City Developments Limited · SGX:C09

City Developments — Q3 2017 Earnings Presentation

58 slides from City Developments's earnings presentation, Nov 9, 2017

  1. Slide 1: Q3 2017 Results Presentation

    Q3 2017 RESULTS PRESENTATION 9 November 2017

  2. Slide 2: Agenda

    AGENDA • EXECUTIVE SUMMARY • FINANCIAL HIGHLIGHTS • SINGAPORE OVERVIEW • INTERNATIONAL OVERVIEW • HOTEL OPERATIONS

  3. Slide 3: Executive Summary

    EXECUTIVE SUMMARY

  4. Slide 4: Key Highlights

    Key Highlights  Resilient financial performance: – Revenue: $863.1 million (Q3 2016: $922.8 million) $2.5 billion (YTD Sep 2016: $2.7 billion) – EBITDA: $312 million (Q3 2016: $313 million) $753 million (YTD Sep 2016: $798 million) – PATMI: $156.1 million (Q3 2016: $170.3 million) $351.5 million (Y

  5. Slide 5: Resilient Performance for Q3 & YTD Sep 2017

    Resilient Performance for Q3 & YTD Sep 2017 Summary of Financial Results YTD YTD Q3 Q3 % % Sep Sep 2017 2016 Change Change 2017 2016 Revenue ($m) 863 923 (6.5) 2,501 2,738 (8.7) PATMI ($m) 156 170 (8.3) 351 409 (14.2) Basic Earnings Per Share 17.2 18.7 (8.0) 38.0 44.3 (14.2) (cents) NAV Per Share ($

  6. Slide 6: Portfolio Composition – YTD Sep 2017

    Portfolio Composition – YTD Sep 2017 Recurring Income Segments Property Hotel Rental S$ million Others Total Funds Development Operations Properties EBITDA * Local 161 58 120 10 349 Overseas 105 202 91 6 404 266 260 211 16 753 Total Assets ^ Local 5,950 666 3,317 295 10,228 AUM = Overseas 3,029 4,81

  7. Slide 7: Portfolio Composition – YTD Sep 2017

    Portfolio Composition – YTD Sep 2017 EBITDA Total Assets Local Overseas Local Overseas 46% 54% 52% 48% • Stability from Recurring Income segments comprising 65% of EBITDA / 54% of Total Assets (excluding tax recoverable and deferred tax asset) • Diversification overseas with international segments a

  8. Slide 8: Diversified Land Bank

    Diversified Land Bank Land Area (as of 30 Sep 2017) – CDL’s Attributable Share Type of Development Land Area (sq ft) Singapore International Total % Residential 741,102 1,809,842 2,550,945 92 Commercial / Hotel 20,886 187,862 208,748 8 Total 761,988 1,997,704 2,759,692 100 Total Proposed GFA – 5.78

  9. Slide 9: Strategic Acquisition of Amber Park

    Strategic Acquisition of Amber Park Successful Collective Sale Bid of Prime East Coast development at $906.7 million Keen Contest with Eight Competitively Priced Bids  CDL and its 20% JV partner successfully tendered for the collective sale of the Amber Park condo site on 4 Oct 2017  Rare freehold

  10. Slide 10: Share Price Performance

    Share Price Performance Stellar Performance for 2017 to date 50% in share price since Jan 2017* PERIOD HIGHEST CLOSE • Q3 Close - $11.33 (29 Sep) $12.44 (↑ 36.3% from 3 Jan) (6 Nov) $11.33 • Highest Close - $13.00 (29 Sep) (19 Oct) $8.31 (↑ 56.4% from 3 Jan) (3 Jan) PERIOD LOWEST CLOSE • Lowest Clos

  11. Slide 11: Share Price Performance

    Share Price Performance CDL vs STI (3 Jan – 6 Nov 2017) Price, Volume & Performance (Rebased) CDL STI 155% 145% 135% 125% 115% 105% 95% 03 Jan 17 08 Feb 17 16 Mar 17 21 Apr 17 30 May 17 05 Jul 17 10 Aug 17 15 Sep 17 23 Oct 17 Price Name Code Cur Open High Low Close Change % City Developments Limited

  12. Slide 12: Acquisition Highlights – YTD 2017

    Acquisition Highlights – YTD 2017 On target to meet $5 billion in Acquisition Objective by end 2018 ACQUISITIONS $ BILLION Site Acquisitions • Hong Leong Plaza Hongqiao – 6.0 RMB 900 million 5.0 • Ransomes Wharf – £58 million • Tampines Ave 10 – $370.1 million 5.0 • Amber Park collective sale site –

