Frasers Property Ltd. · SGX:TQ5
Frasers Property — Frasers Centrepoint Trust — Q2 2008 Earnings Presentation
41 slides from Frasers Property's earnings presentation, Apr 23, 2008
Slide 1: Frasers Centrepoint Trust Q208 results presentation
Frasers Centrepoint Trust Q208 results presentation Christopher Tang, CEO 23 April 2008
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 r
Slide 3: Agenda
Agenda 3 Record 2nd Qtr 08 results Excellent operational performance Growth gaining traction Outlook
Slide 4: Record 2nd Qtr 08 results
Causeway Point 4 Record 2nd Qtr 08 results
Slide 5: Record 2nd Qtr 08 results
Record 2nd Qtr 08 results 5 Jan – Mar 08 Y-o-Y Q208 Highlights (S$ ‘000) Change (%) • strong rental reversions Gross Revenue 21,616 10% • higher turnover rents • rental uplift from AEI Less Property Expenses (7,177) 16% • higher property taxes & other expenses Net Property Income 14,439 8% • reflect
Slide 6: Strong 1H08 results
Strong 1H08 results 6 Oct 07 – Mar 08 Y-o-Y 1H08 Highlights (S$ ‘000) Change (%) • strong rental reversions Gross Revenue 41,740 8% • higher turnover rents • rental uplift from AEI Less Property Expenses (13,364) 7% • higher maintenance & other expenses Net Property Income 28,376 8% • reflects stron
Slide 7: 2nd Qtr revenue by property
2nd Qtr revenue by property 7 S$ m Highlights 10% 21 .6 • strong rental reversion CWP 19 .6 : • higher turnover rents 11% • operations impacted by 14 .6 NP : 1 3.2 enhancement work ACP • 41% increase in rental post AEI 3% : • full trading quarter in Q208 5 .4 5 .6 102% 1 .6 Legend: Q208 Q207 0 .8 FC
Slide 8: 2nd Qtr operating expenses by property
2nd Qtr operating expenses by property 8 S$ m Highlights 16% 7 .2 • increase in property tax CWP 6 .2 • higher maintenance & carpark : expense 23% 4 .6 NP : - 3 .7 ACP • in line with higher revenue 1% : 1 .9 1 .8 21% 0 .8 0 .6 Legend: Q208 Q207 FCT Portfolio CWP NP ACP
Slide 9: 2nd Qtr net property income by property
2nd Qtr net property income by property 9 S$ m Highlights 8% 14 .4 13 .4 CWP • organic growth from positive : rental reversions & GTO 6% 10 .0 • operations impacted by 9 .5 NP : enhancement work ACP 5% • performance uplift from AEI : 3 .6 3 .8 397% 0 .9 Legend: Q208 Q207 0 .2 FCT Portfolio CWP NP AC
Slide 10: DPU profile
DPU profile 10 Legend DPU (¢) 16% 1.94 1.79 Y-o-Y change 0.19 0.18 Income to be distributed 1.75 1.67 1.67 1.67 1.61 Note: FCT is committed to distributing 100% of its distributable income to unitholders for FY08 Q207 Q307 Q407 Q108 Q208
Slide 11: Robust balance sheet
Robust balance sheet 11 Balance sheet Information Debt Information Total assets $1,060.5m Corporate rating 3 A3 Net assets $721.3m Gearing ratio 29% Total units in issue1 618,502,846 Interest cover 4.2 x NAV per unit2 $1.17 Cost of debt 3.66% Debt maturity profile Funding source CMBS programme S$1bn
Slide 12: Excellent operational performance
Anchorpoint 12 Excellent operational performance
Slide 13: Maintained high occupancy rates
Maintained high occupancy rates 13 Occupancy 1 FY2005 FY 2006 FY 2007 End Mar 08 YTD Mar 082 Causeway Point 99.7% 100.0% 99.9% 99.7% 99.9% Northpoint 99.6% 100.0% 100.0% 83.8%3 97.2%3 Anchorpoint 95.9% 92.7% 52.0%3 95.0% 84.8% FCT Portfolio 99.3% 99.2% 94.5% 95.3% 97.6% 1. All occupancies presented
