Rural Funds Group · ASX:RFF
Rural Funds — FY2024 Earnings Presentation
29 slides from Rural Funds's earnings presentation, Aug 23, 2024
Slide 1: Financial results presentation for the financial year ended 30 June 2024
Managed by: Rural Funds Group 10: 22% $22... Managing good assets with good people Financial results presentation for the financial year ended 30 June 2024 23 August 2024
Slide 2: Disclaimer and glossary of terms
Rural Disclaimer and glossary of terms Management Disclaimer 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) and has been authorised for release by the Board of RFM. RFF is a stapled secu
Slide 3: Contents
Contents 1. Financial results summary 2. Capital management 3. Portfolio and strategy update a) . LL Powell H . Daniel Yap \\" General Manager = Investor / ¢ Chief Financial Officer Relations, Corporate Affairs | | and Sustainability 4. Outlook and conclusion 5. Appendices Rural Funds Groupto: i 3 W
Slide 4: Financial results summary
[Ot dap. i Bees orchard aoha ch Sesser : (planted area) ‘a ~ Financial results summary Learn more: Beerwah m@adamia orchard, south-east Queensland, June 2024. Rural Funds Group 10 52° 4
Slide 5: Earnings summary
Earnings summary Property revenue increased 8% primarily due to macadamia developments. Property revenue increased $6.5m, or 8.0%, primarily due to additional rental income earned on macadamia developments and lease indexation. * Earnings of $117.2m, or 30.28 cpu, driven by independent property valu
Slide 6: Balance sheet summary
Rural Balance sheet summary Sie irs Management Adjusted NAV per unit increased 7% primarily due to independent valuations. Balance sheet metrics 30 June 202: 30 June 2023 * Adjusted total assets increased by $241.1m, or 13.3%, primarily due to: | saenceshetmetics | . . oye Total assets - $ 1,901,214
Slide 7: Learn more
Learn more: Chickpeas under lateral irrigation at Baamba Plains, central Queensland, June 2024.
Slide 8: Capital management
. Rural Fund: Capital management ee Debt facility refinanced and additional forward dated interest rate hedges entered. Equity Debt Increase of syndicated debt facility imits, and extension of tenor completed Distribution FY24 DPU 11.73 cents. Forecast FY25 DPU 11.73 cents. Gasilty in December 2023.
Slide 9: Debt facilities
spent —H Rural unds Debt facilities a Pro forma headroom of $98.4m sufficient for committed capex requirements! Debt facility metrics Debt facility limits, maturity (FY) and headroom’ Facilities limit ?* $867.4m $794.5m 400 gn Debt facilities Debt drawn $782.0m $637.7m = : Debt drawn = q EE Headroom
Slide 10: Portfolio and strategy update
3 Portfolio and strategy update Rural a a 10 —
Slide 11: Strategy
Strategy To generate capital growth and income from developing and leasing agricultural assets. Leasing model Maintain a majority of long WALE triple net leases, of agricultural assets to high quality lessees. Active management Seek to improve assets by developing for improved productivity or higher
Slide 12: Earnings and asset value growth
. Rural Earnings and asset value growth Se Force Management Reweighting of portfolio providing higher earnings and asset value. Historical earnings and assets’ $1.8b $2.0b $1.5b 314 Adjusted total assets $0.9b sd =@ Adjusted Net Asset Value $0.2b $0.3b $0.4b $0.6b . WM Earnings per unit 1.43 Distrib
Slide 13: Macadamia development update
Macadamia development update Developments commenced 2021 are on track to be materially complete end of 2024. * The TRG JV leased orchards are on track to be materially complete by year end, despite some delays due to above average rainfall. * The precision focused developments are expected to genera
Slide 14: Macadamia orchard technology
. Rural Macadamia orchard technology eric anagemen' Technology and infrastructure seeking to optimise yield and management efficiency. 9 Environmental, tree and soil data collection Remotely controlled irrigation + Inform Ag is a technology company with multiple farm management platforms, including
Slide 15: Leasing update
Leasing update Continued progress on asset leasing. * Continued progress on asset leasing: * Macadamia developments second tranche ($133.9m assets) lease commenced June 2024 following issuance of Rookwood Weir water entitlements. + Mayneland and Baamba Plains cropping properties ($75.7m) leases and
Slide 16: Outlook and conclusion
Outlook and conclusion Learn more: Inspecting pivot irrigation, Yarra central Queensland, August 2023, = Rural Funds Gfoup10! 3% 16
