Slide 1: HY20 Results
HY20 RESULTS A S X:CNI 12 Feb 2020 Centuria Capital Group CENTURIA CAPITAL GROUP ASX:CNI 1 COF: NISHI, 2 PHILLIP LAW STREET, CANBERRA, ACT
Slide 2: Agenda
Agenda 1. Group Overview 2. Financial Results 3. Divisional Overview 4. Q&A 5. Appendices CENTURIA CAPITAL GROUP ASX:CNI 2 CENTURIA HEATHLEY: 32 MORROW STREET, TARINGA, QLD
Slide 3: Group Overview
SECTION ONE Group Overview A S X:CNI CENTURIA CAPITAL GROUP ASX:CNI 3 CENTURIA UNLISTED: 80 FLINDERS STREET, ADELAIDE, SA
Slide 4: A leading ASX-listed funds manager
CENTURIA CAPITAL GROUP A leading ASX-listed funds manager $7.3bn Group AUM1 ASX:CNI – Market capitalisation of $1.0bn2 $0.6bn $6.4bn Real Estate AUM $0.9bn Investment Bonds AUM CNI Co-Investments on balance sheet Centuria Office $297m3 Listed Real Estate AUM Unlisted Real Estate AUM Centuria REIT AS
Slide 5: Delivering strong growth and creating value across the platform
CENTURIA PLATFORM Delivering strong growth and creating value across the platform $7.3bn 4.50cps 8.10cps 12.50cps Group AUM1 HY20 Distribution HY20 Operating Earnings Forecast FY20 Operating 18% over HY20 per security per security Earnings per security 5.9% growth on HY19 24.6% growth on HY19 $1.0bn
Slide 6: Centuria AUM expands to $7.3 billion
ASSETS UNDER MANAGEMENT Centuria AUM expands to $7.3 billion ASSETS UNDER MANAGEMENT ($BN) HY20 ACTIVITY • Group AUM expanded to $7.3bn (+18%) 9.2 • Real estate AUM grew 21% to $6.4bn 42.4% Augusta Capital Limited • $1.2bn of gross acquisitions and $0.2bn of CAGR1 1.9 FY17 to pro forma revaluations
Slide 7: Centuria has delivered 187% total securityholder return since 2017
RECENT ACTIVITY Centuria has delivered 187% total securityholder return since 20171 300% ASX:CNI ASX 200 A-REIT Accum ASX 300 A-REIT Accum ANNOUNCED 29 January 2020 250% Augusta Capital ACQUISITION 10 December & 11 (NZX:AUG) ANNOUNCED December 2019 ADDITIONAL AUM $1.9bn Nishi Building3 & two ACQUISI
Slide 8: Takeover bid for Augusta Capital Limited (NZ)
AUGUSTA CAPITAL PROPOSAL Takeover bid for Augusta Capital Limited (NZ) • Centuria Capital Group (Centuria, ASX:CNI) entered into a bid implementation agreement that outlines a proposal to acquire Augusta Capital Transaction Limited (Augusta), one of New Zealand’s largest listed real estate funds man
Slide 9: Centuria's pro forma platform to grow by 26% to $9.2bn
TRANSACTION BENEFITS Centuria’s pro forma platform to grow by 26% to $9.2bn1 • Group AUM would increase 26% to $9.2bn1 LISTED FUNDS MANAGER PEER SET (AUM $BN) Increase scale • Market capitalisation is expected to increase by a minimum and relevance of ~A$101m2 to ~A$1.2bn • Acquires one of New Zeala
Slide 10: Strategy & Outlook
CENTURIA CAPITAL GROUP Strategy & Outlook • Australian commercial, industrial and healthcare markets remain compelling and well supported • Wholesale and retail investor demand extremely strong with capital seeking to deploy into Centuria funds MARKETS • Equity markets remain conducive to supporting
Slide 11: Financial Results
SECTION TW O Financial Results A S X:CNI CENTURIA CAPITAL GROUP ASX:CNI 11 CIP: 23-41 GALWAY AVENUE, MARLESTON, SA
Slide 12: Group Financial Highlights: Delivering strong investor returns
GROUP FINANCIAL HIGHLIGHTS Delivering strong investor returns • Distributions per stapled security of 4.50 cents, EARNINGS AND DISTRIBUTIONS (CENTS PER SECURITY) a 5.9% increase on HY19 HY20 • Underpinned by 73% recurring revenues PERFORMANCE 16.30 • Operating NPAT $33.4m1; Operating EPS 8.10cps2 14
Slide 13: Expanded platform enhances fee generation for the Group
OPERATING SEGMENT RESULTS Expanded platform enhances fee generation for the Group HY20 HY19 OPERATING PROFIT BY SEGMENT ($m) ($m) Profit increased 61.5% reflecting expanded platform, Property funds management1 17.6 10.9 strong recurring revenue contribution and transaction fees Performance fees 21.5
Slide 14: HY20 total revenues underpinned by recurring revenues
RECURRING REVENUES HY20 total revenues underpinned by recurring revenues 160 $ MILLIONS $21.5m 80-85% recurring Recognised revenue forecast performance fees1 $24.7m 140 80% Forecast of HY20 performance recurring $34.0m fees collected3 120 73% recurring revenue revenue Non-recurring revenue Performan
Slide 15: Recycling larger balance sheet to grow platform
DEBT AND CAPITAL MANAGEMENT Recycling larger balance sheet to grow platform HY20 FY19 OPERATING BALANCE SHEET ($m) ($m) Assets Cash and cash equivalents 84.8 87.8 Receivables 68.9 65.7 $1.53 7.2 times 10.2% Financial assets 604.0 112.2 Net Asset Value Operating interest Operating Other assets 6.5 5.
