Argosy Property Limited · NZX:ARG
Argosy Property — Shareholder Meeting (July 2017)
31 slides from Argosy Property's shareholder meeting presentation, Jul 25, 2017
Slide 1: Annual Meeting Presentation
Annual Meeting Presentation Argosy Property Limited 25 July 2017 www.argosy.co.nz
Slide 2: The Board
The Board Chris Hunter DIRECTOR Peter Brook DIRECTOR Michael Smith CHAIRMAN Andrew Evans DIRECTOR Mark Cross DIRECTOR Jeff Morrison DIRECTOR 2
Slide 3: Amanda Smith
Amanda Smith Amanda Smith will attend Board meetings for 12 months as part of the Institute of Directors Future Directors Programme. 3
Slide 4: Executive Team
Executive Team Peter Mence Dave Fraser Chief Executive Officer Chief Financial Officer 4
Slide 5: Agenda
Agenda Introduction Chairman’s Address Chief Executive Officer’s Review Questions from Shareholders Resolutions General Business Close of Meeting and Refreshments 5
Slide 6: Chairman's Address
Chairman’s Address Argosy » www.argosy.co.nz
Slide 7: Strategy
Strategy Argosy is, and will remain, invested in a portfolio that is diversified by sector, grade, location and tenant mix. The portfolio will be in the Auckland and Wellington markets with modest tenant-driven exposure to provincial markets. Following an extensive review, the Board has approved
Slide 8: Highlights
Highlights 8.03c 6.64c Gross Distributable Net Distributable Income per share Income per share 99.5m 5.59y $ Net Property Income Weighted Average Lease Term 98.6% 1.06 Occupancy $ Net Tangible Assets per share
Slide 9: Dividends
Dividends The full-year FY17 dividend was 6.10 cents per share, a 1.2% increase on the prior year. Argosy intends to move to an amended dividend 6.20c policy, based on AFFO earnings, in the medium FY18 Dividend Guidance term. The Board expects, based on current projections, that the cash dividen
Slide 10: Governance/Risk Management
Governance/Risk Management Your Board is committed to the highest standards of business behaviour and accountability. We are guided by our Code of Conduct and Ethics. We have a medium to low overall risk appetite with a very low risk appetite for health and safety risks. 10
Slide 11: Capital Management
Capital Management We operate within our Capital Management Framework. The Board’s policy is for debt to total assets to be between 35% to 40%. The debt to total assets ratio was 36.3% at 31 March 2017. We also aim to maximise earnings through the property cycle within the following paramete
Slide 12: Conclusion
Conclusion Argosy remains in a strong position with a diversified portfolio that has improved in quality. We remain focused on dealing with expiries and looking for Value Add opportunities. 12
Slide 13: CEO's Address
CEO’s Address Argosy Fe Se i: ~~ » www.argosy.co.nz
Slide 14: Our Focus Areas
Our Focus Areas OUR TENANTS OUR SHAREHOLDERS OUR PEOPLE HEALTH & SAFETY ENVIRONMENT & COMMUNITY ASSET MANAGEMENT PORTFOLIO POSITIONING 14
Slide 15: Portfolio Mix
Portfolio Mix TOTAL PORTFOLIO VALUE TOTAL PORTFOLIO VALUE PORTFOLIO MIX BY SECTOR BY REGION 3% 5% 10% 22% 25% 40% 70% 38% 87% Retail Auckland Core properties Office Value Add properties Wellington Industrial Properties and land to divest Regional North Island & South Island 15
Slide 16: Value Add
Value Add The following properties have been designated as Value Add, which make up 10% of the total portfolio: Property Sector Location Valuation 90 - 104 Springs Road Industrial Auckland $4.06m 80 Springs Road Industrial Auckland $8.85m 211 Albany Highway Industrial Auckland $15.80m 960 Great Sout
Slide 17: Sector Summary
Sector Summary Industrial Office Retail NUMBER OF BUILDINGS NUMBER OF BUILDINGS NUMBER OF BUILDINGS 38 17 9 MARKET VALUE OF ASSETS ($M) MARKET VALUE OF ASSETS ($M) MARKET VALUE OF ASSETS ($M) $583.40 $547.45 $311.30 OCCUPANCY (BY RENT) OCCUPANCY (BY RENT) OCCUPANCY (BY RENT) 98.3% 98.4% 99.4%
Slide 18: Tenant-led Portfolio Activity
Tenant-led Portfolio Activity Argosy has the following tenant-led development and acquisition pipeline: Development Location Total cost Completion Substantially Foundry Drive Christchurch $7.5m Complete Mighty Ape¹ Silverdale, Auckland $22.3m Dec 2017 Kaiwharawhara, Placemakers $9.4m Mid 2018 Wellin
Slide 19: Lease Maturity
Lease Maturity 18% 36 16% 16.4% Percentage of portfolio (by income) 14% 12% 32 7 8 10% 9 6 9.8% 24 19 10.0% 10.0% 9.7% 22 9.4% 8% 8.8% 8.5% 8.0% 6% 7 5.1% 4% 15 2% 2.9% 1.4% 0% Vacant Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23 Mar-24 Mar-25 Mar-26 Mar-27 Mar-28 + Total expiry Vacant Largest single ex
Slide 20: Financial Overview
Financial Overview Financial Performance FY17 $m FY16 $m Net property income 99.5 98.3 Profit before income tax 120.4 83.6 FY17 FY16 Distributable Income $m $m Profit before income tax 120.4 83.6 Adjustments (54.8) (22.3) Gross distributable income 65.6 61.3 Depreciation recovered 1.1 0.4 Current ta
Slide 21: Market Update
Market Update In New Zealand, net absorption driven primarily by economic growth and modest excess capacity provides a level of confidence. There remains difficulty seeing any realistic catalysts for any short term change. Uncertainty from international events has the potential to solidify NZ’s
Slide 22: Outlook
Outlook We see an end in the yield firming cycle We are still faced with globally uncertain times, however the economy, and thus the property market, in New Zealand remains solid with good economic growth expected to continue. There is potential for rental growth to be stronger than recent yea
Slide 23: Questions from Shareholders
Questions from Shareholders
Slide 24: Resolutions
Resolutions www. argosy.co.nz
Slide 25: Resolution 1
Resolution 1 That Andrew Evans be re-elected as a Director. 25
Slide 26: Resolution 2
Resolution 2 That Mark Cross be re-elected as a Director. 26
Slide 27: Resolution 3
Resolution 3 That, for the purposes of NZX Main Board Listing Rule 3.5.1(a), the maximum aggregate amount of remuneration payable by the Company to Directors (in their capacity as Directors) be increased by $81,500 per annum, from $665,000 per annum to $746,500 per annum, with effect on and from 2
Slide 28: Resolution 4
Resolution 4 That the Board be authorised to fix the auditor’s fees and expenses. 28
Slide 29: General Business
General Business at iis, Bele i ae www.argosy.co.nz
Slide 30: Close of Meeting & Refreshments
Close of Meeting & Refreshments
Slide 31: Disclaimer
Disclaimer This presentation has been prepared by Argosy Property Limited. The details in this presentation provide general information only. It is not intended as investment or financial advice and must not be relied upon as such. You should obtain independent professional advice prior to making an