Slide 1: FY10 Results Presentation
FY10 RESULTS PRESENTATION AUGUST 2010
Slide 2: Key messages
Key messages » Strong earnings growth achieved over FY10 » Improved EBIT margins across both funds management and development divisions » Solid balance sheet – reduced gearing to lower end of target range » Disciplined assessment of growth opportunities » 2H10 dividend of 4.5¢ per share fully franke
Slide 3: Operational highlights
Operational highlights » Business performance » 2,567 2 567 lots sold – up 7% » Contracts on hand increased by 21% to 1,270 – contracts value up 49% to $292.3m » Successful land syndicate capital raising of $22m completed in November 2009 » Performance driven by » Solid underlying drivers in the res
Slide 4: Group key financial highlights
Group key financial highlights $m FY10 FY09 Var (%) » Group revenue of $178.0m Revenue 178.0 176.8 1% » Lot sales of 2,567 ‐ up 7% EBITDA1 74.8 8 57.2 2 31% » Settlements of 2,366 ‐ up 4% Net EBITDA margin 42% 32% 10% » Operating EBITDA of $74.8m – an increase of Operating NPAT 42.1 31.2 35% 31% com
Slide 5: Group operating performance
Group operating performance Key operating statistics FY10 EBITDA composition by business type 3% FY10 FY09 Var (%) Funds 8% Management Lot sales 2,567 2,409 7% Development 35% Lot settlements 2,366 2,282 4% (Owned) JV's No. of lots under 1 270 1,270 1 048 1,048 21% 54% Oh Other contract at 30 June N
Slide 6: Division performance
Division performance HH OF [ aati |) ie | ef oe Se
Slide 7: FM operating performance
FM operating performance Key performance statistics FY10 FM revenue composition by type $m FY10 FY09 Var (%) Project j Management g 9% Selling Fee Revenue 37.6 35.2 7% Operating expenses (11.4) (13.3) 14% 29% Management EBITDA 26 2 26.2 21 9 21.9 20% Performance Fees 62% Net EBITDA margin 70% 62% 8%
Slide 8: Funds management
Funds management » Funds management platform continues to perform strongly » 28 syndicate projects under management GDV of $3.5bn » Long project and syndication duration » Alkimos expected to contribute to profits from 2011 ‐ $1.1bn project end value » High return on equity » $22m raised for Peet Ki
Slide 9: Development operating performance
Development operating performance Key performance statistics FY10 revenue composition by geography $m FY10 FY09 Var (%) 10% Revenue 117.8 126.5 (7%) 28% WA Operating expenses1 (77.5) (94.5) 18% VIC 2 Write‐down Write down in Inventory 0.0 (27.4) 100% QLD EBITDA3 40.3 32.0 26% 62% 3 Net EBITDA margin
Slide 10: JV operating performance
JV operating performance Key performance statistics $m $ FY10 FY09 Var ((%)) » Significant g increase in lot sales Revenue 20.0 11.7 71% from joint venture projects Operating expenses (14.4) (10.2) (41%) » Earnings from joint ventures EBITDA 5.6 1.5 273% were up due to increased Net EBITDA margin 28
Slide 11: Average sales prices
Average sales prices Average prices of lots sold » Average price per lot reflective e ect e ofo Peet’s eet s 100 positioning at affordable end 11% 11% 90 of market 80 20% 22% » pp Approximately y 90% of sales 70 occur at prices less than 60 >$250k $250k 50 $201 ‐ $250k 40 69% 67% < $200k <=$200k 30
Slide 12: Settlements and contracts on hand
Settlements and contracts on hand » Growth in value and number of settlements over FY10 » Significant increase in number and value of contracts on hand » 49% iincrease in i value l off contracts t t on h hand d » 55% of value of contracts on hand in company owned projects » Value of contracts on han
Slide 13: Pipeline mix
Pipeline mix » In excess of 32,700 lots under management with end value of $7.0 billion1 » 13 years supply based on current production rates » Pipeline weighted towards strongest markets (Vic and WA) » Focus remains on the affordable market segment » Strong diversification with 69 Company‐owned and
Slide 14: New syndicate launch
New syndicate launch HH OF [ aati |) ie | ef oe Se
Slide 15: New syndicate launched
New syndicate launched Peet Yanchep Land Syndicate » New syndicate to be launched in S t b 2010 ─ total September t t l equity it raising ii of $55 million » Forecast gross revenue of $460m » First settlements approximately March 2012 » Development of 1 1,500‐lot 500 lot master planned community in
Slide 16: New syndicate launched - location
New syndicate launched ‐ location » Yanchep is an established residential coastal suburb and growth area within the City of Wanneroo, one of Australia’s fastest growing municipalities » Thi llocality This li iis expected d to ultimately li l hhouse 155,000 residents, provide employment for p to 55,0
Slide 17: New syndicate launched – structure plan