  13. Slide 13: Millennium & Copthorne Hotels plc (M&C) – Possible Cash Offer

    Millennium & Copthorne Hotels plc (M&C) – Possible Cash Offer Possible Recommended Cash Offer of 552.5 pence for each M&C Share Possible cash offer announced on 9 Oct 2017 In accordance with Rule 2.6(a) of UK Takeover Code, CDL is required to announce its intent by 8 Dec 2017  M&C’s generation of r

  14. Slide 14: Financial Highlights

    FINANCIAL HIGHLIGHTS

  15. Slide 15: Revenue by Segment for 3rd Quarter (2015 – 2017)

    Financial Highlights Revenue by Segment for 3rd Quarter (2015 – 2017) 600 $863m $923m $809m 500 445 424 438 372 400 $ million 291 300 228 200 89 92 101 100 38 35 42 0 Q3 2017 Q3 2016 Q3 2015 Property Development Hotel Operations Rental Properties Others Q3 2017 Q3 2016 Q3 2015 Property Development 3

  16. Slide 16: Profit Before Tax by Segment for 3rd Quarter (2015 – 2017)

    Financial Highlights Profit Before Tax by Segment for 3rd Quarter (2015 – 2017) 140 $241m $239m $155m 120 95 100 86 74 72 80 64 59 $ million 55 56 60 40 33 40 20 9 0 (20) (8) Q3 2017 Q3 2016 Q3 2015 Property Development Hotel Operations Rental Properties Others Q3 2017 Q3 2016 Q3 2015 Property Devel

  17. Slide 17: EBITDA by Segment for 3rd Quarter (2015 – 2017)

    Financial Highlights EBITDA by Segment for 3rd Quarter (2015 – 2017) $312m $313m $234m 140 112 120 100 105 96 100 88 87 $ million 80 67 72 64 57 60 40 12 20 0 (1) Q3 2017 Q3 2016 Q3 2015 Property Development Hotel Operations Rental Properties Others Q3 2017 Q3 2016 Q3 2015 Property Development 28% 3

  18. Slide 18: Revenue by Segment for YTD Sep (2015 – 2017)

    Financial Highlights Revenue by Segment for YTD Sep (2015 – 2017) 1,600 $2,501m $2,739m $2,449m 1,400 1,244 1,190 1,235 1,147 1,200 893 1,000 795 $ million 800 600 261 278 301 400 103 124 118 200 0 YTD Sep 2017 YTD Sep 2016 YTD Sep 2015 Property Development Hotel Operations Rental Properties Others

  19. Slide 19: Profit Before Tax by Segment for YTD Sep (2015 – 2017)

    Financial Highlights Profit Before Tax by Segment for YTD Sep (2015 – 2017) 360 $541m $583m $514m 320 277 280 252 240 240 $ million 200 162 147 160 129 125 111 107 120 74 80 40 13 1 0 YTD Sep 2017 YTD Sep 2016 YTD Sep 2015 Property Development Hotel Operations Rental Properties Others YTD Sep 2017 Y

  20. Slide 20: EBITDA by Segment for YTD Sep (2015 – 2017)

    Financial Highlights EBITDA by Segment for YTD Sep (2015 – 2017) $753m $798m $729m 360 320 299 266 260 262 280 248 226 $ million 240 211 205 194 200 160 120 79 80 16 14 40 0 YTD Sep 2017 YTD Sep 2016 YTD Sep 2015 Property Development Hotel Operations Rental Properties Others YTD Sep 2017 YTD Sep 201

  21. Slide 21: Robust Balance Sheet

    Financial Highlights Robust Balance Sheet As at 30/09/17 As at 31/12/16 Gross borrowings * $5,244m $5,752m Cash and cash equivalents (include restricted deposits of $214m classified in other non-current $3,725m $3,887m assets and $9m cash and cash equivalents classified as asset held for sale) Net b

  22. Slide 22: Prudent Capital Management

    Financial Highlights Prudent Capital Management Debt Expiry Profile Debt Maturity Within 1 year 2,000 Debt $ million Bond Bank Loan 1 to 2 years 32% 33% 1,500 2 to 3 years 1,000 320 424 251 More than 3 500 386 20% 15% years 746 857 697 607 640 316 0 2017 2018 2019 2020 2021 2022 onwards Debt Currenc

