Kiwi Property Group Ltd. · NZX:KPG
Kiwi Property — Kiwi Income Property Trust — H1 FY2011 Earnings Presentation
29 slides from Kiwi Property's earnings presentation, Nov 12, 2010
Slide 1: Interim Result for the six months ended 30 September 2010
INTERIM RESULT For the six months ended 30 September 2010 KIWI INCOME PROPERTY TRUST 12 November 2010 Chris Gudgeon Chief Executive Gavin Parker Chief Financial Officer
Slide 2: Agenda
Agenda 2 Chris Gudgeon, Chief Executive – Interim result overview Gavin Parker, Chief Financial Officer – Financial review Chris Gudgeon, Chief Executive – Portfolio overview – Review of operations – Outlook All statistics as at 30-Sep-10 unless otherwise stated
Slide 3: Interim result overview
Interim result overview Interim result presentation for the six months ended 30 September 2010
Slide 4: Highlights
Interim result overview Highlights 4 Solid operating performance: – Net operating income $68.2 million, up 1.5% – Distributable profit after tax $33.0 million, up 10.4% – Interim distribution after tax 3.50 cents per unit, in line with guidance Strong balance sheet: – Net gearing ratio of 24.9% – Ba
Slide 5: Highlights (continued)
Interim result overview Highlights (continued) 5 Robust portfolio performance: – Core retail and office occupancy rate 97.0% – Weighted average lease term stable at 4.2 years – Active leasing program delivering results – Retail sales recovering and affordability ratios improving – Sylvia Park net op
Slide 6: Financial result
Interim result overview Financial result 6 30-Sep-10 30-Sep-09 Variance Financial performance For the six months ended $m $m $m % Distributable Gross rental income1 94.0 92.9 +1.1 +1.2 profit Property operating expenditure -25.8 -25.7 -0.1 -0.4 Net operating income1 Other operating expenses 68.2 -31
Slide 7: Total returns
Interim result overview Total returns 7 Cumulative Total returns 1 year 3 year 5 year average Total For the periods to 30-Sep-10 %pa %pa cum %pa cum Return1 since KIP [Unit price $1.01] 3.6 -3.9 4.8 inception NZX 50 Gross Index 0.5 -9.4 -1.6 9.5% NZX Property Gross Index 1.8 -5.1 2.7 KIP has outperf
Slide 8: LPT global total return
Interim result overview LPT global total return 8 Five years ended 30-Sep-10 Singapore 68% KIP 26% Canada 21% New Zealand 14% USA 7% Japan -20% Australia -37% UK -39% -60% -40% -20% 0% 20% 40% 60% 80% Source: Goldman Sachs & Partners NZ Research
Slide 9: Financial review
Financial review Interim result presentation for the six months ended 30 September 2010
Slide 10: Distributable profit
Financial review Distributable profit 10 Distributable profit 30-Sep-10 30-Sep-09 Variance – Net operating For the six months ended $m $m $m % Total % L4L income increased Net operating income - retail1 38.6 35.7 +2.9 +8.1 -1.3 by 1.5% and Net operating income - office1 28.2 29.8 -1.6 -5.4 -2.6 dist
Slide 11: Financial position
Financial review Financial position 11 Financial position 30-Sep-10 31-Mar-10 Variance As at $m $m $m % The balance sheet Assets remains strong and Property assets 1,856.1 1,848.7 +7.4 +0.4 provides flexibility Cash on deposit 112.7 117.8 -5.1 -4.3 to explore value- Other assets 23.1 18.3 +4.8 +26.2
Slide 12: Debt summary
Financial review Debt summary 12 Bank facilities 30-Sep-10 31-Mar-10 Bilateral facilities [ANZ, BNZ, CBA and Westpac] $800m $800m Balance drawn $578m $571m Balance undrawn $222m $229m MCN proceeds on deposit $108m $114m Weighted average cost of debt (incl. margin and line fees) 6.68% 7.07% Weighted
Slide 13: Hedging summary
Financial review Hedging summary 13 Hedging profile 30-Sep-10 31-Mar-10 Percentage of drawn debt hedged [fixed rate] 82% 94% Weighted average interest rate on hedged debt [excl margin and fees] 6.66% 6.67% Weighted average term to maturity of interest rate hedges 3.7 years 3.6 years Hedge maturity p
Slide 14: Debt refinancing
Financial review Debt refinancing 14 – $302.5 million in bank debt facilities renewed post the reporting period, with $800 million in bilateral bank debt facilities maintained – Weighted average term to maturity has increased by 1.5 years to 2.9 years – Renewed facilities with ANZ, BNZ, CBA and West
Slide 15: Portfolio overview
Portfolio overview Interim result presentation for the six months ended 30 September 2010
