D.m. Wenceslao & Associates, Inc. · PSE:DMW
D.m. Wenceslao & Associates — Investor Day (August 2022)
52 slides from D.m. Wenceslao & Associates's investor day presentation, Aug 18, 2022
Slide 1: DMW Management Presentation
DMW Management Presentation August 18, 2022 0
Slide 2: Disclaimer
Disclaimer The information in this document has been prepared by D.M. Wenceslao & Associates, Incorporated (“DMW”) and does not constitute a recommendation regarding the securities of DMW. The statements contained in this document speak only as at the date as of which they are made, and DMW expressl
Slide 3: Key Presenters
Key Presenters Delfin Angelo C. Wenceslao Heherson M. Asiddao Julius Guevara Jeffrey Lucero Chief Executive Officer Chief Finance Officer VP for Corporate Planning Investor Relations Officer 2
Slide 4: Company Background, Property Market Overview, Key Investment Highlights
3 Company Background 7 Property Market Overview 12 Key Investment Highlights 31 Notable Recent Transaction/s in 1H2022 35 Operating and Financial Highlights 44 COVID-19 Response 3 48 Sustainability
Slide 5: The Company at a Glance
The Company at a Glance… 57 YEARS IN BUSINESS AAAA PCAB LICENSE 77 HAS. LANDBANK 56 HAS. INSIDE ASEANA 21 HAS. OUTSIDE ASEANA RESIDENTIAL COMMERCIAL CONSTRUCTION P23 B Other Businesses MARKET CAPITALIZATION* P220 B ASEANA CITY EXTERNAL VALUATION** 90% DISCOUNT TO EXTERNAL VALUATION Notes *as of Nove
Slide 6: Key Milestones – Demonstrating Execution Track Record
Key Milestones – Demonstrating Execution Track Record 2020 1965 - 86 2018 ▪ Signed land lease MOU with St. Luke’s ▪ Completion of Aseana Three 2021 ▪ DMW lists on the PSE ▪ Completion of 69,000sqm 8912 Asean Ave ▪ 8912 Asean Ave. commences ▪ Completion of 58 Jupiter in Makati 1965: Establishment of
Slide 7: Distinct Profile with Strong Embedded Upside Across Businesses
Distinct Profile with Strong Embedded Upside Across Businesses We are an an integrated property developer with expertise in land reclamation, construction and real estate development >140 construction >2.4mn sqms land 166,015 sqms 4 Condo Projects 162,351 sqms GLA & projects reclaimed leased-out lan
Slide 8: Company Background, Property Market Overview, Key Investment Highlights
3 Company Background 7 Property Market Overview 12 Key Investment Highlights 31 Notable Recent Transaction/s in 1H2022 35 Operating and Financial Highlights 44 COVID-19 Response 7 48 Sustainability
Slide 9: Metro Manila Office Market Update
Metro Manila Office Market Update Metro Manila Office Supply Forecast, end 2021 and 2024 Manila Bay Future Office Supply to grow by 16% from 2021-2024 change in % to new 2022 – 2024 supply 14,985,099 sq.m. Location end of 2021 end of 2024 % change 300K sq.m. supply average: 681,000 sq.m. Others, 5%
Slide 10: Metro Manila Residential Market Update
Metro Manila Residential Market Update Metro Manila Residential Supply Forecast, end 2021 and 2024 Bay Area to Account for 57% of New Supply from 2022-2024 change in % to new end of 2021 end of 2024 % change Location units supply 2022F – 2024F supply average: 8,070 units 166,390 units Alabang 4,880
Slide 11: High Vaccination Rate Cushions Impact of Rising COVID Cases
High Vaccination Rate Cushions Impact of Rising COVID Cases to PH's Healthcare Capacity Vaccines Administered First dose Second dose Booster dose % of population: in mn Fully Vaccinated: 66% 180.00 Booster Dose: 15% PH average daily new cases rising to ~3,000 but still well below peak of over 39,000
Slide 12: NCR and Other Key Areas Transitioned to Alert Level 1
NCR and Other Key Areas Transitioned to Alert Level 1 since March 1 Alert Level 1 Alert Level 2 Alert Level 3 Alert Level 4 Alert Level 5 Age All ages allowed, All ages allowed, All ages allowed, Below 18 years old and Below 18 years old and subject to LGU Rules subject to LGU Rules subject to LGU R
