Bewi Invest Asa · OSL:BINT
Bewi Invest Asa — KMC Properties — Q3 2023 Earnings Presentation
24 slides from Bewi Invest Asa's earnings presentation, Oct 26, 2023
Slide 1: The preferred real estate partner for logistics and industrial companies
The preferred real estate partner for logistics and industrial companies KMC Properties ASA Q3 2023 results presentation | 26 October 2023
Slide 2: Q3 highlights
Q3 highlights ▪ Stable operating performance Key figures • Net rental income flat q-o-q • Yield of 7.0% and WAULT 11.1 years Gross Asset Value % EPRA net yield WAULT • 2.7% downwards property value adjustment YTD NOK 5.9 bn 7.0% 11.1 years ▪ Final part of BEWI agreement announced • NOK 625 million p
Slide 3: Transformative acquisition and new strategic owner
Transformative acquisition and new strategic owner ~2.1x asset base since 2020 ▪ Final part of BEWI agreement Gross Asset Value (NOK billion) and net yield (%) 8.0 • NOK 1.9 billion portfolio acquired since Q2’22 6.5 • Geographically diversified across the Nordics/Europe +31% CAGR 5.9 • Accretive on
Slide 4: Building income scale and longevity
Building income scale and longevity ~2.3x rental income since 2020 Annual contractual rent (NOK billion) ▪ Maintaining track record of accretive acquisitions 475 421 ▪ Increasing portfolio WAULT to 11.7 years 371 126% • New properties with WAULT of 17 years 284 • 100% CPI adjustments (50% for 2024)
Slide 5: Growth brings more attractive financing terms
Growth brings more attractive financing terms Broadening top-tier lending relationships Debt structure further improved at reduced interest margin KMC Properties ASA Long term debt % of total and interest margin KMCP III KMCP IV KMCP VI KMCP VII KMCP AS KMCP II AS AS AS AS AS Senior Danske Secured S
Slide 6: Full alignment with new strategic institutional owner
Full alignment with new strategic institutional owner ▪ Nordika is a leading Nordic real estate investment firm Ownership composition ▪ Focusing on value-adding investments supported by yielding income assets 12,7% 17,4% Nordika ▪ Investment mandate includes a broad range of real 31,4% assets across
Slide 7: BEWI transaction shows how growth creates value
BEWI transaction shows how growth creates value Annualised run-rate 475 Rental income 421 ▪ Net income from property management up 26% 194 Net income from property +26% ▪ Rental income run-rate set to increase ~13% management 154 ▪ Total expenses up ~5.2% 119 Fixed interest margin cost 116 ▪ Fixed i
Slide 8: Financial review
Financial review 8
Slide 9: Demonstrating strong operational leverage
Q3 2023 Financial highlights Demonstrating strong operational leverage Profit and loss1 ▪ 58% rental income increase Q3’23 vs Q3’22 NOK million • Weighted average CPI adjustment of 7.5% Q3 2023 Q3 2022 YTD 2023 YTD 2022 on 1 January 2023 Rental income 104 66 303 193 Property expenses -1 -1 -3 -2 ▪ P
Slide 10: Significant non-cash items impacting profits in the quarter
Significant non-cash items impacting profits in the quarter Effect of unrealised items in Q3’23 100 ▪ Gains from interest and currency swaps NOK 29 -22 50 29 million in the quarter ▪ Amortised debt issue costs and bond discount 36 -51 negative with NOK 22 million 0 ▪ Unrealised foreign exchange loss
Slide 11: Financial and operational visibility improving
Financial and operational visibility improving Annualised run-rate1 ▪ Minor reduction in rental income run rate from NOK million, 12 months forward Q2’23 due sales and currency translations Q3’23 ▪ Property related expenses flat due to triple net Q3’23 Q2’23 Q1’23 Q4’22 Q3’22 PF bare house contract
Slide 12: Earnings driven income from property management
Earnings driven income from property management Earnings per share (EPS) last twelve months NOK per share 0.39 0.06 0.37 0.45 0.49 0.08 -0.16 Net income Changes in value Unrealized IFRS EPS Ajd. For Adj. for values of Adj. EPRA from property of investment financials and LTM Q3’23 contribution to NAV
Slide 13: Additional financial headroom
Additional financial headroom Further improved debt terms EBITDA to interest expense gap increased Annualized run-rate 12 months forward, NOK million NOK million Current terms 30 June 30 Sept 30 Sept 30 June 30 Sept 30 Sept 2023 2023 2023 2023 2023 2023 +14,5% Proforma Proforma 426 Bond loan 1 850 9
Slide 14: Maintaining a conservative leverage ratio
Maintaining a conservative leverage ratio LTV per quarter end and post BEWI transaction Debt maturity profile (NOKm) 30 September 2023 Proforma 2,488 59.6% 57.4% 900 56.4% Adj. 56.3%1 860 1,588 New Nordea 291 debt 102 127 569 102 0 127 30 June ’23 30 Sept ’23 30 Sept ’23 0-1 yrs 1-2 yrs 3-4 yrs 4+ y
Slide 15: Comfortable headroom to ICR covenants
Comfortable headroom to ICR covenants ICR forecast Rolling 12m ICR1 3M IBOR %2 2.0 5.0 4.8 4.8 4.7 4.7 1.9 4.6 4.5 4.4 4.1 4.2 1.8 4.2 4.1 4.0 4.0 4.0 4.0 4.0 4.1 1.7 1.7 4.0 3.8 1.7 1.7 3.9 1.7 3.8 3.7 3.6 1.6 3.4 Covenant 3.2 1.5 3.0 2.8 1.4 2.6 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2023 Q4 2023 Q1 2
Slide 16: Steady ICR development
Steady ICR development ICR development 5.0 4.7 4.5 4.4 3M NIBOR % 4.0 ICR (x) 3.7 ICR pro forma (x) 3.5 3.3 2.9 3.0 2.5 2.1 2.1 2.1 2.0 1.8 1.8 1.8 1.8 1.8 1.7 1.5 1.3 1.7 1.0 1.0 0.5 0.0 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 16
Slide 17: Outlook
Outlook 17
Slide 18: Set for further value accretive growth
Set for further value accretive growth Focus on four key areas 7.2% Net yield on NOK 6.5 billion assets post transaction ~Industry exposure (share of NOI) Acquisitions CAPEX 17 tenants 70 properties Other Packaging 680,000 sqm 7% 14% 11.7 yrs wault 23% Acquaculture 19% Components 2% Energy - renewab
Slide 19: Attractive acquisition market ahead
Attractive acquisition market ahead Year end 2024 gross asset value target NOK billion 8.0 Additional growth 1.4 BEWI transaction Building on a strong position: 0.6 ▪ Annualised rental income NOK 481 million with WAULT of 11.7 years after BEWI transaction ▪ Targeting further acquisitions in an attra
Slide 20: scl procanizs
scl procanizs
Slide 21: Appendix
2a - Appendix
Slide 22: Robust platform for continued value accretive growth
Robust platform for continued value accretive growth 7.0% net yield on NOK 5.9 billion assets Solid tenants in attractive Business critical assets Downside protection from Contractual frameworks in industries with sticky features high residual value place to reduce risk Other Packaging Locations wit
Slide 23: Contract structure reducing inflation impact
Contract structure reducing inflation impact Triple net bare house contract structure with CPI adjustments Gross Single-net Double-net Triple-net ▪ 7.5 % CPI-adjustment on 1 January 2023 on 99% of annual contractual rent Rent Tenant Tenant Tenant Tenant ▪ Low run rate property related costs due to t
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