Slide 16: Occupancy
Portfolio overview Occupancy 16 NLA Vacant Occupancy Portfolio / Property Portfolio sqm sqm % Sylvia Park 71,225 - 100.0 occupancy Centre Place 15,133 1,319 91.3 Downtown Plaza 6,146 - 100.0 97.0% The Plaza North City 32,279 25,795 447 - 100.0 98.3 Northlands 42,256 881 97.9 Total: Retail 192,834 2,
Slide 17: Diversification: Sector and regional
Portfolio overview Diversification: Sector and regional 17 Palmerston TOTAL By value Auckland Wellington Christchurch Hamilton North % Total by Sector Retail 24% 6% 13% 11% 6% 60% Office 22% 12% 3% - - 37% Other 2% - - - 1% 3% TOTAL % Total by Region 48% 18% 16% 11% 7% 100% Office Wellington Christc
Slide 18: Diversification: Tenant
Portfolio overview Diversification: Tenant 18 Analysis of property portfolio NZ Chains, 22.7% Other, 3.0% Portfolio No. Tenants NLA Gross income IT / Comms, 1.6% Financial Svcs, 2.8% Retail 83% 55% 60% Banking, 3.5% Office 17% 45% 40% Tenant Aust. & Intern'l Chains, 20.9% Insurance, 4.3% diversifica
Slide 19: Lease expiry and WALT
Portfolio overview Lease expiry and WALT 19 Lease expiry profile By gross income 45% 41% Retail portfolio 39% 40% Office portfolio Portfolio 35% Investment portfolio 35% WALT 30% 22% 4.2 yrs 25% 21% 18% 20% 16% 14% 13% 12% 12% 12% 15% 11% 11% 9% 10% 6% – Retail WALT: 4.3 years 5% 4% 5% – Office WALT
Slide 20: Review of operations
Review of operations Interim result presentation for the six months ended 30 September 2010
Slide 21: General economy
Review of operations General economy 21 Indicator 2008A 2009A 2010A 2011F 2012F – Pace of recovery in global For the year ended/as at 31 Mar economy has slowed GDP Growth 2.9% -1.5% -0.4% 2.1% 1.4% – Growth in Australia and Asia Private Consumption Growth 3.2% -0.8% 0.4% 2.8% 3.9% offsets United Sta
Slide 22: Retail sales and GOC
Review of operations Retail sales and GOC 22 Sales and gross occupancy costs Portfolio sales 30-Sep-10 30-Sep-09 Variance For the year ended / as at [Incl. GST] – Total sales have increased due Portfolio moving annual turnover [$m] 1,074.5 1,042.3 +32.2 +3.1% to new store openings – Household spendi
Slide 23: Office markets
Review of operations Office markets 23 AUCKLAND WELLINGTON Current Forecast Current Forecast Supply ~32,000 sqm new Telecom ~52,000 sqm of new space ~99,000 sqm of new head office recently forecast for 2011 with 60% space over 2010/2011. completed pre-commitment 2 89% pre-committed5 Vacancy Current
Slide 24: Lease and rental activity
Review of operations Lease and rental activity 24 Portfolio No. NLA Rental uplift New leases, sqm $000 % CAGR renewals and NEW LEASES AND RENEWALS Retail 62 7,459 -104 -1.8 N/A rent reviews Office 25 16,192 -9 -0.2 N/A Total: New leases and renewals 87 23,651 -113 -1.0 N/A 385 RENT REVIEWS Retail 27
Slide 25: New lease to Beca
Review of operations New lease to Beca 25 – New nine-year lease agreement for 14,000 sqm of space with Beca Corporate Holdings – Lease to commence March 2012 – Auckland Regional Council to surrender bulk of its lease. Final tenancy is exited in 2015 – Transaction highlights leasing team’s forward so
Slide 26: Development activity update
Review of operations Development activity update 26 ASB Head Office Satisfied key Board and Trustee Potential project statistics Based on conditional contract approvals contained in the conditional development agreement in August Development budget - $m 126.2 – Proposed development remains conditi
Slide 27: Outlook
Outlook Interim result presentation for the six months ended 30 September 2010
Slide 28: Outlook
Outlook 28 – Economic recovery export led – strong growth in Australia, China Moderate pace and emerging Asia of economic – Household sector cautious with soft consumer spending recovery – Recovery in retail sales and employment in 2011 – Strong financial position Trust’s – Active management maintai
Slide 29: Disclaimer
Disclaimer 29 Kiwi Income Properties Limited is the manager (the ‘Manager’) of Kiwi Income Property Trust ('KIP'). The Manager is a subsidiary of Commonwealth Bank of Australia (the ‘Bank’) ABN 48 123 123 124. Neither the Bank nor any member of the Bank’s group of companies guarantees or in any way
Kiwi Income Property Trust — H1 FY2011 Earnings Presentation on 6ix