Slide 13: Company Background, Property Market Overview, Key Investment Highlights
3 Company Background 7 Property Market Overview 12 Key Investment Highlights 31 Notable Recent Transaction/s in 1H2022 35 Operating and Financial Highlights 44 COVID-19 Response 12 48 Sustainability
Slide 14: Key Investment Highlights
Key Investment Highlights 1 A Strategic and Sizeable Land Bank in Aseana City that is Well Positioned for Future Growth 2 An Integrated Master Developer with Competitive Advantages Across Business Lines 3 Thrived Amidst the COVID-19 Pandemic 4 In a Hyper-Growth Stage 5 Grossly Undervalued 13
Slide 15: Aseana City – Conveniently Located and Anchored by Tourism, Recreation, Retail
Aseana City – Conveniently Located and Anchored by Tourism, Recreational Developments, and Retail Malls Aseana City ✓ Located along the shoreline of Manila Bay bordering Pasay City and extending east to Ortigas CBD Roxas Boulevard within Parañaque City (<12km) ✓ Located within the estate is the larg
Slide 16: Updated summary of land holdings in Aseana City as of June 30, 2022
Updated summary of land holdings in Aseana City as of June 30, 2022 Remaining Land Reserves (287,968 sq.m.) Land Used/Allocated for Development Land Allocated (276,050 sq.m.) for Future Sales (4,218 sq.m.) Completed Properties Land Allocated for (36,659 sq.m.) Future Leases (4,532 sq.m.) Land Holdin
Slide 17: Significant Land Value Appreciation
Significant Land Value Appreciation Prices of sold land per sq.m. (PHP’000) 3.5x +4% 440 425 Value of reclaimed land in 2006 Actual DMW Land Sale Transactions 250 185 125 31.5 2006* 2015 2016 2017 2019 2021/1Q2022 Pre-Pandemic COVID Pandemic 16
Slide 18: Key Investment Highlights
Key Investment Highlights 1 A Strategic and Sizeable Land Bank in Aseana City that is Well Positioned for Future Growth 2 An Integrated Master Developer Committed to Holistic Estate Development 3 Thrived Amidst the COVID-19 Pandemic 4 In a Hyper-Growth Stage 5 Grossly Undervalued 17
Slide 19: An Integrated Master Developer with Competitive Advantages across Business Lines
An Integrated Master Developer with Competitive Advantages across Business Lines Integrated master developer covering the entire value chain - land creation, infrastructure construction and property development Capital recycling for future growth Our Current Focus Construction Land sale For sales La
Slide 20: Holistic Estate Development
Holistic Estate Development GLOBAL COMMUNITY URBAN RECREATION Master planned district Wholistic development for all lifestyles Global infrastructure & Balanced locator mix service standards Detailed Promote Regular Attractive development continued review tenant mix plan investments ✓ Update the mast
Slide 21: Holistic Estate Development
Holistic Estate Development 20
Slide 22: Key Investment Highlights
Key Investment Highlights 1 A Strategic and Sizeable Land Bank in Aseana City that is Well Positioned for Future Growth 2 An Integrated Master Developer with Competitive Advantages Across Business Lines 3 Thrived Amidst the COVID-19 Pandemic 4 In a Hyper-Growth Stage 5 Grossly Undervalued 21
Slide 23: Thrived Amidst the COVID-19 Pandemic
Thrived Amidst the COVID-19 Pandemic 1 Core Net Income Higher than Pre-Pandemic Core Net Income* (Php Million) +12% 1,882 1,677 2019 (Pre-Pandemic) 2021 2 Maintained and Grew Cash Dividends Amidst the Pandemic 1 Cash Dividends (Php/ Share) +29% 0.0609 0.0471 0.0471 2019 (Pre-Pandemic) 2020 2021 *Cor
Slide 24: Thrived Amidst the COVID-19 Pandemic
Thrived Amidst the COVID-19 Pandemic Support from Leading Local Financial Net Debt/(net cash) (PHP mn) Debt to Equity (%) Institutions 14% 13% 2020 2021 1H2022 6% (2,384) (2,225) (3,617) 2020 2021 1H2022 Healthy borrowing profile and conservative funding strategy for land sales ▪ DMW maintains good
