Sunway Real Estate Investment Trust · MYX:SUNREIT
Sunway Real Estate Investment Trust — 3Q2021 Earnings Presentation
57 slides from Sunway Real Estate Investment Trust's earnings presentation, May 19, 2021
Slide 1: Financial Results Third Quarter Ended 31 March 2021
FINANCIAL RESULTS Third Quarter Ended 31 March 2021 (FPE 31 December 2021) Date: 19 May 2021
Slide 2: Disclaimer
Disclaimer This presentation is for information purposes only and does not constitute an offer, solicitation or advertisement with respect to the purchase or sale of any security of Sunway Real Estate Investment Trust (“Sunway REIT”) and no part of it shall form the basis of, or be relied on in conn
Slide 3: Table of Contents
Table of Contents 1. Financial Highlights (3Q2021) 2. Financial Results (3Q2021) 3. Portfolio Performance (3Q2021) 4. Property Development Activities 5. Market Outlook 6. Investor Relations Appendix - Property Performance (3Q2021) Empowering Businesses • Curating Experiences • Enriching Lives 3
Slide 4: Financial Highlights (3Q2021)
FINANCIAL HIGHLIGHTS (3Q2021) Empowering Businesses • Curating Experiences • Enriching Lives 4
Slide 5: Financial Highlights – 3Q2021
Financial Highlights – 3Q2021 Highlights 3Q 2021 3Q 2020 No. of Properties 18 17 Property Value (RM'billion) 8.643 8.098 Units in Circulation 3,424,807,700 2,945,078,000 Unit Price as at 31 Mar 2021/2020 (RM) 1.49 1.59 Market Capitalisation (RM'billion) 5.103 4.683 Net Asset Value ("NAV") Per Unit (
Slide 6: Financial Highlights – 3Q2021 (Cont'd)
Financial Highlights – 3Q2021 (Cont’d) Reported in RM’000 Gross Revenue for 3Q2021 decreased by 25.9% or RM36.5 million compared to 3Q2020 mainly due to lower rental income from retail and hotel segments with the re-implementation of MCO since 13 Jan 25.9% 2021 and no income from Sunway Resort Hotel
Slide 7: Financial Highlights – YTD 3Q2021
Financial Highlights – YTD 3Q2021 Reported in RM’000 YTD 307,479 3Q2021 Gross Revenue for YTD 3Q2021 decreased by 32.0% 32.0% or RM144.5 million compared to YTD 3Q2020 mainly due to lower rental income as explained in YTD 451,950 the previous page. 3Q2020 YTD 201,118 3Q2021 Net Property Income for Y
Slide 8: Financial Results (3Q2021)
FINANCIAL RESULTS (3Q2021) Empowering Businesses • Curating Experiences • Enriching Lives 8
Slide 9: Statement of Comprehensive Income – Consolidated
Statement of Comprehensive Income – Consolidated 3Q 2021 3Q 2020 Change YTD 2021 YTD 2020 Change RM'000 RM'000 % RM'000 RM'000 % Gross rev enue 104,266 140,800 -25.9% 307,479 451,950 -32.0% Property operating expenses (37,249) (37,290) -0.1% (106,361) (112,746) -5.7% Net property income 67,017 103,5
Slide 10: Statement of Comprehensive Income – Consolidated (notes)
Statement of Comprehensive Income – Consolidated 1 Interest income for 3Q2021 and YTD 3Q2021 was higher by RM1.0 million and RM1.9 million respectively mainly contributed by higher deposits placed with financial institutions from proceeds received through private placement. 2 Manager’s fees was lowe
Slide 11: Statement of Financial Position – Consolidated
