Centuria Capital Group · ASX:CNI
Centuria Capital — FY2022 Earnings Presentation
42 slides from Centuria Capital's earnings presentation, Aug 10, 2022
Slide 1: Centuria Capital Group FY22 Results
10 AUGUST 2022 ASX: CNI UNLISTED: 1 WILLIAM SQUARE, PERTH WA LISTED: 56-88 LISBON STREET, FAIRFIELD NSW Centuria Capital Group FY22 RESULTS UNLISTED: BLOOMFIELD MEDICAL CENTRE, ORANGE NSW UNLISTED: CAMERON PARK PLAZA, CAMERON PARK NSW UNLISTED: ROBINA HOME + LIFE CENTRE, VARSITY LAKES QLD UNLISTED:
Slide 2: Agenda
ACKNOWLEDGEMENT OF COUNTRY Our group manages property throughout Australia and New Zealand. Accordingly, Centuria pays its respects to the traditional owners of the land in each country, to their unique cultures and to their elders past, present and emerging. AGENDA 1. Group overview 2. Financial re
Slide 3: Group overview
2 CORNWALLIS STREET CSIRO DATA61 BUILDING, 13 GARDEN STREET Group overview SECTION ONE BIOMEDICAL BUILDING, 3 CENTRAL AVENUE UNLISTED: AUSTRALIAN TECHNOLOGY PARK, SOUTH EVELEIGH NSW
Slide 4: A leading Australasian real estate funds manager
A leading Australasian real estate funds manager Included in the S&P/ASX200 Index $20.6bn GROUP AUM1 $1.2bn ON BALANCE SHEET TOTAL $339m CASH & UNDRAWN DEBT $19.8bn REAL ESTATE AUM CENTURIA OFFICE REIT (ASX:COF) INVESTMENTS $192m (18.9%)2 CO- INVESTMENTS CO- CENTURIA INDUSTRIAL LISTED REIT (ASX:CIP)
Slide 5: Delivering strong growth and creating value across the platform
Delivering strong growth and creating value across the platform $20.6bn 14.5cps 11.0cps 89% Group AUM FY22 OEPS1 delivered FY22 DPS delivered Recurring revenues +18% increase above FY21 +20.8% increase above FY21 +10.0% increase above FY21 DPS of FY22 total group revenues 14.5cps FY23 OEPS guidance
Slide 6: Real estate growth lifts Group AUM to $20.6bn
Real estate growth lifts Group AUM to $20.6bn (+18% above FY21) Executing on strategy Organic activity • $3.1bn1 (90 properties & 37 real estate finance loans) FY22 gross real estate activity, FY22 $1.0bn Group valuation uplift, FY22 $0.1bn development completions • Gross real estate activity: $2.1b
Slide 7: AUM momentum from organic growth and select mergers
AUM momentum from organic growth and select mergers Assets under $17.4bn $20.6bn management $8.8bn $6.2bn 13.0 Unlisted real estate $4.9bn 11.0 $3.8bn 4.0 40% 1.5 1.9 2.6 5.5 6.8 Listed real estate 4.0 CAGR1 1.5 2.1 2.7 0.8 0.9 0.9 0.8 0.9 0.8 Investment bonds FY17 FY18 FY19 FY20 FY21 FY22 Primewest
Slide 8: A unique platform with scale and diversification
A unique platform with scale and diversification Platform Expertise Funds Properties • 7 real estate asset classes • 24 years of real estate funds • Manager of Australia’s largest pure play • No single property accounts for with specialist strategies management experience office and industrial REITs
Slide 9: Sustainability at Centuria Capital
Sustainability at Centuria Capital Developing a flexible and relevant sustainability framework Conscious of climate change Industrial: Industry Participation Environment NABERS Accelerate program for Green Building Membership Climate Resilience Climate Action Warehouses and Cold Stores Members of bo
Slide 10: Financial results
ARTIST IMPRESSION Financial results SECTION TWO UNLISTED: VARSITY LAKES DAY HOSPITAL, VARSITY LAKES QLD
Slide 11: Operating earnings and distributions
Operating earnings and distributions Operating NPAT1 Statutory NPAT3 Earnings and distributions (cents per security) $114.5m ($37.9m) OEPS2 Statutory EPS3 14.5cps (4.8)cps 14.50 14.50 FY22 12.70 performance 12.00 12.00 DPS 11.0cps +10.0% increase above FY21 DPS OEPS 11.60 11.00 14.5cps 9.70 10.00 9.
