Stockland · ASX:SGP
Stockland — Investor Presentation (May 2009)
39 slides from Stockland's investor presentation, May 13, 2009
Slide 1: Equity Raising Presentation
For personal use only Equity Raising Presentation 13 May 2009 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES OR TO U.S. PERSONS
Slide 2: Important information
Important information For personal use only This presentation (Presentation) is issued by Stockland Corporation Limited and Stockland Trust Management Limited as responsible entity for Stockland Trust (together, Stockland). This Presentation is in relation to an accelerated non-renounceable entitlem
Slide 3: Contents
Contents For personal use only 1. Overview 2. Details of the Offer 3. Stockland Investment Proposition 4. Key risks 5. Summary Appendix I. Additional risk detail II. International selling restrictions NOT FOR DISTRIBUTION OR RELEASE IN -2- THE UNITED STATES OR TO U.S. PERSONS
Slide 4: 1. Overview
For personal use only 1. Overview NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES OR TO U.S. PERSONS
Slide 5: Stockland is actively managing its business to deal with the current environment
Stockland is actively managing its business to deal with the current environment • Proactive capital management over the past 18 months For personal use only – Renegotiated debt facilities and extended terms Capital – Strengthened balance sheet through Commercial Property sales management • Revised
Slide 6: Stockland is undertaking an Equity Raising
Stockland is undertaking an Equity Raising • Accelerated entitlement offer and institutional placement (together the Equity For personal use only Offer structure Raising) to raise up to approximately $2.0 billion – underwritten to raise approximately $1.53 billion • Equity Raising is consistent with
Slide 7: 2. Details of the Offer
For personal use only 2. Details of the Offer NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES OR TO U.S. PERSONS
Slide 8: Offer structure
Offer structure For personal use only • Accelerated non renounceable entitlement offer on 2 for 5 basis at $2.70 per new security to raise approximately $1.33 billion Institutional offer • Placement of approximately 75 million1 new securities at $2.70 per security to raise approximately $0.20 billio
Slide 9: Offer metrics
Offer metrics For personal use only Stockland’s underlying operating performance is consistent Issue Price Discount with guidance provided in 23 April 2009 market update • Maintain FY09 EPS guidance of 39.8c per security pre- $3.11 13% $2.99 10% discount discount $2.70 inventory impairment (excludin
Slide 10: Pro forma TL / TTA and sensitivity
Pro forma TL / TTA and sensitivity Total Liabilities1 / Total Tangible Assets2 For personal use only Underwritten Offer (Institutional – $1.53b 50% 45% covenant limit 2.2% 0.5% 2.5% 40% 10.4% 30% 20% 38.1% 38.3% 27.9% 29.1% 30.5% 10% 0% 31 Dec 2008 Invest. Estimated Inv. Estimated Other Adj. Other S
Slide 11: Pro forma Debt / TTA and sensitivity
Pro forma Debt / TTA and sensitivity Total Debt1 / Total Tangible Assets2 For personal use only Underwritten Offer (Institutional) – $1.53b 50% 40% 1.0% 0.3% 1.8% 35% upper limit of target gearing range 30% 11.0% 20% 31.0% 33.5% 22.5% 23.5% 24.6% 10% 0% 31 Dec 2008 Invest. Estimated Inv. Estimated O
Slide 12: Pro forma NTA and sensitivity
Pro forma NTA and sensitivity Net Tangible Assets per Security For personal use only $/security Underwritten Offer (Institutional) – $1.53b $6 $5 $0.44 $0.20 $0.21 $4 $0.36 $3 $4.86 $2 $4.01 $3.65 $3.43 $3.20 $1 $0 31 Dec 2008 Invest. Estimated Inv. Estimated Other Adj. Other Subtotal Subtotal Equit
Slide 13: Pro forma balance sheet
Pro forma balance sheet $ millions 31 December 2008 Adjustments1 31 December 2008 31 December 2008 31 December 2008 For personal use only Actual Pro-Forma Pro-Forma Post Pro-Forma Pre Equity Raising Underwritten Offer2 Fully Subscribed2 Cash 52 0 52 148 590 Real estate related assets 13,049 (1,100)
Slide 14: Indicative timetable
Indicative timetable Institutional offer opens 13 May 2009 For personal use only Securityholder declaration forms due 4:00pm (Sydney time) 13 May 2009 Institutional offer closes 12.00pm (Sydney time) 14 May 2009 Record date to determine right to participate in the entitlement offer 7.00pm (Sydney ti
Slide 15: 3. Stockland Investment Proposition
For personal use only 3. Stockland Investment Proposition NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES OR TO U.S. PERSONS
Slide 16: Australia's largest diversified REIT
Australia’s largest diversified REIT Australian Commercial assets1 – A$8.5b For personal use only Retail – $4.0b Office – $3.2b Industrial / Intermodal – $1.3b Australian Residential assets1 – A$3.6b Communities – $2.3b Retirement – $0.5b Apartments – $0.8b 1. As at 31 December 2008 NOT FOR DISTRIBU
Slide 17: Investment profile – Residential
Investment profile – Residential Market Conditions Robust Stockland’s Strong Market Position For personal use only • First Home Buyer (FHB) market still very buoyant Residential Communities Market Share Within Stockland’s Key Development Corridors Federal Budget announcement of FHOB extension 33%
Slide 18: Investment profile – Retail
Investment profile – Retail For personal use only • Portfolio is well placed with shopping centres weighted towards non-discretionary expenditure • Solid retail sales MAT growth of 5.1%, comparable MAT growth of 3.3% (to 31 March 2009) • 99.3% occupancy by GLA as at 31 March 2009 • Arrears still low
Slide 19: Investment profile – Office
Investment profile – Office For personal use only • Solid office tenancy mix, with government (15%), ASX-listed companies (31%) and major professional services & multinationals (18%)1 • No major lease expiry risk in FY10 – FY10 office expiries will occur mostly in Q4 FY10 • Office rent reviews due i
Slide 20: Investment profile – Industrial
