Workspace Group Plc · LSE:WKP
Workspace — H1 2024/25 Earnings Presentation
35 slides from Workspace's earnings presentation, Nov 22, 2024
Slide 1: Half Year Results 2024/25 Investor & Analyst Presentation
Workspace Group PLC Half Year Results 2024/25 Investor & Analyst Presentation 22 November 2024
Slide 2: Agenda
2 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 AGENDA 01 INTRODUCTION Lawrence Hutchings, CEO 02 FINANCIAL & OPERATIONAL REVIEW Dave Benson, CFO 03 WRAP-UP Lawrence Hutchings, CEO
Slide 3: Introduction
3 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 LAWRENCE HUTCHINGS, CEO INTRODUCTION Grand Union Studios, Ladbroke Grove
Slide 4: An Exciting Opportunity
4 Workspace Group PLC Introduction Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 AN EXCITING OPPORTUNITY LONDON’S LEADING PROVIDER OF FLEXIBLE, SUSTAINABLE CUSTOMER-FIRST APPROACH AND WORK SPACE WELL-RECOGNISED BRAND SCALABLE OPERATING PLATFORM MANAGING SIGNI
Slide 5: Financial & Operational Review
5 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 DAVE BENSON, CFO FINANCIAL & OPERATIONAL REVIEW The Shepherds Building, Shepherd’s Bush
Slide 6: Solid Trading Performance
6 Workspace Group PLC Introduction Financial Financial & & Operational Operational Review Wrap-Up Appendix Half Year Results 2024/25 SOLID TRADING PERFORMANCE CONTINUED EARNINGS AND DIVIDEND GROWTH ROBUST BALANCE SHEET Sep 24 Sep 23 Sep 24 Mar 24 Net rental income £60.5m £61.0m -0.8% Property valuat
Slide 7: Ongoing Customer Demand and Pricing Growth
7 Workspace Group PLC Introduction Financial Financial & & Operational Operational Review Wrap-Up Appendix Half Year Results 2024/25 ONGOING CUSTOMER DEMAND AND PRICING GROWTH AVERAGE MONTHLY ENQUIRIES AVERAGE MONTHLY LETTINGS CONTINUED GOOD CUSTOMER DEMAND STRONG CONVERSION 1000 932 120 110 114 114
Slide 8: Higher Level of Customer Movement: Value Creation Opportunity
8 Workspace Group PLC Introduction Financial Financial & & Operational Operational Review Wrap-Up Appendix Half Year Results 2024/25 HIGHER LEVEL OF CUSTOMER MOVEMENT: VALUE CREATION OPPORTUNITY LFL CUSTOMER MOVEMENTS BY H1 24/25 LEAVERS >3K SQ. FT. FLOOR AREA (11 CUSTOMERS) ! Customer churn, which
Slide 9: Good Net Income Growth
9 Workspace Group PLC Introduction Financial Financial & & Operational Operational Review Wrap-Up Appendix Half Year Results 2024/25 GOOD NET INCOME GROWTH £m Sep 24 Sep 23 Change Underlying rental income 68.7 65.4 +5.0% Unrecovered service charge costs (3.1) (2.8) Empty rates and other non-recovera
Slide 10: Valuation Stabilised, Capital Discipline Maintained
10 Workspace Group PLC Introduction Financial Financial & & Operational Operational Review Wrap-Up Appendix Half Year Results 2024/25 VALUATION STABILISED, CAPITAL DISCIPLINE MAINTAINED BALANCE SHEET EPRA NTA PER SHARE £m £m Sep 24 Mar 24 9.00 Investment property valuation 2,423 2,446 8.50 0.17 8.00
Slide 11: Flexible Debt Facilities
11 Workspace Group PLC Introduction Financial Financial & & Operational Operational Review Wrap-Up Appendix Half Year Results 2024/25 FLEXIBLE DEBT FACILITIES Drawn Facility Amount Amount Average Proforma1 Sep 24 Mar 24 Proforma1 debt £m £m interest rate Maturity Bank facilities drawn £194m £194m £1
Slide 12: Yields Stabilising, Continued ERV Growth
