Oue Real Estate Investment Trust · SGX:TS0U
Oue Real Estate Investment Trust — OUE Commercial REIT — Q2 2016 Earnings Presentation
37 slides from Oue Real Estate Investment Trust's earnings presentation, Aug 2, 2016
Slide 1: Financial Results for 2nd Quarter 2016
Financial Results for 2nd Quarter 2016 2 August 2016
Slide 2: Important Notice
Important Notice This presentation shall be read in conjunction with OUE Commercial REIT’s Financial Results announcement for 2Q 2016 dated 2 August 2016. This presentation is for information only and does not constitute an invitation or offer to acquire, purchase or subscribe for units in OUE Comme
Slide 3: Agenda
Agenda Key Highlights Financial Performance and Capital Management Portfolio Performance Outlook Appendices 3
Slide 4: Key Highlights
Key Highlights Financial Highlights Higher 2Q 2016 gross revenue and net property income of S$45.7 million and S$35.2 million respectively due mainly to contribution from One Raffles Place Excluding One Raffles Place, organic growth in net property income of the portfolio (i.e. OUE Bayfront and
Slide 5: Key Highlights
Key Highlights Capital Management Aggregate leverage as at 30 June 2016 was 40.2% with a weighted average cost of debt of 3.53% p.a. 79.5% of borrowings on fixed rate basis as at 30 June 2016, with an average term of fixed rate debt of 2.72 years In July 2016, secured the refinancing of RMB on
Slide 6: Financial Performance & Capital Management
Financial Performance & Capital Management
Slide 7: Consistent Growth in Distribution
Consistent Growth in Distribution Delivered consistent year-on-year growth in distribution to Unitholders Distribution Since IPO (1) Period commencing from OUE C-REIT’s listing date of 27 January 2014 to 31 March 2014 (2) For a meaningful comparison, the amount available for distribution for the per
Slide 8: 2Q 2016 vs 2Q 2015
2Q 2016 vs 2Q 2015 2Q 2016 2Q 2015 Change Gross Revenue (S$m) 45.7 19.7 +132.2% Net Property Income (S$m) 35.2 14.7 +139.8% Amount Available for Distribution (S$m) 17.7(1) 12.8 +38.6% DPU (cents) 1.36 1.01(2) +34.7% • Higher gross revenue of S$45.7 million was mainly due to contribution from One Raf
Slide 9: 2Q 2016 vs 2Q 2015
2Q 2016 vs 2Q 2015 S$'000 2Q 2016 2Q 2015 Change (%) Gross revenue 45,688 19,677 132.2 Property operating expenses (10,460) (4,984) 109.9 Net property income 35,228 14,693 139.8 Other income 759 2,651 (71.4) Amortisation of intangible asset (1,118) (1,047) 6.8 Manager's management fees (3,528) (1,26
Slide 10: 1H 2016 vs 1H 2015
1H 2016 vs 1H 2015 1H 2016 1H 2015 Change Gross Revenue (S$m) 88.6 40.1 +121.0% Net Property Income (S$m) 68.5 30.4 +125.3% Amount Available for Distribution (S$m) 34.8(1) 25.4 +36.9% DPU (cents) 2.68 2.00(2) +34.0% • Higher 1H 2016 gross revenue of S$88.6 million was achieved mainly due to contribu
Slide 11: 1H 2016 vs 1H 2015
1H 2016 vs 1H 2015 S$'000 1H 2016 1H 2015 Change (%) Gross revenue 88,602 40,088 121.0 Property operating expenses (20,119) (9,688) 107.7 Net property income 68,483 30,400 125.3 Other income 1,462 4,449 (67.1) Amortisation of intangible asset (2,236) (2,094) 6.8 Manager's management fees (5,873) (2,
Slide 12: Distribution Details
Distribution Details Distribution Period 1 January 2016 to 30 June 2016 Distribution Per Unit 2.68 cents comprising (i) Taxable income distribution of 1.20 cents (ii) Tax exempt income distribution of 0.76 cents (iii) Capital distribution of 0.72 cents Notice of Books Closure Date 2 August 2016 Last
