Great Eagle Holdings Limited · HKEX:41
Great Eagle — 1H 2013 Earnings Presentation
54 slides from Great Eagle's earnings presentation, 2013
Slide 1: Great Eagle Holdings Investor Presentation 3Q13
Great Eagle Holdings Investor Presentation 3Q13 1
Slide 2: Highlights of 1H 2013 Results
Great Eagle Holdings Limited Financials Highlights of 1H 2013 Results 1. In May 2013, the Group spun off its interests in the three hotels in Hong Kong and created the Langham Hospitality Investments (LHI), in which the Group retained a 57.8% interest. Net proceeds from the spin-off exercise came to
Slide 3: 2013 Interim Results
Great Eagle Holdings Limited Financials 2013 Interim Results 1H 2013 1H 2012 Change HK$'000 HK$'000 HK$'000 % Gross Revenue 350,325 350,325 Rental Income - HK 90,066 82,785 7,281 8.8% - Overseas 54,201 55,112 (911) -1.7% - Building mgt fee inc 11,199 10,944 255 2.3% Hotel Income - HK 656,695 763,083
Slide 4: 2013 Interim Results
Great Eagle Holdings Limited Financials 2013 Interim Results 1H 2013 1H 2012 Change HK$'000 HK$'000 HK$'000 % Net Operating Income Net Rental Income - HK 67,919 74,279 (6,360) -8.6% - Overseas 24,503 23,731 772 3.3% Hotel Income - HK 254,743 281,957 (27,214) -9.7% - Overseas 166,224 149,854 16,370 1
Slide 5: 2013 Interim Results
Great Eagle Holdings Limited Financials 2013 Interim Results 1H 2013 1H 2012 Change HK$'000 HK$'000 HK$'000 % Net finance costs Finance cost (60,838) (50,816) (10,022) 19.7% Interest income 16,469 89,930 (73,461) -81.7% (44,369) 39,114 (83,483) -213.4% Share of results of associates 11,081 11,597 (5
Slide 6: 2013 Interim Results – Income from Champion breakdown
Great Eagle Holdings Limited Financials 2013 Interim Results – Income from Champion breakdown Income from Champion REIT 1H 2013 1H 2012 Change HK$'000 HK$'000 HK$'000 % Dividend received 331,700 299,387 32,313 10.8% Asset management income 103,020 99,620 3,400 3.4% Agency commission income & 37,965
Slide 7: Analysis on change on core income
Great Eagle Holdings Limited Financials Analysis on change on core income 1H 2013 $'000 Change in profit from core business after tax (54,799) Arise from: Increase in Income from Champion REIT 39,334 Net decrease in income and deferred tax provision (excluding deferred tax on fair value changes) 25,
Slide 8: Discount to NAV
Great Eagle Holdings Limited Discount to NAV Financials NAV based on statutory accounting principles (June 2013) NAV based on net assets of Champion REIT and LHI (June 2013) % of % of HK$m HK$/psf HK$/shr Total HK$m HK$/psf HK$/shr Total Investment properties 6,107 6,771 9.6 16% Investment propertie
Slide 9: Financial position
Great Eagle Holdings Limited Financials Financial position (i) Financial position - Based on statutory accounting principles Book Net Carrying Net Cash Net Loan to interest Interest (HK$ Million) Value (Debt) Equity Value Gearing EBITDA expense Cover Hong Kong/ PRC Assets 49,065 (6,548) 42,517 13% 1
Slide 10: Valuation – Investment properties
Great Eagle Holdings Limited Valuation – Investment properties Financials As at the end of June , 2013 Hong Kong investment properties Valuation Change from GFA (Sqft) HK$/psf end of Dec 2012 Great Eagle Centre Office 193,271 15,258 0.9% Retail 55,944 8,589 1.6% 3rd floor 20,959 7,562 2.9% Carparks
Slide 11: Development project
Development project Great Eagle 11 Holdings Limited
Slide 12: Dalian Mixed-use Development Project
Great Eagle Holdings Limited Development project Dalian Mixed-use Development Project Location: Donggang Area, Renmin Road East, ZhongShan District, Dalian, PRC Site: 28,600 sq.m. G.F.A.: Hotel 50,000 s.m. Res 236,000 s.m. Total 286,000 s.m. Status: Completion in two phases from 2014/2015 onward. Pr
Slide 13: Langham Hotels International
Langham Hotels International Great Eagle 13 Holdings Limited
Slide 14: Hotel portfolio – 1H 2013 Operational Statistics
Great Eagle Holdings Limited Langham Hotels International Hotel portfolio – 1H 2013 Operational Statistics Occupancy Average Room Rate RevPar (local currency) (local currency) YTD-June 2013 YTD-June 2012 Change YTD-June 2013 YTD-June 2012 Change YTD-June 2013 YTD-June 2012 Change Wholly-owned Hotels
