Workspace Group Plc · LSE:WKP
Workspace — H1 2016 Earnings Presentation
29 slides from Workspace's earnings presentation, Nov 9, 2016
Slide 1: Workspace Interim Results: Customer Demand Driving Income Growth
INVESTOR AND WORKSPACE ANALYST PRESENTATION 9 NOVEMBER 2016 INTERIM RESULTS CUSTOMER DEMAND DRIVING INCOME GROWTH
Slide 2: The Right Strategy
WORKSPACE THE RIGHT STRATEGY Right market London is growing and changing Right Right brand properties Increasing Creating recognition and modern growth reputation WORKSPACE environments UNDERSTANDS WORK SPACE Right Right people customers Driving New and performance growing companies Home to new and
Slide 3: Agenda
AGENDA WORKSPACE Jamie Hopkins Chief Executive Officer PERFORMANCE Graham Clemett Chief Financial Officer DIRECTION Jamie Hopkins Chief Executive Officer QUESTIONS 3
Slide 4: Results
WORKSPACE RESULTS September March Change Active Management 2016 2016 Rent Roll (lfl) £51.5m £48.8m 5.5% Rent per sq. ft. (lfl) £24.93 £23.86 4.5% Enquiries (per month) 1,025 1,029 Stable Occupancy (lfl) 90.3% 90.0% 0.3% Property Valuation £1,780m £1,779m (0.9)%* Capital Value per sq. ft. (lfl) £374
Slide 5: Income Growth
WORKSPACE INCOME GROWTH LIKE-FOR-LIKE OCCUPANCY + PRICING COMPLETED PROJECTS LETTING UP + PRICING CURRENT PROJECTS LETTING UP + PRICING PIPELINE ACQUISITIONS 5
Slide 6: Like-for-Like
WORKSPACE LIKE-FOR-LIKE RENT ROLL RENT PER SQ. FT. £55.0m £26 +1.4% +3.0% +4.1% +2.6% £24 +1.9% +3.4% +2.9% £50.0m +4.7% £22 +2.2% £20 +2.8% £45.0m £18 £16 Sep 15 Dec 15 Mar 16 Jun 16 Sep 16 £40.0m OCCUPANCY £35.0m 100% 90.4% 90.6% 90.0% 89.6% 90.3% 90% £30.0m 80% £25.0m 70% Sep 15 Dec 15 Mar 16 Jun
Slide 7: Projects
100,000 120,000 140,000 Sq. ft. 0 20,000 40,000 60,000 80,000 Cargo Works The Light Bulb 2015 PROJECTS Projects underway Completed Projects WORKSPACE Pipeline with planning Metal Box Factory Pipeline pre-planning / design Grand Union Studios The Print Rooms 2016 Vox Studios Barley Mow The Faircharm
Slide 8: Enquiries
WORKSPACE ENQUIRIES 1,400 1,200 1,000 800 600 400 200 0 Mar 15 Jun 15 Sep 15 Dec 15 Mar 16 Jun 16 Sep 16 Monthly Enquiries Rolling 3 months 8
Slide 9: Income Statement
PERFORMANCE INCOME STATEMENT September September Change £m 2016 2015 Net Rental Income 38.0 35.9 +6% Joint Venture Income 0.3 0.5 Administrative Expenses (7.4) (7.6) (3)% Net Finance Costs (7.3) (8.4) (13)% Trading Profit after Interest 23.6 20.4 +16% Investment Property Surplus / (Deficit) (14.6) 1
Slide 10: Net Rental Income
PERFORMANCE NET RENTAL INCOME £42m £2.6m (£1.2m) £41m £0.4m (£2.3m) £40m £39m £2.6m £38.0m £38m £37m £35.9m £36m £35m £34m £33m £32m £31m £30m Sep 2015 Like-for-Like Completed Current Acquisitions Disposals Sep 2016 Properties Projects Projects 10
Slide 11: Rent Roll
PERFORMANCE RENT ROLL LIKE-FOR-LIKE COMPLETED PROJECTS £60m +£5.9m £60m £50m £50m £40m £40m £30m £30m £20m £20m +£6.4m £10m £10m £0m £0m Sep 2015 Mar 2016 Sep 2016 Sep 2015 Mar 2016 Sep 2016 CURRENT PROJECTS ACQUISITIONS £60m £60m £50m £50m £40m £40m £30m £30m £(2.1)m £20m £20m +£1.1m £10m £10m £0m
Slide 12: Completed Projects
PERFORMANCE COMPLETED PROJECTS REFURBISHMENTS REDEVELOPMENTS Rent Roll Rent Roll £15.0m £5.0m £12.5m +£1.8m £4.0m +£1.2m £3.9m £10.7m £10.0m £3.0m £2.7m 3 Business £2.0m 2 Business £5.0m Centres Centres £1.0m £0.0m £0.0m Sep 2016 Future Sep 2016 Future • Future rents are based on the assumptions in
Slide 13: Current Projects
PERFORMANCE CURRENT PROJECTS REFURBISHMENTS REDEVELOPMENTS Rent Roll Rent Roll £30.0m £5.0m £4.8m £25.7m £25.0m £4.0m £20.0m +£14.1m +£3.8m £3.0m £15.0m £11.6m 10 Business £2.0m 6 Business £10.0m Centres Centres £1.0m £1.0m £5.0m £0.0m £0.0m Sep 2016 Future Sep 2016 Future • Excludes projects at des
Slide 14: Cash Flow