Statement of Financial Position – Consolidated 31.03.2021 30.06.2020 31.03.21 30.06.2020 (Unaudited) (Restated)^ (Unaudited) (Restated)^ RM'000 RM'000 RM'000 RM'000 ASSETS Units in circulation ('000 units) 3,424,808 2,945,078 Non-current assets Investment properties 8,625,891 1 8,020,233 Investment
Slide 12: Statement of Financial Position – Consolidated (notes)
Statement of Financial Position – Consolidated 1 Investment properties increased by RM605.7 million pursuant to the completion of the acquisition of The Pinnacle Sunway on 20 Nov 2020 as well as on-going capital expenditure mainly for the expansion of Sunway Carnival Shopping Mall and Sunway Resort
Slide 13: Statement of Cash Flows – Consolidated
Statement of Cash Flows – Consolidated Cumulative Quarter ended 31.03.2021 31.03.2020 * 1 Net cash from operating activities for YTD 3Q2021 of (Restated) RM'000 RM'000 RM217.0 million was lower by RM105.4 million compared to YTD 3Q2020 mainly attributable to lower collection OPERATING ACTIVITIES Cas
Slide 14: Financing Profile as at 31 March 2021
Financing Profile as at 31 March 2021 Facility Limit Amount RM'million RM'million 1 Revolving Loan (USD) USD95.5million 393.9 Commercial Papers (CP) / 2 3,000.0 1,600.0 Revolving Loan (RL) 3 Unrated MTNs 10,000.0 1,400.0 Total Gross Borrowings 3,393.9 Unamortised transaction costs (0.4) Total Borrow
Slide 15: Portfolio Performance (3Q2021)
PORTFOLIO PERFORMANCE (3Q2021) Empowering Businesses • Curating Experiences • Enriching Lives 15
Slide 16: Revenue & NPI growth in 3Q2021 – Realised
Revenue & NPI growth in 3Q2021 – Realised Reported in RM’million Retail Hotel 6% Office Revenue 45% 3Q2021 53.7 14.4 19.3 3Q2020 98.3 15.3 10.7 80% NPI 64% 5% 13.4 3Q2021 23.9 12.8 108% 3Q2020 67.1 13.5 6.4 The retail segment recorded The hotel segment recorded gross The office segment recorded gros
Slide 17: Revenue & NPI growth in 3Q2021 – Realised (Cont'd)
Revenue & NPI growth in 3Q2021 – Realised (Cont’d) Reported in RM’million Services 3% Industrial & Others Overall Revenue 26% 3Q2021 15.3 1.5 104.3 3Q2020 14.9 1.5 140.8 3% NPI - - - 35% 3Q2021 15.3 1.5 67.0 3Q2020 14.9 1.5 103.5 The services segment Sunway REIT Industrial - Shah Revenue of the port
Slide 18: Revenue & NPI growth in YTD 3Q2021 – Realised
Revenue & NPI growth in YTD 3Q2021 – Realised Reported in RM’million Retail Hotel Office Revenue 39% 59% YTD 3Q2021 188.2 25.1 44.3 YTD 3Q2020 310.6 61.5 31.3 42% NPI 53% 64% YTD 3Q2021 102.0 20.6 28.6 YTD 3Q2020 216.4 56.6 17.6 63% The retail segment recorded YTD The hotel segment recorded YTD The
Slide 19: Revenue & NPI growth in YTD 3Q2021 – Realised (Cont'd)
Revenue & NPI growth in YTD 3Q2021 – Realised (Cont’d) Reported in RM’million Services 3% Industrial & Others Overall Revenue 32% YTD 3Q2021 45.2 4.6 307.5 YTD 3Q2020 44.0 4.6 452.0 3% NPI 41% YTD 3Q2021 45.2 4.6 201.1 YTD 3Q2020 44.0 4.6 339.2 The services segment Sunway REIT Industrial - Shah Reve
Slide 20: 3Q2021 and YTD 3Q2021 Revenue Contribution (by Property)
3Q2021 and YTD 3Q2021 Revenue Contribution (by Property) YTD 3Q YTD 3Q 3Q 2021 3Q 2020 Variance Change 2021 2020 Variance Change By Property RM'mil RM'mil RM'mil % RM'mil RM'mil RM'mil % Sunway Pyramid Mall 38.6 76.2 (37.7) -49.4% 137.9 237.8 (99.8) -42.0% Sunway Carnival Mall 6.7 10.7 (4.0) -37.2%
