Charter Hall Social Infrastructure Reit · ASX:CQE
Charter Hall Social Infrastructure Reit — FY2023 Earnings Presentation
30 slides from Charter Hall Social Infrastructure Reit's earnings presentation, Aug 11, 2023
Slide 1: Charter Hall Social Infrastructure REIT 2023 Full Year Results
Charter Hall Social Infrastructure REIT Charter Hall Social Infrastructure REIT 2023 Full Year Results 2023 Full Year Results
Slide 2: Acknowledgement of Country
Acknowledgement of Country Charter Hall acknowledges the Traditional Custodians of the lands on which we work and gather. We pay our respects to Elders past and present and recognise their continued care and contribution to Country. Charter Charter Hall Hall Social Social Infrastructure Infrastructu
Slide 3: Agenda
Agenda 1. Key Highlights and Strategy 2. Financial Performance 3. Portfolio Update 4. Outlook & Guidance 5. Additional Information Cover: Innovation Quarter, Westmead, NSW Left: Geoscience Australia, Narrabundah, ACT Charter Charter Hall Hall Social Social Infrastructure Infrastructure REIT REIT 202
Slide 4: Key Highlights and Strategy
Charter CharterHall Charter 2023 2023 HallSocial Hall Full 2023Full SocialInfrastructure Social Full Year InfrastructureREIT Infrastructure Year Results Results REIT 1 Keswick, SA Key Highlights and Strategy Emergency Command Centre
Slide 5: Key Highlights and Strategy
Key Highlights and Strategy Australia’s largest diversified ASX-listed social infrastructure REIT Operations Balance Sheet Property Portfolio Distribution per Unit Gross Assets WALE 17.2c $2.3bn 13.2yrs Acquisitions1 NTA per Unit Occupancy $184.2m $4.04 100% Divestments1 Average Debt Hedged to June
Slide 6: Our Strategy
Key Highlights and Strategy Our Strategy Provide investors with secure income and capital growth through exposure to social infrastructure property Enhancing income sustainability and Targeting ongoing Portfolio resilience capital growth curation ‒ Improving the quality of ‒ Focus on assets with the
Slide 7: Delivering on Strategy
Key Highlights and Strategy Delivering on Strategy $184.2 million of diversified social infrastructure acquisitions contracted in FY23 Life Sciences − Acquisition of a 25% interest in the Geoscience Australia life sciences complex in Canberra with a 9.6 year remaining lease term to the Commonwealth
Slide 8: CQE ESG Leadership
Key Highlights and Strategy CQE ESG Leadership Achievements in FY23 Focus areas in FY24+ Environment Net Zero Carbon by 2025 Engaged one of our key tenant Target investment in assets with Continued focus on rolling out clean Accelerated carbon target by 5 years 1. customers to pilot Australia’s firs
Slide 9: Financial Performance
Charter CharterHall Charter 2023 2023 HallSocial Hall Full 2023Full SocialInfrastructure Social Full Year InfrastructureREIT Infrastructure Year Results Results REIT 2 TAFE Robina, Qld Financial Performance
Slide 10: Earnings Summary
Financial Performance Earnings Summary $m FY22 FY23 % change Net Property Income1 84.5 100.5 18.9 - Net property income increased by $16.0 million or 18.9% on the previous corresponding period Distribution Income 1.9 1.0 (47.4) (pcp) predominantly driven by: Operating Expenses (12.0) (13.8) (15.0) -
Slide 11: Balance Sheet
Financial Performance Balance Sheet $m 30 June 2022 30 June 2023 - $184.5 million growth in total assets, up 8.9% Cash 10.5 14.5 primarily driven by: Investment Properties 1,945.9 2,015.9 - $235.9 million of property acquisitions settled during the year Investment in JVs 45.3 200.5 - $36.7 million o
Slide 12: Capital Management
Financial Performance Capital Management Key metrics as at 30 June 2023 - Facilities extended and increased to $850 million Debt summary Hedging summary in September 2022 Facility Limit ($m) 850.0 Balance Sheet Debt Hedged ($m)2 600.0 - Balance sheet gearing of 32.2% within target gearing range of 3
Slide 13: Portfolio Update
Charter CharterHall 2023 2023Full HallSocial FullYear Full SocialInfrastructure YearResults Year InfrastructureREIT Results Results 3 YMCA Early Learning Wyndham Vale, Vic Portfolio Update
Slide 14: Portfolio Update
Portfolio Update Portfolio Summary FY22 FY23 Number of operating properties 368 366 – Portfolio metrics remain strong Number of tenants 41 55 – 100% occupancy Property valuation ($m) 1,968.4 2,216.9 – Weighted average lease expiry (WALE) of 13.2 years Passing yield (%) 4.7 5.01 Occupancy (%) 100 100
Slide 15: Portfolio Composition
Portfolio Update Portfolio Composition 47% of rental income subject to market Sub-Sector by % of income as at Tenant profile by % of income as at rent reviews in the next 5 years 30 June 2023 30 June 2023 – Key portfolio income metrics: Transport Higher Education – Metropolitan location: 82% Emergen
Slide 16: Portfolio Valuations
