Social Housing Reit Plc · LSE:SOHO
Social Housing Reit — Triple Point Social Housing REIT — FY2022 Earnings Presentation
31 slides from Social Housing Reit's earnings presentation, March 2023
Slide 1: 2022 Annual Results Presentation
2022 Annual Results Presentation March 2023
Slide 2: Agenda
AGENDA Triple Point Social Housing REIT plc - Board Highlights Max Shenkman Financial Overview Isobel Gunn-Brown Operational Overview Chris Phillips Chairman Ian Reeves CBE Senior Independent Director Tracey Fletcher-Ray Non-Executive Director Peter Coward Non-Executive Director Paul Oliver Non-Exec
Slide 3: Key Points
KEY POINTS Diversified Portfolio Highly Regulated Lessees Resilient Valuation Growing Excess Demand Inflation Protection Share Price Discount 3
Slide 4: Key Performance Indicators
KEY PERFORMANCE INDICATORS 109.06p £669.1m 5.46p 37.4% EPRA NTA Portfolio Valuation FY22 Target LTV per Share (Dec-21: £642.0m) Dividend Met (Dec-21: 37.6%) (Dec-21: 108.27p) (FY21: 5.20p) 25.3 years 0.92x 91.8% 5.49% WAULT Dividend Cover1 Rent Collection Valuation Net (Dec-21: 26.2 years) (Dec-21:
Slide 5: Valuation Resilience
VALUATION RESILIENCE Valuation Resilience Underpinned by Growing Demand and Limited Supply £800m 5.49% 6.00% 5.25% 5.30% 5.28% 5.39% 5.00% £600m 4.00% £400m 3.00% £642.0m £663.4m £669.6m £672.2m £669.1m 2.00% £200m 1.00% £0m 0.00% 31-Dec-21 31-Mar-22 30-Jun-22 30-Sep-22 31-Dec-22 Valuation Blended V
Slide 6: Inflation and Protection from Rising Interest Rates
INFLATION AND PROTECTION FROM RISING INTEREST RATES 100% 7% 10.6 years 100% Leases linked to inflation1 Temporary rent increase Weighted average Fixed price debt; cap for 2023 debt maturity 2.74% weighted average fixed coupon Weighted Average Rental Growth from Inflation-linked Uplifts Earliest Debt
Slide 7: Specialised Supported Housing
SPECIALISED SUPPORTED HOUSING Responding to Homes for people moving local need out of registered care Additional demand is forecast to increase by over 125,000 homes by 2030 Care provided by Independent community separate care providers based housing 7
Slide 8: Portfolio Composition – Highly Regulated
PORTFOLIO COMPOSITION – HIGHLY REGULATED 98.4% 92.3% Lessees subject to specialist Properties have support housing or care regulation provided by CQC regulated care providers Lessee Breakdown - Regulation Portfolio Breakdown - Housing Type 1.6% 0.3% 4.1% 3.8% Regulator of Social Housing Specialised
Slide 9: Financial Overview
FINANCIAL OVERVIEW 9 9
Slide 10: Statement of Comprehensive Income
STATEMENT OF COMPREHENSIVE INCOME Year ended Year ended % change £’000 31 December 2022 31 December 2021 Dec 22 v Dec 21 12.6% Rental Income Expected Credit Loss 37,300 (2,073) 33,117 - 12.6% - Increase in Rental Income Other Income 110 - - Total expenses (7,866) (6,926) 13.6% 0.92x Gross profit 27,
Slide 11: Statement of Financial Position
STATEMENT OF FINANCIAL POSITION Year ended Year ended % change £’000 31 December 2022 31 December 2021 Dec 22 v Dec 21 0.7% Investment property (IFRS valuation) 667,713 641,293 4.1% Increase in EPRA NTA per Share Asset held for sale - 480 - Trade and other receivables 7,161 5,746 24.6% Cash and cash
Slide 12: EPRA NTA Reflecting Valuation Resilience
EPRA NTA REFLECTING VALUATION RESILIENCE EPRA NTA per Share Bridge 116 114 -0.25p -0.65p +2.06p 112 -5.40p +5.03p 110 EPRA NTA per Share 108 106 104 109.06p 108.27p 102 100 98 1 EPRA NTA Adjusted EPRA Earnings Amortisation - Loan One-off Write-off - Loan Property Revaluation Dividends Paid EPRA NTA
Slide 13: Total Accounting Return
TOTAL ACCOUNTING RETURN Cumulative total accounting 5.7% 5.46p FY23 Target return of 37.4% since IPO Total Return for 2022 FY22 Target Dividend target expected Dividend met to be announced in May Total Accounting Return since IPO 40% 37.4% 140 NAV plus Cumulative Dividend Paid per Cumulative Total A
Slide 14: Operational Overview
OPERATIONAL OVERVIEW 14
Slide 15: Active Asset Management - Rent Collection
ACTIVE ASSET MANAGEMENT - RENT COLLECTION 91.8% Rent Collection • 7.9% of Group rent roll • 9.6% of Group rent roll • Requirement to address solvency issues • Arrears built up in H2 2022 • Actively looking to move properties • Plan to increase rent payments and • 25 of 27 Lessees Possible merger or
Slide 16: Active Portfolio Management