Slide 21: 3Q2021 NPI and NPI Margin Contribution (by Property)
3Q2021 NPI and NPI Margin Contribution (by Property) NPI NPI Margin 3Q 2021 3Q 2020 Variance Change 3Q 2021 3Q 2020 Variance By Property RM'mil RM'mil RM'mil % % % % Sunway Pyramid Mall 19.1 55.9 (36.9) -65.9% 49.4% 73.3% -23.9% Sunway Carnival Mall 2.7 5.9 (3.3) -54.9% 39.9% 55.6% -15.7% SunCity Ip
Slide 22: YTD 3Q2021 NPI and NPI Margin Contribution (by Property)
YTD 3Q2021 NPI and NPI Margin Contribution (by Property) NPI NPI Margin YTD 3Q 2021 YTD 3Q 2020 Variance Change YTD 3Q 2021 YTD 3Q 2020 Variance By Property RM'mil RM'mil RM'mil % % % % Sunway Pyramid Mall 79.8 177.2 (97.4) -54.9% 57.9% 74.5% -16.6% Sunway Carnival Mall 12.4 20.3 (7.9) -38.7% 51.3%
Slide 23: Key Performance Indicators – YTD 3Q2021
Key Performance Indicators – YTD 3Q2021 Industrial & Retail Hotel Office Services Others 2 YTD 3Q 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 Average 1 Occupancy 95% 96% 27% 66% 85% 78% 100% 100% 100% 100% Rates NPI Margin 68% 70% 91% 92% 58% 56% 100% 100% 100% 100% Notes: 1. Excludes Sunway R
Slide 24: Property Development Activities (3Q2021)
PROPERTY DEVELOPMENT ACTIVITIES (3Q2021) Empowering Businesses • Curating Experiences • Enriching Lives 24
Slide 25: Property Development Activities
Property Development Activities Expansion of Sunway Carnival Shopping Mall Sunway Resort Hotel Refurbishment Estimated total property development RM436.0 million # RM261.0 million cost (including land) Cummulative cost incurred from initiation RM173.4 million RM60.2 million to YTD 3Q2021 Expected co
Slide 26: General Outlook
General Outlook o Amidst continued uncertainties surrounding the pandemic globally and domestically, the ongoing expansionary monetary policy, accommodative financial conditions globally and deployment of vaccines are expected to pave the way for normalisation in global economic activities. o The In
Slide 27: General Outlook (cont'd)
General Outlook (cont’d) o The domestic economy performed better-than-expected in 1Q CY2021, despite the imposition of MCO 2.0 during the quarter. Malaysia’s gross domestic product recorded a marginal contraction of 0.5% in 1Q CY2021, underpinned by improvement in domestic demand and robust exports,
Slide 28: General Outlook (cont'd)
General Outlook (cont’d) o Following a deflationary position in CY2020, headline inflation in CY2021 is forecasted to be higher, hovering between 2.5% - 4.0% owing to cost-push factors such as the expected increase in global oil and commodity prices. Underlying inflation, as measured by core inflati
Slide 29: General Outlook (cont'd)
General Outlook (cont’d) o On 5 March 2021, the Movement Control Order (MCO) 2.0 was lifted in Selangor, Kuala Lumpur, Johor and Penang and replaced with the Conditional Movement Control Order (CMCO). However, the relaxation was short-lived following the implementation of MCO 3.0 nationwide on the b
Slide 30: Retail Segment