Slide 13: Healthy Balance Sheet
Healthy Balance Sheet S$ million As at 30 June 2016 Investment Properties 3,370.6 Total Assets 3,419.3 Loans and borrowings 1,298.4 Total Liabilities 1,482.8 Net Assets Attributable to Unitholders 1,179.7 Units in Issue (’000) 1,296,928 NAV per Unit (S$) 0.91 13
Slide 14: Capital Management
Capital Management Every 25bps increase in floating interest rates is expected to reduce distribution by S$0.6 million per annum, or 0.05 cents in DPU As at 30 Jun 2016 As at 31 Mar 2016 Aggregate Leverage 40.2% 40.5% S$1,258m(1) comprising S$1,274m(2) comprising Total debt - S$1,228m - S$1,236m - R
Slide 15: Debt Maturity Profile as at 30 Jun 2016
Debt Maturity Profile as at 30 Jun 2016 In July 2016, secured refinancing of RMB onshore loan ahead of maturity in 2017 with a new 8-year term loan expiring in 2024 (1) Based on SGD:CNY exchange rate of 1:4.895 15
Slide 16: Portfolio Performance
Portfolio Performance
Slide 17: Portfolio Composition
Portfolio Composition By Asset Value(1) By Revenue Contribution(2) By Segment Revenue(2) (1) Based on independent valuations as at 31 December 2015 and OUE C-REIT’s proportionate interest in One Raffles Place (2) For 2Q 2016 and based on OUE C-REIT’s attributable interest in One Raffles Place 17
Slide 18: Resilient and Stable Portfolio
Resilient and Stable Portfolio OUE C-REIT’s Portfolio Committed Occupancy (1) Proforma committed occupancy as at 30 September 2013 as disclosed in OUE C-REIT’s Prospectus dated 17 January 2014 18
Slide 19: Office Occupancy In Line with Market
Office Occupancy In Line with Market Singapore Shanghai (1) Singapore Market Occupancy refers to Core CBD office occupancy for 2Q 2016 according to CBRE Research. Shanghai Market Occupancy refers to Shanghai Grade A office occupancy for 2Q 2016 according to Colliers International Shanghai 19
Slide 20: Improved Office Passing Rents
Improved Office Passing Rents Rental Reversions(1) Average Passing Rent 2Q 2016 Committed Rents(2) 2Q 2016 1H 2016 Jun 2016 Jun 2015 OUE -0.9% 1.8% S$11.00 – S$14.20 psf/mth S$11.84 psf/mth S$11.04 psf/mth Bayfront One Raffles -0.1% 2.1% S$8.40 – S$11.00 psf/mth S$10.33 psf/mth N.A.(3) Place Lippo P
Slide 21: Lease Expiry Profile - Portfolio
Lease Expiry Profile - Portfolio Only 4.8% of OUE C-REIT’s gross rental income is due for renewal for balance of 2016, reduced from 15.1% at the start of the year WALE(1) of 2.7 years by NLA(2) and 2.8 years by Gross Rental Income As at 30 June 2016 (1) “WALE” refers to the weighted average lease te
Slide 22: Lease Expiry Profile - OUE Bayfront
Lease Expiry Profile - OUE Bayfront More than 65% of OUE Bayfront’s gross rental income is due only in 2019 and beyond. To-date, the Manager has completed the renewal of all expiring office leases in 2016 WALE of 3.4 years by NLA and 3.3 years by Gross Rental Income As at 30 June 2016 22
Slide 23: Lease Expiry Profile - One Raffles Place
Lease Expiry Profile - One Raffles Place Approximately 45.8% of 2017 renewals by gross rental income is attributable to retail income as One Raffles Place Shopping Mall was re-opened after a major refurbishment in 2014 WALE of 2.4 years by NLA and 2.3 years by Gross Rental Income As at 30 June 2016
Slide 24: Lease Expiry Profile - Lippo Plaza