ACTIVE PORTFOLIO MANAGEMENT Engagements Range of Experience Specialist Team 24 strong Housing Team and Backgrounds Property inspections focused on portfolio Registered Provider and Local performance Authority experience alongside finance and legal Surveys (operational, financial, governance and comp
Slide 17: Diversified Portfolio
DIVERSIFIED PORTFOLIO Diversified Lessee Base (by rent roll) Inclusion Parasol Homes Falcon Hilldale My Space Chrysalis 31.1% BeST AHS Blue Square Care Housing Association Highstone Sunnyvale 5.3% IHL Sandwell Wings Care 5.7% Bespoke Care and Support 9.2% IKE 7.6% Lifeways Pivotal 8.7% 8.3% Inclusio
Slide 18: Active Regulation Driving Transparency and Accountability
ACTIVE REGULATION DRIVING TRANSPARENCY AND ACCOUNTABILITY Looking Forward 94.3% of lessees regulated by Regulator of Social Housing Direct engagement Lessees and New Lease 10 of 18 Group’s RP lesees with the Regulator the Regulator Clause deemed non-compliant The Manager ensures a Desire amongst les
Slide 19: Implementation of New Risk Sharing Clause
IMPLEMENTATION OF NEW RISK SHARING CLAUSE Improving Compliance Existing Portfolio Supported by Key Stakeholders Aimed at strengthening compliance Included in existing Valuers, lenders and with Regulator’s standards and new leases Registered Providers THE CLAUSE RE-BALANCES LOCAL AND CENTRAL GOVERNME
Slide 20: Emma's story
CASE STUDY “ Emma’s story Leeds Supported Living Gildersome My flat is spacious, it’s all really modern and I’m allowed to express myself. Living here is a big step forward, after being in institutions for five to six years where you don’t really get the opportunity to do that. Mental health is quit
Slide 21: Impact Overview
IMPACT OVERVIEW 21
Slide 22: The Good Economy Impact Report
THE GOOD ECONOMY IMPACT REPORT 22
Slide 23: Sustainability Reporting
SUSTAINABILITY REPORTING Property EPC Ratings 0.1% 0.4% 70.9% of property EPCs rated between A-C 7.0% 31.2% 22.0% A B 3,610 tonnes C Total property emissions D for the portfolio E F 39.3% 1.4 tonnes per annum average CO2 emissions from a Group property 23
Slide 24: TCFD Disclosures
TCFD DISCLOSURES TCFD Risk Matrix Reporting in line with TCFD Physical Financial impact if risk happens recommendations 1 Water Stress 2 Increased frequency of heatwaves 1 Identified most prominent Increased surface flooding during Likelihood of risk happening 3 more frequent storms physical and tra
Slide 25: Outlook
OUTLOOK Valuations expected to show resilience relative to commercial property sectors Majority of lessees expected to perform in line with expectations Active asset management with a focus on rent collection New risk sharing clause and temporary 7% rent cap Share buy-backs and portfolio sale are be
Slide 26: Appendix
Appendix 26
Slide 27: Secured Debt Overview
SECURED DEBT OVERVIEW Long-Term and Fixed-Price Debt Portfolio 11.6 years Loan Lender Facility Cost Maturity Amount Drawn Fitch Rating Weighted average Commitment MetLife Loan Notes I Fixed debt 2028 maturity £41.5m £41.5m A Tranche A 2.924% Loan Notes II Fixed MetLife & Barings 2031 £77.5m £77.5m A
Slide 28: Covenant Headroom
COVENANT HEADROOM Interest Cover Significant covenant Headroom headroom maintained in Actual Covenant (rental income movement) both facilities Loan Notes I 5.02x 1.75x 65% Loan Notes II 4.41x 1.75x 60% Additional liquidity from £13 million cash and £75.1 Asset Cover million unencumbered properties H
Slide 29: Key Terms
KEY TERMS UK listed REIT The Company London Stock Exchange Main Market, Premium Segment Management Triple Point Investment Management LLP as Investment Manager • the Group will only invest in social housing assets located in the United Kingdom • the Group will only invest in social housing assets wh
Slide 30: Glossary
GLOSSARY Approved Provider a housing association, local authority or other regulated organisation in receipt of direct payment from local government including a care provider; Board the Directors of the Company from time to time; Company Triple Point Social Housing REIT plc (company number 10814022)
Slide 31: Disclaimer
DISCLAIMER This presentation, including any oral presentation, any question or answer session and any written or persons to whom it may be lawful to communicate it (each such person in (A) to (E) above being a made in relation to, and no responsibility or liability is or will be accepted by Triple P
Triple Point Social Housing REIT — FY2022 Earnings Presentation on 6ix