Slide 14: Diversified portfolio risk
Diversified portfolio risk 14 Portfolio trade mix (31 March 2008) NLA Gross rental income Vacant, 5% Leisure/ Entmt, 4 % Fashion, 12% Healthcare, 5% Lesiure/ Entmt, 8 % Super/ Hypermkt, Fashion, 22% 4% Healthcare, 3% Household, 10% Super/ Hypermkt, Dept Store, 8% 7% Svc/ Education, 4% Spo rts Access
Slide 15: Achieved strong Q208 lease renewals
Achieved strong Q208 lease renewals 15 Net Lettable Area No of Increase in Current Property Renewals / vs Preceding Rents New Leases Area (sq ft) % Total NLA Anchorpoint - - - NA Northpoint1 - - - NA Causeway Point 19 20,816 5.0% 16.0% FCT Portfolio 19 20,816 5.0% 16.0% 1. As Northpoint is being pre
Slide 16: Achieved strong 1H08 lease renewals
Achieved strong 1H08 lease renewals 16 Net Lettable Area No of Increase in Current Property Renewals / vs Preceding Rents New Leases Area (sq ft) % Total NLA Anchorpoint - - - NA Northpoint1 - - - NA Causeway Point 87 172,582 41.3% 13.9% FCT Portfolio 87 172,582 41.3% 13.9% 1. As Northpoint is being
Slide 17: Lease expiry profile
Lease expiry profile 17 No of Net Lettable Area 2H08 Renewals / New Leases Area (sq ft) % Total NLA Anchorpoint - - - Northpoint 22 18,673 13% Causeway Point 25 16,264 4% FCT Portfolio 47 34,937 6% No of Net Lettable Area FY09 Renewals / New Leases Area (sq ft) % Total NLA Anchorpoint 8 4,289 6% Nor
Slide 18: Increased gross turnover rents and step-up leases
Increased gross turnover rents and step-up leases 18 GTO Step-up 62% 60% % of total no. of leases % of total no. of leases 16% 15% Q207 Q208 Q207 Q208 GTO and Step-up Rent clauses to be part of all renewals and new leases
Slide 19: Growth gaining traction
The Centrepoint 19 Growth gaining traction
Slide 20: Growth strategy
Growth strategy 20 Optimise rental reversions Inject pipeline assets Delivering sustainable Grow overseas DPU growth Unlock portfolio value
Slide 21: Optimise rental reversions
Optimise rental reversions 21 Portfolio increase in rental over preceding rates1 % 1 6 .0 1 4 .0 1 3 .6 1 0 .1 1 0 .3 Q2 07 Q3 07 Q407 Q108 Q208 1. Excludes extensions to leases in Anchorpoint & Northpoint arising from AEI.
Slide 22: Inject pipeline assets
Inject pipeline assets 22 Northpoint 2 YewTee Mall Bedok Mall The Centrepoint NLA (sf) MRT station Target injection Northpoint 2 83,000 Yishun End 2008 YewTee Mall 80,000 Yew Tee Middle 2009 Bedok Mall 80,000 Bedok 2010 The Centrepoint 390,000 Somerset TBA
Slide 23: Northpoint 2
Northpoint 2 23 Progress report Topping up on 13 Feb 2008 TOP expected by Aug 2008 70% completed 68% of NLA committed Put & Call option Put & call option agreement with price range of NP1 S$139.5 million – S$170.5 million NP2
Slide 24: Our Malaysian platform - Hektar REIT
Grow overseas 24 Our Malaysian platform - Hektar REIT Subang Parade Mahkota Parade Wetex Parade1 ON I TI D AD T TES LA 3.51 Quarterly DPU (sen) 2.40 2.40 2.40 Q107 Q207 Q307 Q407 1. Wetex Parade acquisition announced in Feb 2008 and expected to complete by May 2008.