Slide 16: Co-investments: Strong 14.7% annualised return
CO-INVESTMENTS Strong 14.7% annualised return CARRYING VALUE DISTRIBUTION CARRYING VALUE DISTRIBUTION CO-INVESTMENTS 31 Dec 2019 INCOME 1H20 31 Dec 2018 INCOME 1H19 ($m) ($m) ($m) ($m) Centuria Office REIT (COF)2,3 227.4 6.4 178.8 4.4 Centuria Industrial REIT (CIP) 2,3 227.1 6.2 173.0 5.5 Strong ali
Slide 17: Increased ESG initiatives across Centuria's platform
ESG Increased ESG initiatives across Centuria’s platform ENVIRONMENTAL SOCIAL & WELLBEING GOVERNANCE & COMPLIANCE St Lucy’s School, over $115,000 donated COF’S EXPANDING SOLAR INITIATIVES at 2019 annual trivia night Continued focus on Non-Financial Risk Social and Affordable Housing Projects: Commit
Slide 18: Divisional Overview
SECTION THREE Divisional Overview A S X:CNI CENTURIA CAPITAL GROUP ASX:CNI 18 CENTURIA UNLISTED & COF: 203 PACIFIC HIGHWAY, ST LEONARDS, NSW
Slide 19: Centuria Office REIT: AUM increased to $2.1bn
REAL ESTATE DIVISION: CENTURIA OFFICE REIT | ASX:COF AUM increased to $2.1bn underpinned by quality office acquisitions TOTAL UNITHOLDER RETURN 109.5% CNI co-investment Market Capitalisation INCLUDED IN THE S&P/ASX Australia’s largest S&P/ASX300 A-REIT SINCE IPO1,2,3 pure-play COF INDEX 74.6% 19.9%4
Slide 20: Centuria Industrial REIT: AUM increased to $1.6bn
REAL ESTATE DIVISION: CENTURIA INDUSTRIAL REIT | ASX:CIP AUM increased to $1.6bn underpinned by quality industrial acquisitions TOTAL UNITHOLDER RETURN 63.1% CNI co-investment Market Capitalisation INCLUDED IN THE S&P/ASX Australia’s largest domestic S&P/ASX300 A-REIT EX JAN 20171,2,3 300 Index pure
Slide 21: Fixed Term Funds: $216m of HY20 acquisitions
REAL ESTATE DIVISION: CENTURIA UNLISTED REAL ESTATE – FIXED TERM FUNDS $216m of HY20 acquisitions enhance strong performance ATTRACTIVE INITIAL YIELD SPREAD IN DECREASING TERM DEPOSIT AND RATE CLIMATE4 $1.8bn 16 4 10.00% Fixed term funds Funds in the Centuria Fixed AUM1 Wholesale top 10 index2 Term
Slide 22: CDPF Gross AUM increase of 74% from FY19
REAL ESTATE DIVISION: CENTURIA UNLISTED REAL ESTATE – CENTURIA DIVERSIFIED PROPERTY FUND (CDPF) CDPF Gross AUM increase of 74% from FY19 12.0% ASSET ALLOCATION1,2 HY20 ACQUISITIONS 2 13.5% Direct Real Estate Unlisted Real Estate Funds CDPF 74.5% Liquid Assets GROSS ASSETS UNDER MANAGEMENT 1,2 CDPF:
Slide 23: Centuria Heathley
REAL ESTATE DIVISION: CENTURIA HEATHLEY Established presence in healthcare real estate sector Centuria Heathley Progressing Est. $500m $0.7bn 1 50 11 ~$300m acquisition healthcare property mandate with AXA Unlisted Investment Managers AUM Assets pipeline and Grosvenor Group fixed-term funds RECENT A
Slide 24: Investment Bonds Division
INVESTMENT BONDS DIVISION Continued investment in Centuria Life • Property and infrastructure funds 2 options CENTURIA • Cash and fixed interest funds 3 options CENTURIA LIFE LIFEGOALS • Diversified balanced funds 3 options $0.9bn 22 • International share funds • Diversified growth funds 4 options 4
Slide 25: Q&A
SECTION FOUR Q&A A S X:CNI CENTURIA CAPITAL GROUP ASX:CNI 25 CENTURIA UNLISTED: 348 EDWARD STREET, BRISBANE, QLD
Slide 26: Appendices
SECTION FIVE Appendices A S X:CNI CENTURIA CAPITAL GROUP ASX:CNI 26 CENTURIA HEATHLEY: 42-44 ORD STREET, WEST PERTH WA
Slide 27: Centuria Listed Division: COF and CIP
APPENDIX: REAL ESTATE DIVISION - CENTURIA LISTED DIVISION COF: Australia’s largest CIP: Australia’s largest domestic pure play office REIT pure play industrial REIT • HY20 FFO of 9.6cpu, distributions of 8.9cpu delivered • HY20 FFO of 9.9cpu, distributions 9.4cpu delivered • FY20 FFO guidance of 19.
