Pioneer Property Group ASA · OSL:PPG
Pioneer Property Group ASA — Pioneer Public Properties AS — Debt Investor Presentation (June 2016)
17 slides from Pioneer Property Group ASA's debt investor presentation, Jun 7, 2016
Slide 1: Pioneer Public Properties AS - Condensed Investor Presentation
Private & confidential Pioneer Public Properties AS Condensed Investor Presentation for the PPP AS unsecured bond placement June 2016
Slide 2: Disclaimer and important notice
Disclaimer and important notice THIS PRESENTATION HAS BEEN PRODUCED BY PIONEER PUBLIC PROPERTIES AS (THE “COMPANY”), SOLELY FOR USE IN CONNECTION WITH THE CONTEMPLATED PRIVATE PLACEMENT OF BONDS (THE “BONDS”) BY THE COMPANY (THE “TRANSACTION”), AND MAY NOT BE REPRODUCED, OR REDISTRIBUTED IN WHOLE OR
Slide 3: Disclaimer and important notice (continued)
Disclaimer and important notice (continued) NEITHER THE COMPANY NOR THE MANAGER HAVE AUTHORISED ANY OFFER TO THE PUBLIC OF SECURITIES, OR HAS UNDERTAKEN OR PLANS TO UNDERTAKE ANY ACTION TO MAKE AN OFFER OF SECURITIES TO THE PUBLIC REQUIRING THE PUBLICATION OF AN OFFERING PROSPECTUS, IN ANY MEMBER ST
Slide 4: Indicative main terms and conditions
Indicative main terms and conditions Issuer: Pioneer Public Properties AS Status: Senior unsecured Issue Amount: NOK [800-1,000] million Borrowing Limit: NOK 1,000 million Settlement Date: Expected to be 1 July 2016 Maturity Date: 28 May 2021 Tenor: Approx. 4 years and 11 months Coupon Rate: 3m NIBO
Slide 5: Introduction to Pioneer Public Properties
Introduction to Pioneer Public Properties 112 preschools with a total of 11,082 children Total rent: NOK 209m (contractual rent 2016) Rent by geography Rent by tenant Weighted average lease term Loan to value (gross)* 13% 30% 18% 30% 53% 29% 26% 17.7 years 59-64% North Bergen Kidsa Drift NCG Espira
Slide 6: The Norwegian preschool market
The Norwegian preschool market Regulatory framework Total market value in excess of NOK 50bn • Preschool-law (“Barnehageloven”) # preschools 8,000 - All children between 1-6 have a legal right to attend preschool in 6,436 6,622 6,705 6,675 6,579 6,469 6,278 6,397 6,296 6,205 their home municipality
Slide 7: Private preschools have boosted coverage rates
Private preschools have boosted coverage rates Children in preschool (1-5 years) Private preschools fully integrated '000 • Government stimulus through cheap state-financed loans and equal 300 treatment of contributions for private and public players have contributed 250 to strong growth for private
Slide 8: Social infrastructure: Lowest risk infrastructure assets
Social infrastructure: Lowest risk infrastructure assets Secure cash flows with limited correlation to the economic development Extract from JP Morgan’s ‘Guide to Infrastructure Investing’ Social infrastructure generates revenues that are most closely linked to inflation than to economic growth. I
Slide 9: New build cost development underscores solid asset backing
New build cost development underscores solid asset backing Comments Total cost per child development • The average cost to construct a preschool place has NOK ('000) / place 350 324 320 314 increased significantly over the last decade 307 300 278 275 - From 2000 to 2014, the total cost (construction
Slide 10: Geographic location
Geographic location Clusters Greater Oslo Rent*: NOK 55m Region Rent of total: 26% Bodø/Tromsø Rent*: NOK 63m Bergen Rent of total: 30% Geographic locations with property clusters in three of the four most populated Rent*: NOK 28m urban areas in North Rent of total: 13% Norway. Bodø/Tromsø also disp
Slide 11: Triple net lease contracts secures low capex and minimal operational costs
Triple net lease contracts secures low capex and minimal operational costs • All Properties are modern and in line with current regulations - No need to upgrade the portfolio in the foreseeable future (no imminent capital expenditures of material size) • The lease agreements with NCG are structured
Slide 12: Pioneer Public Property AS - Key financials
Pioneer Public Property AS - Key financials Financial summary Q1’16 and pre/post bond issue Comments • EBITDA of NOK 47m in Q1’16 with a stable EBITDA margin Key income statement figures (NOKm) Q1’2016 of 90% Rent 52.3 • Total senior debt post recapitalization of ~NOK 2,200m Owner cost 5.3 EBITDA 47
Slide 13: Long and stable cash flow – remaining average lease period of 17.7 years
Long and stable cash flow – remaining average lease period of 17.7 years Total backlog of NOK 10.8bn including NOK 6.2bn in options NOKm • Annual rent in 2016 of NOK 450 209m 400 - All contracts are adjusted based on CPI 350 • Remaining lease period of 15.3- 19 years 300 - Weighted average of 17.7 y
Slide 14: Strategy
Strategy Key focus on care services real estate • Pioneer Property Group shall mainly own, manage and develop real-estate for government-backed operators • To date the company has started consolidation of- and developed the Norwegian marked for preschool properties Consolidate market through acquisi
Slide 15: Shareholders
Shareholders Pioneer Property Group ASA* Hospitality Invest / Adolfsen Group • Through investment and holding companies Kristian and Roger Adolfsen have the indirect controlling interest (together) in Pioneer Property Group 14.5% • Their primary investment company is Hospitality Invest AS (“HI”), wh
Slide 16: Summary
Summary 1 2 Stable and attractive Stable earnings and great underlying fundamentals cash flow visibility 3 4 5 Attractive general terms for private players to own and Attractive property Operators highly operate preschools in portfolio replaceable Norway 6 7 8 Leading operators with Experienced spon
Slide 17: Private & confidential
Private & confidential
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