Frasers Property Ltd. · SGX:TQ5
Frasers Property — Frasers Centrepoint Trust — Q1 FY2009 Earnings Presentation
37 slides from Frasers Property's earnings presentation, Jan 23, 2009
Slide 1: Frasers Centrepoint Trust 1st Quarter FY09 results
Frasers Centrepoint Trust 1st Quarter FY09 results 23 January 2009
Slide 2: Important notice
Important notice 2 Certain statements in this Presentation constitute “forward-looking statements”, including forward-looking financial information. Such forward-looking statement and financial information involve known and unknown risks, uncertainties and other factors which may cause the actual re
Slide 3: Agenda
Agenda 3 Results Operational performance Summary
Slide 4: Results
4 Results
Slide 5: 1Q09 result: DPU up 4% Y-o-Y
Results 5 1Q09 result: DPU up 4% Y-o-Y Oct – Dec 08 Y-o-Y 1Q09 Highlights (S$ ‘000) Change (%) • temporary impact of planned enhancement works at Northpoint (scheduled to complete by June 09) Gross Revenue 19,482 3% • mitigated by rental growth at Causeway Point and Anchorpoint Less Property Expense
Slide 6: 1Q09 gross revenue by property
Results 6 1Q09 gross revenue by property Highlights S$ m • organic growth from positive 3% -$0.6m CWP: rental reversions & higher turnover rents 19.5 20.1 6% +S$0.8m • impacted by temporary 14.4 NP : vacancies arising from 13.5 planned enhancement works 41% -S$2.3m 5.5 ACP : • performance uplift fro
Slide 7: 1Q09 net property income by property
Results 7 1Q09 net property income by property Highlights S$ m • organic growth from positive 8% -S$1.1m CWP: rental reversions & higher 13.9 turnover rents 12.8 +S$0.5m 5% • impacted by temporary 10.3 9.8 NP : vacancies arising from planned enhancement works 58% -S$2.2m 3.8 ACP : • performance upli
Slide 8: 1Q09 DPU up 4% Y-o-Y
Results 8 1Q09 DPU up 4% Y-o-Y Quarterly DPU payout trend 1Q09 DPU DPU (¢) 0.46 4% Y-o-Y 1Q09 1Q08 Change (%) 1.75 1.88 1.61 1.67 1.59 1.67¢ 1.61¢ 4% 1Q08 2Q08 3Q08 4Q08 1Q09 Income retained from previous quarters Y-o-Y change
Slide 9: Distribution details
Results 9 Distribution details Distribution period 1 October to 31 December 2008 Distribution per unit 1.67¢ Ex-date 2 February 2009 Books closure date 4 February 2009 at 5 pm Payment date 27 February 2009
Slide 10: Operational performance
10 Operational performance
Slide 11: Large, diverse & quality tenant base focused on non-discretionary consumer spending
Operational performance 11 Large, diverse & quality tenant base focused on non-discretionary consumer spending Trade mix - gross rental income1 Top 10 tenants1 % total % total Lesiure/Entmt, 4% No. Tenant NLA gross rents Healthcare, 5% Super/Hypermkt, 1 Cold Storage2 8% 7% 5% Fashion, 20% 2 Courts 6
Slide 12: Sustainable rentals with low exposure to volatility in tenant sales
Operational performance 12 Sustainable rentals with low exposure to volatility in tenant sales Occupancy costs1 Turnover rentals as % of gross revenue Turnover rent contribution 1Q09 5% Causeway Point 12.7% Gross revenue Anchorpoint 15.7% Currently undergoing Northpoint enhancement works 95% Fixed r
Slide 13: 1Q09 lease renewals
Operational performance 13 1Q09 lease renewals Net Lettable Area Mall No. of renewals / Increase over New leases Area preceding rents (sq ft) % Total NLA Anchorpoint - - - NA Northpoint1 3 18,191 12.1% 14.2% Causeway Point 24 24,278 5.8% 18.9% FCT 27 42,469 6.6% 17.5% 1. As Northpoint is being prepa
Slide 14: 90% of FY09 gross rental income locked-in
Operational performance 14 90% of FY09 gross rental income locked-in Lease expiry profile (as at 31 Dec 2008) Weighted avg lease term to expiry By NLA 2.14 yrs By Gross rent 2.31 yrs 41% 10% 11% 28% Expiries as % of total 8% gross rental income FY09 FY10 FY11 FY12 FY13 Number of leases expiring 31 5