Slide 25: Key Investment Highlights
Key Investment Highlights 1 A Strategic and Sizeable Land Bank in Aseana City that is Well Positioned for Future Growth 2 An Integrated Master Developer with Competitive Advantages Across Business Lines 3 Thrived Amidst the COVID-19 Pandemic 4 In a Hyper-Growth Stage 5 Grossly Undervalued 24
Slide 26: Hypergrowth Stage: Massive New and Upcoming Completions
Hypergrowth Stage: Massive New and Upcoming Completions Total Building Leasable Floor Area (sq.m.) +70,148 sqms +71,639 sqms 232,499 162,351 89,914 90,712 2019A 2020A 2021A 2022F 8912 Asean Ave Parqal 58 Jupiter 25
Slide 27: Commercial Pipeline Milestones: PARQAL Construction Progress
Commercial Pipeline Milestones: PARQAL Construction Progress 75% 26
Slide 28: Residential Pipeline Milestones: MIDPARK TOWERS Construction Progress
Residential Pipeline Milestones: MIDPARK TOWERS Construction Progress 38% 27
Slide 29: Pipeline of Premier Assets Beyond 2022
Pipeline of Premier Assets Beyond 2022 Aseana Plaza (formerly Aseana Five and Six) Commercial Leasing • After Parqal, close to ~200,000sqms of Gross Leasable Area will be added to our portfolio in the medium term with the planned completions of 1) Aseana Plaza and 2) Aseana Mainstreet 2. One Parq Su
Slide 30: Key Investment Highlights
Key Investment Highlights 1 A Strategic and Sizeable Land Bank in Aseana City that is Well Positioned for Future Growth 2 An Integrated Master Developer with Competitive Advantages Across Business Lines 3 Thrived Amidst the COVID-19 Pandemic 4 In a Hyper-Growth Stage 5 Grossly Undervalued 29
Slide 31: Value of properties inside of Aseana City as of December 31, 2021
Value of properties inside of Aseana City as of December 31, 2021 Owned Land Holdings Completed Properties(1) Pipeline Properties Land area (sq.m.) Total leasable/saleable floor area (sq.m.) Leasable/saleable floor area (sq.m.) Roads and right of way Land currently Aseana One One Parq 18,368 leased
Slide 32: Company Background, Property Market Overview, Key Investment Highlights
3 Company Background 7 Property Market Overview 12 Key Investment Highlights 31 Notable Recent Transaction/s in 1H2022 35 Operating and Financial Highlights 44 COVID-19 Response 31 48 Sustainability
Slide 33: January 2022 Land Sale Php787.6 million
January 2022 Land Sale Block 3, Lot 4-D-2 1,790 Square Meters Php787.6 million Total Contract Price ex- VAT 93% Land Sale Gross Margin 32
Slide 34: Land Sales Crystallize Value of Assets
Land Sales Crystallize Value of Assets Prices of sold land per sq.m. (PHP’000) 3.5x +4% 440 425 Value of reclaimed land in 2006 Actual DMW Land Sale Transactions 250 185 125 31.5 2006* 2015 2016 2017 2019 2021/1Q2022 Pre-Pandemic COVID Pandemic 33
Slide 35: D.M. Wenceslao Signs Contract of Lease with St. Luke's Medical Center
D.M. Wenceslao Signs Contract of Lease with St. Luke’s Medical Center Higher of Fixed Rate or Percentage of Sales Land Lease Scheme 13,896 50 Years Square Meters Lease Term 34
Slide 36: Company Background, Property Market Overview, Key Investment Highlights
3 Company Background 7 Property Market Overview 12 Key Investment Highlights 31 Notable Recent Transaction/s in 1H2022 35 Operating and Financial Highlights 44 COVID-19 Response 35 48 Sustainability
Slide 37: 1H2022 Net Income Jumps 56% YoY to ₱1.3 billion
1H2022 Net Income Jumps 56% YoY to ₱1.3 billion PHP 1H2022 1H2021 Change Rentals Land P 488,099,100 P 493,423,860 -1% Building 398,737,226 389,076,298 +2% Other revenues 219,669,159 91,499,141 +140% 1,106,505,485 973,999,299 +14% Land Sales 787,600,000 - N/A P2.36 billion Sale of condominium units 4
Slide 38: In focus: Leasing
