Bwp Trust · ASX:BWP
Bwp Trust — H1 FY2025 Earnings Presentation
35 slides from Bwp Trust's earnings presentation, Feb 5, 2025
Slide 1: 2025 Half-year results
2025 Half-year results For personal use only 5 February 2025
Slide 2: Important notice
Important notice For personal use only The information provided in this presentation is not intended to be comprehensive in nature and should be considered together with the financial statements for the period and previous periods, ASX announcements and other information available on BWP’s website.
Slide 3: Acknowledgement of Country
Acknowledgement of Country For personal use only We acknowledge the Traditional Owners of Country throughout Australia and their continuing connection to lands and waterways upon which we depend. We pay our respects to their Elders, past, present, and emerging. PHOTO: HANS WISMEIJER 3 BW P 2 0 2 5 H
Slide 4: Presentation outline
Presentation outline For personal use only Presenters Item Slide Mark Scatena, Managing Director 1H FY25 Portfolio highlights 5 Andrew Ross, Head of Property Financial performance 8 David Hawkins, Head of Finance Strategic framework 11 Portfolio optimisation 13 Profitable growth 23 Portfolio renewal
Slide 5: 1H FY25 Portfolio highlights
1H FY25 Portfolio highlights For personal use only Pakenham (VIC) 5 BW P 2 0 2 5 H A L F -YEA R RE S U L TS
Slide 6: 1H FY25 performance highlights
1H FY25 performance highlights Optimisation and profitable growth focus support portfolio momentum For personal use only > Like-for-like rental growth of 3.3% > Agreement reached for Bunnings > Port Kennedy (WA) divestment expansion ($14.0m) at Pakenham (VIC) advanced (2H FY25 completion > Five Bunn
Slide 7: 1H FY25 key portfolio highlights
1H FY25 key portfolio highlights Balance sheet strength leveraged whilst maintaining high quality and For personal use only high returning portfolio As at 31 December 2024 Total income Profit (before revaluations) Interim ordinary distribution Net tangible assets per unit $100.6m $66.1m 9.20 cents p
Slide 8: Financial performance
Financial performance For personal use only Bunnings Townsville North (QLD) 8 BW P 2 0 2 5 H A L F -YEA R RE S U L TS
Slide 9: Financial performance
Financial performance HALF-YEAR ENDED 31 DEC 2024 31 DEC 2023 For personal use only INCOME AND EXPENSES Total income $m 100.6 82.3 Total expenses $m (34.5) (24.9) Profit before fair value movements $m 66.1 57.4 Amounts (retained)/released from undistributed income reserve $m (0.4) 0.5 Distributable
Slide 10: Financial performance (continued)
Financial performance (continued) For personal use only HALF-YEAR ENDED 31 DEC 2024 31 DEC 2023 INVESTMENT AND CASH GENERATION Operating cash flow $m 53.0 56.3 Capital expenditure $m 4.7 8.4 Acquisitions of investment properties $m - 32.0 Free cash flow $m 47.5 13.1 CAPITAL STRUCTURE Total assets $m
Slide 11: Strategic framework
Strategic framework For personal use only Bunnings Nunawading (VIC) 11 BW P 2 0 2 5 H A L F -YEA R RE S U L TS
Slide 12: Strategic framework and investment proposition
Strategic framework and investment proposition For personal use only > Consistent objective > Key focus areas align to strategic pillars – Portfolio optimisation – optimising and leveraging the existing network while managing asset repurposing requirements – Profitable growth – expanding the core po
Slide 13: Portfolio optimisation
Portfolio optimisation For personal use only Southport (QLD) 13 BW P 2 0 2 5 H A L F -YEA R RE S U L TS
Slide 14: Rental income growth reflecting escalation mix and tenant composition change
Portfolio optimisation For personal use only Rental income growth reflecting escalation mix and tenant composition change Rental income > 1H FY25: 3.3% like for like rental growth driven by balanced lease $ per sqm review structure: 9.0% 180 – CPI: 48.0% 8.0% 170 – Fixed: 50.5% 7.0% – Market rent re
Slide 15: Continued active management of Bunnings market rent review process
Portfolio optimisation Continued active management of Bunnings market rent review process For personal use only > Five Bunnings market rent reviews PASSING REVIEWED VARIANCE EFFFECTIVE PROPERTY LOCATION finalised RENT ($PA) RENT ($PA) (%) DATE > Variance to passing rent of 2.7% Balcatta (WA)1,2 2,47
Slide 16: Continued covenant mix strength driven by Wesfarmers Group and national retailers
Portfolio optimisation For personal use only Continued covenant mix strength driven by Wesfarmers Group and national retailers (collectively ~98%) with WALE extended and occupancy improved Rental income mix WALE and occupancy % of Total Rent WALE Occupancy 0.7% 1.2% 1.2% 1.3% 2.1% 100.0% 5.0 98.8% 9
Slide 17: Recent Bunnings Warehouse transactions
Portfolio optimisation Recent Bunnings Warehouse transactions For personal use only > Increased market transaction Capitalisation rate activity in 1H FY25 – Three Bunnings Warehouse 7.00% transactions completed (all 6.50% purchased by private investors) 6.00% • Average cap rate of 5.0% NPR Portfolio
Slide 18: Portfolio capitalisation rate compression of 11 basis points in 1H FY25
Portfolio optimisation For personal use only Portfolio capitalisation rate compression of 11 basis points in 1H FY25 > December 2024 weighted average cap rate of Valuations by State as at 31 December 2024 5.43% (June 2024: 5.54% and December 2023 5.53%) PROPERTIES RENTAL CAP RATE VALUE STATE (NO.) (