Slide 15: Analysis of FY09 lease renewals
Operational performance 15 Analysis of FY09 lease renewals Mall No. of leases % total gross rents Demand drivers • Only regional mall in Northern Singapore Causeway Point 17 8.5% • No new retail supply near Causeway Point • 89% of Northpoint’s post AEI NLA has been Northpoint 6 1.1% committed or in
Slide 16: Growing number of leases with gross turnover rents & step-up rents
Operational performance 16 Growing number of leases with gross turnover rents & step-up rents Leases with Gross Turnover (GTO) Leases with Step-up % of total no. of leases with GTO % of total no. of leases with Step-up 84% 91% 41% 37% 1Q08 1Q09 1Q08 1Q09 GTO rent and Step-up rent clauses to be part
Slide 17: Causeway Point & Anchorpoint at full occupancy
Operational performance 17 Causeway Point & Anchorpoint at full occupancy Occupancy 1 Mar 08 Jun 08 Sep 08 Dec 08 Causeway Point 99.7% 99.7% 100.0% 100.0% Northpoint2 83.3% 82.9% 47.6% 52.2% / 89.0%3 Anchorpoint 95.0% 98.6% 99.5% 99.5% FCT Portfolio 95.3% 95.7% 87.7% 88.7% 1. All occupancies present
Slide 18: No material refinancing & interest escalation risks
Operational performance 18 No material refinancing & interest escalation risks – 80% of loan expires only in July 2011 with interest rate fully hedged Debt Information Debt expiry profile CMBS Expiry: Jul 2011 As at 31 December 2008 Interest rate: fixed Gearing ratio 28.5% 260 Interest cover1 4.34 x
Slide 19: FCT currently trading at substantial discount to NAV
Operational performance 19 FCT currently trading at substantial discount to NAV As at 31 December 2008 Total assets $1,129.4m Net assets $761.3m Total units in issue1 621,374,188 NAV per unit2 $1.23 Unit price $0.63 Discount to NAV 49% 1. Excludes 1,537,804 units in payment of 1Q09 mgmt fees. Total
Slide 20: Summary
20 Summary
Slide 21: Singapore Government's fiscal measures to benefit tenants, ease cashflow concerns and stimulate consumption
Summary 21 Singapore Government’s fiscal measures to benefit tenants, ease cashflow concerns and stimulate consumption Singapore’s Budget 2009 Impact on FCT and tenants announcements (selected) 40% property tax rebate for • Tenants’ competitiveness and sustainability to be enhanced by pass- commerci
Slide 22: FCT: Quality REIT with robust capital structure, minimal refinancing risks & defensive cashflows
Summary 22 FCT: Quality REIT with robust capital structure, minimal refinancing risks & defensive cashflows Key strengths Prudent capital structure • Low gearing ratio of 28.5% • 80% of loans expiring only in July 2011 with associated interest rate fully Minimal refinancing risks hedged • 90% of FY0
Slide 23: Thank you
Thank you Analyst & media contact: James Goh Chat Shen, CFA Investor Relations Frasers Centrepoint Asset Management Ltd Tel: (65) 6277-2657 Email: james.goh@fraserscentrepoint.com Web: www.fraserscentrepointtrust.com
Slide 24: Appendix
Appendix - Introduction - Suburban resilience - Asset enhancement initiatives - Others
Slide 25: Frasers Centrepoint Trust
Introduction 25 Frasers Centrepoint Trust Overview Causeway Point FY08 distributable income: S$45.2 million Northpoint FY08 DPU: 7.3¢ FY08 yield ($0.63 unit pr)1: 11.6% FY08 valuation: S$1.1 billion Anchorpoint Portfolio NLA1 (sf) MRT station Catchment population Annual traffic Causeway Point 418,50
Slide 26: Developer sponsored REIT with strong corporate governance framework
Introduction 26 Developer sponsored REIT with strong corporate governance framework Frasers Centrepoint Limited (“FCL”) A leading retail mall developer, owner, and manager in Singapore with experienced and tested management team Strong corporate governance framework Independent and non-executive dir