12 Workspace Group PLC Introduction Financial Financial & & Operational Operational Review Wrap-Up Appendix Half Year Results 2024/25 YIELDS STABILISING, CONTINUED ERV GROWTH 30 Sep 24 Movement in half year Valuation Cap. Val. Valuation Valuation Equivalent Yield ERV £m Initial Yield Equivalent Yiel
Slide 13: Smaller Units Deliver Strongest Returns
13 Workspace Group PLC Introduction Financial Financial & & Operational Operational Review Wrap-Up Appendix Half Year Results 2024/25 SMALLER UNITS DELIVER STRONGEST RETURNS ERV GROWTH STRONGEST FOR SMALLER UNITS 4% ! Workspace’s core offering is providing smaller spaces to London’s growing SMEs ! O
Slide 14: Significant Growth Opportunity from Unit Subdivision
14 Workspace Group PLC Introduction Financial Financial & & Operational Operational Review Wrap-Up Appendix Half Year Results 2024/25 SIGNIFICANT GROWTH OPPORTUNITY FROM UNIT SUBDIVISION LFL UNITS LARGER THAN 3,000 SQ. FT. ! Majority of larger spaces are let, many on more traditional leases in place
Slide 15: Our Operating Platform Extracts Value from the Portfolio
15 Workspace Group PLC Introduction Financial Financial & & Operational Operational Review Wrap-Up Appendix Half Year Results 2024/25 OUR OPERATING PLATFORM EXTRACTS VALUE FROM THE PORTFOLIO ! A rolling programme of unit upgrades to meet changing BEFORE customer needs and deliver rental and capital
Slide 16: Major Projects Also Meet Customer Demand for Small Units
16 Workspace Group PLC Introduction Financial Financial & & Operational Operational Review Wrap-Up Appendix Half Year Results 2024/25 MAJOR PROJECTS ALSO MEET CUSTOMER DEMAND FOR SMALL UNITS LEROY HOUSE: OUR FIRST NET ZERO BUILDING ! Refurbishment completed in October 2024 ! 57,000 sq. ft. of new an
Slide 17: Financial Outlook H2 2024/25
17 Workspace Group PLC Introduction Financial Financial & & Operational Operational Review Wrap-Up Appendix Half Year Results 2024/25 FINANCIAL OUTLOOK H2 2024/25 ! Focus on driving occupancy and rent roll in H2 ! Limited direct impact of Budget on our customers, but market sentiment may take time t
Slide 18: Significant Income Growth Opportunity
18 Workspace Group PLC Introduction Financial Financial & & Operational Operational Review Wrap-Up Appendix Half Year Results 2024/25 SIGNIFICANT INCOME GROWTH OPPORTUNITY £250m ! Like-for-like / SE Offices reversion of £21m largely £230m delivered from moving Reversion at current ERVs = £36m all cu
Slide 19: Wrap-Up
19 Workspace Group PLC Introduction Financial & Operational Review Wrap-up Appendix Half Year Results 2024/25 LAWRENCE HUTCHINGS, CEO WRAP-UP Canalot Studios, Ladbroke Grove
Slide 20: Well-Positioned for Growth
20 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 WELL-POSITIONED FOR GROWTH ! A strong brand serving an SME market in structural growth ! Scalable operating platform provides multiple routes to drive income and capital growth ! Well positi
Slide 21: Q&A
21 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 Q&A Metal Box Factory, Southwark
Slide 22: Appendix
22 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 APPENDIX Jukebox Studios at Pall Mall Deposit, Ladbroke Grove
Slide 23: Leading Provider to a Diverse and Growing SME Market
23 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 LEADING PROVIDER TO A DIVERSE AND GROWING SME MARKET OUR CUSTOMERS BY INDUSTRY INFORMATION, COMMUNICATION & TECHNOLOGY 5% 3% PROFESSIONAL, TECHNICAL & CONSULTANCY SERVICES 3% 17% 3% WHOLESAL
Slide 24: ESG That Resonates With Our Customers