  23. Slide 23: Singapore Overview

    . wy SX . \ SINGAPORE OVERVIEW

  24. Slide 24: Singapore Property Market

    Singapore Property Market Property Price Index – Residential (2012 – Q3 2017) All Residential 180 160 Q2 17 Q3 17 140 136.6 137.6 120 100 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 12 12 12 12 13 13 13 13 14 14 14 14 15 15 15 15 16 16 16 16 17 17 17 Source : URA, Q3 2017 24

  25. Slide 25: Singapore Property Development – Residential Units Sold

    Singapore Property Development Residential Units Sold YTD Q3 2017 YTD Q3 2016 $1,763,460 1,140,625 1,056 Sales Value 3x 482 518,800 $622,361 Units Sold 2x No. of Units* Sales Value* Total Floor Area* (#039;000) (sq ft) * Includes share of JV partners 25

  26. Slide 26: Gramercy Park – 88% Sold; Final Choice Units Released

    Singapore Property Development Gramercy Park – 88% sold; Final Choice Units Released Project Location Tenure Equity Total Total Units % Total Saleable Stake Units Sold Sold Area (sq ft) Gramercy Park Grange Road Freehold 100% 174 153 Over 368,743 89 Strong Uptake:  Phase 1 (North Tower) – 98% sold

  27. Slide 27: Forest Woods – Continued Strong Uptake; 90% Sold

    Singapore Property Development Forest Woods – Continued Strong Uptake; 90% sold Project Location Tenure Equity Total Total % Total % Expected Stake Units Units Sold* Saleable Completed TOP Sold* Area (sq ft) (as of 30 Sep 2017) Forest Lorong 99-year 50% 519 469 90 431,265 10.7 Q4 2020 Woods Lew Lian

  28. Slide 28: Upcoming Residential Project Launches for Q1 / 1H 2018

    Singapore Property Development Upcoming Residential Project Launches for Q1 / 1H 2018# Project Location Tenure Equity Total Gross Floor Expected TOP Stake Units Area (sqm) Completed – New Futura Leonie Hill Road Freehold 100% 124 23,043 TOP in Aug 2017 99-year Tampines Ave 10 project Tampines Ave 10

  29. Slide 29: Inventory of Launched Residential Projects

    Singapore Property Development Inventory of Launched Residential Projects – As of 30 Sep 2017 Total Unsold CDL’s Share of Project Equity Stake Total Units Units Sold % Sold Inventory Unsold Inventory St. Regis Residences 33% 173 161 93% 12 4.0 The Oceanfront @ Sentosa Cove 50% 264 263 99% 1 0.5 One

  30. Slide 30: Completed Residential Projects in Q3 2017

    Singapore Property Development Completed Residential Projects in Q3 2017 Project Location Equity Total % TOP Obtained Stake Units Sold* D’Nest Pasir Ris Grove 51% 912 100 Phase 1 – Jul 2017 Phase 2 – Oct 2017 New Futura Leonie Hill Road 100% 124 -^ Aug 2017 Residential Projects to be Completed in Q4

  31. Slide 31: Singapore Commercial Market

    Singapore Commercial Market Property Price Index – Commercial (2012 – Q3 2017) 145 Office Retail 140 135 Q2 17 130 127.5 Q3 17 128.0 125 120 Q2 17 113.9 115 Q3 17 112.9 110 105 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 12 12 12 12 13 13 13 13 14 14 14 14 15 15 15 15 16 16

  32. Slide 32: Singapore Office Market

    Singapore Office Market Office Space Demand & Supply (2012 – Q3 2017) Private & Public Sector Cumulative Supply Occupancy 90,000 85,337 85,000 81,300 81,365 83,206 80,095 78,254 80,000 72,205 72,980 73,647 73,938 73,992 75,000 70,913 70,000 65,000 60,000 55,000 CDL’s Office Properties 50,000 Occupan

  33. Slide 33: Office Portfolio – Lease Expiry Q4 2017 – 2019

    Rental Properties Office Portfolio – Lease Expiry Q4 2017 – 2019 As of 30 Sep 2017 NLA: 16 92.5% ~2,342,000 sq ft Properties Occupancy Expiry % of NLA 27% 32% 5% Q4 2017 2018 2019 33

  34. Slide 34: Singapore Retail Market

    Singapore Retail Market Retail Space Demand & Supply (2012 – Q3 2017)* Private & Public Sector Cumulative Supply Occupancy 66,000 65,197 65,079 64,271 64,000 63,658 62,000 61,333 60,052 59,955 60,192 59,632 59,880 60,000 58,599 58,000 57,060 56,000 CDL’s Retail Properties Occupancy 54,000 97.5%* (Na