Slide 27: FY2008 valuation
Introduction 27 FY2008 valuation (S$ million) Sep 2008 valuation Sep 2007 valuation Variance Property yield Causeway Point 710.0 675.7 34.3 5.6% Northpoint 286.0 265.8 20.2 NA1 Anchorpoint 67.0 47.0 20.0 6.2%2 FCT portfolio 1,063.0 988.5 74.5 - 1. Northpoint actual NPI affected by AEI. Based on mana
Slide 28: Causeway Point & Northpoint maintained above 95% occupancy through previous recessions
Suburban resilience 28 Causeway Point & Northpoint maintained above 95% occupancy through previous recessions Occupancy rate GDP growth 100% 15% 80% 10% 60% 5% SARS 40% 0% Recession 20% -5% 0% -10% 2000 2001 2002 2003 2004 2005 Causeway Point Northpoint
Slide 29: Causeway Point experienced 2 economic downturns with minimal rental loss
Suburban resilience 29 Causeway Point experienced 2 economic downturns with minimal rental loss Gross rental income (S$ million ) GDP growth 0.6% 45 15% 40 10% 35 5% SARS 30 0% Recession 25 -5% 20 -10% 2000 2001 2002 2003 2004 2005
Slide 30: Northpoint experienced 3 economic downturns with minimal rental loss
Suburban resilience 30 Northpoint experienced 3 economic downturns with minimal rental loss Gross rental income (S$ million ) GDP growth 0.3% 14 15% 3.3% 12 10% 10 5% SARS 8 0% Asian crisis Recession 6 -5% 4 -10% 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Slide 31: Organic growth from asset enhancement initiatives
Asset enhancement initiative 31 Organic growth from asset enhancement initiatives Asset enhancement master plan Strategic initiative to unlock value from existing assets Customised enhancement programme for individual assets Indicative timetable Anchorpoint COMPLETED Northpoint Causeway Point TBA CY
Slide 32: Anchorpoint AEI Financials
Asset enhancement initiative 32 Anchorpoint AEI Financials Before AEI After AEI Change Average rent per sf S$5.32 S$7.50 41% Monthly shopper traffic 259,750 317,174 22% Incremental NPI of S$1.8m is 3% NPI S$1.7m S$3.5m 106% accretive to FCT portfolio Capex - S$12.8m - ROI - 14.1% -
Slide 33: Northpoint AEI Summary
Asset enhancement initiative 33 Northpoint AEI Summary Demolish 2-storey Annex building Decant level 4 & transfer GFA to extend levels 1 – 3 Connect and integrate NP to NP2, creating a 232,000 sf mall Play area on 4th floor Expected completion by June 2009 Covered walkway Northpoint 2 Northpoint 1 N
Slide 34: Northpoint AEI: newly opened sections
Asset enhancement initiative 34 Northpoint AEI: newly opened sections Levels 2 & 3 Basement 1 Basement 1
Slide 35: Northpoint AEI Financials
Asset enhancement initiative 35 Northpoint AEI Financials Projected Before AEI Change after AEI Average rent per sf S$11.00 S$13.20 20% Incremental NPI of S$4.1m is 7% NPI S$13.9m S$18.0m 30% accretive to FCT portfolio Capex - S$38.6m - Approx. 90% ROI - 10.7% - of post AEI NPI secured1 1. Calculate
Slide 36: Hektar REIT shares similar defensive characteristics; FCT to benefit from tax rate changes
Others 36 Hektar REIT shares similar defensive characteristics FCT to benefit from tax rate changes Hektar REIT portfolio Subang Parade Mahkota Parade Wetex Parade Portfolio NLA FY08 distribution S$3.36 million from Hektar REIT WP Withholding 16% Pro-forma FY08 tax cut from SP distribution from S$3.
Slide 37: Acquisition plans on hold pending stabilisation of capital markets
Others 37 Acquisition plans on hold pending stabilisation of capital markets Northpoint 2 YewTee Point Bedok Mall The Centrepoint NLA (sf) MRT station Catchment population Northpoint 2 83,000 Yishun 179,400 YewTee Point 72,000 Yew Tee 80,000 Bedok Mall 81,000 Bedok 129,100 The Centrepoint 392,100 So
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