Prosperity Real Estate Investment Trust · HKEX:808
Prosperity Real Estate Investment Trust — H1 2016 Earnings Presentation
26 slides from Prosperity Real Estate Investment Trust's earnings presentation, August 2016
Slide 1: Interim Results
Interim Results For the six months ended 30 June 2016 August 2016
Slide 2: Disclaimer
Disclaimer This document was prepared by ARA Asset Management (Prosperity) Limited, in its capacity as the manager (“REIT Manager”) of Prosperity Real Estate Investment Trust (“Prosperity REIT”) solely for use at the presentation to analysts in relation to the announcement of the results of Prosperi
Slide 3: Table of Contents
Table of Contents Results Highlights Financial Review Operations Review Outlook & Strategies Appendix ProsperityREIT Prosperity REIT2015 2016Interim InterimResults ResultsPresentation Presentation 3
Slide 4: Results Highlights
Results Highlights Prosperity REIT 2015 Interim Results Presentation 4
Slide 5: Results Highlights
Results Highlights Revenue Net Property Distributable Distribution Income Income Per Unit 3.3% 3.1% 5.3% 4.0% HK$222.9m HK$176.0m HK$215.8m HK$170.7m HK$131.4m HK$0.0871 HK$0.0906 HK$124.8m 1H15 1H16 1H15 1H16 1H15 1H16 1H15 1H16 Rental Occupancy Cost-to- Average Reversion Rate revenue Effective Rat
Slide 6: Outperformance in Unit Price and Attractive Yield
Results Highlights Outperformance in Unit Price: 14%1 Prosperity REIT HS REIT Index HS Property Index HS Index 14.0%1 8.8% Prosperity REIT HS REIT Index HS Property Index HS Index -1.1% -5.1% Attractive yield: 5.7%2 5.7%2 4.0% 3.5% 1.1% 0.3% 0.3% Prosperity REIT's HS IndexHSDividend Index Yield HS P
Slide 7: 1H16 Key Takeaways
1H16 Key Takeaways Steady and positive growth to continue ● Continued to deliver positive rental reversion at 9.6% with a stable occupancy rate, providing steady topline revenue ● Increased completions of new Grade A office buildings and moving in of high quality tenants/end users boost up business
Slide 8: Financial Review
Financial Review Prosperity REIT 2015 Interim Results Presentation 8
Slide 9: Income Statement
Income Statement (HK$’000) 1H16 1H15 (unaudited) (unaudited) Revenue 222,925 215,802 Total property operating expenses (46,972) (45,115) NPI increased Net property income 175,953 170,687 by 3.1% Interest Income 23 39 Manager’s fee (26,328) (25,105) Trust and other expenses (4,906) (4,458) Change in
Slide 10: Financial Position
Financial Position As at 30 Jun As at 31 Dec Change 2016 2015 Out of HK$10,688m investment properties4, Total assets (HK$m) 10,775.7 10,492.7 +2.7% HK$6,682m was pledged Borrowings1 (HK$m) 2,819.6 2,813.3 +0.2% Interest Rate5 Other liabilities (HK$m) 557.8 523.7 +6.5% Fixed : Floating 55% : 45% Net
Slide 11: Debt Maturity Profile
Debt Maturity Profile No major refinancing needs until 2019 3,000 2,500 430 2,000 HK$ million 1,500 1,000 2,070 500 800 380 404 0 Jan 2017 2018 Jan 2019 Nov 2019 Aug 2021 Unsecured 3-yr term loan @ HIBOR+150 bps Secured 5-yr term loan @ HIBOR+135 bps Secured 5-yr term loan @ HIBOR+145 bps Secured RC
Slide 12: Portfolio Valuation
Portfolio Valuation Valuation by Property Type As at 30 Jun 2016 Commercial 21.1% HK$2,253m ● Portfolio valuation at HK$10,688m, up Grade A Office 2.6% compared to 31 Dec 2015 HK$6,254m ● Cap rates remain unchanged Industrial/Office 17.4% 58.5% HK$1,865m 3.0% Industrial HK$316m (HK$m) 30 June 2016 3
Slide 13: Operations Review
Operations Review Prosperity REIT 2015 Interim Results Presentation 13
Slide 14: Property Income
