Charter Hall Long Wale Reit · ASX:CLW
Charter Hall Long Wale Reit — FY2019 Earnings Presentation
32 slides from Charter Hall Long Wale Reit's earnings presentation, Aug 12, 2019
Slide 1: Charter Hall Long WALE REIT 2019 Full Year Results
For personal use only Charter Hall Long WALE REIT 2019 Full Year Results 12 August 2019 Brisbane City Council Bus Network Terminal, Eagle Farm QLD
Slide 2: Agenda
For personal use only 1. FY19 Highlights 2. Financial Performance 3. Operational Updates and Portfolio Overview Agenda 4. FY20 Earnings Guidance 5. Additional Information Avi Anger Kerri Leech Ben Ellis Fund Manager Head of Finance Deputy Fund Manager Charter Hall Charter Hall Charter Hall Long WALE
Slide 3: FY19 Highlights
FY19 Highlights For personal use only Charter Hall Long WALE REIT 2019 Full Year Results Telstra Canberra Head Office, 16-18 Mort St, ACT 3
Slide 4: FY19 Highlights
FY19 Highlights FY19 Highlights1 For personal use only Financial Portfolio Capital performance performance management Operating EPS of 26.9 cents 12.5 year WALE2 27.5% gearing up 1.9% from FY18 up 16% from 10.8 years at within target range of 25% – 35%3 30 June 2018 DPS of 26.9 cents $2.13bn portfol
Slide 5: Delivering on strategy
FY19 Highlights Delivering on strategy High quality portfolio underpinned by stable and secure long-term income For personal use only Increased portfolio WALE… Enhanced sector diversification1… 30 June 2018 30 June 2019 1.4 Retail Retail 25% 22% 1.3 Industrial 12.5 Industrial 37% 10.9 45% 10.8 9.8 Y
Slide 6: Financial Performance
Financial Performance For personal use only Charter Hall Long WALE REIT 2019 Full Year Results Thales Australia Head Office, Sydney Olympic Park, NSW 6
Slide 7: FY19 full year results snapshot
Financial Performance FY19 full year results snapshot For personal use only Key metrics FY18 FY19 Movement Statutory profit $83.3m $69.6m ($13.7m) Operating earnings $58.4m $70.8m $12.4m Operating earnings per security 26.4 cents 26.9 cents 1.9% Distributions per security 26.4 cents 26.9 cents 1.9%
Slide 8: Financial performance
Financial Performance Financial performance For personal use only • Net property income increase represents like-for-like growth A$m FY18 FY19 % change of 2.6% plus $16.5 million from net acquisitions Net property income 90.6 108.3 19.5% • Interest income increase due to timing between equity raises
Slide 9: Balance sheet
Financial Performance Balance sheet For personal use only • $510.1 million (37%) asset growth due to: A$m 30 Jun 2018 30 Jun 2019 ‒ Net acquisitions transacted during the year; and Cash 5.5 6.4 ‒ Gross property revaluations of $63.8 million Investment properties 894.3 1,328.4 (H1 - $30.7 million, H2
Slide 10: Debt and hedging summary
Financial Performance Debt and hedging summary For personal use only • Balance sheet gearing remains within target 25 – 35% range Debt summary (A$m) Limit Drawn Maturity • Established two new $100 million bilateral debt facilities with Balance sheet debt international banks and a new $51.3 million s
Slide 11: Operational Updates and Portfolio Overview
Operational Updates and Portfolio Overview For personal use only Charter Hall Long WALE REIT 2019 Full Year Results Woolworths Distribution Centre, South Dandenong, VIC 11
Slide 12: Portfolio update
Operational Updates and Portfolio Overview Portfolio update Strategic transaction activity enhancing covenant strength, diversification and WALE For personal use only Acquisitions – $707.0 million Office Industrial $314.0 million $109.4 million Acquisition of $314.0 million of high quality office pr
Slide 13: Portfolio update (cont.)