Retail Segment o The retail industry in Malaysia is experiencing its worst performance following a contraction of 16.3% y-o-y recorded in CY2020. The Retail Group Malaysia (RGM) expects retail sales in 1Q CY2021 to contract by 13.4% q-o-q due to the imposition of MCO 2.0 in January 2021. The RGM has
Slide 31: Retail Segment
Retail Segment o Leading retail malls continue to demonstrate a high level of resiliency where occupancy and attrition rates remained stable. It is a testament of a strong landlord- tenant relationship, on top of the rental assistance and marketing support to tide through the pandemic period. Furthe
Slide 32: Hotel Segment
Hotel Segment o Malaysian Association of Hotels (MAH) reported a nationwide hotels average occupancy rate of 20% and 18% in January 2021 and February 2021 respectively as the re-implementation of MCO in January 2021 hampered the movement activities. The average occupancy rate reported was at the low
Slide 33: Office Segment
Office Segment o The total supply of purpose-built office space in Kuala Lumpur and Selangor stood at approximately 144.8 million sq.ft. in CY2020, a 2.2% increase from CY2019. The average occupancy rate in Kuala Lumpur and Selangor in CY2020 dropped to 77.6% (2019: 78.3%) and 69.2% (2019: 71.6%) re
Slide 34: Industrial & Others Segment
Industrial & Others Segment o Malaysia’s Industrial Production Index (IPI) rose 1.5% in February 2021, mainly attributed to the growth in the manufacturing sector. The manufacturing subsector major contributor were the electrical and electronics products (+10.3% y-o-y), petroleum, chemical, rubber a
Slide 35: Unit Price Performance from IPO to 3Q FP2021
Unit Price Performance from IPO to 3Q FP20211 Unit Price Performance of Sunway REIT versus Benchmarks (8 July 2010 – 31 March 2021) 200.0% GPR APREA Composite REIT Index - Malaysia +139.0% 150.0% Sunway REIT 100.0% +65.6% 50.0% FBM KLCI +19.6% 0.0% 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2
Slide 36: Unit Price YTD Performance for FP2021
Unit Price YTD Performance for FP2021 Unit Price Performance of Sunway REIT versus Benchmarks (1 July 2020 – 31 March 2021) 15.0% FBM KLCI +4.8% 10.0% 5.0% Bursa Malaysia REIT Index 0.0% -5.5% -5.0% -10.0% Sunway REIT -8.0% -15.0% -20.0% Jun 2020 Sep 2020 Dec 2020 Mar 2021 Performance Statistics (1
Slide 37: Indices Representation
Indices Representation o FTSE Bursa Malaysia Mid 70 Index o FTSE Bursa Malaysia Emas o FTSE Bursa Malaysia Top 100 Index Index o Bursa Malaysia REIT Index o FTSE ASEAN All-Share Index o FTSE ASEAN Malaysia Index o FTSE ASEAN All-Share ex Developed Index o FTSE4Good Bursa Malaysia Index o GPR APREA C
Slide 38: Unitholders' Composition (as at 31 March 2021)
Unitholders’ Composition (as at 31 March 2021) Foreign Retail 7.2% 8.1% Sunway Berhad 40.9% Institutions & Corporates 51.0% Domestic 92.8% March 2021 December 2020 Q-o-Q Change No of unitholders 26,074 23,316 +2,758 (11.8%) Retail unitholders 8.1% 7.6% +0.5% Foreign unitholders 7.2% 7.3% -0.1% Sunwa
Slide 39: Analysts Recommendation (as at March 2021)
Analysts Recommendation (as at 31 March 2021) 14.1 11.4 10.1 4.0 4.0 1.70 1.55 1.66 1.64 1.55 1.522.0 1.500.7 1.49 1.48 1.45 1.45 1.42 1.39 1.500.7 1.48 1.10 0.0 (0.7) (0.7) (2.7) (2.7) (4.7) (6.7) Target Price as at 31 March 2021 (RM) Upside / Downside to unit price as at 31 March 2021 (%) (26.2) T