Property Income Revenue Net Property Income Trendy Centre Trendy Centre HK$23.2m HK$16.9m Prosperity Prosperity Center Prosperity HK$18.9m Prosperity Center Place Place 10.4% HK$14.5m HK$33.1m HK$26.7m 9.6% 14.8% 8.5% New Treasure 15.2% 8.2% New Treasure Centre Centre 3.4% HK$7.6m 3.2% HK$5.7m Harbo
Slide 15: Occupancy Rates
Occupancy Rates Portfolio Occupancy Rates Above 95% Since 2006 (As at 30 Jun 2016) The Metropolis Tower 97.0% Prosperity Millennia Plaza 96.6% 9 Chong Yip Street 98.9% Harbourfront Landmark (portion) 100.0% Prosperity Place 96.5% Trendy Centre 93.9% Prosperity Center (portion) 95.8% New Treasure Cen
Slide 16: Commercial Tenants at Prosperity Place
Commercial Tenants at Prosperity Place Diversified retail/services tenants, accounted for around 41.4% of gross rentable area of Prosperity Place as at 30 June 2016 F&B - Cafe Beauty Salon Fitness Centre Skincare products & SPA ProsperityREIT Prosperity REIT2015 2016Interim InterimResults ResultsPre
Slide 17: Commercial Tenants at Prosperity Place
Commercial Tenants at Prosperity Place Education ProsperityREIT Prosperity REIT2015 2016Interim InterimResults ResultsPresentation Presentation 17
Slide 18: Marketing Campaigns for Prosperity Place
Marketing Campaigns for Prosperity Place Chinese New Year Easter ProsperityREIT Prosperity REIT2015 2016Interim InterimResults ResultsPresentation Presentation 18
Slide 19: AEIs Updates – The Metropolis Tower
AEIs Updates – The Metropolis Tower • With the increased supply of Grade A office, upgrading of the executive and common washrooms on the selected floors commenced Male common washroom Female common washroom Before Before After After ProsperityREIT Prosperity REIT2015 2016Interim InterimResults Resu
Slide 20: Outlook & Strategies
Outlook & Strategies Prosperity REIT 2015 Interim Results Presentation 20
Slide 21: Outlook & Strategies
Outlook & Strategies Stable and sustainable distribution to continue ● 100% payout ratio ● Defensive investment as proven in economic cycles ● 175.9%* total return since IPO DPU (HK$) 0.0897 0.0906 0.0871 0.0815 0.0815 0.0744 0.0751 0.0694 0.0660 0.0555 0.0595 0.0607 0.0554 0.0544 0.0546 1H09 2H09 1
Slide 22: Outlook & Strategies
Outlook & Strategies Kowloon East (accounting for 35.4% of NPI) on track to become “CBD2” Tenant mix enhancement and diversification Acquisition focus – Seeking yield-accretive acquisition ProsperityREIT Prosperity REIT2015 2016Interim InterimResults ResultsPresentation Presentation 22
Slide 23: Appendix
Appendix Prosperity REIT 2015 Interim Results Presentation 23
Slide 24: Portfolio Map
Portfolio Map The Metropolis 1 Prosperity 5 Total Gross Rentable Area: 1.35m sq.ft. Tower Place GRA: 271,418 sq. ft. GRA: 240,000 sq. ft. Prosperity Trendy Millennia Plaza 2 Centre 6 6 GRA: 217,955 sq. ft. GRA: 173,764 sq. ft. 8 9 Chong Yip Prosperity Street 3 Center Property 7 GRA: 136,595 sq. ft.
Slide 25: Key Facts
Key Facts Key Facts as at 30 June 2016 IPO Date 16 Dec 2005 IPO Price HK$2.16 5.70% Indicative Yield (based on 1H16 DPU of HK$0.0906 and closing unit price of HK$3.18 as at 30 June 2016) Number of Issued Units 1,445,971,969 Market Capitalization HK$4.60 billion (US$589.5 million) Average Daily Tradi
Slide 26: Contacts
Contacts ARA Asset Management (Prosperity) Limited (as manager of Prosperity REIT) Ms. Mavis Wong Chief Executive Officer maviswong@ara.com.hk Mr. Vicho Chung Manager, Investments & Investor Relations vichochung@ara.com.hk Ms. Kitty Lam Senior Analyst, Investments & Research kittylam@ara.com.hk Unit
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