37 slides from Sasseur Real Estate Investment Trust's earnings presentation, Feb 18, 2019
Slide 1: Sasseur REIT Financial Results for FY 2018
SASSEUR REIT First Listed Outlet Mall REIT in Asia Financial Results for FY 2018 18 February 2019
Slide 2: Disclaimer
Disclaimer NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO THE UNITED STATES, CANADA, JAPAN OR THE PEOPLE’S REPUBLIC OF CHINA. This presentation shall be read in conjunction with Sasseur REIT’s financial results announcement dated 18 February 2019 published on SGX Net. This presentation is f
Slide 3: Contents
Contents Section 1 FY2018 Key Highlights Section 2 Financial Results Section 3 Capital Management Section 4 Portfolio Update Section 5 Outlook and Strategies to improve DPU 3
Slide 4: FY2018 Key Highlights
FY2018 Key Highlights SASSEUR (KUNMING) OUTLETS
Slide 5: FY2018 Results exceed Forecast
FY2018 Results exceed Forecast Actual 4Q2018 Actual FY2018 S$30.9 million S$93.5 million EMA Rental Income 2.9% 2.2% S$23.6 million S$60.5 million Distributable Income 28.1% 12.6% Distribution Per Unit 1.999 S cents 5.128 S cents (“DPU”) 28.1% 12.6% FY2018 Annualised Distribution Yield: ➢ 8.4% based
Slide 6: Strong Operating Performance
Strong Operating Performance Key Portfolio Metrics NAV per unit High Occupancy Rate* S$0.903 95.2% 12.9% as at IPO Low Aggregate Leverage Weighted Average Debt 29.0% Maturity from 36.0% as at IPO 3.75 years Portfolio Valuation S$1,539.5 million 5.0% based on IPO portfolio valuation 13.7% based on IP
Slide 7: Financial Results
Financial Results SASSEUR (CHONGQING) OUTLETS 7
Slide 8: EMA Rental Income and Distribution
EMA Rental Income and Distribution FY2018 4Q18 Actual Forecast Variance Actual Forecast Variance Fixed Component 291.2 291.2 - 95.7 95.7 - (RMB mil) Variable Component 153.5 142.0 +8.1% 61.1 55.6 +9.9% (RMB mil) EMA Rental Income1 444.7 433.2 +2.6% 156.8 151.3 +3.7% (RMB mil) Exchange Rate 4.948 4.9
Slide 9: Balance Sheet
Balance Sheet Actual Actual S$ mil 31 Dec 2018 30 Sep 2018 Investment properties 1,539.5 1,347.7 Cash and bank balances 203.6 206.3 Other assets 25.6 16.6 Total Assets 1,768.7 1,570.6 Loans and borrowings 493.3 490.2 Other liabilities 201.4 166.2 Total Liabilities 694.7 656.4 Net Assets 1,074.0 914.
Slide 10: Portfolio Valuation
Portfolio Valuation Valuation Valuation as at Change RMB million as at 30 Sep 2017 (%) 31 Dec 2018 Chongqing 2,901.0 2,654.0 +9.3% 重庆 Bishan 790.0 789.0 0.1% 璧山 Hefei 2,521.0 2,434.5 +3.6% 合肥 Kunming 1,495.0 1,460.5 +2.4% 昆明 Total Portfolio 7,707.0 7,338.0 +5.0% 10
Slide 11: Quarterly EMA Rental Income exceeds Forecast
Quarterly EMA Rental Income exceeds Forecast 200 180 156.8 160 151.3 142.0 145.8 142.3 139.6 140 61.1 55.6 RMB ‘millions 120 42.2 39.8 50.1 46.6 100 80 60 99.8 99.8 95.7 95.7 95.7 95.7 40 20 0 Q2 Actual Q2 Forecast Q3 Actual Q3 Forecast Q4 Actual Q4 Forecast Fixed Component Variable Component 固定部分 浮
Slide 12: Distribution Details
Distribution Details Distribution Period 1 1 July to 31 December 2018 Distribution Per Unit1 3.541 S cents Distribution Timetable Notice of Books Closure Date 18 February 2019 Ex-dividend Date 4 March 2019 Books Closure Date 5 March 2019 Distribution Payment Date 28 March 2019 Distribution to switch
Slide 13: Comparative Yields
