Slide 1: HY24 Results Presentation
HY24 RESULTS PRESENTATION 27 FEBRUARY 2024 201 Abacus Group | HY24 Elizabeth Results Street, Sydney NSW Presentation
Slide 2: Agenda
ABACUS GROUP HY24 RESULTS Agenda 01 Overview 02 Key financial metrics and capital management 03 Operating performance 04 Outlook and guidance Steven Sewell, Evan Goodridge, Steven Sewell, Steven Sewell, Managing Director CFO Managing Director Managing Director Abacus Group | HY24 Results Presentatio
Slide 3: HY24 Highlights
HY24 HIGHLIGHTS Portfolio Office Retail Diversified earnings Capital allocation 21 12.5% 5.4% 4 $96 million2 Assets Leasing spreads Average rent review Income streams Net divestment Solid occupancy and WALE 53 new deals in HY24, with Strong rent review driven by 53% Office Divested two properties wi
Slide 4: HY24 Platform Metrics
HY24 PLATFORM METRICS TOTAL ASSETS WEIGHTED AVG CAP RATE2 GEARING NET TANGIBLE ASSETS 31 December 2023 (Pro forma)1 $2.7bn 6.08% 30.2% $1.92ps $2.8bn 6.07% 31.6% $1.92ps 31 December 2023 STATUTORY PROFIT FFO FFO PER SECURITY DPS ($143.6m) $40.1m 4.49cps 4.25cps 1. Includes $107 million of proceeds f
Slide 5: HY24 Balance Sheet Allocation
HY24 BALANCE SHEET ALLOCATION 31 December 2023 (pro forma)1 30 June 2023 $ 2.7bn 60% OFFICE $1.6 bn 15% RETAIL $0.4 bn 15% ASK $0.4 bn 10% OTHER $0.3 bn Total Assets $ 2.5bn 67% OFFICE $1.7 bn 19% RETAIL $0.5 bn 14% OTHER $0.3 bn Total Assets2 Office $1,608 m 14 properties Office $1,703 m 15 propert
Slide 6: Consistent Strategy
CONSISTENT STRATEGY CREATING SPACES FOR NOW INVESTING FOR YOUR FUTURE VISION STRATEGY VALUES To create exceptional value for our To concentrate on select real estate sectors that deliver long-term, sustainable We are entrepreneurial and deliver customers and stakeholders through outcomes through act
Slide 7: Key Financial Metrics & Capital Management
KEY FINANCIAL METRICS & CAPITAL MANAGEMENT EVAN GOODRIDGE 99 Walker Abacus Group | HY24 Street, Results North Sydney NSW Presentation
Slide 8: Operating Earnings Summary
OPERATING EARNINGS SUMMARY $ millions HY24 HY232 Change Comments Office LFL net rental FFO1 33.5 32.3 3.7% Driven by increase in occupancy and rent reviews Includes divestments of 33 Queen Street, Brisbane QLD and Office Non-LFL net rental FFO1 5.9 8.4 (29.8%) 187 Todd Road, Port Melbourne VIC HY24
Slide 9: Capital Management
CAPITAL MANAGEMENT ~$200m acquisition capacity, with low levels of capital expenditure forecast in the short to medium term NTA1,5 ABG total assets5 Acquisition capacity2,5 Avg. cost of drawn debt3 Gearing4,5 Debt term to maturity $1.92ps $2.7bn $194m 4.1% 30.2% 3.9yrs Debt expiry profile Interest r
Slide 10: HY24 Valuation Update
HY24 VALUATION UPDATE Bond yields continue to impact cap rates Investment Portfolio Office Retail ASK Other 31 December 15 assets 4 assets n/a 2 assets No. of properties 31 December Chg photo (pro forma) 1 14 assets 3 assets n/a 2 assets 31 December $1,639m $461m $400m $276m2 HY24 carrying value 31
Slide 11: Operating Performance
Chg photo OPERATING PERFORMANCE STEVEN SEWELL Abacus Group |459-471 Church HY24 Results Street, Richmond VIC Presentation
Slide 12: Business Model
BUSINESS MODEL CORE BUSINESS ASSET + DEVELOPMENT CUSTOMER + INVESTMENT MANAGEMENT MANAGEMENT BRAND MANAGEMENT ENABLERS OUR PEOPLE AND OUR RESPOSITIONING CULTURE OUR MARKET INSIGHT CAPABILITY AREAS OF FOCUS AND OPPORTUNITY RESPONSIBLE AND SUSTAINABLE EVOLUTION CUSTOMER ENGAGEMENT OF CORE BUSINESS CON
