Slide 1: FY12 Results Presentation
For personal use only FY12 Results Presentation 23 August 2012 Cromwell Property Group – FY12 Results 1
Slide 2: Important Information & Disclaimer
Important Information & Disclaimer For personal use only This presentation including its appendices (“Presentation”) is advice as they deem necessary or consider appropriate for securities. To the extent that general financial product advice dated 23 August 2012 and has been prepared by the their pa
Slide 3: Section 1: FY12 Financial Results
For personal use only Section 1 FY12 Financial Results Cromwell Property Group – FY12 Results 3
Slide 4: Key Financial Results
FY12 RESULTS Key Financial Results For personal use only Operating profit1 increased by 23% to $80.0m (7.5 cps) Derived 100% from property portfolio Increase in like for like property income of 6.8%2 over FY11 Growth in operating EPS of 6% Average interest cost of 6.9% Distributions main
Slide 5: Statutory Financial Results
FY12 RESULTS Statutory Financial Results For personal use only Fair value decrease of investment properties of $12.4m $1.5m increase in property values (net of leasing and capex costs) $13.9m decrease due to transaction costs related to acquisition of HQ North Tower & Bundall Corporate Centre
Slide 6: Financial Position
FY12 RESULTS Financial Position For personal use only Growth in asset base from acquisition of HQ North Jun-11 Jun-12 Tower and Bundall Corporate Centre for ($’000) ($’000) approximately $250m Assets Cash and Cash Equivalents 46,572 59,153 NTA impacted by fair value of interest rate swaps Invest
Slide 7: Debt Facilities Further Extended
CAPITAL MANAGEMENT Debt Facilities Further Extended For personal use only Diversified across a syndicated facility and six bilateral facilities Changes during the year demonstrate continued support for Cromwell’s high quality cashflow assets Lenders comprise major Australian banks and one offs
Slide 8: Interest Rate Hedging Extended
CAPITAL MANAGEMENT Interest Rate Hedging Extended For personal use only Took advantage of recent market lows to extend swap profile Weighted average swap term of 2.6 years 93% hedged for FY13 at 4.6% plus margins High degree of certainty over interest expense in FY13 and FY14 72% hedged fo
Slide 9: Section: Investment Portfolio
For personal use only Section 2 Investment Portfolio Cromwell Property Group – FY12 Results 9
Slide 10: Property Portfolio
INVESTMENT PORTFOLIO Property Portfolio For personal use only Geographic Diversification1 Sector Diversification1 Tenant Classification1 4.5% 4.8% 1.8% 15.7% 1.4% QLD 39.1% 29.7% NSW 26.8% Retail Government ACT Commercial Listed Company VIC Industrial Private Company TAS SA 17.5% 45.2% 93.4% 20.1%
Slide 11: Continuing Portfolio Improvement
INVESTMENT PORTFOLIO Continuing Portfolio Improvement For personal use only Acquisition of HQ North Tower, Brisbane for $186m Sale of Masters Distribution Centre for $39m Near new asset in improving Brisbane market Lower yielding property in low growth market Average rent increase of 4.2%
Slide 12: Continuing Portfolio Improvement
INVESTMENT PORTFOLIO Continuing Portfolio Improvement For personal use only WALE of 6.2 years one of the longest in the sector Weighted Average Cap Rate (WACR) by Sector Industry comparatives include: Sector Jun-11 Jun-12 CPA – 4.9 years Commercial 8.09% 8.22% Industrial 8.97% 9.36% Dexus –
Slide 13: Minimal Lease Expiries
INVESTMENT PORTFOLIO Minimal Lease Expiries For personal use only Average of only 6.3% lease expiry FY13 – FY15 Lease Expiry Profile % Gross Income 1.4% Marketing of 380 LaTrobe Street space generating positive Latrobe St VIC interest in a challenging market 3.3% 1.0% 1.0% Collins St 100 Waymo
Slide 14: Qantas Global Headquarters, Mascot, NSW
INVESTMENT PORTFOLIO Qantas Global Headquarters, Mascot, NSW For personal use only Since acquisition Cromwell has agreed with Qantas Lease extension to 2032 A $131m refurbishment and expansion programme Average return on cost of 8.8% in first financial year after completion of refurbishment
Slide 15: Section: Funds Management
For personal use only Section 3 Funds Management Cromwell Property Group – FY12 Results 15
Slide 16: Funds Management – Organic Growth
GROWTH Funds Management – Organic Growth For personal use only Funds Management Summary Number of Fund Investors Investors Total Assets Properties Ongoing Fees Cromwell Property Fund Retail $171m 5 - Cromwell Riverpark Trust Retail $195m 1 0.60% Cromwell Ipswich City Heart Trust1 Retail $30m 1 0.60%
Slide 17: Proposed CPF Transaction
CPF Proposed CPF Transaction For personal use only Cromwell has made an offer to buy all units in the Cromwell Property Fund it does not already own Consideration to be paid in Cromwell securities on an NTA for NTA basis Would result in approximately $22m Cromwell securities being issued Tra