Slide 15: Hotel portfolio – 1H 2013 RevPAR performance
Great Eagle Holdings Limited Langham Hotels International Hotel portfolio – 1H 2013 RevPAR performance RevPAR (in HK$) YTD-June 2012 YTD-June 2013 RevPAR yoy Growth 3,000 12% 11.2% 2,500 10% 2,310 2,436 2,000 1,8111,924 1,841 8% 1,833 RevPAR Yoy growth 6.2% 1,656 6.5% 1,619 5.5% 1,500 1,587 6% 5.4%
Slide 16: Hotel portfolio – 1H 2013 Final Operational statistics
Great Eagle Holdings Limited Langham Hotels International Hotel portfolio – 1H 2013 Final Operational statistics Room revenue growth F&B revenue growth YTD-June 2013 YTD-June 2013 The Langham, London 8% 10% The Langham, Boston 5% 8% The Langham, Melbourne 13% 0% The Langham, Auckland 3% 4% The Langh
Slide 17: Hotel portfolio – Currency impact
Great Eagle Holdings Limited Langham Hotels International Hotel portfolio – Currency impact Jun-13 Jun-12 yoy change Variance in profit contribution (in HK$ mn) GBP 11.9811 12.2527 -2.2% (1.4) CAD 7.6403 7.7145 -1.0% (0.3) AUD 7.8728 8.0035 -1.6% (0.8) USD 7.7594 7.7614 0.0% (0.0) NZD 6.4224 6.2338
Slide 18: Hotel portfolio – Profit contribution
Great Eagle Holdings Limited Langham Hotels International Hotel portfolio – Profit contribution in Local Currency in HK$ 1H 2013 1H 2012 Change 1H 2013 Contribution to Owned Hotels in mn in mn in mn hotel profits Hong Kong $254.8 $282.0 -9.7% $254.8 61% (The Langham, Hong Kong, Langham Place, Hong K
Slide 19: The Langham, London
Great Eagle Holdings Limited Langham Hotels International 1H 2012 1H 2013 Change The Langham, London Rooms Available 378 380 +2 After a slow start in the first quarter of 2013, RevPAR £189 £203 7.8% activities in London picked up in the second Room Rate £264 £267 1.1% quarter of 2013. Occupancy Ra
Slide 20: The Langham, Melbourne
Great Eagle Holdings Limited Langham Hotels International The Langham, Melbourne 1H 2012 1H 2013 Change Rooms Available 376 377 +1 A string of sporting events and conferences have helped boost performance of the RevPAR $207 $234 13.0% Langham Melbourne for the first half period. Room Rate $262 $27
Slide 21: The Langham, Sydney
Great Eagle Holdings Limited Langham Hotels International 1H 2012 1H 2013 Change The Langham, Sydney Rooms Available n.a. 96 n.a. The acquisition of the 96-key Observatory RevPAR n.a. $233 n.a. Hotel in downtown Sydney was completed and rebranded it as a Langham in August Room Rate n.a. $281 n.a.
Slide 22: The Langham, Auckland
Great Eagle Holdings Limited Langham Hotels International 1H 2012 1H 2013 Change The Langham, Auckland Rooms Available 411 411 - While demand from the corporate segment was weak, the hotel RevPAR $129 $133 3.3% managed to keep up its occupancy by Room Rate $186 $184 -1.1% targeting the retail segm
Slide 23: The Langham, Hong Kong
Great Eagle Holdings Limited Langham Hotels International 1H 2012 1H 2013 Change The Langham, Hong Kong Rooms Available 495 495 - RevPAR $1,811 $1,924 6.2% Room Rate $2,221 $2,254 1.5% Occupancy Rate 81.6% 85.4% 3.8 ppt Langham Hong Kong enjoyed continued growth in individual leisure tourist arriv
Slide 24: Langham Place Hotel Hong Kong
Great Eagle Holdings Limited Langham Hotels International 1H 2012 1H 2013 Change Langham Place Hotel Hong Kong Rooms Available 654 652 -2 RevPAR $1,587 $1,619 2.0% Room Rate $1,850 $1,846 - 0.2% Occupancy Rate 85.8% 87.7% 1.9 ppt Langham Place Hong Kong achieved a higher average occupancy in 1H 20
Slide 25: Eaton, Hong Kong
Great Eagle Holdings Limited Langham Hotels International Eaton, Hong Kong 1H 2012 1H 2013 Change The renovation on approximately Rooms Available 461 440 - 21 one-fifth of the guest rooms at the RevPAR $1,055 $1,082 2.5% Eaton Hotel from the second quarter of 2013 has negatively Room Rate $1,141 $
Slide 26: The Langham, Boston
Great Eagle Holdings Limited Langham Hotels International 1H 2012 1H 2013 Change The Langham, Boston Rooms Available 318 318 - RevPAR $154 $162 5.5% The hotel market in the U.S. continues to experience improving fundamentals as a Room Rate $239 $243 1.5% result of the economic recovery that is Occ