Slide 12: Expanded platform enhances fee generation
Expanded platform enhances fee generation Group margins improved to 47% FY22 FY21 OPERATING PROFIT BY SEGMENT Profit increases by 77% due to organic ($m) ($m) 1 growth and Primewest merger 1 Property funds management1 79.4 44.8 FY22 increased due to additional transaction 2 Performance fees 33.0 17.
Slide 13: Diverse recurring revenues contribute to Group profits
Diverse recurring revenues contribute to Group profits Group revenues ($m) FY22 $33m 350 89% FY22 transaction fee income3 up FY22 recognised Recurring 162% on FY21 performance fees 300 revenues2 Performance fees Transaction fee income from 250 92% Other income $4.3bn4 $21m Recurring revenues2 Distri
Slide 14: Balance sheet positioned to capitalise on future growth opportunities
Balance sheet positioned to capitalise on future growth opportunities Increased funding optionality, access to new debt instruments FY22 FY21 OPERATING BALANCE SHEET ($m) ($m) 13.2% Assets $1.73 Operating gearing ratio3 (FY21: 3.9%) Cash and cash equivalents Receivables 185.0 105.9 249.6 120.8 Net a
Slide 15: Managing debt across the platform
Managing debt across the platform1 21 Quality lenders $7.5bn Total lending facilities across over 150 funds 2.5yrs Weighted average debt duration 2.1yrs Weighted average hedge duration 56% Weighted average hedging profile LISTED: 56-88 LISBON STREET, FAIRFIELD NSW 1. Not representative of any single
Slide 16: Divisional overview
Divisional overview SECTION THREE UNLISTED: WEST VILLAGE SHOPPING CENTRE PRECINCT, WEST END QLD
Slide 17: $19.8bn real estate platform
$19.8bn1 real estate platform (+20% over FY22) Diverse geographies, sectors, fund types capital sources Geography1 Sectors 0.1 0.5 0.4 0.2 0.3 Office 0.8 Industrial 2.2 2.5 1.3 1.6 Healthcare Australia 1.3 7.3 Daily needs retail 1.7 FY21 FY22 New Zealand FY21 7.1 FY22 $16.5bn $19.8bn 1.1 $16.5bn $19
Slide 18: Strong organic growth across all real estate sectors
Strong organic growth across all real estate sectors $19.8bn real estate platform1,2 Daily needs Large format Real estate Office Industrial Healthcare Agriculture retail (“DNR”) retail (“LFR”) finance $7.3bn $6.0bn $1.8bn $1.7bn $1.6bn $0.8bn $0.4bn AUM AUM AUM AUM AUM AUM AUM (FY21: $7.1bn) (FY21:
Slide 19: Diversifying fund and capital allocation across Centuria's platform
Diversifying fund and capital allocation across Centuria’s platform DAILY LARGE REAL SECTOR OFFICE INDUSTRIAL NEEDS HEALTHCARE FORMAT ESTATE AGRICULTURE • Diversified funds and RETAIL RETAIL FINANCE capital sources across FUND TYPE / AUM $7.3 $6.0 $1.8 $1.7 $1.6 $0.8 $0.4 all verticals CAPITAL SOURC
Slide 20: $3.1bn of FY22 gross real estate activity
$3.1bn of FY22 gross real estate activity FY22 gross real estate activity3 $3.1bn Real estate Industrial $718m 24 properties finance $2.5bn FY22 exchanged yet to be settled Healthcare $670m 49 properties Real estate finance $516m 37 real estate finance loans Office $423m 5 properties $1.2bn $0.9bn D
Slide 21: High quality long-term income streams
High quality long-term income streams Integrated management capabilities lead to strong asset management success Top tenants by income (%)1,2 6.1 year weighted avg. lease expiry (WALE) by income1,2 ~419 assets1,2 14.5 Government 11.8% ~2,480 Woolworths Limited 11.2 tenants1,2 ASX/NZX Listed 2.5% 7.6
