Cedar Woods Properties Limited · ASX:CWP
Cedar Woods Properties — Investor Presentation (May 2014)
43 slides from Cedar Woods Properties's investor presentation, May 6, 2014
Slide 1: Brisbane Acquisition and Equity Raising
XX October 2012 MAY 2014 BRISBANE ACQUISITION For personal use only AND EQUITY RAISING 2012 FINANCIAL RESULTS •For the Year Ended 30 June 2012 1
Slide 2: Presentation Outline
Presentation Outline For personal use only ► Transaction Overview ► Strategic Rationale ► Brisbane Market ► Upper Kedron Project Overview ► Funding ► Key Risks 2
Slide 3: Transaction Overview
For personal use only OVERVIEW TRANSACTION 3
Slide 4: Introduction
Introduction For personal use only ► Cedar Woods is raising capital via a share placement and SPP to fund a significant acquisition in Brisbane: Upper Kedron. ► The acquisition marks Cedar Woods’ entry into the South East Queensland property market, after a detailed and rigorous assessment process.
Slide 5: Brisbane Acquisition
Brisbane Acquisition For personal use only ► Capital for Brisbane acquisition • 227ha Upper Kedron property, under contract, settling May 2014 • Purchase price $68m plus GST over 4 ½ years • >1000 lots, 10 year project • Funded by new equity and current corporate facility. ► Consistent with diversif
Slide 6: Equity Raising Details
Equity Raising Details For personal use only ► Placement of $25m to institutional and sophisticated investors. ► Share purchase plan offer to retail shareholders at the same price as the institutional placement, capped at $5m. ► Offer at $6.80 per share, represents: • 3% discount to last closing pri
Slide 7: Strategic Rationale
For personal use only RATIONALE STRATEGIC 7
Slide 8: Company Strategy
Company Strategy For personal use only Cedar Woods’ strategy is to grow and develop its national portfolio, diversified by geography, product type and price point, so that it continues to hold broad customer appeal and performs well in a range of market conditions. The company implements this strate
Slide 9: Acquisition aligns with company strategy
Acquisition aligns with company strategy For personal use only ► Enhanced geographic footprint, consistent with Cedar Woods’ strategy. ► Project area has a strong demographic with few other developments nearby. ► Project will appeal to a range of buyer types, mainly upgraders. ► Prime property, adva
Slide 10: Cedar Woods' project locations
Cedar Woods’ project locations For personal use only 10
Slide 11: Track record of growth and balance sheet strength
Track record of growth and balance sheet strength For personal use only Gearing (%) NPAT ($m) 40.0 100% 40 34.3 36.3 30 28.0 75% 20 17.2 50% 43.0% Target range 36.5% 18.2% 21.1% 10 25% 2.1% 0 0% FY10 FY11 FY12 FY13 FY14 (f) FY10 FY11 FY12 FY13 1HY14 ► Two states have provided good diversity and henc
Slide 12: Brisbane Market
For personal use only MARKET BRISBANE 12
Slide 13: Population growth and dwelling commencements
Population growth and dwelling commencements For personal use only Queensland – a major market with solid population growth C2013 Starts Population Population (‘000) Growth (‘000) Change (%) Victoria 45 110.5 2.0% New South Wales 42 108.1 1.5% Queensland 30 83.7 1.8% Western Australia 26 76.3 3.1% S
Slide 14: HIA forecast Queensland detached housing starts
HIA forecast Queensland detached housing starts For personal use only Year Housing starts % increase 2013/14 19,450 9% 2014/15 21,720 12% 2015/16 24,310 12% Population growth and tight market 2016/17 25,670 6% conditions to underpin 2017/18 27,030 5% housing starts Source: HIA February 2014 14
Slide 15: Median dwelling prices and outlook
Median dwelling prices and outlook For personal use only Median price as at December 2013 Brisbane $445,000 Population growth Perth $520,000 and tight market Melbourne $563,000 conditions to underpin dwelling Sydney $655,000 commencements Source: CBA research ► Analysts forecasting continued price g
Slide 16: Upper Kedron Project Overview
For personal use only UPPER KEDRON PROJECT OVERVIEW 16
Slide 17: Upper Kedron details
Upper Kedron details For personal use only UPPER KEDRON 10km Population growth and tight market conditions to underpin 5km dwelling commencements CBD Brisbane CBD ► Upper Kedron site – 13kms from CBD 17
Slide 18: Upper Kedron
Upper Kedron For personal use only ► Adjacent well Upper Kedron Population growth established and tight market suburbs with many conditions to underpin facilities dwelling commencements The Gap 18
Slide 19: Well located with limited competition
Well located with limited competition For personal use only ► Located just 13km west of Brisbane CBD. ► Well regarded suburb, median price $537,000. ► Services available. ► Adjacent to the popular suburb “The Gap”. ► Last major housing development site in Brisbane City • Most competing estates are 2
Slide 20: Significant, long term project
Significant, long term project For personal use only ► Proposed master planned residential development to accommodate > 1000 lots. ► 227ha (137ha developable, balance parks and reserves). ► Mix of lot sizes with price range of $160,000 to $380,000. ► Rezoning anticipated within 12 months (strong Cou
Slide 21: Rigorous assessment and planning
Rigorous assessment and planning For personal use only ► Reviewed Brisbane market for 3 years. ► 5 months of due diligence undertaken on site. ► Strong team assembled to undertake the project. ► Site well located: • 25 minutes commute to CBD • 3km to Ferny Grove rail station 21
Slide 22: Financial impact of acquisition
Financial impact of acquisition For personal use only ► Settlements begin 2H FY2016. ► EPS accretive from FY2016. ► Funded by equity and debt – $68m paid over 4½ years. ► Gearing to stay at the lower end of our target range. ► >1,000 lots added to portfolio, increase of around 10%. ► Earnings contri
Slide 23: Funding
For personal use only FUNDING 23
Slide 24: Funding