PERFORMANCE CASH FLOW £m Total Trading Net Cash from Operations after Interest 22 7 Dividends Paid (15) Investment Capital Expenditure (30) Capital Receipts 13 26 Distributions and Proceeds from Joint Ventures 46 Other Items (3) Net Movement in Year 33 Net Debt at March 2016 (276) Net Debt at Septem
Slide 15: Balance Sheet
PERFORMANCE BALANCE SHEET September March £m 2016 2016 Investment Property Valuation 1,780 1,779 Other Investment 3 27 Net Debt (243) (276) Other (26) (12) Net Assets 1,514 1,518 EPRA NAV per Share £9.15 £9.23 Loan to Value 14% 16% Facility Headroom / Cash £122m £134m 15
Slide 16: Property Valuation
PERFORMANCE PROPERTY VALUATION £2,000m £1,900m £30m £(16)m £1,800m £1,779m £(13)m £1,780m £1,700m £1,600m £1,500m Mar 2016 Capital Capital Revaluation Sep 2016 Receipts Expenditure Deficit 16
Slide 17: Revaluation
PERFORMANCE REVALUATION Uplift / (Deficit) Main drivers Rent per sq. ft. up 4.5% £44m Like-for-Like £(7)m Initial Yield out 0.3% £(51)m The Light Bulb £3m Completed Projects £13m Metal Box Factory £3m Grand Union Studios £3m Redevelopments £4m Sale of consented schemes Properties being refurbished R
Slide 18: Debt
PERFORMANCE DEBT September March 2016 2016 Net Debt £243m £276m Average Interest Cost 5.5% 5.1% Total Facilities (all unsecured) £365m £410m Hedged/Fixed Rate Facilities 56% 50% Average Period to Maturity 5.3 years 5.9 years September March FACILITIES BY TYPE (£m) 2016 2016 Private Placement Notes (
Slide 19: The Right Strategy
DIRECTION THE RIGHT STRATEGY Like-for-Like Redevelopments Crossrail Acquisitions Refurbishments Northern Line Extension 19
Slide 20: Customers
© DIRECTION CUSTOMERS 20
Slide 21: Outlook
DIRECTION OUTLOOK Right market London is growing and changing Right Right brand properties Increasing Creating recognition and modern growth reputation WORKSPACE environments UNDERSTANDS WORK SPACE Right Right people customers Driving New and performance growing companies Home to new and growing com
Slide 22: Questions
QUESTIONS WORKSPACE
Slide 23: Supplementary Information
SUPPLEMENTARY INFORMATION | WORKSPACE
Slide 24: Appendix 1: Refurbishment Projects
APPENDIX 1 REFURBISHMENT PROJECTS Actual/ Estimated Estimated Estimated Cost to Estimated Unaffected Upgraded New ERV Rent at 90% September 2016 March 2016 At September 2016 Valuation cost Complete Completion area area space (Average) occupancy* Rent Roll* Rent Roll* Completed Metal Box Factory £101
Slide 25: Appendix 2: Redevelopment Projects
APPENDIX 2 REDEVELOPMENT PROJECTS Development September Estimated Residential At September 2016 partner Valuation 2016 Rent Roll completion units no. Commercial space returned Other proceeds Estimated Estimated Cash Cash Overage Area ERV Rent* received to come to come Completed The Light Bulb Mount
Slide 26: Appendix 3: Customer Portfolio March 2016
APPENDIX 3 CUSTOMER PORTFOLIO MARCH 2016 DATA REPRESENTS 92% OF TOTAL RENT ROLL 26
Slide 27: Appendix 4: BlackRock Workspace Property Trust
APPENDIX 4 BLACKROCK WORKSPACE PROPERTY TRUST 16 properties acquired £86m Lettings, renewals, refurbishments Rental income 16 properties sold £188m Mar 2011 Mar 2012 Mar 2013 Mar 2014 Mar 2015 Mar 2016 Fees to workspace Transaction management £2.4m Asset management £1.8m Performance £24.5m 27
Slide 28: Appendix 5: How We Make Money
APPENDIX 5 HOW WE MAKE MONEY WHAT UNDERSTANDING CREATING THE RIGHT WE DO DEMAND SUPPLY STRATEGY MARKET LONDON KNOWLEDGE REVENUE THE RIGHT PROPERTIES + + NEW AND GROWING CUSTOMER + GROWTH RELATIONSHIPS COMPANIES THE RIGHT SERVICES + + CAPITAL TAILORED BUSINESS OPERATIONAL ENVIRONMENTS CAPABILITY 28
Slide 29: Disclaimer
DISCLAIMER The information in this document may include forward-looking statements, which are based on current expectations and projections about future events. These forward-looking statements reflect the directors' beliefs and expectations and are subject to risks, uncertainties and assumptions ab