24 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 ESG THAT RESONATES WITH OUR CUSTOMERS Portfolio Energy Use Intensity (kWhe/sqm GIA) "!! &%! &$! &#! &"! Industry best practice energy intensity – 118 kWhe/sqm &!! Workspace average energy in
Slide 25: Our Sustainability Benchmarks and Scores
25 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 OUR SUSTAINABILITY BENCHMARKS AND SCORES We transparently disclose our performance and data to numerous external benchmarking authorities. GOLD EPRA Sustainability Best Practice Our top scor
Slide 26: Our Portfolio Provides Choice and Good Value
26 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 OUR PORTFOLIO PROVIDES CHOICE AND GOOD VALUE LIKE-FOR-LIKE PROPERTIES: ERV £ PER SQ. FT. 120 110 100 90 80 70 60 50 40 30 20 10 0 ERV per sq. ft property average ERV per sq. ft. property ran
Slide 27: Long-Term Project Pipeline
27 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 LONG-TERM PROJECT PIPELINE sq. ft. 250,000 200,000 150,000 100,000 50,000 0 Busworks Kennington Riverside The Shaftesbury Old Dairy Havelock Busworks Morie Street Riverside Kennington East L
Slide 28: Completed Projects
28 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 COMPLETED PROJECTS Unaffected area Upgraded area New Space ERV psf Rent at 90% Sep-24 At September 2024 Valuation (£m) (sq. ft.) (sq. ft.) (sq. ft.) (Average) occupancy Rent roll (£m) Wenloc
Slide 29: Projects Underway
29 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 PROJECTS UNDERWAY Actual/ Cost to Unaffected Upgraded Sep-24 Valuation Estimated Complete area area New Space ERV psf Rent at 90% Rent Roll At September 2024 (£m) cost (£m) (£m) Completion (
Slide 30: Future Projects
30 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 FUTURE PROJECTS Estimated cost Unaffected area Upgraded area New space At September 2024 (£m) (sq. ft.) (sq. ft.) (sq. ft.) Design stage (with planning consent) Busworks (phase 1) 28 12,000
Slide 31: Property Portfolio
31 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 PROPERTY PORTFOLIO LIKE-FOR-LIKE LIKE-FOR-LIKE REFURBISHMENTS REDEVELOPMENTS Map Property Net lettable Net rent NON-CORE ref name area (sq. ft.) roll (£) 1 Archer Street Studios 14,984 1,141
Slide 32: Property Portfolio
32 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 PROPERTY PORTFOLIO LIKE-FOR-LIKE continued LIKE-FOR-LIKE continued Map Property Net lettable Net rent Map Property Net lettable Net rent ref name area (sq. ft.) roll (£) ref name area (sq. f
Slide 33: Property Portfolio
33 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 PROPERTY PORTFOLIO REFURBISHMENTS REDEVELOPMENTS Map Property Net lettable Net rent Map Property Net lettable Net rent ref name area (sq. ft.) roll (£) ref name area (sq. ft.) roll (£) 43 Ba
Slide 34: Property Portfolio
34 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 PROPERTY PORTFOLIO SOUTH EAST OFFICE NON-CORE Map Property Net lettable Net rent Map Property Net lettable Net rent ref name area (sq. ft.) roll (£) ref name area (sq. ft.) roll (£) 62 Build
Slide 35: Disclaimer
35 Workspace Group PLC Introduction Financial & Operational Review Wrap-Up Appendix Half Year Results 2024/25 DISCLAIMER This document is not audited and may include certain forward-looking statements relating to Workspace Group PLC (the “Company”), its plans and its current goals and expectations r