Property For Industry Limited · NZX:PFI
Property For Industry — H1 2019 Earnings Presentation
32 slides from Property For Industry's earnings presentation, Aug 19, 2019
Slide 1: Welcome to the 2019 Interim Results Briefing
WELCON TO THE 2019 INTERIM RESULTS BRIEFING
Slide 2: Agenda
—_— 3 HIGHLIGHTS 2<=PORTFOLIO® 2019 INTERIM RESULTS CAPITAL MANAGEMENT “MARKET UPDATE ON 2019 PRIORITIES REVIEW & QUESTIONS APPENDICES
Slide 3: Highlights
HIGHLIGHTS
Slide 4: Highlights
Highlights Interim Results Briefing 2019 EARNINGS GROWTH: interim profit after tax up $16.8 million, Funds From Operations (FFO) 1 earnings per share in line with the prior interim period, Adjusted Funds From Operations (AFFO) earnings per share up 16.8% to 4.11 cents per share VALUATION GAINS: $23.
Slide 5: Portfolio
PORTFOLIO
Slide 6: Portfolio Snapshot
Portfolio Interim Snapshot Results Briefing 2019 ▪ PFI’s portfolio is diversified across 94 JUNE 2019 DECEMBER 2018 JUNE 2018 properties and 147 tenants, with 99.7% occupancy and a weighted average lease BOOK VALUE $1,368.3m $1,322.0m $1,239.5m term of 5.71 years, weighted towards Auckland industria
Slide 7: Valuations
Valuations Interim Results Briefing 2019 ▪ Full valuations for 13 properties, $23.4 million or 8.8% uplift: − $25.0 million or 11.3% uplift on 10 properties with leasing transactions (refer next slide for more detail) − $0.7 million or 4% uplift on 51-61 Spartan Road, Takanini, purchased in March 20
Slide 8: Leasing
Leasing Interim Results Briefing 2019 ▪ 14 leases agreed over ~72,000 sqm of ADDRESS TENANT TERM AREA % RENT ROLL space for an average term of 6.8 years ▪ Lease renewals accounted for more than 7-9 NIALL BURGESS RD DHL 7.0 years 23,525 sqm 2.9% 90% of the contract rent secured CARLAW PARK Jacobs 5.4
Slide 9: Rent Reviews
Rent Interim Reviews Results Briefing 2019 Vacant 0.3% ▪ 56 rent reviews delivered an average annual uplift of ~3.3% Market 1.8% on ~$23.4 million of contract rent Expiry 2.8% ▪ Nine market rent reviews delivered an annualised increase of CPI 11.4% 3.3% over an average review period of 3.7 years on
Slide 10: H2 2019 Lease Expiries
H2 2019 Interim Lease Results Expiries Briefing 2019 ▪ Portfolio is 99.7% occupied (0.3% vacancy) and 2.8% of H2 2019 EXPIRIES TENANT % RENT ROLL contract rent is due to expire in the second half of 2019, a total of 3.1% (H2 2018: 3.9%) 2 PACIFIC RISE Hewlett-Packard 1.2% ▪ Short term renewal at 2 P
Slide 11: 2019 Interim Results
2019 INTERIM RESULTS
Slide 12: Net Rental Income
Net Rental Interim Income Results Briefing 2019 $42m ▪ Net rental income of $41.0 +0.3 million up $1.7 million or 4.3% $42m +1.0 ▪ Increases due to positive -0.3 41.0 $41m -0.2 leasing activity totalling $1.1 -0.1 -0.1 million and acquisitions ($1.0 -0.1 $41m +1.1 million) ▪ Increases partially offs
Slide 13: Adjusted Funds From Operations
Adjusted Interim Funds From Results Operations Briefing (cents per share) 2019 4.6 ▪ Profit after tax up $16.8 million to $46.4 million +0.26 +0.02 4.4 ▪ FFO earnings per share in line with the prior interim period and slightly ahead of H2 2018 4.2 +0.63 -0.22 4.11 ▪ AFFO earnings per share 0.59 -0.
