Rural Funds Group · ASX:RFF
Rural Funds — Wilsons Rapid Insights (May 2018)
28 slides from Rural Funds's conference presentation, May 31, 2018
Slide 1: Wilsons Rapid Insights Presentation
For personal use only Wilsons Rapid Insights Presentation 31 May 2018
Slide 2: Disclaimer
Managed by: Disclaimer For personal use only This presentation has been prepared by Rural Funds Management Limited (ACN 077 492 838, AFSL 226 701) (RFM) as the responsible entity of Rural Funds Group (RFF). RFF is a stapled security, incorporating Rural Funds Trust (ARSN 112 951 578) and RF Active (
Slide 3: Agenda
Managed by: Agenda For personal use only RFM presenter 1. Investment overview James Powell General Manager - 2. Portfolio update Investor Relations & Marketing 3. Acquisition strategy and outlook 4. Appendices 3
Slide 4: Investment overview
For personal use only 1 Investment overview Forage crop, Rewan, central Queensland, July 2017
Slide 5: Investment overview and strategy
Managed by: Investment overview and strategy For personal use only Factors supporting the objectives and strategy Description • Rural Funds Group (ASX:RFF) is an agricultural real estate investment trust (REIT) that leases 1 Manager with multi-sector operational experience properties to agricultural
Slide 6: Investment metrics
Managed by: Investment metrics Key metrics – 31 December 2017 FY18 forecast revenue by sector For personal use only Adjusted total assets $687.4m 2% 3% 4% Adjusted net assets $409.1m Almonds 7% Adjusted NAV per unit $1.60 Poultry Market capitalisation (at $2.14 per unit) $545.6m Cotton 13% 51% Numbe
Slide 7: Portfolio assets and lessees
Managed by: Portfolio assets and lessees1,2 For personal use only 1 Existing assets 1 Comanche (expected to settle July 2018) Notes: 1. Shaded areas denote climatic zones differentiated by rainfall seasonality. Source: Bureau of Meteorology. Climatic diversification reduces lessee concentration in a
Slide 8: Acquisition track record and performance
Managed by: Acquisition track record and performance RFF trading price, acquisitions and equity raises1 For personal use only October 2017 May 2018 Natal aggregation Comanche (cattle) November 2016 (cattle) contracted contracted for October 2016 Lynora Downs as part of $72.5m $17.5m Murrumbidgee (co
Slide 9: Portfolio update
For personal use only 2 Portfolio update Cultivation area, Rewan, central Queensland, July 2017
Slide 10: Cotton property: productivity improvement
Managed by: Cotton property: productivity improvement Lynora Downs, central Queensland Development capex – stage one For personal use only Total inc. FY18f FY19f existing Water storage 4,142 ML - 14,547 ML Irrigated cropping 170 ha 230 ha 1,349 ha area • Lynora Downs was acquired November 2016 and i
Slide 11: Cattle property: productivity improvement
Managed by: Cattle property: productivity improvement Rewan, central Queensland Development capex For personal use only Total inc. FY17 FY18f existing Water points 10 30 82 Cultivation area 668 ha 554 ha 3,052 ha Pasture improvement - 190 ha 675 ha (inc. Leucaena) • Rewan was acquired in August 2016
Slide 12: Replicating successful acquisitions: Comanche
Managed by: Replicating successful acquisitions Comanche, central Queensland For personal use only Comanche comprises 7,599 ha suitable to both backgrounding (foreground of picture) and breeding (background of picture). The property is located 86km west of Rockhampton in central Queensland. The curr
Slide 13: Replicating successful acquisitions: Comanche
Managed by: Replicating successful acquisitions Comanche, central Queensland For personal use only Comanche has productivity development opportunities almost identical to those proven on Rewan including: planting additional Leucaena (pictured), increasing cultivation area and developing additional w
Slide 14: Replicating successful acquisitions: Comanche
Managed by: Replicating successful acquisitions Comanche, central Queensland For personal use only RFM was well advanced in arranging a lessee at the time of contracting to purchase Comanche. Since the purchase announcement, RFM has had several other parties enquire about leasing the property. 14