Slide 18: Proposed CPF Transaction: CPF portfolio
CPF Proposed CPF Transaction For personal use only Cromwell Property Fund portfolio: 30 June 2012 Predominantly located in NSW and ACT CPF Portfolio Value2 $168.4m The majority of the portfolio is commercial office Number of Properties3 5 property with a smaller exposure to the retail and Occu
Slide 19: Section: Strategy & Outlook
For personal use only Section 4 Strategy & Outlook Cromwell Property Group – FY12 Results 19
Slide 20: Strategy
OUTLOOK Strategy Provide defensive, superior risk adjusted returns from a 100% Australian portfolio For personal use only CROMWELL’S Invest in high quality office assets in predominantly CBD / core fringe markets STRATEGY Seek assets which offer the potential for superior returns through activ
Slide 21: Property Portfolio
OUTLOOK Property Portfolio For personal use only Will continue to seek investment property opportunities consistent with strategy Allocation of capital to markets with best growth potential ahead of cycle Continued focus on improving portfolio quality Disciplined approach to transaction acti
Slide 22: Funds Management
OUTLOOK Funds Management For personal use only Building blocks for growth in earnings are in place Retail funds management Riverpark Trust will deliver increased recurring fees in FY13 Ipswich City Heart Trust will deliver transactional fees in FY13, recurring fees from FY14 onwards Expect
Slide 23: Earnings and Capital Management
OUTLOOK Earnings and Capital Management For personal use only Operating earnings expected to be at least 7.5cps in FY13, 10.1% yield1 Growth in property income partially offset by 100 Waymouth Street refurbishment Weighted average interest rate of 6.6% Increase in funds management income exp
Slide 24: Contacts
Contacts For personal use only Paul Weightman Cromwell Property Group Chief Executive Officer Level 19, 200 Mary Street Ph: +61 7 3225 7720 Brisbane QLD paul.weightman@cromwell.com.au Phone: +61 7 3225 7777 Facsimile: +61 7 3225 7788 Daryl Wilson WWW.CROMWELL.COM.AU Director – Finance & Funds Manage
Slide 25: Appendix: Additional Information
For personal use only Appendix Additional Information Cromwell Property Group – FY12 Results 25
Slide 26: Property Portfolio – Key Assets
Property Portfolio – Key Assets For personal use only Top 10 assets account for 80% of portfolio with occupancy of 99.4% and a WALE of 7.2 years CMW Top 10 Property Assets Asset State Class Book Value Cap Rate Occupancy WALE Major Tenants Review Qantas Global Headquarters NSW Office $198.8 M 7.25%
Slide 27: Property Portfolio – Top tenants
Property Portfolio – Top 20 tenants For personal use only Top 20 tenants account for 75% of our tenancy income CMW Top 20 Tenants % of Total Portfolio Tenant Building Tenant Classification Gross Income Commonwealth of Australia Dept of FaHCSIA Tuggeranong Office Park Government 11.9% Qantas Airway
Slide 28: Property Portfolio – Focus on Sustainability
Property Portfolio – Focus on Sustainability Cromwell has adopted Global Reporting Initiative (GRI) G3 guideline as the framework for reporting on the Group’s environmental, For personal use only economic and social performance Since 2007, Cromwell has applied the National Australian Built Envir
Slide 29: Property Portfolio – Net Property Income
Property Portfolio – Net Property Income For personal use only FY12 FY11 FY12 FY11 ($’000) ($’000) Variance ($’000) ($’000) Variance Tuggeranong Office Park, Greenway Gillman Woolstore, Gillman SA 1,323 1,287 2.8% ACT 19,576 18,916 3.5% NQX Distribution Centre, Pinkenba QLD 2,336 1,918 21.8% Industr
Slide 30: Reconciliation Operating and Statutory Profit
FY12 Reconciliation Operating and Statutory Profit For personal use only FY11 FY11 FY12 FY12 (cents per (cents per ($’000) security) ($’000) security) Profit from operations 65,297 7.1 80,010 7.5 Gain/(loss) on sale of investment properties (195) 0.0 (331) 0.0 Gain/(loss) on sale of available-for-sa
Slide 31: Cromwell Property Fund - Assets
Cromwell Property Fund - Assets For personal use only 43 Bridge Street, Hurtsville NSW This property is located in Hurtsville’s commercial market, which is a sub-regional centre within the middle ring of Sydney’s Southern/South Western suburbs situated approximately 20 km from Sydney CBD and is clas
Slide 32: Cromwell Property Fund - Assets
Cromwell Property Fund - Assets For personal use only Lovett Tower, Woden ACT With 22 commercial office floors and ground floor retail, Lovett Tower is Canberra’s tallest building and is 99% leased to the Department of Veteran Affairs until 2017. Address 13 Keltie Street, Wooden, ACT External Valuat
Slide 33: well versed, well timed, well considered
For personal use only well versed well timed well considered Cromwell Property Group – FY12 Results 33