Slide 27: The Langham, Huntington Hotel & Spa, Pasadena
Great Eagle Holdings Limited Langham Hotels International 1H 2012 1H 2013 Change The Langham, Huntington Hotel & Spa, Rooms Available 380 380 - Pasadena RevPAR $157 $164 4.8% After a good start in the first quarter, there Room Rate $210 $228 8.4% was evidence of a slowdown in the market during the
Slide 28: Eaton Chelsea, Toronto
Great Eagle Holdings Limited Langham Hotels International Eaton Chelsea, Toronto (Rebranded from Delta 1H 2012 1H 2013 Change Chelsea in July 2013) Rooms Available 1,590 1,590 - Over the first half of 2013, given RevPAR $81 $85 4.6% there were signs of an improvement in Toronto’s hotel Room Rate $
Slide 29: The Langham, Xintiandi (33.3% owned)
Great Eagle Holdings Limited Langham Hotels International 1H 2012 1H 2013 Change The Langham, Xintiandi Rooms Available 347 356 +9 (33.3% owned) RevPAR ¥835 $957 14.5% The Langham Xintiandi continued Room Rate ¥1,597 $1,729 8.3% to solidify its positioning as one of Occupancy Rate 52.3% 55.3% 3.0
Slide 30: Managed hotel owned by third parties
Great Eagle Holdings Limited Langham Hotels International Managed hotel owned by third parties 30
Slide 31: Eaton Luxe, Nanqiao, Shanghai
Great Eagle Holdings Limited Langham Hotels International Eaton Luxe, Nanqiao, Shanghai With 204 rooms Opened in April 2010 31
Slide 32: Langham Place, Beijing Capital Airport
Great Eagle Holdings Limited Langham Hotels International Langham Place, Beijing Capital Airport With 372 guest rooms Opened in August 2010 32
Slide 33: Eaton Smart, New Delhi International Hotel
Great Eagle Holdings Limited Langham Hotels International Eaton Smart, New Delhi International Hotel, Indira Gandhi International Airport, New Delhi With 93 rooms Opened in June 2011 33
Slide 34: 88 Xintiandi, Shanghai
Great Eagle Holdings Limited Langham Hotels International 88 Xintiandi, Shanghai With 53 rooms Opened in September 2011 34
Slide 35: The Langham, Shenzhen
Great Eagle Holdings Limited Langham Hotels International The Langham, Shenzhen Guangzhou, China With 352 rooms Opened in October 2012 35
Slide 36: Eaton Luxe, Xinqiao, Shanghai
Great Eagle Holdings Limited Langham Hotels International Eaton Luxe, Xinqiao, Shanghai With 214 rooms Opened in November 2012 36
Slide 37: Langham Place Fifth Avenue, New York
Great Eagle Holdings Limited Langham Hotels International Langham Place Fifth Avenue, New York 217 rooms Rebranded to Langham Place in May 2013 37
Slide 38: Owned Portfolio Expansion: The Langham, Xintiandi, Shanghai
Great Eagle Holdings Limited Langham Hotels International Owned Portfolio Expansion The Langham, Xintiandi, Shanghai Interest: 33.3% Location: Xintiandi, Luwan District, Shanghai, PRC G.F.A. Approx. 52,000 sq.m. Rooms 357 rooms Status: The hotel opened in October 2010 38
Slide 39: Owned Portfolio Expansion: The Langham, Chicago
Great Eagle Holdings Limited Langham Hotels International Owned Portfolio Expansion The Langham, Chicago Interest: 100% Location: Downtown Chicago G.F.A. Approx. 375,000 sq.ft. Rooms 330 rooms Expected opening Soft opened in July 2013, grand opening in September 2013 39
Slide 40: Owned Portfolio Expansion: The Langham, Sydney
Great Eagle Holdings Limited Langham Hotels International Owned Portfolio Expansion The Langham, Sydney Interest: 100% Location: Situated in the heart of Sydney CBD, close by The Rocks with easy access to Sydney Harbour Bridge and Opera House Rooms 96 rooms Status The acquisition was completed in Au
Slide 41: Owned Portfolio Expansion: Langham Place, New York
Great Eagle Holdings Limited Langham Hotels International Owned Portfolio Expansion Langham Place, New York The property: The building was completed in September 2010. The Hotel with 214 rooms is located in the lower half of the 60-story building Location: On Fifth Avenue between 36th and 37th Stree
Slide 42: Summary of managed hotels