Funding For personal use only Upper Kedron payment terms: Date Amount Funding Source May 2014 $19,000,000 Equity raising May 2015 $10,000,000 Equity raising/corporate facility September 2018 $39,000,000 Corporate facility/balance sheet Total $68,000,000 24
Slide 25: Equity raising overview
Equity raising overview For personal use only Funds to be Shares raised Placement at $6.80 per share $25m 3.68m Share purchase plan, up to $15,000 per $5m 0.74m shareholder at $6.80 per share Total equity raising $30m 4.42m Number of shares before equity raising 73.91m Number of shares after equity
Slide 26: Placement & SPP timetable
Placement & SPP timetable For personal use only Event Date ASX trading halt Monday 5 May 2014 Commence placement book build Monday 5 May 2014 ASX announcement and recommencement of trading Tuesday 6 May on the ASX 2014 Tuesday 13 May DVP settlement of placement 2014 Share purchase plan documents to
Slide 27: Cedar Woods' investment case
Cedar Woods’ investment case For personal use only ► Listed 1994, consistently profitable, always paid dividends. ► Experienced and stable board and management team. ► Strategically located and diverse residential portfolio. ► Urban and regional growth areas in VIC, WA and QLD. ► Apartments, medium
Slide 28: Key Risks
For personal use only KEY RISKS 28
Slide 29: Summary of key risks
Summary of key risks For personal use only ► General economic environment. ► Regulatory issues and changes in law. ► Changes in accounting standards. ► Taxation risks. Population growth ► Interest rates and financial instruments. and tight market ► Trading and liquidity in the ordinary shares.condit
Slide 30: General investment risks
General investment risks For personal use only GENERAL Cedar Woods' operating and financial performance is influenced by a variety ECONOMIC of general economic and business conditions, including the level of inflation, ENVIRONMENT interest rates, ability to access funding, oversupply and demand cond
Slide 31: General investment risks
General investment risks For personal use only TAXATION Future changes in Australian taxation law, including changes in interpretation RISKS or application of the law by the courts or taxation authorities in Australia, may affect taxation treatment of an investment in Cedar Woods securities, or the
Slide 32: General investment risks
General investment risks For personal use only TRADING AND The market price of Cedar Woods securities will fluctuate due to various LIQUIDITY IN THE factors including general movements in interest rates, the Australian and ORDINARY SHARES international general investment markets, economic conditions
Slide 33: Company specific risks
Company specific risks For personal use only DEVELOPMENT Cedar Woods’ core business is the development of property. Property RISKS development has a number of risks including: the risk that planning consents and regulatory approvals are not obtained or, if obtained, are received later than expecte
Slide 34: Company specific risks
Company specific risks For personal use only ENVIRONMENTAL Cedar Woods is exposed to a range of environmental risks which may MATTERS result in failure to gain approvals or additional expenditure on properties and/or project delays. Cedar Woods may be required to undertake remedial works and potenti
Slide 35: Company specific risks
Company specific risks For personal use only LITIGATION Legal proceedings may arise from time to time in the course of Cedar RISK Woods’ business. Cedar Woods cannot preclude the possibility that litigation may be brought against it or the members of Cedar Woods at some time in the future. Populatio
Slide 36: Appendix
For personal use only APPENDIX 36
Slide 37: Sustainable earnings from long term projects
Sustainable earnings from long term projects For personal use only Population growth and tight market conditions to underpin dwelling commencements 37 37
Slide 38: Disclaimer
Disclaimer For personal use only Disclaimer of liability While every effort is made to provide complete and accurate information, Cedar Woods Properties Limited does not warrant or represent that the information in this presentation is free from errors or omissions or is suitable for your intended u
Slide 39: International Offer Restrictions / Disclosures
International Offer Restrictions / Disclosures For personal use only This document does not constitute an offer of new ordinary shares ("New Shares") of the Company in any jurisdiction in which it would be unlawful. New Shares may not be offered or sold in any country except to the extent permitted
Slide 40: International Offer Restrictions / Disclosures
International Offer Restrictions / Disclosures For personal use only Hong Kong WARNING: This document has not been, and will not be, registered as a prospectus under the Companies Ordinance (Cap. 32) of Hong Kong (the "Companies Ordinance"), nor has it been authorised by the Securities and Futures C
Slide 41: International Offer Restrictions / Disclosures
International Offer Restrictions / Disclosures For personal use only New Zealand This document has not been registered, filed with or approved by any New Zealand regulatory authority under or in accordance with the Securities Act 1978 (New Zealand). The New Shares are not being offered or sold in Ne
Slide 42: International Offer Restrictions / Disclosures
International Offer Restrictions / Disclosures For personal use only Singapore This document and any other materials relating to the New Shares have not been, and will not be, lodged or registered as a prospectus in Singapore with the Monetary Authority of Singapore. Accordingly, this document and a
Slide 43: For personal use only
For personal use only Perth Office Melbourne Office Ground Floor Level 12 50 Colin Street 484 St Kilda Road West Perth WA 6005 Melbourne VIC 3004 T: (08) 9480 1500 T: (03) 9820 1777 E: email@cedarwoods.com.au E: melbourne@cedarwoods.com.au 43
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