In focus: Leasing P1.11B Land We pay particular attention to recurring income sources to provide our lease with Ayala us with higher earnings visibility. We primarily target traditional Land provides for a companies, including logistics, BPOs, and gaming and tourism-related minimum guaranteed rent o
Slide 39: Robust leasing activity reflects high level of sustainability
Robust leasing activity reflects high level of sustainability Recurring Income Contribution(1) (%) Total recurring revenues 21% 40% 17% 31% 7% 9% 1H2021 1H2022 % to Total Revenues 78% 47% Land (PHP mm) 493 488 Building 389 399 Other Revenues 91 220 Total Leasable Floor Area (sq.m.) Total Leased Land
Slide 40: In focus: Residential
In focus: Residential Residential sales % to Revenue contribution P466.2M total revenues We are complementing the speed of development in the area with 2019 16% Accounted for 20% of total revenues on the back of residential offerings in the mid-income and upscale categories, 2020 27% accounts that m
Slide 41: Superior profitability scorecard consistent with resilient portfolio
Superior profitability scorecard consistent with resilient portfolio Gross Profit (PHP mm) Operating Profit (PHP mm) 80% 83% 82% 76% 72% 72% 65% 62% 2,819 2,845 2,271 2,486 2,071 1,934 1,707 1,690 2019 2020 2021 1H2022 2019 2020 2021 1H2021 Gross Profit Gross Profit Margin Operating Profit Operating
Slide 42: Financial strength supports growth aspirations
Financial strength supports growth aspirations Debt To Equity(1) (%) Return on Equity(2) (%) 12% 12% 14% 10% 13% 9% 6% 3% 2019 2020 2021 1H2022 2019 2020 2021 1H2022 Current Ratio(3) (x) Asset to Equity(4) (x) 1.67x 1.74x 1.61x 1.47x 1.56x 1.51x 1.57x 1.53x 2019 2020 2021 1H2022 2019 2020 2021 1H202
Slide 43: Progress Report on Use of proceeds
Progress Report on Use of proceeds Pixel Residences P286M 8912 Asean Ave. P2.4B Parqal P2.4B MidPark Towers P540M Aseana Plaza P113M 42
Slide 44: Summary: 1H 2022 highlights
Summary: 1H 2022 highlights 1H 2022 Summary FY 2022 Outlook • Consolidated revenues amounted to ₱2.4 billion and net • The newly completed 69,000sqm GLA 8912 Asean Ave and income reached ₱1.3 billion, 56% higher YoY. Core net income the over 2,000sqm GLA 58 Jupiter are expected to post to parent gre
Slide 45: Company Background, Property Market Overview, Key Investment Highlights
3 Company Background 7 Property Market Overview 12 Key Investment Highlights 31 Notable Recent Transaction/s in 1H2022 35 Operating and Financial Highlights 44 COVID-19 Response 44 48 Sustainability
Slide 46: DMWAI's Response to the COVID-19 Pandemic
DMWAI’s Response to the COVID-19 Pandemic Supporting our Business Partners Expanding Reach to Clients: through these Trying Times Adopting to the New Normal ✓ More market-friendly terms such as no escalation ✓ Monthly virtual presentations and webinars via and lower rates were introduced to our smal
Slide 47: Employee Vaccination Program
Employee Vaccination Program 46
Slide 48: Safety Seal – Certified Mixed Use and Office Buildings
Safety Seal – Certified Mixed Use and Office Buildings 47
Slide 49: Company Background, Property Market Overview, Key Investment Highlights
3 Company Background 7 Property Market Overview 12 Key Investment Highlights 31 Notable Recent Transaction/s in 1H2022 35 Operating and Financial Highlights 44 COVID-19 Response 48 48 Sustainability
Slide 50: DM Wenceslao's Five Pillars of Sustainability
DM Wenceslao’s Five Pillars of Sustainability 49
Slide 51: Corporate Sustainability Assessment Percentile Rank
Corporate Sustainability Assessment As of March 2022, DMW 73% performed in the top third in the Real Estate Industry of S&P Global Corporate Percentile Rank Sustainability Assessment. (100 being the highest) 50
Slide 52: Q&A
Q&A www.dmwai.com www.aseanacity.com 51 iro@dmwai.com
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