Slide 13: Office Snapshot
OFFICE SNAPSHOT Portfolio of 15 Office assets valued at $1.6 billion1 OCCUPANCY1,2 WALE1,2 YTD LEASING DEALS YTD LFL RENT GROWTH2 Chg photo 92.6% 3.8yrs 53 5.4% FY23: 95.0% FY23: 3.7yrs HY23: 54 HY23: 3.0% WACR1 A GRADE BUILDINGS1,3 TENANT CUSTOMERS1,4 SME CUSTOMERS1,4,5 5.95% 76% 319 63% FY23: 5.59
Slide 14: 76% A Grade Office Portfolio
76% A GRADE OFFICE PORTFOLIO A grade portfolio in premium locations underpinned by a diversified SME customer base Market profile: Geography1 Melbourne Brisbane CBD Sydney CBD & Fringe Other CBD & Fringe & Fringe 96% exposed to Asset profile: Grade1,2 the Eastern Seaboard1 A B+ B Asset profile: Life
Slide 15: Office Leasing Metrics
OFFICE LEASING METRICS Strong leasing spreads achieved in a challenging office environment 22,776 31% 12.5% 3.7% $743psm sqm leased1 average gross leasing spreads average rent average net face incentive review rent2 HY23: 25,379sqm HY23: 31% HY23: 9.4% HY23: 4.1% HY23: $737psm 70% new 31% on new dea
Slide 16: Office Leasing Expiry
OFFICE LEASING EXPIRY1 Underpinned by geographical diversity NSW QLD VIC SA ACT 39% 77% of vacant area already spec fitted2 16% 15% 12% 8% 9% 1% Vacant Short Term Year 1 Year 2 Year 3 Year 4 Year 5+ Major Vacancies: Major Expiries: Major Expiries: Major Expiries: Major Expiries: Major Expiries: Majo
Slide 17: Retail Snapshot
RETAIL SNAPSHOT Portfolio of 4 Retail assets (3 centres and 1 CBD asset) valued at $0.5 billion1 OCCUPANCY1 WALE1 YTD LEASING DEALS2 94.5% 5.5yrs 20 FY23: 95.2% FY23: 5.8yrs HY23: 30 YTD RENT GROWTH WACR1 LEASING SPREAD 5.5% 6.36% 3.3% HY23: 0.2% FY23: 6.16% FY23: (1.6%) 1. As at 31 December 2023. 2
Slide 18: Sustainability Progress
SUSTAINABILITY PROGRESS Abacus continues to embed sustainable practices across the business 39% reduction in Scope 1 & 2 NET ZERO TARGET HY24 Results GHG Emissions Intensity Scope 1 & 2 GHG Emissions by compared to FY19 baseline 2030 for Office assets under Abacus control Released the FY23 Modern Sl
Slide 19: Sustainability: Tracking Our Progress
SUSTAINABILITY: TRACKING OUR PROGRESS FY19 FY20 FY21 FY22 FY23 HY24 Net zero EMISSIONS On track to achieve net zero emissions 2030 by 2030 (Scope 1 & 2) 39% improvement Scope 1 & 2 GHG 0.080 0.069 emissions intensity ENERGY 0.061 0.059 (t/sqm) 0.053 0.049 From FY19 Scope 1 & 2 GHG emissions intensit
Slide 20: Outlook and Guidance
OUTLOOK AND GUIDANCE STEVEN SEWELL ThePresentation Abacus Group | HY24 Results Oasis, Broadbeach QLD
Slide 21: Outlook and Guidance
OUTLOOK AND GUIDANCE Owning and managing an Australian eastern Abacus Group FY24 Guidance seaboard focused Active asset management and diversified leasing strategies • Reaffirming Abacus Group FY24 distribution guidance of 8.5 Commercial portfolio to drive income growth throughout our portfolio cent
Slide 22: Contents
CONTENTS STATUTORY EARNINGS RECONCILIATION SLIDE 23 FFO PROFIT AND LOSS SLIDE 24 BALANCE SHEET OVERVIEW SLIDE 25 DEBT FACILITIES SLIDE 26 INVESTMENT PORTFOLIO METRICS SLIDE 27 COMMERCIAL CAPABILITY SLIDE 28 COMMERCIAL PORTFOLIO SLIDE 29 TRACK RECORD OF PERFORMANCE SLIDE 30 SELF STORAGE INCOME SLIDE
Slide 23: Statutory Earnings Reconciliation
STATUTORY EARNINGS RECONCILIATION Performance metrics ($m) HY24 Term Definition Net profit attributable to ABG securityholders (143.6) FFO is in line with the PCA’s definition and comprises net profit/loss after tax attributable to stapled security holders, calculated in accordance Discontinued oper