Investment profile – Industrial For personal use only • Stable industrial tenancy mix with government (14%) and major transport, manufacturing and wholesale / distribution firms (72%)1 • Only one asset with major lease expiry risk in FY10 Geographic diversification2 Lease expiry profile3 Average WAL
Slide 21: Strategic investments
Strategic investments For personal use only GPT – $510m market value at 12 May 2009 • Interest in 1,215m GPT stapled securities held through derivatives (including take-up of entitlement) • Position restructured as part of financing of take-up of entitlement of last week’s raising, which also result
Slide 22: Realistic asset valuations
Realistic asset valuations • Carried at lower of cost or net realisable value For personal use only • In depth review of all projects in response to tougher conditions and changed Residential Apartments business plan Inventory valuation – $150m inventory impairment recognised in 1H09 – Further impai
Slide 23: Active capital management initiatives
Active capital management initiatives • Commercial asset sales of $1.1 billion1 in FY08 / FY09 YTD at an average cap For personal use only rate of 6.4% Asset sales • Will continue with our program of seeking joint venture partners and disposing of non-core assets • Revised distribution policy from F
Slide 24: Credit and debt maturity profile
Credit and debt maturity profile For personal use only • All lenders have one set of covenants S&P Rating A- / Negative – Total liabilities / total tangible assets: 45% Weighted average debt maturity 5.2 years1 – Interest cover: 2.0x (write-downs and Debt fixed / hedged 71%1 impairments are excluded
Slide 25: 4. Key risks
For personal use only 4. Key risks NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES OR TO U.S. PERSONS
Slide 26: Key risks
Key risks Development and planning risks For personal use only Residential housing cycle Retirement market UK property market Availability of capital Stockland Equity derivative contracts specific risks Impact of financing covenants Impact of interest rates Financial forecasts Refinancing requiremen
Slide 27: 5. Summary
For personal use only 5. Summary NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES OR TO U.S. PERSONS
Slide 28: Summary
Summary For personal use only • Volatile and uncertain markets are likely to continue for some time Business • Residential well positioned for market upturn fundamentals • Commercial Property profits underpinned by rental contracts • No capital being committed to new Apartment projects and the UK •
Slide 29: Appendix I – Additional Risk Detail
For personal use only Appendix I Additional Risk Detail NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES OR TO U.S. PERSONS
Slide 30: Risks
Risks • This section identifies the key risks associated with an investment in stapled securities in Stockland (Securities). These risks are not exhaustive of the For personal use only risks faced by potential investors in Stockland • You should consider carefully the risks described in this section
Slide 31: Risks
Risks Residential housing cycle For personal use only • Stockland’s operating cash flow is influenced by, amongst other things, residential land sales to builders, home owners and investors and commercial development sales to professional investors and institutions. A sustained downturn in the econo
Slide 32: Risks
Risks Impact of interest rates For personal use only • Stockland's interest cost on floating rate debt will increase if benchmark interest rates increase. This would reduce earnings and cashflow available for distribution to security holders • Stockland manages its exposure to adverse fluctuations i
Slide 33: Risks – A-REIT sector risks
Risks A-REIT sector risks For personal use only Asset values • Asset values are affected by many factors including prevailing market conditions, risk appetite, volume of sales, the ability to procure tenants, contracted rental returns, operating, maintenance and refurbishment expenses and the fundin
Slide 34: Risks
Risks Unemployment For personal use only • Current economic conditions due to the global financial crisis mean there is a risk of unemployment levels rising over the coming months. If so, this could impose financial stresses on households • This could impact demand for Residential dwellings and reta
Slide 35: Appendix II – International Selling Restrictions
For personal use only Appendix II International Selling Restrictions NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES OR TO U.S. PERSONS
Slide 36: International selling restrictions
International selling restrictions This Presentation and any accompanying documents do not constitute an offer or invitation in any jurisdiction in which, or to any person to whom, it would not be lawful to make such an offer or invitation. The distribution of this presentation and any accompanying
Slide 37: International selling restrictions
International selling restrictions Hong Kong For personal use only This Presentation and accompanying documents are provided only for the personal and confidential use of the institutional investors as defined in the Hong Kong Securities and Futures Ordinance (Cap 571) (“SFO”). If you are not an ins
Slide 38: International selling restrictions
International selling restrictions Netherlands For personal use only In relation to each member state of the European Economic Area which has implemented the Prospectus Directive (each, a “Relevant Member State”), no offer of the offered shares to the public in that Relevant Member State prior to th
Slide 39: Stockland Corporation Limited
For personal use only Stockland Corporation Limited ACN 000 181 733 Stockland Trust Management Limited ACN 001 900 741 25th Floor 133 Castlereagh Street SYDNEY NSW 2000 DISCLAIMER OF LIABILITY While every effort is made to provide accurate and complete information, Stockland does not warrant or repr