Peet Limited · ASX:PPC
Peet — Shareholder Meeting (November 2008)
27 slides from Peet's shareholder meeting presentation, Nov 19, 2008
Slide 1: Chairman's address to 2008 Annual General Meeting
Perth www.peet.com.au asx release Level 7, 200 St Georges Terrace Perth WA 6000 Telephone (08) 9420 1111 | Facsimile (08) 9481 4712 Email perth@peet.com.au For personal use only 19 November 2008 Chairman’s address to 2008 Peet Limited Annual General Meeting Introduction Ladies and gentlemen, this is
Slide 2: The business model
Perth www.peet.com.au Level 7, 200 St Georges Terrace Perth WA 6000 Telephone (08) 9420 1111 | Facsimile (08) 9481 4712 Email perth@peet.com.au The business model We are proud of our 113-year history and, though we’re a very modern and dynamic company, the For personal use only people in it never lo
Slide 3: The Australian property market
Perth www.peet.com.au Level 7, 200 St Georges Terrace Perth WA 6000 Telephone (08) 9420 1111 | Facsimile (08) 9481 4712 Email perth@peet.com.au The Australian property market For personal use only In the year to September 2008, house prices rose by 5.6% in Brisbane and a very significant 8.1% in Mel
Slide 4: Peet's management strategies and initiatives
Perth www.peet.com.au Level 7, 200 St Georges Terrace Perth WA 6000 Telephone (08) 9420 1111 | Facsimile (08) 9481 4712 Email perth@peet.com.au Peet’s management strategies and initiatives Peet Limited has taken some sensible and responsible initiatives too. For personal use only It is a time for us
Slide 5: Dividends
Perth www.peet.com.au Level 7, 200 St Georges Terrace Perth WA 6000 Telephone (08) 9420 1111 | Facsimile (08) 9481 4712 Email perth@peet.com.au Dividends It’s sensible too, to review the Company’s dividend payout-out policy. Up until now, Peet has had a payout ratio policy of 90% and that has been a
Slide 6: The Peet team
Perth www.peet.com.au Level 7, 200 St Georges Terrace Perth WA 6000 Telephone (08) 9420 1111 | Facsimile (08) 9481 4712 Email perth@peet.com.au You’ll note I’m sure, and in line with our stated approach, that there are some very significant performance hurdles linked to earnings per share growth and
Slide 7: Outlook
Perth www.peet.com.au Level 7, 200 St Georges Terrace Perth WA 6000 Telephone (08) 9420 1111 | Facsimile (08) 9481 4712 Email perth@peet.com.au Outlook Ladies and gentlemen, it seems a very long time since I stood here last year and talked about target For personal use only earnings for 2008 based o
Slide 8: Peet Limited 2008 Annual General Meeting Presentation
For personal use only Peet Limited 2008 Annual General Meeting Presentation November 2008 asset manager land syndicator fund manager asset manager land syndicator fund manager asset manager land syndicator fund manager asset manager Peet Limited | Enriching lives since 1895
Slide 9: Group performance highlights
Group performance highlights For personal use only Peet achieved NPAT growth of 5.3% for FY08; full year dividend of 19.75 cents per share fully franked » Full year net profit after tax of $47.9 million (FY07: $45.5 million) » Final dividend of 10.75 cents per share fully franked » Sales of 2,274 lo
Slide 10: Strong shareholder returns
Strong shareholder returns For personal use only Peet’s strong earnings growth has provided high dividends for shareholders » Strong historical performance » Despite this performance, Peet is not immune to the current macroeconomic trends that are affecting the broader market Earnings Dividends 25.0
Slide 11: Share price performance
Share price performance For personal use only Peet has outperformed peers and the relevant indices » Although Peet’s share price has fallen, Peet has outperformed the relevant indices over medium term Relative share price performance Last 3 years Last 12 months 250 120 100 200 80 150 60 100 (58%) 40
Slide 12: Current market conditions
Current market conditions For personal use only Diversification important in a generally challenging environment » 58% of FY08 EBIT from Victoria, currently the most stable and affordable market of the major states EBIT FY08 composition by geography » Significant slowdown across Qld currently being
Slide 13: A stable residential market
A stable residential market For personal use only Australia is fundamentally different to foreign markets GDP growth » US/UK housing market oversupplied GDP growth % p.a. (Actual 4.2 2007, Forecast 2008-10) » more than 10 months oversupply in the 3.0 2.6 2.6 US, leading to lower prices 2.0 2.2 1.5 »
