Slide 1: ASX cover letter - Annual General Meeting 30 October 2014
30 October 2014 The Manager Company Announcements Office ASX Limited Exchange Centre 20 Bridge Street SYDNEY NSW 2000 Dear Sir/Madam Federation Centres – Annual General Meeting 30 October 2014 Attached is:- • Chairman’s address and presentation to the meeting; and • CEO & MD’s address and presentati
Slide 2: Chairman Script: Welcome and Introductions
Federation Centres Annual General Meeting Thursday 30 October 2014 Chairman Script SLIDE 1: WELCOME AND INTRODUCTIONS Good afternoon ladies and gentlemen. My name is Bob Edgar, and I am Chairman of Federation Centres. It is my pleasure to welcome you to the Annual General Meeting of Federation Centr
Slide 3: Chairman's Address
Starting at the far right we have non executive directors Clive Appleton, Tim Hammon, Charles Macek, then CEO and Managing Director Steven Sewell. To my immediate left is Elizabeth Hourigan the Company Secretary and then continuing to the left we have the non executive directors Fraser Mackenzie, De
Slide 4: New Format Stores Enhance Sales Productivity
While the REIT sector has produced generally positive results for investors for the 2014 financial year, retailers have faced challenges from both domestic and international macro economic conditions. The slowdown in the mining and manufacturing sectors combined with lengthy speculation about a toug
Slide 5: Retail sector and Productivity Commission comments
In the supermarket category the expansion of the Aldi chain, and mooted entry of the Lidl chain,will also keep this sector focussed on continuing to enhance the offer to consumers. Australian retailers are capable of responding to changing customer needs and the challenges of new international retai
Slide 6: Taxation and GST comments
Commission and addressing the unfairness of the existing GST arrangements and I call on them to do so as a matter of real urgency. As a final comment in relation to taxation I would like to join with the Property Council of Australia and Australian Taxation Office in rejecting the notion recently ex
Slide 7: FY14 Key Financial Highlights; Gearing Levels and Debt Costs Reduced
SLIDE 4: FY14 KEY FINANCIAL HIGHLIGHTS As the slide shows, good progress has been made as a result of the work done to simplify and improve our business. Statutory Net profit more than doubled to $441.3 million mainly due to improvement in asset values. Underlying earnings increased 8.2% reflecting
Slide 8: Rebranding Nearing Completion
As a result of these activities future refinancing requirements have been spread over a longer period with smaller amounts required each year. This debt maturity profile is preferable because it reduces the funding requirement in any one year and the longer maturity is more suited to the ownership a
Slide 9: Warnbro Development Completed, Opened for Trade
states. More than 1100 signs were installed or replaced and 2000 signs were removed or modified which involved more than 25,000 hours worked. As well as the rebranding progress, I want to acknowledge the success of the first major redevelopment undertaken as Federation Centres at Warnbro in Western
Slide 10: Annual General Meeting October 2014
Annual General Meeting 30 October 2014
Slide 11: Chairman's Address
Chairman’s Address Dr Bob Edgar
Slide 12: New Format Stores Enhance Sales Productivity
New Format Stores Enhance Sales Productivity 3
Slide 13: FY14 Key Financial Highlights
FY14 Key Financial Highlights Key Metrics FY14 FY13 % Change Statutory Net Profit $441.3m $212.7m 107.5% Underlying Earnings $242.9m $224.4m 8.2% Underlying Earnings per Security (cents) 17.0 15.8 7.6% Distribution per Security (cents) 15.71 14.1 11.3% (1) This includes an additional 0.4cps paid for
Slide 14: Gearing Levels and Debt Costs Reduced
Gearing Levels and Debt Costs Reduced FDC Gearing Levels1 FDC direct cost of debt as at reporting date 8.50% 36% 34.6% 8.00% 8.07% 34% 7.50% 32% 7.48% 29.9% 7.00% 30% 6.90% 6.50% 28% 26% 25.5% 6.00% 26.3% 24.1% 24% 22.9% 5.50% 5.24% 5.15% 22% 5.00% 5.23% Guidance Range - 4.7-4.9% 20% 4.50% Dec-11 Ju
Slide 15: Rebranding Nearing Completion
Rebranding Nearing Completion 6
Slide 16: Warnbro Development Completed, Opened for Trade
Warnbro Development Completed, Opened for Trade 7
Slide 17: CEO Script: CEO Address and Portfolio
Federation Centres Annual General Meeting Thursday 30 October 2014 CEO Script SLIDE 8: CEO ADDRESS Thank you Bob. I would also like to welcome securityholders. It has been an exciting year of progress. Besides the changes related to rebranding and the restructuring of the portfolio there has been a
Slide 18: Portfolio and Mt Ommaney acquisition