Slide 17: Outlook and conclusion
Outlook and conclusion FY25 forecast AFFO 11.4 cpu and distributions 11.73 cpu. * Earnings of $117.2m, or 30.3 cpu driven by property valuations. + Ongoing leasing: * macadamia developments second tranche commenced June 2024 Mayneland and Baamba Plains cropping properties! Cerberus cattle property b
Slide 18: Appendices
Appendices Summarised comprehensive income AFFO composition Reconciliation of net profit to AFFO Summarised balance sheet Total assets reconciliation Property compendium Lessees Weighted average lease expiry and indexation Sustainability : go Investment and development strategy “qd 4 FIOM 9790 wD >
Slide 19: Appendix A - Summarised comprehensive income
Appendix A - Summarised comprehensive income + Revenue from farming operations and cost of goods sold relates to sale of farming proceeds (primarily cattle, cropping, sugar and macadamias). * Other income mainly relates to annual allocation sales of unleased water. + Property expenses increased main
Slide 20: Appendix B - AFFO composition
Appendix B - AFFO composition * Adjusted funds from operations (AFFO) is pre-tax and excludes fair value adjustments, depreciation and impairment to represent RFF's operating result. * Property expenses relate to costs directly attributable to the properties (eg Composition of AFFO (pre-tax) 12 mont
Slide 21: Appendix C - Reconciliation of net profit to AFFO
Appendix C - Reconciliation of net profit to AFFO * Non-cash items added back to reconcile net profit after tax to AFFO. * Key adjustments include: Notes: Property revaluations (excluding other comprehensive income) include $47.4m in cattle properties, $14.8m in macadamia properties, $1.5m for water
Slide 22: Appendix D - Summarised balance sheet
Appendix D - Summarised balance sheet + Water entitlements are recorded as intangible assets and held at the lower of cost less accumulated impairment or fair value in accordance with accounting standards and ASIC guidance. The adjustment for water entitlements shows the difference between book valu
Slide 23: Appendix E - Total assets reconciliation
Rural Appendix E - Total assets reconciliation a Total assets reconciliation Propert Financial io Uetment Investment Pe Plant and for water owner- assets " Other assets Total property occupied] (propertyp-3| eduipment entitlements e Property! at fair value! $ $ $ $ $ $ $ Balance as at 30 June 2023 9
Slide 24: Appendix F - Property compendium
Appendix F - Property compendium Policy to conduct independent valuations at least every two years. FY25t Rural Funds Management Adjusted Rent review erty by sector ription Acquisition date propery value Naluation date, Valu Valuer “Sepenby, Development strategy | mechanism Almonds Yilgeh NSW 935 ha
Slide 25: Appendix G - Lessees
. Rural - Funds Appendix G - Lessees +4 Management High quality lessees. Majority are corporate or institutional entities. Percentage Description Sector Lessee since (by FY25f revenue) Subsidiary of Olam Group, Almonds — | A Olam Singapore-listed (SGX: 032) 2015 21% _ . US asset manager joint THE RO
Slide 26: Appendix H - Weighted average lease expiry and indexation
Rural Appendix H - Weighted average lease expiry and indexation i a Long dated WALE provides stability of income and long-term rental growth via a mix of indexation mechanisms. WALE profile Indexation mechanisms (by FY25f revenue) 18.0 10 13.5 years 56% CPl-linked WALE TT 28% CPI 140 22% CPI (cap an
Slide 27: Appendix I - Sustainability
Appendix | - Sustainability Continued progress of sustainability initiatives. FY24 achievements FY25 focus areas Rural Funds Management fone one emissions Quantified RFF FY23 Scope 1 and Scope 2 emissions (disclosed in December 2023) and in-house capabilities! Carbon feasi studies Continued work on
Slide 28: Appendix J - Investment and development strategy
Appendix J - Investment and development strategy Seis on To generate income and capital growth from improving and leasing agricultural assets. Spectrum of investment opportunities! Development strategies Infrastructure predominant Natural resource predominant Product developments High density Steel
Slide 29: Managed by: Rural Funds Management
Managed by: Rural Funds Group 10} 4?" id Management Managing good assets with good people wt Rural Funds Management Limited For further information: ACN 077 492 838 James Powell: AFSL 226701 E jpowell@ruralfunds.com.au Level 2, 2 King Street Deakin ACT 2600 T +61 2 6203 9742 T 02 6203 9700 Tim Sheri