Slide 14: Solid fundamentals in Australia
Solid fundamentals in Australia For personal use only Residential demand underpinned by: Unprecedented residential stock deficiency in 2009/10 200,000 » Interest rates – expected to ease to Demand Completions 3.5-4.0% in 2009 (from peak of 7.25% only 150,000 three months ago) 100,000 Shortage 50,000
Slide 15: Solid fundamentals in Australia
Solid fundamentals in Australia For personal use only Residential demand underpinned by: Dwelling approvals versus population growth – moving annual turnover » Historically low vacancy rates 350,000 » less than 2% in capital cities 300,000 250,000 200,000 » Significant increase in rental costs 150,0
Slide 16: Solid fundamentals in Australia
Solid fundamentals in Australia For personal use only Challenges » Increasing unemployment » Tight credit market » Poor consumer confidence and sentiment » Discounting by competitors Summary » Residential market remains sound over the medium to long term » Strong fundamentals » Government initiative
Slide 17: Peet – strong and stable business
Peet – strong and stable business For personal use only Peet is a specialist in the residential land development market » 80 Projects (28 currently being developed) with 37,000 lots managed and owned illustrate Peet’s extensive expertise » Solid organic growth projected from existing development pip
Slide 18: Peet – well placed to benefit from improved market conditions
Peet – well placed to benefit from improved market conditions For personal use only Land bank diversification by ownership » Peet is well placed to benefit from improved conditions » low historical cost base of land assets » greater operating leverage provided through 46% 54% funds management platfo
Slide 19: Competitive position
Competitive position For personal use only Peet is in a strong position relative to its competitors » Significant land bank » Peet is not compelled to make acquisitions to support its earnings for several years » Australian-focused business » no offshore exposure » core competency of delivering qual
Slide 20: Competitive position
Competitive position For personal use only Peet is in a strong position relative to its competitors » Capital efficient model » over 50% of Peet’s land bank is currently off balance sheet » establishing wholesale distribution capability » strategy to increase off balance sheet weighting over time »
Slide 21: Capital management
Capital management For personal use only All Peet debt is secured by a portfolio of high-quality property assets and solid operating cash flows » Senior debt facilities – 3 year evergreen » Direct benefit from lower rates due to » Syndicate debt is all non-recourse hedging profile » At year end gear
Slide 22: Capital management
Capital management For personal use only A changing market environment demands changes to business practices Dividend policy » Over the last 12 months, key focus of equity investors has changed from high dividends to protecting shareholders’ equity » Peet has acknowledged this change and proposes to
Slide 23: Peet – the most stable land syndicator
Peet – the most stable land syndicator For personal use only Track record of more than 113 years of asset and funds management » Peet bears no similarities to “funds managers” that had shown large profits over the last boom years due to complex structuring and high gearing » Peet has a proud 113 yea
Slide 24: Peet's business strategy
Peet’s business strategy For personal use only Solid and transparent platform from existing businesses » Continuing to focus on our core business to deliver sustainable growth in earnings » Growing our existing funds management platform and capital partnering relationships » Remaining prudent with o
Slide 25: Outlook
Outlook For personal use only Uncertain market but longer term fundamentals remain sound » Property markets have been subdued over the past six months given the challenging economic environment » Recent cuts to interest rates and government initiatives have stimulated demand in the first home buyer
Slide 26: Disclaimer
Disclaimer For personal use only While every effort is made to provide accurate and complete information, Peet does not warrant or represent that the information in this presentation is free from errors or omissions or is suitable for your intended use. Subject to any terms implied by law and which
Slide 27: For personal use only
For personal use only Asset Manager Land Syndicator Fund Manager Peet Limited | Enriching lives since 1895 20