Stockland · ASX:SGP
Stockland — Corporate Update (December 2008)
18 slides from Stockland's corporate update, Dec 17, 2008
Slide 1: Stockland Market Update - December 08
me §) Stockland Market Update lai Stockland. - December 08 i ae
Slide 2: Introduction: FY09 Outlook
Introduction FY09 Outlook * Underlying FY09 Operating Profit remains in line with previous guidance, but downside risks remain from residential sales Residential * First home owner segment of residential market stronger due to Federal Government's First Home Owners Boost and recent interest rate cut
Slide 3: Residential outlook - by market segment
Residential outlook — by market segment SGP current purchaser profile @ N/A + Differential of own vs rent is shrinking dramatically due to rising rents and lower interest rates ’ * Affordability improving due to: plecheme Owners @ 45% - First Home Sete Boost - interest rate cuts - more affordable pr
Slide 4: Residential outlook - the first home owner segment
Residential outlook — the first home owner segment We changed our product mix in early 2008 to address affordability - we are now in the ‘sweet spot’ for first home owners First home owner campaign launched in November — ‘Kick The Rent’, one of our most successful national marketing campaigns Banks
Slide 5: Residential outlook - impact of FHOB and rate cuts
Residential outlook — impact of FHOB and rate cuts Residential Communities enquiry levels *90% of Australians 20yo+ who have not bought property before are aware of the FHOB* *24% of the same group who were not considering buying in the next 6 months have now changed their mind* QLD vic #20% 200) 45
Slide 6: Residential super lot sales
Residential super lot sales * FY09 guidance includes super lot sales representing circa 30% of Residential gross margin * These sales comprise normal course of business sales (eg, school sites, builder sales) plus a number of bulk project disposals * Normal course of business sales are tougher, but
Slide 7: Residential inventory
Residential inventory * A detailed review of all Stockland residential projects has been conducted as part of the six monthly financial reporting cycle * Each project is assessed on the lower of cost or net realisable value (no upward revaluations). Underlying value of the total Residential portfoli
Slide 8: Commercial Property outlook
Commercial Property outlook ca * Retailers are becoming increasingly cautious Office demand falling in line with declining business sentiment and white collar job losses * Industrial demand likely to remain soft Suppl @ * Many retail and office development projects are y being shelved across the ind
Slide 9: Commercial Property update
Commercial Property update A review of Stockland’s development pipeline currently underway — a number of projects will be deferred until capital markets improve * Most projects are redevelopments of existing income producing assets — no significant holding costs * Average 50bps cap rate expansion si
Slide 10: Stockland UK update
Stockland UK update ¢ Inventory write-down in 1H09 results — around $50m after tax as flagged in October 2008 Break even FY09 operating profit No significant new capital to be invested in the short term Goodwill impairment may be higher than anticipated Continuing to manage the income producing asse
Slide 11: EPS/DPS
EPS/DPS Operating businesses remain on track to achieve full year forecasts. Forecast Residential profit will be achieved if current rate of single lot sales is maintained and remaining bulk sales are achieved Revised guidance - FY09 EPS post the adjustments outlined below is 35.0c Estimated FY09 DP
Slide 12: Capital management - debt covenants
Capital management - debt covenants TLITTA D/ITTA * All lenders have one set of covenants: PR mA] 30 Jun 08 39.9% 28.9% — Total liabilities / total tangible assets (TL/TTA): 45% (est 08 = 39.3% 32.0% — Interest cover: 2:1 (write-downs and provisions are excluded from calculation) ° Target TL/TTA < 4
Slide 13: Capital management - debt facilities
Capital management - debt facilities Weighted Weighted « All debt unsecured, no CMBS etc average cost average of debt maturity ° Diversity of debt sources and maturity profile reduces re-financing risk 31 Dec 08 6.7% 5.0 yrs * All FY09 debt refinancing completed (est.) * Maturities in FY10 limited t
Slide 14: Capital management - liquidity
Capital management - liquidity * Capital markets remain tough and the following initiatives are in place to ensure Stockland has sufficient liquidity: No restocking of residential inventory (average spend of $200m pa in FY06-FY08) Deferrel of uncommitted Commercial Property development pipeline Furt
Slide 15: Strategy - responding to changing market dynamics
Strategy — responding to changing market dynamics Global Relevance Capital Management -15- * Strategic goal to appeal to global investors; will aim for Top 20 EPRA/NAREIT - currently 24* * Competitive advantage from diversification. Aim to be Australia’s pre-eminent brown field and green field mixed
Slide 16: Strategic investments
Strategic investments FKP ¢ Retirement living exclusive dealing period expired 15 December 2008 * Due diligence largely complete, but not sufficient to enable proposal to be presented to FKP Board * Ongoing first right of refusal * Will continue to work with FKP Board and management GPT ° Happy with
Slide 17: Summary
¢ Underlying Operating Profit performance in line with guidance, but downside risk remains Strong residential sales from first home owners * Provisions required against residential inventories * Commercial Property rents holding up, but cap rates softening Sound balance sheet, bolstered by asset sal
Slide 18: Stockland contact details and disclaimer
Stockland Corporation Limited ACN 000 181 733 Stockland Trust Management Limited ACN 001 900 741 25th Floor 133 Castlereagh Street SYDNEY NSW 2000 DISCLAIMER OF LIABILITY. While every effort is made to provide accurate and complete information, Stockland does not warrant or represent that the inform