  35. Slide 35: Retail Portfolio – Lease Expiry Q4 2017 – 2019

    Rental Properties Retail Portfolio – Lease Expiry Q4 2017 – 2019 As of 30 Sep 2017 NLA: 19 97.5% ~845,000 sq ft Properties Occupancy Expiry % of NLA 37% 34% 2% Q4 2017 2018 2019 35

  36. Slide 36: Rental Properties Revenue by Sector for YTD Sep

    Rental Properties Revenue by Sector for YTD Sep (2015 – 2017) $261m $278m $301m 160 140 140 116 Office 120 103 S$ million 100 86 Retail 81 84 80 54 57 Industrial 60 52 REIT/Hotel 40 19 13 18 20 5 6 6 Others ^ 0 YTD Sep 2017 YTD Sep 2016 YTD Sep 2015 YTD Sep 2017 YTD Sep 2016 YTD Sep 2015 Office 40%

  37. Slide 37: International Overview

    INTERNATIONAL OVERVIEW

  38. Slide 38: Residential Projects Launched To Date

    International Property Development Residential Projects Launched To Date* Project City Equity Total Total % Sold/ Est. Total Expected Stake Units Units Sold Booked Saleable Completion / Booked Area (sq ft) Australia Ivy and Eve Brisbane 33%# 476 461 97 348,678 1H 2018 China Hong Leong City Center Su

  39. Slide 39: Unlaunched Residential Projects

    International Property Development Unlaunched Residential Projects Project City Tenure Equity Total Est. Total Saleable Area / Expected Stake Units GFA^ / Site Area+ (sq ft) Completion China Huang Huayuan Chongqing 50-year lease 30% >600 1,041,589 TBC UK Belgravia London Freehold 100% 6 12,375 Q1 20

  40. Slide 40: Australia & Japan – Good Progress on Launched Projects

    International Property Development Australia & Japan – Good Progress on Launched Projects Brisbane – Ivy and Eve Tenure Equity Total Total Units % Expected Stake Units Sold* Sold Completion Freehold 33%# 476 461 97 1H 2018  Approx. 97% of project sold to date Ivy and Eve, Brisbane Artist’s Impressi

  41. Slide 41: Collaboration with Waterbrook Lifestyle Resorts

    Collaboration with Waterbrook Lifestyle Resorts Australia – Investment in its 2nd Luxury Retirement Village Development Strategic Focus on Luxury Retirement Sector Project Location Tenure Est. Site Expected Area (sqm) Completion Waterbrook Bayview Northern Sydney Freehold 20,000 2020 Waterbrook Bowr

  42. Slide 42: Strategic Partnership with China Vanke Co., Ltd

    Strategic Partnership with China Vanke Co., Ltd Partial Divestment of 2 Chongqing Projects for RMB 986 million Unlocking Value of Huang Huayuan and Eling Residences Project Tenure Equity Total Expected Stake Units Completion Huang Huayuan 30% >600 TBC 50-year- Eling Residences lease 50% 126 Complete

  43. Slide 43: China – Healthy Sales for Launched Residential Projects

    International Property Development China – Healthy Sales for Launched Residential Projects Suzhou – Hong Leong City Center (丰隆城市中心) Tenure Equity Total Total Units % Expected Completion Stake Units Sold* Sold 70 years 100% 1,804 1,355 75 Completed (Phase 1) (Residential) / Q2 2018 (Phase 2)^ 40 year

  44. Slide 44: China – Completion of Shanghai Commercial Project by Q4 2017

    International Rental Properties China – Completion of Shanghai Commercial Project by Q4 2017 Hong Leong Plaza Hongqiao Tenure Equity Est. Total GFA Expected Stake (sqm) Completion 50-year lease 100% 32,182 Q4 2017  Formerly known as Meidao Business Plaza, the project comprises five office towers wi

  45. Slide 45: International Investment Platforms

    International Investment Platforms Strategic Investments in Synergistic Sharing Economy Sectors mamahome – China’s Fast-Growing Online Apartment Rental Platform  Acquired 20% equity stake for RMB 100 million in Sep 2016  Currently has around 177,000 apartment listings across 30 cities in China – p