Portfolio Update Portfolio Valuations Like-for-like full year portfolio valuations1 Assets (No.) Value ($m) Yield (%) Valuation Increase Valuation Increase Like-for-like valuation uplift of $9.9 million1 for the ($m) (%) full year FY23 reflects continuing demand for 351 1,939.6 4.9%2 9.9 0.5 quality
Slide 17: Childcare Industry
Portfolio Update Childcare Industry Government funding forecast to increase by 41% over next four years to $15.0 billion per annum1 – Importance of the sector continues as a labour supply mechanism to Australian economy and provision of quality educational outcomes to children – Annual government fu
Slide 18: Outlook & Guidance
Charter CharterHall Charter 2023 2023 HallSocial Hall Full 2023Full SocialInfrastructure Social Full Year InfrastructureREIT Infrastructure Year Results Results REIT 4 Busy Bees Killarney, Qld Outlook & Guidance
Slide 19: Outlook & Guidance
Outlook & Guidance Outlook & Guidance − Continue to execute on CQE’s strategy to actively manage the portfolio to maintain income security and capital growth Click icon to add − Positive industry and demographic pictur e fundamentals to provide further opportunities in the social infrastructure sect
Slide 20: Additional Information
Charter CharterHall Charter 2023 2023 HallSocial Hall Full 2023Full SocialInfrastructure Social Full Year InfrastructureREIT Infrastructure Year Results Results REIT 5 Newstead, Qld Additional Information Mater Headquarters, Stratton Street
Slide 21: Portfolio Overview
Additional Information Portfolio Overview As at 30 June 2023 No. Value ($m) % Portfolio Passing Yield (%) QLD 119 553.0 24.7 4.7 − Majority of leases in the portfolio are triple net VIC 83 494.0 22.1 4.9 NSW / ACT 84 323.7 14.5 5.2 − Combination of fixed (77%) and CPI linked (23%) annual rent review
Slide 22: Childcare Development Pipeline
Additional Information Childcare Development Pipeline 4 developments completed through FY23, providing purpose-built, high quality assets Completed Developments FY23 Number 4 Valuation upon completion ($m) 33.8 Valuation uplift ($m) 5.5 Average yield on cost (%) 5.8 Ongoing Developments Number 4 Ave
Slide 23: Social Infrastructure Overview
Additional Information Social Infrastructure Overview Spending on social infrastructure forecast to increase, providing further opportunities for CQE Childcare Education Health Transport and Communication Female workforce participation rate at record By 2050 it is estimated that 55% of all Australia
Slide 24: Statutory Profit Reconciliation
Additional Information Statutory Profit Reconciliation FY22 FY23 Statutory Profit Reconciliation ($m) ($m) Operating Earnings 62.9 59.2 Net fair value gain/(loss) on investment properties 269.9 (6.4) Net movements on derivative financial instruments 20.3 1.4 Straightlining of rental income, amortisa
Slide 25: Debt Facility Summary
Additional information Debt Facility Summary Debt summary ($m) – 30 June 2023 Limit Drawn Maturity Gearing (covenant) ICR (covenant) Balance sheet debt - $0.9 billion of look through debt facilities across International bank bilateral debt facility 100.0 100.0 Jan-25 CQE’s head trust and joint ventu
Slide 26: CQE and joint venture summary
Additional information CQE and joint venture summary Investment in property joint ventures – operating earnings and balance sheet breakdown FY23 A$m CQE CH BBD Trust LWR GSA PFA Westmead Total Ownership interest 100.0% 50.0% 25.0% 49.9% Properties 367 properties in Brisbane Bus Depot Geoscience, ACT
Slide 27: CQE and joint venture summary
Additional information CQE and joint venture summary Investment in property joint ventures – operating earnings and balance sheet breakdown FY22 A$m CQE CH BBD Trust LWR GSA PFA Westmead Total Ownership interest 100.0% 50.0% 25.0% 49.9% Properties 371 properties in Australia Brisbane Bus Depot Geosc
Slide 28: Key Statistics
Additional Information Key Statistics Financial & Capital Management Metrics FY19 FY20 FY21 FY22 FY23 NTA ($) 2.96 2.92 3.25 4.08 4.04 NTA Growth (%) 6.5 (1.4) 11.3 25.5 (1.0) DPU (c) – Ordinary 16.0 16.0 15.7 17.2 17.2 DPU (c) – Special - - 4.0 - - DPU Growth (%) – Ordinary 6.0 - (1.9) 9.6 - Gearin
Slide 29: Glossary
Additional Information Glossary ACECQA Australian Children’s Education and Care Quality Authority ASX Australian Securities Exchange Balance sheet gearing Calculated as the ratio of net drawn debt less cash to total tangible assets, less cash CPI Consumer Price Index CPU Cents per unit CQE Charter H
Slide 30: Further information
Further information Investor Relations Click icon to Tel 1300 365 585 (within Australia) add pictur e +61 2 8651 9000 (outside Australia) Email reits@charterhall.com.au Presentation authorised by the Board charterhall.com.au/cqe IMPORTANT NOTICE & DISCLAIMER Charter Hall Social Infrastructure Limite
Charter Hall Social Infrastructure REIT — FY2023 Earnings Presentation on 6ix