Slide 19: Independent valuation movement reflects cap rate compression and rental growth
Portfolio optimisation For personal use only Independent valuation movement reflects cap rate compression and rental growth > Cohort of 13 independent valuations Independent valuation summary completed in 1H FY25 (15.7% of BWP portfolio value) with average Valuation (m) Cap rate cap rate of 5.64% $1
Slide 20: Near term expiries reflect historic tranche portfolio acquisitions
Portfolio optimisation Near term expiries reflect historic tranche portfolio acquisitions; For personal use only option exercising supported by portfolio quality and option history Outlook Weighted average lease expiry profile1 (at 31 December 2024) > Bunnings store network decisions influenced by:
Slide 21: Term certain and lease option management supported by improved portfolio quality
Portfolio optimisation Term certain and lease option management supported by improved For personal use only portfolio quality In year expiries (number of Bunnings leases) Recent history 25 > Nine (11.0% of rent) options exercised in six months to 31 December 2024 20 – Four relate to FY25 and five re
Slide 22: Core portfolio improvement driven by effective asset repurposing and renewal
Portfolio optimisation Core portfolio1 improvement driven by effective asset repurposing and For personal use only renewal and growth activity Core portfolio contribution to portfolio Average lettable area (sqm) Metropolitan location (# of properties) (% of sites) 100 14,220 14,213 100 6 80 11 14,20
Slide 23: Profitable growth
Profitable growth For personal use only Hervey Bay (QLD) 23 BW P 2 0 2 5 H A L F -YEA R RE S U L TS
Slide 24: Upgrades agreed at Pakenham and Midland reflect strong tenant partnerships
Profitable growth Upgrades agreed at Pakenham (VIC) and Midland (WA) reflect strong tenant For personal use only partnerships and BWP support to drive improved lessee store format and customer proposition Bunnings – Pakenham (VIC) Carco – Midland (WA) > Terms agreed for an expansion (subject to > Up
Slide 25: Alternate use activity reflects improved portfolio quality
Profitable growth Alternate use activity reflects improved portfolio quality; For personal use only Hervey Bay provides template for near term repurposing activity PROPERTY LEASE EXPIRY COMMENTS Port Kennedy (WA) > Expired > Divestment process advanced (expected completion 2H FY25) Noarlunga (SA) >
Slide 26: Portfolio renewal
Portfolio renewal For personal use only Browns Plains (QLD) 26 BW P 2 0 2 5 H A L F -YEA R RE S U L TS
Slide 27: Capital management: Diversified debt sources and maturities
Portfolio renewal Capital management: Diversified debt sources and maturities For personal use only > Average borrowings for the period $793.9m > As at 31 December 2024: – 58.0% up on pcp, largely due to NPR debt assumed as part of the takeover – Hedging cover of 52.4% – 4.4% weighted average cost o
Slide 28: Outlook
Outlook For personal use only Bunnings Belmont (WA) 28 BW P 2 0 2 5 H A L F -YEA R RE S U L TS
Slide 29: Outlook: FY25 focus areas
Outlook Continued focus on BWP’s objective of providing unitholders a secure For personal use only and growing income stream and long-term capital growth FY25 focus areas > Continued progress in repurposing vacated properties, > Recycling proceeds from divestments of non-core filling vacancies, comp
Slide 30: Outlook: operating environment and income generation
Outlook Continued focus on BWP’s objective of providing unitholders a secure For personal use only and growing income stream and long-term capital growth Operating market and environment Income generation > Trust remains well positioned with rental income > FY25 rent reviews comprising largely the W
Slide 31: Q&A Thank you
Q&A For personal use only Thank you Further Information Responsible entity: BWP Management Limited Tel: +61 8 9327 4356 Email: investorrelations@bwptrust.com.au
Slide 32: Appendix A Core Portfolio Lease Options to December 2027
Appendix A For personal use only Core Portfolio Lease Options to 31 December 2027 (yet to be exercised)
Slide 33: Core Portfolio Bunnings lease expiries
Core Portfolio For personal use only Bunnings lease expiries LEASE OPTIONS ANNUAL RENTAL PROPERTY COMMENTS EXPIRY (YEARS) ($’000) Vermont South (VIC) Aug 2025 3 x 5 (15) 2,681 Third option, notification required by May 2025 Rocklea (QLD) Oct 2025 4 x 6 (24) 2,668 First option, notification required
Slide 34: Core Portfolio Bunnings lease expiries
Core Portfolio For personal use only Bunnings lease expiries LEASE OPTIONS ANNUAL RENTAL PROPERTY COMMENTS EXPIRY (YEARS) ($’000) Sunbury (VIC) Jun 2026 5 x 6 (30) 2,232 First option, notification required by Jun 2025 West Ipswich (QLD) Sep 2026 5 x 6 (30) 3,057 First option, notification required b
Slide 35: Core Portfolio Bunnings lease expiries
Core Portfolio For personal use only Bunnings lease expiries LEASE OPTIONS ANNUAL RENTAL PROPERTY COMMENTS EXPIRY (YEARS) ($’000) Maribyrnong (VIC) Feb 2027 5 x 6 (30) 3,314 First option, notification required by Feb 2026 Gladstone (QLD) Feb 2027 2 x 5 (10) 1,809 Third option, notification required