Comparative Yields Sasseur REIT Distribution Yield 10.3%1 2 FTSE ST REIT Index 12-month Dividend Yield 5.1% 2 FTSE ST Real Estate Index 12-month Dividend Yield 4.5% 2 STI 12-month Dividend Yield 4.4% 3 China 10-year Government Bond Yield 3.3% 3 Singapore 10-year Government Bond Yield 2.0% 3 CPF Ordi
Slide 14: Capital Management
Capital Management 14 SASSEUR (HEFEI) OUTLETS
Slide 15: Capital Management
Capital Management Onshore Offshore Debt Facilities Total Facilities Facility (SGD million) Currency RMB SGD - ~SGD 388 SGD 125 ~SGD 513 million million1 million Debt Headroom Quantum 283 (RMB 1.94 (~RMB 0.63 (~RMB 2.57 billion) billion) billion) Proportion 75.6% 24.4% 100% 4.5 years Offshore Debts
Slide 16: Debt Maturity Profile
Debt Maturity Profile No Immediate Major Refinancing Risks S$ million Debt Maturity 358 132 8 8 7 2019 2020 2021 2022 2023 16
Slide 17: Portfolio Update
Portfolio Update SASSEUR (HEFEI) OUTLETS
Slide 18: Portfolio Overview
Portfolio Overview Portfolio Valuation* : 7,707 mil NLA :304,573 sq m Occupancy^ : 95.2% Hefei Outlet Mall Valuation : 2,521 mil NLA : 138,449 sqm Occupancy : 97.6% Chongqing Outlet Mall Bishan Outlet Mall Kunming Outlet Mall Valuation : 2,901 mil Valuation : 790 mil Valuation : 1,495 mil NLA : 50,8
Slide 19: Strong Portfolio Occupancy
Strong Portfolio Occupancy Occupancy (%) 99.8% 98.3% 97.6% 96.5% 95.2% 94.2% 94.2% 94.4% 87.9% 87.5% 4Q 3Q 4Q 3Q 4Q 3Q 4Q 3Q 4Q 3Q Chongqing 重庆 Bishan 璧山 Hefei 合肥 Kunming 昆明 Portfolio 项目组合 19 For 4Q vs 3Q 2018
Slide 20: Weighted Average Lease Expiry (WALE)
Weighted Average Lease Expiry (WALE) 80.0% WALE by : 73.7% 70.0% NLA 3.0 years 60.0% 51.5% Gross Revenue 1.3 years 50.0% 40.0% 30.0% 22.7% 20.0% 13.5% 12.4% 9.2% 10.0% 7.4% 3.1% 4.4% 2.1% 0.0% 2019 2020 2021 2022 2023 & beyond by NLA by Gross Revenue Deliberate short WALE for gross revenue permits :
Slide 21: VIP Members' Growth by Outlets and by Year
VIP Members’ Growth by Outlets and by Year VIP Members’ purchases are around 50% of total sales. Increased in the VIP membership base will drive sales. 350.0 +202% 302.1 300.0 250.0 +49% Members in ‘000 202.1 203.1 200.0 +22% +66% 155.0 159.0 150.0 136.3 126.9 100.0 95.7 100.0 74.2 66.8 63.3 54.5 57
Slide 22: Well Diversified Portfolio Trade Mix
Well Diversified Portfolio Trade Mix Breakdown of Revenue Breakdown of NLA Anchor Tenants; F&B; 2.7% 3.9% Miscellaneous; F&B; 7.0% International 11.4% Brands ; 15.1% Anchor Tenants; International 12.9% Brands ; 23.4% Sports; 7.7% Miscellaneous; Children; 4.7% Sports; 13.0% 16.4% Fashion; 39.8% Child
Slide 23: Exciting Shoppers' Events to Drive Sales
Exciting Shoppers’ Events to Drive Sales Spring Mother’s Children’s Apr Festival May Day Jun Day VIP Annual Summer Jul Sale Aug Members Sep Celebrati Promotions ons National Red Year-End Oct Day Nov Friday Dec Celebration 23
Slide 24: Exciting Shoppers' Events to Drive Sales
Exciting Shoppers’ Events to Drive Sales 24
Slide 25: Potential Pipelines
Potential Pipelines • All acquisitions must be yield accretive • First China, then the World Changchun • Pipeline Properties increased from 3 to 7 ROFR Properties Lanzhou Xi’an Guiyang Xi’an Yangzhou Nanjing Hangzhou Opening Date Sep 2017 Dec 2017 Changsha Guiyang GFA (sqm) 141,708 193,520 Shenzhen