New syndicate launched – structure plan » Future residents will benefit from close proximity to the significant amenity proposed in the adjoining Yanchep City Centre » Y h City Yanchep Cit Centre C t will ill iinclude l d commercial and retail amenities, civic and community facilities, a future trai
Slide 18: Capital management
Capital management . St v9 i alu = a
Slide 19: Capital management
Capital management » Compliant with all debt covenants » Advanced discussions to extend current debt term » Current head h d room / lliquidity d > $110m $ » DRP for 2H10 dividend – 4.5 cents per share fully franked 30‐Jun‐10 30 Jun 09 Weighted average debt maturity 1 9 years 1.9 1 3 years 1.3 Weight
Slide 20: Cash flow analysis
Cash flow analysis » Strong operating cash flow FY10 cash flow analysis result » Strong cash St h flow fl position iti influenced by a continued focus on (86.1) » Working k capitall – tighter inventory (22.3) 178.2 management resulting in release of (5 0) (5.0) capital (32.2) 64.8 » Increase in aver
Slide 21: Market overview
Market overview i, i wbalg un ; vy 2 ga ® —m | wae) a
Slide 22: Geographic positioning - residential
Geographic positioning ‐ residential Strong market position especially in metropolitan growth corridors in Victoria and WA Victoria Western Australia Pipeline by geography (lots)1 » Continues to perform well » Sentiment expected to with strong sales momentum improve following resolution of resource
Slide 23: Residential – market outlook
Residential – market outlook Key drivers for residential remain positive – major Australian housing market balance undersupply of housing & low unemployment 400 350 » Housing undersupply due to supply constraints 300 Numbeer of dwellings ('000) and population growth 250 Underlying demand 200 » Const
Slide 24: Australian economic fundamentals
Australian economic fundamentals Housing fundamentals driven by national housing undersupply » Whilst affordability has reduced with increased interest rates and price growth, current affordability levels remain reasonable bl relative l to prior peaks k » Average monthly repayments have grown in lin
Slide 25: FHB still active, upgrader and investor activity improving
FHB still active, upgrader and investor activity improving First Home Buyer (FHB) » FHB in the market has trended back to longer term average of 20% ‐ 25% » Victoria remains strong with state grant increased to $20k until June 2011 Upgraders » Volumes increasing ‐ backfilling FHB demand since Decemb
Slide 26: Peet strategy and outlook
Peet strategy and outlook
Slide 27: Strategy
Strategy Peet will continue to responsibly identify and explore growth opportunities in line with strategic objectives, building on a quality asset base » Peet’s strategic priorities remain » Continuing expansion of syndication platform nationally » Improve market share in existing and new growth co
Slide 28: Capital efficient operating platform
Capital efficient operating platform High margin business with operating synergies across divisions Target Capital Land bank Operations p EBIT margin i employed2 » Acquisition Lots: 17,152 » Development management Funds 65 ‐ 75% $119m GDV ($bn): 4.1 » Marketing M t1 Management No. of projects: 34 »
Slide 29: Outlook
Outlook Subject to the continuation of current market conditions, Peet remains optimistic on the outlook given its pipeline mix, level of pre‐sales and underlying earnings provided through its funds management platform » Pipeline mix » Pipeline weighted towards strongest markets (Vic and WA) » Focus
Slide 30: FY10 annexures
FY10 annexures es; ae = Te rey, | whalSur . = i i a | a 7 = = r Pa a 1 , é “4
Slide 31: Summary income statement
Summary income statement $m FY10 FY09 Var (%) Funds management 37.6 35.2 7% Development 117 8 117.8 126 5 126.5 (7%) Other1 22.6 15.1 50% Revenue 178.0 176.8 1% EBITDA (pre inventory write write‐downs) downs) 74 8 74.8 57 2 57.2 31% Finance costs2 (12.0) (12.0) 0% Depreciation and amortisation (1.5)
Slide 32: Summary balance sheet
Summary balance sheet $m 30‐Jun‐10 30‐Jun‐09 Assets Cash 41.1 123.1 Receivables 64.3 32.9 Inventories 418.4 430.7 Investments accounted for using the equity method 32.6 32.7 Other 9.5 22.1 Total assets 565.9 641.5 iabilities Liabilities Trade and other payables 25.0 24.9 Land vendor liabilities 60.3
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Slide 34: Disclaimer
Disclaimer » While every effort is made to provide accurate and complete information, Peet does not warrant or represent that the information in this presentation is free from errors or omissions or is suitable for your intended use. Subject to any terms implied by law and which cannot be excluded,