Operational Updates and Portfolio Overview Portfolio update Strategic transaction activity enhancing covenant strength, diversification and WALE For personal use only Acquisitions – $707.0m (cont.) Disposals – $173.7m Agri-logistics Long WALE Retail Office Industrial $207.0m $76.6m $135.0m $38.7m Ac
Slide 14: Executed major leases securing long term income
Operational Updates and Portfolio Overview Portfolio update Executed major leases securing long term income For personal use only • On 12 August 2019, CLW announced that it had entered into an agreement with Woolworths in relation to a lease extension at its Hoppers Crossing Distribution Centre in V
Slide 15: Portfolio snapshot
Operational Updates and Portfolio Overview Portfolio snapshot For personal use only Jun 2018 Jun 2019 Portfolio by sector1 Number of properties 81 118 Retail Property valuation (A$m) 1,525.2 2,133.3 22% Industrial Weighted Average Capitalisation Rate (“WACR”) 6.13% 5.95% 37% Occupancy 100.0% 99.6% W
Slide 16: Tenant diversification
Operational Updates and Portfolio Overview Tenant diversification CLW’s portfolio comprises a strong and stable tenant base across various industries and sectors For personal use only Major tenants1 23.3% 4.4% 17.6% 3.2% 11.4% 2.1% 9.7% 2.0% 9.0% 1.7% 5.4% 1.6% 5.0% 1.4% 1 Weighted by net passing in
Slide 17: Industry diversification
Operational Updates and Portfolio Overview Industry diversification1 Portfolio underpinned by long leases to tenants across diverse business industries For personal use only • 98% of the portfolio leased to either ASX listed, government / government related or multinational corporate tenants Major t
Slide 18: Lease expiry profile
Operational Updates and Portfolio Overview Lease expiry profile1 Long dated portfolio WALE of 12.5 years For personal use only • Portfolio WALE of 12.5 years, up 16% from 10.8 years as at 30 June 2018 WALE of 12.5 years 24.9% 16.6% 12.0% 10.0% 7.7% 6.4% 5.8% 4.8% 2.8% 2.1% 2.2% 1.2% 1.0% 0.8% 0.4% 0
Slide 19: Geographic diversification
Operational Updates and Portfolio Overview Geographic diversification1 Highly diversified by geography and real estate sector For personal use only • 118 assets comprising office, industrial, agri-logistics and long WALE retail properties located in seven Australian states and territories 3 22 QLD O
Slide 20: FY20 Earnings Guidance
FY20 Earnings Guidance For personal use only Charter Hall Long WALE REIT 2019 Full Year Results Coles Distribution Centre, Perth Airport, WA 20
Slide 21: FY20 earnings guidance
FY20 Earnings Guidance FY20 earnings guidance For personal use only • The REIT confirms that barring any unforeseen events and no material change in current market conditions, CLW’s guidance for FY20 is Operating EPS of 28.0 cents per security reflecting Operating EPS growth over FY19 of 4.0% • The
Slide 22: Additional Information
Additional Information • NTA reconciliation For personal use only • Portfolio revaluations • Portfolio income quality • Property investment portfolio • Glossary • Contact information Charter Hall Long WALE REIT 2019 Full Year Results Hyde Park Hotel, West Perth, WA 22
Slide 23: NTA reconciliation
Additional Information NTA reconciliation FY19 summary For personal use only • NTA of $4.09 as at 30 June 2019, up 1% relative to NTA bridge 30 June 2018 • Movement driven by net valuation uplift of $63.8m 0.06 0.06 (0.02) (see following page for breakdown) and equity raising (0.06) activity, partia
Slide 24: Portfolio revaluations
Additional Information Portfolio revaluations FY19 valuation summary For personal use only • FY19 property revaluations resulted in a total Agri- Long WALE A$m Office Industrial Total gross uplift of $63.8m logistics Retail 30 June 2018 portfolio value 464.5 685.8 - 374.9 1,525.2 • The portfolio WAC
Slide 25: Portfolio income quality
Operational Updates and Portfolio Overview Portfolio income quality 71%1 of the portfolio is leased to government and investment grade tenants (or subsidiaries thereof) For personal use only Tenant credit ratings1 AAA 9% Not rated AA+ 26% 6% AA- 5% A+ 2% 5% 12% A- B+ 12% 23% BBB+ BBB 1 Weighted by n
Slide 26: Property investment portfolio: Industrial
Additional Information Property investment portfolio Industrial portfolio – $779.8m For personal use only REIT Valuation1 Cap rate2 WALE3 Occupancy3 GLA4 WARR3 Asset State interest (A$m) (%) (years) (A$m) (sqm) (%) Australia Post, Kingsgrove NSW 100% 24.8 5.0% 7.0 100% 6,729 3.5% SUEZ, Artarmon NSW
Slide 27: Property investment portfolio: Office
Additional Information Property investment portfolio Office Portfolio – $650.4m For personal use only REIT Valuation1 Cap rate2 WALE3 Occupancy3 NLA4 WARR3 Asset State Interest (A$m) (A$m) (years) (%) (sqm) (%) Westpac Building, Kogarah NSW 50.1% 105.7 5.5% 15.0 100% 31,715 CPI Thales Australia Head
Slide 28: Property investment portfolio: Long WALE retail
Additional Information Property investment portfolio Long WALE retail portfolio – $468.1m For personal use only Asset LWIP portfolio1 Other Total Number of assets 59 2 61 2 Property valuation (A$m) 415.7 52.4 468.1 3 WACR (%) 5.8% 5.9% 5.8% 4 WALE 15.1 10.0 14.5 4 Occupancy 100% 100% 100% 4 WARR CPI
Slide 29: Property investment portfolio: Agri-logistics
Additional Information Property investment portfolio Agri-logistics portfolio – $235.0m For personal use only Valuation1 Cap rate2 WALE3 Occupancy3 Building area4 WARR3 Asset State REIT interest (A$m) (%) (years) (A$m) (sqm) (%) Ingham’s portfolio (27 properties) Australia-wide 100.0% 235.0 6.4% 24.
Slide 30: Glossary
Additional Information Glossary For personal use only ASX Australian Stock Exchange Calculated as the ratio of net drawn debt (excluding unamortised debt establishment costs) to total tangible assets, Balance sheet gearing less cash The return of a property or portfolio of properties calculated by d
Slide 31: Contact Information
Contact Information For personal use only Avi Anger Kerri Leech Ben Ellis Phillip Cheetham Fund Manager Head of Finance Deputy Fund Manager Head of Listed Investor Charter Hall Charter Hall Charter Hall Relations Long WALE REIT Long WALE REIT Long WALE REIT Charter Hall T: +61 2 8651 9111 T: +61 2 8
Slide 32: Charter Hall office addresses
For personal use only Sydney Head Office Melbourne Brisbane Perth Adelaide Level 20, No.1 Martin Place Level 14, 570 Bourke Street Level 22, Northbank Plaza Level 5, St Georges Square Level 2, 80 Pirie Street Sydney, NSW, 2000 Melbourne VIC 3000 69 Ann Street 225 St Georges Terrace Adelaide SA 5000
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