Slide 22: $2.1bn development pipeline to seed funds
$2.1bn development pipeline to seed funds FY22 COMMITTED PIPELINE FUTURE PIPELINE TOTAL SECTOR COMPLETIONS (est. value on completion)2 (est. value on completion)2,3,4 PIPELINE $M GLA $M GLA $M GLA $M GLA • Development fees and Office - - 202 25,600 - - 202 25,600 profits provide growing income Indus
Slide 23: Unlisted property: AUM grows to $13.0bn
Unlisted property: AUM grows to $13.0bn (+18% over FY22) Between >12,000 2 - 6 Funds in the top $620m $33m $21m $179m 32% 56% Australasian investors FY22 gross equity FY22 recognised FY22 performance FY22 latent underlying Unlisted AUM with no Unlisted AUM with 10 index1 raised performance fees fee
Slide 24: Generating new unlisted investment opportunities
Generating new unlisted investment opportunities Strong support from Centuria’s direct unlisted investors, advisers Centuria unlisted funds represented on all major and domestic bank private wealth divisions for unlisted funds investment platforms used by financial advisers Single asset initiatives
Slide 25: Healthcare: Growing in an attractive sector
Healthcare: Growing in an attractive sector Targeting $2.0bn of Healthcare AUM by FY23 end Centuria is an established Themes and megatrends healthcare real estate manager Emerging Australian real estate sector2 Real estate AUM • Australian private hospital sector worth ~$41bn by 2041 • $1.7bn AUM (+
Slide 26: Agriculture: Diversification into a compelling sector
Agriculture: Diversification into a compelling sector Targeting $0.8bn of Agriculture AUM by FY23 end Themes and megatrends Expanding Agriculture Exports Potential premium food product growth by 55% to 20301 $0.4bn AUM 7 assets, 3 funds Supply chain disruptions highlight access to local agriculture
Slide 27: Centuria Bass Credit: A new unlisted growth opportunity
Centuria Bass Credit: A new unlisted growth opportunity ARTIST IMPRESSION $0.8bn 37 loans 91% Real Estate Finance AUM funded worth $516m of loan volumes secured (FY21: $0.3bn) by first mortgage security, gross average LVR of 64% RICHARDSON STREET, SOUTH PERTH, PERTH WA ARTIST IMPRESSION Changing mar
Slide 28: Institutional AUM growth to $1.9bn
Institutional AUM growth to $1.9bn (+12% over FY22) Unlisted mandates and partnerships support new investment opportunities ARTIST IMPRESSION $1.9bn • Morgan Stanley (MSREI) healthcare partnership grows to $215m AUM1 $1.7bn • Opportunities to expand healthcare institutional capital WESTSIDE PRIVATE
Slide 29: Listed property: AUM grows to $6.8bn
Listed property: AUM grows to $6.8bn (+24% over FY22) ASX: ASX: NZX: COF Australia’s largest pure-play CIP Australia’s largest pure-play APL Targeting long term CENTURIA office REIT CENTURIA industrial REIT ASSET total returns OFFICE REIT INDUSTRIAL REIT PLUS A quality portfolio of de-centralised, s
Slide 30: Strategy
Strategy SECTION FOUR LISTED: 101 MORAY STREET, SOUTH MELBOURNE VIC
Slide 31: Strategy
Strategy Retain sole focus on Australasian Real Estate sector Consolidate position as Grow platform strongly in popular alternative sectors – Healthcare, Agriculture markets a leading Australasian as well as Credit (Centuria Bass) funds manager Vision Leverage our extensive unlisted network and inst
Slide 32: Appendices
Appendices SECTION FIVE UNLISTED: MOORA ALMOND ORCHARD, RIVERINA NSW
Slide 33: Centuria Capital Group