Slide 24: FFO Profit and Loss
FFO PROFIT AND LOSS Performance metrics ($m)1 HY24 HY23 Comments Rental income 77.4 76.4 Driven by increase in LFL occupancy and rent reviews Fee, finance and other income 9.7 2.4 Increase due to ASK fees received from August 2023 Share of profit from equity accounted investments 10.5 3.7 Increase d
Slide 25: Balance Sheet Overview
BALANCE SHEET OVERVIEW $ millions HY24 31 December 2023 2.8bn Investment properties $2,027.1m PP&E, equity and other investments, financial and other assets Loans $619.5m $55.9m $ Cash and cash equivalents $33.7m Total Assets Goodwill and intangibles $32.4m Deferred tax assets $7.5m 59% OFFICE $1.6
Slide 26: Debt Facilities
DEBT FACILITIES Capital management metrics HY24 Comments Total bank debt facilities $1,183m Total bank debt drawn $899m Term to maturity 3.9yrs Interest rate hedging1 76% Weighted average hedge maturity 2.5yrs Average cost of debt - drawn 4.1% Average cost of debt - fully drawn 4.0% Calculated as ba
Slide 27: Investment Portfolio Metrics
INVESTMENT PORTFOLIO METRICS Investment portfolio sector diversification Portfolio metrics HY24 Office Retail ASK Other1 Total Value ($m) 1,639 461 400 276 2,776 Office 59% No. of assets 15 4 - 2 21 Retail 17% NLA2,3 (sqm) 138,209 62,406 - - 200,615 ASK 14% Other 10% WACR (%) 5.95 6.36 - - 6.04 Occu
Slide 28: Commercial Capability
COMMERCIAL CAPABILITY Assets in focus with strong income growth potential and low capex requirements over the short to medium term Asset 99 Walker Street, 77 Castlereagh Street, 14 Martin Place, The Oasis, 324 Queen Street, North Sydney NSW1 Sydney NSW Sydney NSW Broadbeach QLD Brisbane QLD Occupanc
Slide 29: Commercial Portfolio
COMMERCIAL PORTFOLIO $2.2bn portfolio, 96% exposed to the Eastern Seaboard 23% QLD $492 million 21 Office $257m Retail $235m 47% NSW $1,031 million Assets QLD 5 Office $877m Retail $76m •BRISBANE FRINGE 2 Other1 $78m • BRISBANE 2 • BROADBEACH 1 SA 3% ACT 1 NSW $59 million ACT 9 Office $59m 1 • SYDNE
Slide 30: Track Record of Performance
TRACK RECORD OF PERFORMANCE Annuity style business model supported by consistent operating metrics Average Occupancy1 Average WALE1 92.8% 3.8 yrs Occupancy % Average Occupancy H19-HY24 WALE (yrs) Average WALE H19-HY24 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 90.0% 95.0% 95.0% 88.4% 94.8% 95.5% 92.6% 94.7% 91
Slide 31: Self Storage Generated Income
SELF STORAGE GENERATED INCOME ABG income and fees received from ASK Fee type Fee description HY24 impact $5.2 million1,2 Management fee 0.4% of ASK gross asset value (40bps of $3.1b gross assets) 5.0% of total development costs (TDC) up to a total of $2.5m and 3.0% of TDC above $2.5m Development man
Slide 32: Glossary
GLOSSARY Term Definition Term Definition ABG Abacus Group KL/SQM Kilolitres per square metre ASK Abacus Storage King KPI Key performance indicator ASX Australian Securities Exchange LFL Like for like CBD Central business district NABERS National Australian Built Environment Rating System CPI Consume
Slide 33: Important Information
IMPORTANT INFORMATION The information provided in this document is general, and may not be suitable for the specific purpose of any user of this document. It is not financial advice or a recommendation to acquire Abacus Group securities (ASX:ABG). Abacus Group believes that the information in this d