Slide 40: Comparative Yields for Various Assets
Comparative Yields for Various Assets 6.0% 5.32%2 5.20%5 5.0% 4.0% 3.25%1 3.24%3 3.0% 2.0% 1.75%4 1.75%6 1.0% 0.0% Sunway REIT M-REITs 10-Year MGS Fixed Deposit EPF Yield OPR Note: 1 Distribution yield is computed based on annualised FY2021 DPU of 4.84 sen (annualised based on 18-month consensus DPU
Slide 41: Appendix: Property Performance (3Q2021)
APPENDIX: PROPERTY PERFORMANCE (3Q2021) Empowering Businesses • Curating Experiences • Enriching Lives 41
Slide 42: Retail Properties – Sunway Pyramid Shopping Mall
RETAIL PROPERTIES – Sunway Pyramid Shopping Mall Average occupancy rate Projected lease expiry schedule 50.0% 100.0% 98.9% 98.0% 98.2% 97.6% 97.6% 96.7% 40.0% 95.0% 30.0% 90.0% 20.0% 85.0% 80.0% 10.0% 75.0% 35.5% 47.4% 9.8% 0.1% 3.9% 0.0% Jun-17 Jun-18 Jun-19 Jun-20 YTD 3Q YTD 3Q FP2021 FY2022 FY202
Slide 43: Retail Properties – Sunway Carnival Shopping Mall
RETAIL PROPERTIES – Sunway Carnival Shopping Mall Average occupancy rate Projected lease expiry schedule 60.0% 100.0% 97.6% 97.3% 97.4% 96.5% 50.0% 95.7% 95.0% 91.3% 40.0% 90.0% 30.0% 85.0% 20.0% 80.0% 75.0% 10.0% 52.7% 45.8% 0.2% 0.4% 70.0% 0.0% Ju n-17 Ju n-18 Ju n-19 Ju n-20 YTD 3Q YTD 3Q FP2021
Slide 44: Retail Properties – SunCity Ipoh Hypermarket
RETAIL PROPERTIES – SunCity Ipoh Hypermarket Average occupancy rate 100% 100% 100% 100% 100% 100% 90% 86% 80% 70% 60% 50% Jun-17 Jun-18 Jun-19 Jun-20 YTD 3Q YTD 3Q 2021 2020 SunCity Ipoh Hypermarket replaced its single tenant which ended on 30 April 2020 with new single tenant TF Value-Mart which co
Slide 45: Retail Properties – Sunway Putra Mall
RETAIL PROPERTIES – Sunway Putra Mall Average occupancy rate Projected lease expiry schedule 80.0% 100.0% 92.9% 93.5% 92.4% 90.7% 90.4% 67.6% 86.3% 60.0% 80.0% 60.0% 40.0% 40.0% 20.0% 20.0% 14.2% 11.1% 0.0% 0.8% 0.2% 0.0% Jun-17 Jun-18 Jun-19 Jun-20 YTD 3Q YTD 3Q FP2021 FY2022 FY2023 Beyond Monthly
Slide 46: Retail Properties – Sunway Clio Retail
RETAIL PROPERTIES – Sunway Clio Retail Average occupancy rate Projected lease expiry schedule 60.0% 52.4% 100.0% 92.3% 89.7% 50.0% 80.0% 72.4% 40.0% 37.8% 65.8% 64.8% 60.0% 30.0% 37.6% 40.0% 20.0% 20.0% 10.0% 0.0% 0.0% Jun-17 Jun-18 Jun-19 Jun-20 YTD 3Q YTD 3Q FP2021 FY2022 2021 2020 Note : The acqu
Slide 47: Hospitality Properties – Sunway Resort Hotel
HOSPITALITY PROPERTIES – Sunway Resort Hotel Average occupancy rate 100.0% 81.5% 80.0% 73.5% 65.4% 65.5% 60.0% 49.5% 40.0% 20.0% 0.0% Ju n-17 Ju n-18 Ju n-19 Ju n-20 YTD 3Q YTD 3Q 2021 2020 Note 1: The hotel properties are under 10-year master leases. The master lease of Sunway Resort Hotel was rene
Slide 48: Hospitality Properties – Sunway Pyramid Hotel
HOSPITALITY PROPERTIES – Sunway Pyramid Hotel Average occupancy rate 100.0% 80.0% 71.4% 68.1% 67.5% 56.8% 58.7% 60.0% 40.0% 29.6% 20.0% 0.0% Ju n-17 Ju n-18 Ju n-19 Ju n-20 YTD 3Q YTD 3Q 2021 2020 Note: The hotel properties are under 10-year master leases. The master lease of Sunway Pyramid Hotel wa
Slide 49: Hospitality Properties – Sunway Clio Hotel
