with the release of $184 million in capital through
Slide 17: 2015 portfolio focus
2015 will be another year focused on driving long term Total Portfolio Returns across the group. We are very comfortable with our sector weightings and don’t expect a significant shift in these allocations in the near future. Our high quality, diversified portfolio, combined with a growing funds
Slide 18: Funds management performance
Thanks Carmel. 2014 was a year of success for Nick Harris and the Funds Management team. The strong response from investors to the capital raisings undertaken by both the Office and Shopping Centre funds is an indication of the quality of the transactions completed, the quality of the portfoli
Slide 19: Wrap-up and questions
In wrapping up, GPT is in great shape to continue to deliver consistent and reliable returns from the core portfolio. The funds management business is going from strength to strength, and all parts of the Group are delivering profits. Our development capability allows us to grow the portfolio,
Slide 20: Disclaimer
DISCLAIMER The information provided in this presentation has been prepared by The GPT Group comprising GPT RE Limited (ACN 107 426 504) AFSL (286511), as responsible entity of the General Property Trust, and GPT Management Holdings Limited (ACN 113 510 188). The information provided in this presenta