Slide 1: 1H14 Results Presentation
1H14 Results Presentation For personal use only A Clear Direction Stockland Townsville, QLD
Slide 2: Agenda
For personal use only Agenda Topic Speaker Page Number Group Update Mark Steinert, Managing Director and CEO 03 Financial Update Tiernan O’Rourke, CFO 05 Commercial Property John Schroder, Group Executive and CEO, 09 Commercial Property Residential Andrew Whitson, Group Executive and CEO, 16 Residen
Slide 3: Key achievements
For personal use only Key achievements Created a strong foundation to grow profit Our Our On track to achieve the upper end of guidance, and have therefore tightened this to 5-6% EPS growth in FY14 purpose vision We believe there’s To be a great Australian a better way to live property company t
Slide 4: Improving results in variable market conditions
For personal use only Improving results in variable market conditions Results reflect improving operational performance 1H14 1H13 Change Underlying profit up 4.8% Statutory Profit/(Loss) $298m $(147)m nm Statutory Earnings per 12.9 cents (6.7) cents nm Underlying EPS in line with 1H13 and up 7
Slide 5: Financial Management
Financial Management 01 Financial Update – Tiernan O’Rourke For personal use only Stockland Shellharbour Stockland 1H14 Results 5
Slide 6: Underlying Profit improving
For personal use only Underlying Profit improving $m 1H14 1H13 Change Commentary Retail 174 159 9%▲ 2.6% comparable NOI growth (3.8% comparable FFO growth), completion of Shellharbour, Townsville and Merrylands Industrial 31 32 3% 1.6% comparable NOI reduction (1.0% comparable FFO growth), declinin
Slide 7: Statutory Profit
For personal use only Statutory Profit $m 1H14 1H13 Change Commentary Underlying Profit 267 255 5%▲ Commercial Property revaluations 44 35 Completion of retail developments Retirement Living revaluations 3 (61) MTM of financial instruments (3) (34) Write-down of inventory - (318) Fair value adjustme
Slide 8: Efficient capital management maintained a strong balance sheet
For personal use only Efficient capital management maintained a strong balance sheet Capital management Key debt metrics Gearing maintained within target range (20-30%) 1H14 1H13 A-/stable metrics; rating confirmed in June 2013 S&P rating A-/Stable A-/Stable DRP reinstated, 28% take up Drawn d
Slide 9: Commercial Property
Commercial Property 02 Commercial Property - John Schroder For personal use only Stockland Hervey Bay Stockland 1H14 Results 9
Slide 10: Commercial Property Operating Metrics
For personal use only Commercial Property Operating Metrics Solid result in a challenging environment Asset Portfolio Total WALE Occupancy WACR2 weighting value Underlying (years) (stable ROA improved from 8.2% to 8.6% with steady increase in ($m)1 Profit assets) Underlying Profit (change) Retai
Slide 11: Commercial Property delivered solid result
For personal use only Commercial Property delivered solid result Commercial Property ($m) Funds From Operations1 Underlying Profit 1H14 1H13 Change Comparable 1H14 1H13 Change Comparable growth2 growth2 Retail 184 165 11.5% 3.8% 174 159 9.4% 2.6% Industrial 35 35 1.0% 1.0% 31 32 (3.1)% (1.6)% Office
Slide 12: Retail: sales growth positive in challenging market
For personal use only Retail: sales growth positive in challenging market Moving annual turnover (MAT) growth1 4.9% 4.7% Total MAT growth has increased boosted by development completions 3.3% 2.6% 1.4% annual MAT growth. Supermarkets and specialty sales have 2.2% trended positively 1.4% 1.6% 1.0
Slide 13: Retail: leasing activity reflects remixing strategy
For personal use only Retail: leasing activity reflects remixing strategy Maintained high occupancy within our operating retail centres Retail leasing activity1 1H14 FY13 1H13 Occupancy 99.6% 99.4% 99.4% Reversionary rental growth has improved despite challenging Tenant retention 66% 75% 78% con
Slide 14: Industrial: improving portfolio quality
For personal use only Industrial: improving portfolio quality Portfolio reshaping underway 1H14 FY13 1H13 Accretive acquisition of the Forrester Distribution Centre, Sydney Leasing Activity – Executed 176,000 sqm 287,000 sqm 127,000 sqm Refurbished Port Adelaide Distribution Centre, 37,000 sqm L
Slide 15: Office: actively managing the portfolio
For personal use only Office: actively managing the portfolio Disposals impacting net operating income 1H14 FY13 1H13 Net operating income lower as a result of disposals over the past year Leasing Activity – Executed 28,000 sqm 58,000 sqm 33,000 sqm Created JV with AMP AIMS at Optus Centre, 7.8%
Slide 16: Residential
Residential 03 Residential - Andrew Whitson For personal use only Calleya Stockland 1H14 Results 16
Slide 17: Strong sales result
For personal use only Strong sales result Residential Communities 1H14 1H13 Change Operating profit recovery on track Lots settled 2,253 2,085 8.1% Revenue - Retail $392m $381m 2.9% Successful launch of Willowdale and Calleya - Superlots1 $47m $17m 176.5% EBIT (before interest in COGS) $120m
Slide 18: Market improvement broadening
For personal use only Market improvement broadening Total settlement volumes have increased by 8% Lots settled by location (lots) 2,253 VIC9%: volumes improving, limited price growth to date 2,085 220 NSW QLD22%: vacant land sales now growing off a low base 422 725 QLD WA32%: robust market
Slide 19: Reshaping portfolio to drive higher returns
For personal use only Reshaping portfolio to drive higher returns Capital Core projects employed1 Residential Communities 1H14 Delivering 28 Active projects2 current $1.1b earnings ~24,700 Lots Core Workout Total 1H14 Active ROA6 Lots settled 1,873 380 2,253 Bring to 14.1% 5 New Launch projects Reve
Slide 20: Retirement Living
Retirement Living 04 Retirement Living - Stephen Bull For personal use only Macarthur Gardens Stockland 1H14 Results 20
Slide 21: Improved Retirement Living result
For personal use only Improved Retirement Living result 1H14 1H13 Change Steady improvement in returns Established unit turnover 302 249 21.3% New unit settlements 122 131 6.9% 21.3% increase in established unit turnover. New unit settlements Transaction value1 $144m $131m 9.9% down, impacted b
Slide 22: Retirement portfolio continues to transition in line with strategy
For personal use only Retirement portfolio continues to transition in line with strategy Established portfolio Established portfolio 1H14 1H13 Change Strong result, increased turnover, re-sale prices and reservations Established unit turnover 302 249 21.3% on hand Average re-sale price $320k $315
Slide 23: Summary and overview
Retirement Living 04 Summary and overview - Mark Steinert For personal use only Willowdale Stockland 1H14 Results 23
Slide 24: Market trends
For personal use only Market trends Asset class Market trends Retail On balance, positive impact of a more competitive $AUD Positive wealth effect from residential market Expect modest improvement in sales environment overall Industrial Very competitive market for acquisitions Demand depen
Slide 25: Progress on business priorities
For personal use only Progress on business priorities Priority Progress Improve Residential profitability Continue to reshape portfolio Achieved Medium density / built form progress Impaired asset sales progressing Ongoing Ahead of 5,000 lot settlement target for FY14, on track for 11-13% op
Slide 26: Outlook
For personal use only Outlook New projects and re-letting activity support earnings improvement Willowdale, NSW Reinvesting to enhance sales and acquisition capabilities and control functions On track to achieve the upper end of guidance, and have therefore tightened this to 5-6% EPS growth in
Slide 27: Stockland Corporation Limited
For personal use only 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 repr