HOSPITALITY PROPERTIES – Sunway Clio Hotel Average occupancy rate 100.0% 80.0% 74.4% 72.3% 71.5% 66.7% 58.4% 60.0% 40.0% 31.2% 20.0% 0.0% Ju n-17 Ju n-18 Ju n-19 Ju n-20 YTD 3Q YTD 3Q 2021 2020 Note: The hotel properties are under 10-year master leases. The master lease of Sunway Clio Hotel is expir
Slide 50: Hospitality Properties – Sunway Hotel Seberang Jaya
HOSPITALITY PROPERTIES – Sunway Hotel Seberang Jaya Average occupancy rate 100.0% 80.0% 76.4% 74.7% 71.1% 62.7% 60.0% 50.7% 43.2% 40.0% 20.0% 0.0% Ju n-17 Ju n-18 Ju n-19 Ju n-20 YTD 3Q YTD 3Q 2021 2020 Note: The hotel properties are under 10-year master leases. The master lease of Sunway Hotel Sebe
Slide 51: Hospitality Properties – Sunway Putra Hotel
HOSPITALITY PROPERTIES – Sunway Putra Hotel Average occupancy rate 80.0% 72.8% 68.2% 62.4% 62.9% 60.0% 48.0% 40.0% 21.5% 20.0% 0.0% Ju n-17 Ju n-18 Ju n-19 Ju n-20 YTD 3Q YTD 3Q 2021 2020 Note: The hotel properties are under 10-year master leases. The master lease of Sunway Putra Hotel is expiring i
Slide 52: Hospitality Properties – Sunway Hotel Georgetown
HOSPITALITY PROPERTIES – Sunway Hotel Georgetown Average occupancy rate 100.0% 91.8% 87.7% 84.5% 80.0% 69.1% 60.0% 52.6% 40.0% 20.0% 15.3% 0.0% Ju n-17 Ju n-18 Ju n-19 Ju n-20 YTD 3Q YTD 3Q 2021 2020 Note: The hotel properties are under 10-year master leases. The master lease of Sunway Hotel Georget
Slide 53: Office Properties – Menara Sunway
OFFICE PROPERTIES – Menara Sunway Average occupancy rate Projected lease expiry schedule 100.0% 100.0% 98.0% 97.3% 97.1% 80.0% 94.8% 95.0% 93.8% 92.1% 60.0% 90.0% 40.0% 85.0% 80.0% 20.0% 65.8% 10.3% 21.9% 75.0% 0.0% Jun-17 Jun-18 Jun-19 Jun-20 YTD 3Q YTD 3Q FP2021 FY2022 FY2023 2021 2020 YTD 3Q2021
Slide 54: Office Properties – Sunway Tower
OFFICE PROPERTIES – Sunway Tower Average occupancy rate Projected lease expiry schedule 18.0% 40.0% 32.9% 33.9% 15.0% 32.2% 30.0% 12.0% 20.7% 21.0% 20.1% 20.0% 9.0% 6.0% 10.0% 3.0% 0.0% 17.1% 18.3% 0.0% Jun-17 Jun-18 Jun-19 Jun-20 YTD 3Q YTD 3Q FP2021 FY2022 2021 2020 YTD 3Q2021 average occupancy ra
Slide 55: Office Properties – Sunway Putra Tower
OFFICE PROPERTIES – Sunway Putra Tower Average occupancy rate Projected lease expiry schedule 100.0% 40.0% 85.5% 86.1% 82.0% 83.0% 80.0% 30.0% 60.0% 56.0% 20.0% 40.0% 36.6% 20.0% 10.0% 0.0% 27.0% 22.6% 33.4% Jun-17 Jun-18 Jun-19 Jun-20 YTD 3Q YTD 3Q 0.0% FP2021 FY2022 FY2023 2021 2020 YTD 3Q2021 ave
Slide 56: Office Properties – Wisma Sunway
OFFICE PROPERTIES – Wisma Sunway Average occupancy rate Projected lease expiry schedule 100.0% 100.0% 100.0% 100.0% 94.1% 70.0% 86.9% 78.3% 60.0% 80.0% 50.0% 60.0% 40.0% 30.0% 40.0% 20.0% 20.0% 10.0% 57.4% 18.6% 24.0% 0.0% 0.0% Jun-17 Jun-18 Jun-19 Jun-20 YTD 3Q YTD 3Q FP2021 FY2022 FY2023 2021 2020
Slide 57: Office Properties – The Pinnacle Sunway
OFFICE PROPERTIES – The Pinnacle Sunway Average occupancy rate Projected lease expiry schedule 98.8% 98.8% 98.4% 97.7% 99.3% 50.0% 100.0% 96.5% 40.0% 80.0% 60.0% 30.0% 40.0% 20.0% 20.0% 10.0% 43.9% 17.1% 36.5% 0.0% 0.0% Dec-17 Dec-18 Dec-19 Dec-20 YTD 3Q YTD 3Q FP2021 FY2022 FY2023 2021 2020 Note :
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