  46. Slide 46: UK – Upcoming Launches in Q1 2018

    International Property Development UK – Upcoming Launches in Q1 2018 Project Tenure Equity Total Est. Total Saleable Expected Expected Stake Units Area (sq ft) Completion Launch Belgravia Freehold 100% 6 12,375 Q1 2018 Q1 2018 Knightsbridge Freehold 100% 3 5,193 Q1 2018 Q1 2018 Teddington Riverside

  47. Slide 47: UK – Pipeline Projects

    International Property Development UK – Pipeline Projects 28 Pavilion Road, Knightsbridge, London SW1 Tenure Equity Stake Total Units Est. GFA (sq ft) Freehold 100% 34 135,000  Planning consent received for redevelopment into a 34-unit luxury care home, with the possibility to re-engineer into a re

  48. Slide 48: UK – Commercial / Mixed-Use Projects

    International Property Development UK – Commercial / Mixed-Use Projects Development House, Leonard Street, Shoreditch Tenure Equity Stake Est. Total Lettable Area (sq ft) Freehold 100% 90,000  Existing 28,000 sq ft building is fully leased; vacant possession expected from Q3 2018  Submission of pl

  49. Slide 49: Hotel Operations

    HOTEL OPERATIONS

  50. Slide 50: M&C Hotel Operations – Trading Performance

    M&C Hotel Operations Trading Performance Reported Constant Currency Currency YTD Sep YTD Sep Change YTD Sep Change 2017 2016 2016 Revenue £748m £665m 12.5% £716m 4.5% Revenue (hotel) £649m £581m 11.7% £624m 4.0% Profit before tax * £118m £102m 15.7% £109m 8.3% PATMI * £92m £59m 56.0%  In constant c

  51. Slide 51: M&C Hotel Operations – Trading Performance

    M&C Hotel Operations Trading Performance  RevPAR in reported currency and constant currency were up by 11.5% and 4.0% respectively for YTD Sep 2017 as compared to the same period last year: YTD Sep 17 Reported Currency Constant Currency New York £156.36 ↑ 20.0% ↑ 10.0% Regional US £65.80 ↑11.9% ↑ 2

  52. Slide 52: M&C Hotel Operations – Asset Enhancement

    M&C Hotel Operations Asset Enhancement M Social Auckland (previously known as Copthorne Hotel Auckland Harbourcity)  Soft-opening in early October 2017  During the coming months all of the hotel’s 190 guest rooms and facilities will be commissioned in weekly releases, with the aim of having the ne

  53. Slide 53: M&C Hotel Operations – Asset Enhancement

    M&C Hotel Operations Asset Enhancement Orchard Hotel Singapore  The renovation of 260 deluxe guest rooms will be carried out by the end 2017 for completion in 1H 2018  The interior renovation works at the hotel’s Chinese restaurant, Hua Ting commenced in August 2017 and it is scheduled for complet

  54. Slide 54: Hotel Room Count and Pipeline

    M&C Hotel Operations Hotel Room Count and Pipeline Hotels Rooms 30-Sep 31 Dec 30-Sep 31 Dec Hotel and Room Count 2017 2016 2017 2016 By region: ● New York 4 4 2,238 2,238 ● Regional US 15 15 4,559 4,559 ● London 8 8 2,651 2,651 ● Rest of Europe 21 19 3,528 3,081 ● Middle East * 31 26 10,346 7,805 Mi

  55. Slide 55: CDL Hospitality Trusts – Trading Performance

    CDL Hospitality Trusts Trading Performance YTD Sep YTD Sep 2017 2016 Change S$’000 S$’000 Gross Revenue 149,075 132,531 12.5% Net Property 111,136 99,866 11.3% Income (NPI) Pullman Hotel Munich Gross revenue and NPI increased mainly due to:  Inorganic contribution from The Lowry Hotel and Pullman H

  56. Slide 56: Appointment of AccorHotels as New Resort Operator

    CDL Hospitality Trusts Appointment of AccorHotels as new resort operator for Jumeirah Dhevanafushi  Renamed as Dhevanafushi Maldives Luxury Resort (formerly known as Jumeirah Dhevanafushi)  Appointment effective from 1 Sep 2017  Plans for enhancements in late 2018 and repositioned to join the ico

  57. Slide 57: Disclaimer

    Disclaimer: This document may contain forward-looking statements that involve assumptions, risks and uncertainties. Actual future performance, outcomes and results may differ materially from those expressed in forward-looking statements as a result of a number of risks, uncertainties and assumptions

  58. Slide 58: Gramercy Park, Singapore

    Gramercy Park, Singapore www.cdl.com.sg

City Developments — Q3 2017 Earnings Presentation on 6ix