Slide 14: Earnings, Dividends, Guidance
Earnings, Interim Dividends, Results Guidance Briefing 2019 ▪ H1 2019 cash dividends total 3.60 cps, in EARNINGS H1 2019 CPS H1 2018 CPS CHANGE line with H1 2018 ▪ 2019 dividend guidance unchanged: 7.60 FUNDS FROM OPERATIONS 4.49 4.46 +0.03 CPS or +0.7% cps, up 0.05 cps or 0.7% from 2018 ADJUSTED FU
Slide 15: Investment Properties
Investment Interim Properties Results Briefing 2019 $1,380m ▪ Portfolio value of ~$1.37 +7.6 +1.5 1,368.3 billion +17.2 -0.2 $1,360m ▪ Full valuations of 13 properties resulted in uplift of $23.4 +23.4 million or 8.8% $1,340m ▪ 51-61 Spartan Road, Takanini, purchased in March 2019 for $1,320m 1,318.
Slide 16: Net Tangible Assets
Net Tangible Interim Assets Results (cents per share) Briefing 2019 188 ▪ Net tangible assets (NTA) per share increased by 5.4 cents per share or 3.0% 184 +0.4 +0.3 183.1 +4.7 -0.0 ▪ Change in NTA per share driven by the increase in the 180 fair value of investment 177.7 properties (+4.7 cps), retai
Slide 17: Capital Management
Capital Interim Management Results Briefing 2019 CAPITAL MANAGEMENT
Slide 18: Funding, Covenants, Interest Rates
Funding, Interim Covenants, Results Interest Briefing Rates 2019 ▪ No changes to PFI’s bank facilities during JUNE 2019 DECEMBER 2018 the first half of 2019 FUNDING ▪ Gearing of 31.1% well within the self- imposed gearing limit of 40% and bank SYNDICATED BANK FACILITY DRAWN $224.8m $201.1m covenants
Slide 19: Debt Facility Maturity Profile, Hedging
Debt Facility Interim Maturity Results Profile, Briefing Hedging 2019 200.0 ▪ Debt facility maturity profile: average term to expiry of 3.5 150.0 years, $50.2 million of 100.0 187.5 unutilised bank facility capacity 50.0 100.0 100.0 50.0 37.5 0.0 FY19 FY20 FY21 FY22 FY23 FY24 FY25 Bank facilities Bo
Slide 20: Market
Interim Results Briefing MARKET
Slide 21: Market Update: Economy
Market Interim Update: Results Economy Briefing 2019 21
Slide 22: Market Update: Property
Market Interim Update: Results Property Briefing 2019 22
Slide 23: Update on 2019 Priorities
Update on Interim 2019 Priorities Results Briefing UPDATE ON 2019 PRIORITIES
Slide 24: 2019 Priorities
2019 Interim Priorities Results Briefing 2019 DISPOSALS: begin disposing PFI’s non-industrial assets ACQUISITIONS: recycle capital from disposals into quality industrial properties in sought-after areas VALUE-ADD STRATEGIES: recycle capital from disposals into value-add ASSET MANAGEMENT: strategies
Slide 25: Disposals
Disposals Interim Results Briefing 2019 ▪ 2019 priority: begin disposing PFI’s non- industrial assets ▪ Progress: Following completion of asset management initiatives, mixed-use property at 229 Dairy Flat Highway, Albany now being marketed for sale by Colliers International under deadline private tr
Slide 26: Acquisitions
Acquisitions Interim Results Briefing 2019 ▪ 2019 priority: replace PFI’s non-industrial properties with quality industrial properties in sought-after areas ▪ Progress: $51.4 million committed to two prime Auckland industrial opportunities 51-61 SPARTAN ROAD, DEVELOPMENT AT TIDAL ROAD, TAKANINI MANG
Slide 27: Value-add Strategies
Value-add Interim Strategies Results Briefing 2019 27
Slide 28: Slide 28
Slide 29: Review & Questions
Review & Interim Questions Results Briefing 2019 29
Slide 30: Appendices
=| Interim Results Briefing
Slide 31: Appendix 1: FFO and AFFO
Appendix 1: Interim FFO and Results AFFO Briefing 2019 (Unaudited, $000, unless noted) 6ME June 2019 6ME June 2018 Profit and total comprehensive income after income tax attributable to the shareholders of the Company 46,398 29,570 Adjusted for: Fair value gain on investment properties (23,449) (7,9
Slide 32: Disclaimer
Disclaimer Interim Results Briefing 2019 The information included in this presentation is provided as at 19 August 2019 and should be read in conjunction with the NZX results announcement, NZX Form – Results Announcement, NZX Form – Distribution Notice, and interim financial statements issued on tha
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