Slide 28: Real estate AUM grew 23% in FY19 to $6.4 billion
APPENDIX: REAL ESTATE DIVISION Real estate AUM grew 23% in FY19 to $6.4 billion1 43 properties valued at $1,589m (FY19: $1,317m) COF: 6 properties CIP: 12 properties Unlisted: 2 properties CDPF: 1 property Healthcare: 21 properties 20 properties valued at $710m NT QLD 26% 39 properties valued at $1,
Slide 29: Centuria's pro forma AUM expands to $9.2bn
APPENDIX: AUGUSTA CAPITAL PROPOSAL Centuria’s pro forma AUM expands to $9.2bn 1 (+26%) $9.2bn Pro forma Group AUM1 ASX:CNI – Pro forma market capitalisation of ~$1.2bn2 $8.3bn Real Estate AUM $0.9bn Investment Bonds AUM Listed Real Estate AUM Unlisted Real Estate AUM Centuria $3.8bn AUGUSTA CAPITAL
Slide 30: Enhanced asset diversification post transaction
AUGUSTA CAPITAL PROPOSAL Enhanced asset diversification post transaction GEOGRAPHIC DIVERSIFICATION SECTOR DIVERSIFICATION Enhances Centuria’s presence as a leading funds Augusta’s complementary platform is highly manager across Australia and New Zealand aligned to Centuria’s sectors of expertise •
Slide 31: Social and Affordable Housing
APPENDIX: REAL ESTATE DIVISION Social and Affordable Housing ARTIST IMPRESSIONS PARTNERING WITH PROGRESSING COMPASS HOUSING ALL PROJECTS (TIER 1 SERVICE PROVIDER) AND TETRIS CAPITAL Development approvals Four projects, received for all projects 190 dwellings CARDIFF MAYFIELD Commenced demolition CNI
Slide 32: Continuing to build out Centuria LifeGoals
APPENDIX: INVESTMENT BONDS DIVISION Continuing to build out Centuria LifeGoals HY20 TOTAL AUM ($m) FY19 HY20 CHANGE (%) Centuria LifeGoals Prepaid funeral plans (Guardian)2 534.0 550.0 3.0% • Assessing opportunities to expand from 22 to 30 Capital Guaranteed (Centuria Life) 194.0 182.4 investment op
Slide 33: Reconciliation of statutory profit to operating profit
APPENDIX: GROUP FINANCIALS Reconciliation of statutory profit to operating profit HY20 HY19 ($m) ($m) Statutory net profit after tax 78.0 22.2 Statutory EPS (cents)1 18.6 6.4 Less non-operating items: Gain on fair value movements in derivatives and investments (38.3) (0.9) Transaction and other cost
Slide 34: Operating segment balance sheet
APPENDIX: GROUP FINANCIALS Operating segment balance sheet PROPERTY FUNDS INVESTMENT BONDS CO-INVESTMENTS CORPORATE HY19 FY19 OPERATING BALANCE SHEET MANAGEMENT ($m) MANAGEMENT ($m) ($m) ($m) ($m) ($m) ASSETS Cash and cash equivalents 37.8 6.4 29.8 10.8 84.8 87.8 Receivables 43.6 1.7 22.3 1.3 68.9 6
Slide 35: AASB15 revenue accounting standard impact on performance fees
APPENDIX: GROUP FINANCIALS AASB15 revenue accounting standard impact on performance fees The Group receives a performance fee for providing management services 2 years from forecast fund end date: Management’s model assumes that the where the property fund outperforms a set IRR benchmark at the time
Slide 36: Definitions
Definitions Operating Segments: Group has five reportable Non-operating segments: Non-operating items CNI, CCG or the Group: Centuria Capital Group operating segments. These reportable operating comprises transaction costs, mark-to-market comprises of Centuria Capital Limited ABN 22 segments are the
Slide 37: Disclaimer
Disclaimer This presentation has been prepared by Centuria Capital Limited and Centuria Funds Management Limited This presentation has been prepared without taking account of any person’s individual investment as responsible entity of Centuria Capital Fund (together the stapled listed entity CNI). o
Slide 38: Centuria Metropolitan REIT ASX:CMA
CENTURIA METROPOLITAN REIT ASX:CMA 38