Centuria Capital Group A leading Australasian real estate funds manager Integrated Active Generating investment platform management opportunities Geography Asset Fund types Capital Integrated in-house Balance Platform classes sources capability sheet support Listed Australia Office Listed Funds mana
Slide 34: Group AUM movement
Group AUM movement1 ($bn) Note: Assets under management (AUM) as at 30 June 2022. All figures above are in Australian dollars (currency exchange ratio of AU$1.000:NZ$1.1088 as at 30 June 2022). Numbers presented may not add up precisely to the totals provided due to rounding 1. AUM includes assets e
Slide 35: A $19.8bn leading Australasian real estate platform
A $19.8bn leading Australasian real estate platform1 WA 22% 95 properties valued at $4,207m NSW 22% 107 properties valued at $4,184m NT VIC 19% 82 properties valued at $3,598m QLD WA QLD 18% 105 properties valued at $3,490m SA SA 4% 28 properties valued at $811m NSW ACT 2% 5 properties valued at $40
Slide 36: COF, CIP and APL portfolio snapshots
COF: Australia’s largest pure CIP: Australia’s largest domestic APL: Targeting long term total play office REIT pure play industrial REIT returns • Delivered FY22 FFO of 18.2 cents per unit • Delivered FY22 FFO of 18.2 cents per unit • Delivered FY22 Distributions of 16.6 cents per unit • Delivered
Slide 37: Centuria LifeGoals
Centuria LifeGoals HY22 FLOWS FY22 FY22 FY21 ASSET/S UNDER MANAGEMENT CHANGE $0.8bn ($m) ($m) (%) APPLICATIONS ($M) REDEMPTIONS ($M) 26.6 -50.2 AUM Prepaid funeral plans (Guardian)2 536.6 582.0 -7.8% 0.0 -0.2 Capital guaranteed (Centuria Life)3 0.0 140.9 -100.0% Unitised bonds (Centuria Life)3 230.7
Slide 38: Reconciliation of statutory profit to operating profit
Reconciliation of statutory profit to operating profit FY22 ($m) FY21 ($m) Statutory net (loss)/profit after tax (37.4) 149.6 Statutory EPS (cents)1 (4.8) 24.6 ADJUSTED FOR NON-OPERATING ITEMS (Gain) on fair value movements in derivatives and investments 167.1 (79.8) Transaction and other costs 4.4
Slide 39: Co-investments reconciliation
Co-investments reconciliation CARRYING VALUE DISTRIBUTION 30 JUNE 22 INCOME FY22 CARRYING DISTRIBUTION VALUE INCOME FY21 Strong alignment to Centuria’s CO-INVESTMENTS FUND TYPE ($M) ($M) 30 JUNE 21($M) ($M) listed REITs Centuria Industrial REIT (ASX: CIP)1 Listed 284.1 17.4 345.0 14.4 CNI is the lar
Slide 40: Definitions
Definitions Operating Segments: Group has six reportable operating segments. AUM: Assets under management IRR: Internal Rate of Return These reportable operating segments are the divisions which report CAGR: Compound annual growth rate NPAT: Net Profit After Tax to the Group’s Chief Executive Office
Slide 41: Disclaimer
Disclaimer This presentation has been prepared by Centuria Capital Limited and Centuria Funds Management Limited as responsible entity of Centuria Capital Fund (together the stapled listed entity CNI). Centuria Property Funds Limited (ABN 11 086 553 639, AFSL 231 149) ('CPFL') and Centuria Property
Slide 42: Office contact details
AUSTRALIA Sydney Head Office Melbourne Office (02) 8923 8923 (03) 9616 6500 Level 41, Chifley Tower Level 32 2 Chifley Square 120 Collins Street Sydney NSW 2000 Melbourne VIC 3000 Brisbane Office Perth Office (07) 3905 7000 (08) 9321 7133 Level 2 Level 1 348 Edward Street 307 Murray Street Brisbane
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