spending. This has been a benefit in the current low-growth economic environment when consumer confidence has been fragile. The number of owned and co-owned centres increased from 47 in the last financial year. This reflects the decision to seek to wind-up the syndicate business and purchase the ass
Slide 19: Operating Platform Delivers Stable Results
These activities have allowed Federation Centres to: • recycle capital and improve the return on equity; • retain management and development rights in co-owned centres while improving portfolio diversification; and • have adequate balance sheet capacity to continue to grow and improve the portfolio
Slide 20: Building Capability and Culture to Be a Leading Australian Retail REIT
SLIDE 11: BUILDING CAPABILITY AND CULTURE TO BE A LEADING AUSTRALIAN RETAIL REIT Another key factor in delivering sustainable returns to investors is having a diverse and engaging culture with the right performance and remuneration systems to attract and retain high-performing people. In order to co
Slide 21: Our Property Focus - Optimise
• The Property Industry Foundation, which provides assistance to homeless youth. We have also launched our volunteering leave program which gives employees two days of paid leave each year for community work. I would now like to provide a little more detail about the activities we are undertaking to
Slide 22: Our Property Focus - Enhance
I am very proud of our team who worked hard to achieve this result and I would like to congratulate them. This new capability will revolutionise the way we do business and ensure Federation Centres remains an efficient and nimble organisation. Another important way to optimise the value we deliver t
Slide 23: Centre upgrades and tenancy fitouts
In the first instance we are undertaking a range of upgrades to improve our centres with new floors, ceilings, furnishings, amenities and way-finding. As part of the enhancement effort we have a full in-house tenancy design and delivery team that is looking to deliver quality contemporary fitouts. S
Slide 24: Our Property Focus - Redevelop
SLIDE 14: OUR PROPERTY FOCUS - REDEVELOP Redevelopment And of course, our redevelopment pipeline, valued at $1.3 billion, is a significant opportunity to grow returns to investors through improving customer experience and therefore retailer sales productivity. As Bob has mentioned, our Warnbro devel
Slide 25: Sustainability and conclusion
well, with good progress being made on reducing energy and greenhouse gas emissions with targets set for a 5% decrease in energy use and waste to landfill in the 2015 financial year. In conclusion, I would like to reiterate that all of the achievements of the past year are directed at delivering our
Slide 26: CEO's Address
CEO’s Address Steven Sewell
Slide 27: The Federation Centres' Portfolio
The Federation Centres’ Portfolio* $6.9 billion Regional Centres - 1 Convenience Centres -1 assets under Sub-regional Centres - 4 Convenience Centres - 8 Sub-regional Centres - 6 Convenience Centres - 9 management 1 Other - 2 <1% by Value 17 13 14% by Value Over 4,600 leases 24% by 5 with more than
Slide 28: Operating Platform Delivers Stable Results in FY2014
Operating Platform Delivers Stable Results in FY2014* Deliver consistent operating Solid core fundamentals Deliver consistent operating performance performance 30 supermarkets achieving sales of >$12,000 per sq.m • NOI growth +3.2% annual average for ~270 million customer visitations past 5 years an
Slide 29: Building capability and culture to be a leading Australian retail REIT
Building capability and culture to be a leading Australian retail REIT 2011 2% 2% 2% Property Operations 2014 Property Operations 2% Finance 3% 4% Finance 7% Legal and Corporate Legal and Corporate Development 23% 10% People and Culture Development People and Culture 3% Leasing 53% 3% Syndicate Fund
Slide 30: Our Property Focus - Optimise
Our Property Focus - Optimise • Efficiencies and reduced cost structure • Yardi implementation to drive efficiencies • Debt structure via diversity and duration, at attractive prices • Innovation, customer loyalty and marketing 5
Slide 31: Our Property Focus - Enhance
Our Property Focus - Enhance • Ambience of our centres through upgrades • Tenancy fitouts with our store design and delivery capabilities • Opportunistically invest in small, high yielding value add projects • Continually enhancing retailer mix and offer 6
Slide 32: Our Property Focus - Redevelop
Our Property Focus - Redevelop • Market pipeline increased to $1.3 billion (FDC share $673 million) • 3 new Board approved projects totalling $190 million • Sustainability, Innovation and Safety • Functional team in place nationally 7