Lease Expiry Profile - Lippo Plaza Significantly increased the weighted average lease expiry to 3.4 years by gross rental income compared to 1.6 years(1) a year ago, with leases that extend beyond 2023 WALE of 2.4 years by NLA and 3.4 years by Gross Rental Income As at 30 June 2016 (1) Based on OUE
Slide 25: Quality and Diversified Tenant Base
Quality and Diversified Tenant Base Top 10 tenants(1) contribute approximately 27.2% of gross rental income WALE by NLA 3.9 years As at 30 June 2016 25
Slide 26: Diversified Tenant Base
Diversified Tenant Base As at June 2016 26
Slide 27: Outlook
Outlook L) I! peezi ll I <r a We
Slide 28: Outlook and Prospects
Outlook and Prospects Singapore Singapore’s 2Q 2016 GDP grew by 2.2%(1) YoY, marginally higher than the 2.1% achieved in the previous quarter. Given weak global and regional economic conditions, downside risk to growth in 2H 2016 remains. GDP growth forecast for 2016 was maintained at 1.0% to 3.0%
Slide 29: Outlook and Prospects
Outlook and Prospects Outlook for the financial year ending 2016 OUE C-REIT’s portfolio of strategically located Grade A office properties continue to record healthy occupancy levels which provide stability in income In 2016, OUE C-REIT will enjoy a full year’s contribution from its effective 67
Slide 30: Appendices
Appendices • Overview of OUE C-REIT • OUE C-REIT’s Portfolio • Singapore Office Market • Shanghai Office Market
Slide 31: Overview of OUE C-REIT
Overview of OUE C-REIT OUE C-REIT is a Singapore real estate investment trust listed on the Mainboard of Singapore Exchange Securities Trading Limited with the principal investment strategy of investing, directly or indirectly, in a portfolio of income-producing real About OUE C-REIT estate which
Slide 32: Premium Portfolio of Assets - OUE Bayfront
Premium Portfolio of Assets OUE Bayfront OUE Bayfront GFA (sq m) 46,774.6 Office: 35,334.5 NLA (sq m) Retail: 1,830.1 Overall: 37,164.6 Office : 98.2% Committed Occupancy Retail : 100.0% as at 30 Jun 2016 Overall : 98.3% Number of Car Park Lots 245 Valuation S$1,146.0 m (as at 31 Dec 2015) OUE Bayfr
Slide 33: Premium Portfolio of Assets - One Raffles Place
Premium Portfolio of Assets One Raffles Place One Raffles Place GFA (sq m) 119,626.2 Office (Tower 1): 28,890.7 Office (Tower 2): 27,061.8 Attributable NLA (sq m) Retail: 9,500.2 Overall: 65,452.7 Office (Tower 1): 89.3% Committed Occupancy Office (Tower 2): 94.4% as at 30 Jun 2016 Retail: 97.1% Ove
Slide 34: Premium Portfolio of Assets - Lippo Plaza
Premium Portfolio of Assets Lippo Plaza Lippo Plaza GFA (sq m) 58,521.5 Office: 33,538.6 Attributable NLA (sq m) Retail: 5,685.9 Overall: 39,224.5 Office : 93.4% Committed Occupancy Retail : 97.3% as at 30 June 2016 Overall : 93.9% Number of Car Park Lots 168 RMB2,401.0 m / RMB41,028 psm Valuation(1
Slide 35: Singapore Office Market
Singapore Office Market As at 2Q 2016, core CBD office occupancy remained steady QoQ at 95.1%, while Grade A office rents declined 4.0% QoQ to S$9.50 psf/mth Despite a pick-up in leasing activity, net demand continues to be negative. The completion of major new CBD office developments from 3Q 20
Slide 36: Shanghai Office Market
Shanghai Office Market CBD Grade A office occupancy decreased 3.2 ppt QoQ to 92.8% as at 2Q 2016, due to new office completions during the quarter as well as net absorption turning negative. As a result, average Shanghai CBD Grade A office rents edged down 0.5% QoQ to RMB10.3 psm/day In Puxi, oc
Slide 37: Thank you
Z Z i = COMMER SIAL I Thank you