Great Eagle Holdings Limited Langham Hotels International Summary of managed hotels 2009 Rooms Status The Langham, Yangtze, Shanghai 96 Opened in May 2009 2010 Rooms Status Eaton Luxe, Nanqiao Shanghai 204 Opened in Apr 2010 Langham Place, Beijing Capital Airport 372 Opened in Aug 2010 The Langham,
Slide 43: Hotel pipeline
Great Eagle Holdings Limited Langham Hotels International Hotel pipeline 2013 Rooms Status Langham Place Fifth Avenue, New York (under contract to be purchased by the Group) 214 Rebranded May 2013 Langham Place, EDZ, Guangzhou 320 Agreement Eaton Luxe, Qingdao 500 Agreement Langham Place, Pazhou Con
Slide 44: Investment properties
Investment properties Great Eagle 44 Holdings Limited
Slide 45: Rental income breakdown
Great Eagle Holdings Limited Investment properties 2012 Final Results - Rental income breakdown Gross rental income Growth Net rental income Growth 1H 2013 1H 2012 (%) 1H 2013 1H 2012 (%) (in HK$ mn) Hong Kong Investment Properties Great Eagle Centre 69.6 60.4 15.2 56.7 58.6 (3.2) Eaton House 19.4 2
Slide 46: Great Eagle Centre
Great Eagle Holdings Limited Investment properties Great Eagle Centre The Wanchai office market displayed considerable resilience in the first half of 2013, given continued demand from Mainland Chinese companies and relocations of Central tenants seeking more affordable rents. As for Great Eagle
Slide 47: Eaton Serviced Apartments
Great Eagle Holdings Limited Investment properties Eaton Serviced Apartments On the back of slower demand for short term accommodations, coupled with interruptions from redevelopment works at the Wanchai Gap road property, these factors have added pressure on the occupancy of our serviced apartments
Slide 48: US Investment properties
Great Eagle Holdings Limited Investment properties US Investment properties As recovery in the office leasing market in California progresses, vacancy rates in the San Francisco area continued to decline over the first half of 2013. Spot rents at 353 Sacramento and 500 Ygnacio have risen to levels a
Slide 49: Investment in Champion REIT and Langham Hospitality Investments
Great Eagle Holdings Limited Investment in Champion REIT Investment in the Champion REIT (2778.HK) & Langham Hospitality Investments (1270.HK) Note that our core profit is based on dividend from Champion REIT and LHI in respective of the same financial period. Outlook for Champion REIT’s properties:
Slide 50: Reconciliation to core earnings from reported
Great Eagle Holdings Limited Core earnings reconciliation Reconciliation to core earnings from reported 1H 2013 1H 2012 HK$ 000 HK$ 000 Net Profit 1,272,331 1,329,698 Adjustment items: Less: reversal of consolidated results of Champion REIT (CREIT) (912,719) (656,772) See Exclusions in calculation f
Slide 51: Reconciliation to core earnings from reported
Great Eagle Holdings Limited Core earnings reconciliation Reconciliation to core earnings from reported Reported earnings Core earnings Core earnings 1H 2013 1H 2013 1H 2012 HK$'000 HK$'000 HK$'000 Gross Revenue 350,325 350,325 Rental Income - HK 90,066 90,066 - 82,785 - Overseas 54,201 54,201 - 55,
Slide 52: Reconciliation to core earnings from reported
Great Eagle Holdings Limited Core earnings reconciliation Reconciliation to core earnings from reported Reported earnings Core earnings Core earnings 1H 2013 1H 2013 1H 2012 HK$'000 HK$'000 HK$'000 Net Operating Income Net Rental Income - HK 67,919 67,919 - 74,279 - Overseas 24,503 24,503 - 23,731 H
Slide 53: Reconciliation to core earnings from reported
Great Eagle Holdings Limited Core earnings reconciliation Reconciliation to core earnings from reported Reported earnings Core earnings Core earnings 1H 2013 1H 2013 1H 2012 0 HK$'000 HK$'000 HK$'000 Operating profit before Dep. and Amortisation 1,538,934 1,091,992 1,028,778 Depreciation and amortis
Slide 54: Reconciliation to core earnings from reported
Great Eagle Holdings Limited Core earnings reconciliation Reconciliation to core earnings from reported Reported earnings Core earnings Core earnings 1H 2013 1H 2013 1H 2012 HK$'000 HK$'000 HK$'000 Net finance costs Finance cost (264,946) (60,838) - (50,816) - Exclude interest expense relating to CR