Slide 15: Summary of northern climatic zone developments
Managed by: Summary of northern climatic zone developments For personal use only 15
Slide 16: Acquisition strategy and outlook
For personal use only 3 Acquisition strategy and outlook Baled raw cotton ready for delivery to Queensland Cotton for ginning, Lynora Downs , central Queensland, March 2017
Slide 17: Acquisition environment
Managed by: Acquisition environment For personal use only Farms by size and average age of farmers1 Capital sources for investment2 Notes: 1. Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) AGSURF Data 2018. Data represents ABARES defined broadacre sector of Australian
Slide 18: Acquisition strategy
Managed by: For personal use only Acquisition strategy Spectrum of investment opportunities1 Higher lease rate compensates for low or negative Higher IRR through productivity improvement asset growth. Immediate AFFO accretion opportunities. AFFO accretion over lease term Note: 1. The income and grow
Slide 19: Rent review profile and indexation
Managed by: Rent review profile and indexation For personal use only Natural resource market rent reviews1 Indexation mechanisms3 3% 7% 7.0 6% FY18f Rental income (millions) 6.0 5.0 4.0 32% 3.0 2.0 1.0 52% 0.0 2019 2020 2021 2022 2023 2024 2025 2026 2027 Year Lynora Downs Natal aggregation 2.5% fixe
Slide 20: Outlook and conclusion
Managed by: Outlook and conclusion For personal use only Growing AFFO RFM will continue to seek to invest in both infrastructure predominant and natural resource assets to grow AFFO per unit through In time it is expected RFF will have a regular pipeline of market rent acquisitions reviews for natur
Slide 21: Appendices
For personal use only 4 Appendices Cattle on Rewan, central Queensland, July 2017
Slide 22: Glossary and table of abbreviations
Managed by: Glossary and table of abbreviations Term Definition Term Definition Net Asset Value (NAV) adjusted for the independent High security - a water entitlement that ranks above other types For personal use only Adjusted NAV HS (e.g. general security) and has a historically high level of valua
Slide 23: Key assets and counterparts
Managed by: Key assets and counterparts Almond orchards Poultry farms Vineyards Cattle assets Cotton assets For personal use only Brief 1,814 ha mature almond 154 sheds on 17 farms 666 ha mature vineyards Six cattle properties and 4,880 ha cropping property description: orchards and 3,100 ha of on s
Slide 24: Key assets and leases further details
Managed by: Key assets and leases further details Almond orchards Poultry farms Vineyards Cattle assets Cotton assets For personal use only Description: 1,814 ha across two 154 sheds on 17 farms Seven vineyards with 666 ha Two cattle operations 4,880 ha cropping property mature almond orchards consi
Slide 25: Strategy
Managed by: Strategy Diligent management of existing assets and examination of acquisition opportunities For personal use only Key principles underpinning assessment of acquisition opportunities Acquire properties with income secured by long-term leases to Maintain agricultural REIT • 1 structure
Slide 26: Productivity capex
Managed by: Productivity capex Productivity capex aims to increase farm values, lease income and counterpart profitability For personal use only 125 yrs of agricultural returns (10yr moving avg of % price change)1 • Gains in farming productivity (e.g. via technology or science) have historically sup
Slide 27: Rural Funds Management
Managed by: For personal use only Rural Funds Management Key information Board and management team contacts and tenure Established 1997 Total $743m Assets under Rural Funds Group: $687m Guy Paynter David Bryant Michael Carroll Julian Widdup management RFM Poultry: $9m Non-Executive Managing Non-Exec
Slide 28: Corporate information
Managed by: Corporate information For personal use only ACN 077 492 838 AFSL 226701 Canberra Office Level 2, 2 King Street Deakin ACT 2600 Telephone: +61 2 6203 9700 Facsimile: +61 2 6281 5077 managing good assets with good people Website: www.ruralfunds.com.au Further information: Media enquiries:
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