Slide 25: Increased stake in Hektar REIT
Grow overseas 25 Increased stake in Hektar REIT Details Date Shares purchased Stake purchased Consideration Consideration 14 Apr 08 13.0m 4.06% RM 1.33 per share RM17.29m FCT stake rises to 31.06% Right of First Refusal for another 13% remains intact FCL completed 40% acquisition of Hektar Asset Man
Slide 26: Unlock portfolio value
Unlock portfolio value 26 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 CY2007 CY2008 CY2009 CY2010
Slide 27: Anchorpoint AEI
Anchorpoint AEI 27 Summary of enhancement works Changed retail mix to: • Strong F&B offering • New factory outlet concepts Improved sight lines by removing secondary corridors Moved food court to basement to improve traffic flow
Slide 28: Anchorpoint AEI
Anchorpoint AEI 28 Anchorpoint basement Supermarket Food court Corridor
Slide 29: Anchorpoint AEI Financials
Anchorpoint AEI 29 Financials Before AEI After AEI Change Average rent per sf S$5.32 S$7.50 41% Monthly shopper traffic 259,750 295,200 14% Incremental NPI of S$1.6m is NPI S$1.5m S$3.1m 107% 3.1% accretive to FCT portfolio Capex - S$13.1m - ROI - 12.2% -
Slide 30: Northpoint AEI
Northpoint AEI 30 Summary Demolish 2-storey Annex building Decant level 4 & transfer GFA to extend levels 1 – 3 Connect and integrate NP to NP2, creating 232,000 sf mall NorthPoint 1 NorthPoint 2 Annex Building Extension
Slide 31: Northpoint AEI
Northpoint AEI 31 Summary Play area on 4th floor Covered walkway on ground floor Northpoint 2
Slide 32: Northpoint AEI Timeline
Northpoint AEI 32 Timeline1 Activity Levels Q208 Q308 Q408 Q109 Q209 Q309 Reconfiguration B3 to B1 Reconfiguration B3 to B1 COMPLETED Demolition of Annex Building - Extension L1 to L4 Reconfiguration L1 to L4 Reconfiguration L1 to L4 1. Indicative timing, subject to changes.
Slide 33: Northpoint AEI Financials
Northpoint AEI 33 Financials Before AEI After AEI Change Average rent per sf S$11.00 S$12.91 17% Incremental NPI of S$3.7m is NPI S$13.9m S$17.6m 27% 7% accretive to FCT portfolio Capex - S$38.6m - ROI - 9.7% -
Slide 34: Outlook
/' a ry = : e/\\ = t " x WAN x a a) a Northpoint 2
Slide 35: Building a growth platform …
Building a growth platform … 35 Strategy Progress made • Mid-teens rental reversions in recent quarters Optimise rental reversions • Increased proportion of leases carrying GTO & step-up clauses • Northpoint 2 expected TOP in August 2008 Inject pipeline assets • Yee Tee mall 50% completed • Increase
Slide 36: … that's gaining momentum
… that’s gaining momentum 36 Steady growth with significant upside Strategy Outlook • Catching up market rents with 40% of FCT portfolio up for renewal Optimise rental reversions (2H08 & FY09) • Increasing contribution from GTO & step-up rentals Inject pipeline assets • Northpoint 2 by end CY2008 &
Slide 37: Thank you
Thank you Analyst & media contact: James Goh Chat Shen, CFA Investor Relations Frasers Centrepoint Asset Management Ltd Tel: (65) 6277-2657 Email: james.goh@fraserscentrepoint.com Web: www.fraserscentrepointtrust.com
Slide 38: Additional slides
Woodlands Central 38 Additional slides
Slide 39: Suburban rentals more resilient than Orchard rentals
39 Suburban rentals more resilient than Orchard rentals Rental (S$ psf/mth ) 45.0 Legend: 40.0 35.0 Orchard mall 30.0 Suburban mall 25.0 20.0 15.0 10.0 ASIAN SEP 11 SARS CRISIS 5.0 0.0 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Source: CBRE
Slide 40: FCT - resilient occupancy
FCT - resilient occupancy 40 9% 8% 8% Legend: 7% S’pore’s GDP 98.1 98.9 99.3 99.2 growth 94.5 FCT portfolio (%) 3% occupancy rate Note: 2007 occupancy rate affected by enhancement works to Anchorpoint 2003 2004 2005 2006 2007
Slide 41: FCT - stable cashflows
FCT - stable cashflows 41 9% 8% 8% Legend: 7% 77.5 S’pore’s GDP 71.1 71.9 growth 69.3 68.9 (S$ m ) 3% FCT gross revenue 47.7 49.1 50.1 51.7 FCT NPI 47.9 2003 2004 2005 2006 2007
Frasers Centrepoint Trust — Q2 2008 Earnings Presentation on 6ix