Slide 26: Outlook and Strategies to improve DPU
Outlook and Strategies to improve DPU 26 SASSEUR (KUNMING) OUTLETS
Slide 27: Outlook
Outlook Macro Risk Factor • Persistent concerns over global trade and slowing economic growth Mitigating Factors • Outlets’ underlying products are mid to high-end, less affected by economic downturn • Outlets business model has proven to be recession resilient • Sasseur Outlets’ business exposure i
Slide 28: Mitigating Factor: Mid to high-end products less affected by downturn
Mitigating Factor: Mid to high-end products are less affected by economic downturn LVMH released stellar Q4 earnings, as all segments and geographies delivered solid performance. Hermes said sales momentum in its Chinese stores stayed strong in the fourth quarter, adding to reassuring signals from r
Slide 29: Mitigating Factor: Chinese Government's Stimulative Measures
Mitigating Factor: Chinese Government’s Stimulative Measures Income tax reform to E-commerce law,* The enforcement of Reducing the import boost domestic which cracks down official overseas tariff- tariff to narrow the consumption shuttle traders free spending limit price differential from (daigou) (
Slide 30: Strategies to Improve DPU
Strategies to Improve DPU The management strives to improve FY2019 DPU Organic Measures: ➢ Increase VIP members ➢ Improve occupancy rates, notably Bishan and Kunming ➢ Increase control over brand product pricing ➢ Leverage on asset enhancement initiatives, e.g. Super Farm in Hefei Inorganic Measures
Slide 31: Awards and Achievement
Awards and Achievement Gold Award at the Asia Included as a constituent stock “Most Promising REIT Pacific Best of the Breeds of the Global Property in Asia” Award REITs Awards 2018 Research (“GPR”) / Asia Pacific Real Estate Association (“APREA”) Composite Index and the GPR/APREA Composite REIT Ind
Slide 32: Appendix
Appendix SASSEUR (HEFEI) OUTLETS 32
Slide 33: Chongqing Outlets
Chongqing Outlets 重庆 Sales and Occupancy (RMB ‘mil) 635.9 612.9 105.0% 605.3 600 98.1% 98.6% 98.3% 100.0% 99.8% 550 528.9 517.4 95.0% 500 475.1 461.8 90.0% 450 85.0% 401.9 400 80.0% 350 75.0% 300 70.0% 1Q 2Q 3Q 4Q Year Commenced Operations Sep 2008 2017 2018 2018 Occupancy GFA (sqm) 73,373 Outlet Me
Slide 34: Hefei Outlets
Hefei Outlets Sales and Occupancy (RMB ‘mil) 338.8 100.0% 310 97.6% 96.5% 98.0% 95.1% 95.2% 96.0% 260 236.2 201.7 216.6 94.0% 210 193.8 92.0% 90.0% 160 135.1 121.2 88.0% 110.8 110 86.0% 84.0% 60 82.0% 10 80.0% 1Q 2Q 3Q 4Q Year Commenced Operations May 2016 2017 2018 2018 Occupancy GFA (sqm) 141,182
Slide 35: Kunming Outlets
Kunming Outlets Sales and Occupancy (RMB ‘mil) 95.4% 100.0% 94.2% 94.2% 222.8 93.3% 200 187.5 193.7 90.0% 155.8 150.7 80.0% 150 98.2 70.0% 100 74.7 60.0% 62.9 50 50.0% 0 40.0% 1Q 2Q 3Q 4Q 2017 2018 2018 Occupancy Year Commenced Operations Dec 2016 GFA (sqm) 88,257 Outlet Members NLA (sqm) 70,067 (‘0
Slide 36: Bishan Outlets
Bishan Outlets Sales and Occupancy (RMB ‘mil) 87.5% 87.9% 132.2 90.0% 88.0% 88.3% 113.9 80.0% 100 94.3 96.4 70.0% 75.9 65.8 69.8 57.6 60.0% 50 50.0% 40.0% 0 30.0% 1Q 2Q 3Q 4Q 2017 2018 2018 Occupancy Year Commenced Operations Oct 2014 GFA (sqm) 68,791 Outlet Members NLA (sqm) 47,308 (‘000) Occupancy
Slide 37: Thank You
Thank You