Slide 1: 2022 Half Year Results
2022 HALF YEAR RESULTS 28 JULY 2022
Slide 2: Clear & consistent strategy continues to deliver
CLEAR & CONSISTENT STRATEGY CONTINUES TO DELIVER Portfolio valuation +7.2% Like-for-like rental growth +7.1% ERV growth +5.9% Uplift on rent reviews and +24% renewals Net investment £548m Occupancy 97% LTV ratio 23% Cost of Debt1 1.8% Debt Maturity1 8.7 years 2 1 Proforma for US Private Placement si
Slide 3: Occupier outlook remains very positive
OCCUPIER OUTLOOK REMAINS VERY POSITIVE European 1H22 take-up 8% higher than 1H211 Low vacancy rate across all European markets2 45.0 Estimated 16 H2 take-up 40.0 UK France Germany 14 35.0 Poland Italy Spain 12 30.0 Take-up, million sqm 10 Vacancy, % 25.0 8 20.0 6 15.0 10.0 4 5.0 2 0.0 0 2012 2013 20
Slide 4: Prime modern portfolio heavily weighted to urban markets
PRIME MODERN PORTFOLIO HEAVILY WEIGHTED TO URBAN MARKETS Portfolio split by geography and asset type (at 30 June 2022) Other, £1.3bn Poland £1.4bn Italy £1.9bn London £8.1bn AUM France £2.7bn £23.8bn Germany £2.9bn Thames Valley £3.5bn National Logistics £2.0bn Other (2%) Urban (67%) Big box (31%) 4
Slide 5: A very diversified and growing customer base
A VERY DIVERSIFIED AND GROWING CUSTOMER BASE Customer sectors (headline rent, SEGRO share) 1,462 customers Other Services & 6% ultilities 7% Transport and logistics Top 20 customers = Technology, Media and 22% 32% of total group Telecoms 11% headline rent Wholesale and Retail Distribution Retail 10%
Slide 6: Responsible SEGRO increasingly integrated throughout the business
RESPONSIBLE SEGRO INCREASINGLY INTEGRATED THROUGHOUT THE BUSINESS CHAMPIONING LOW-CARBON Retrofitting solar panels Use of low-carbon concrete GROWTH INVESTING IN OUR LOCAL NURTURING SEGRO Day of Giving Slough Community Investment Plan COMMUNITIES TALENT AND ENVIRONMENTS Early careers/ diversity 6
Slide 7: We create the space that enables extraordinary things to happen
WE CREATE THE SPACE THAT ENABLES EXTRAORDINARY THINGS TO HAPPEN Inflation- Delivering Disciplined Confident beating strong approach to outlook earnings operational capital growth metrics allocation
Slide 8: We create the space that enables extraordinary things to happen
WE CREATE THE SPACE THAT ENABLES EXTRAORDINARY THINGS TO HAPPEN Inflation- Delivering Disciplined Confident beating strong approach to outlook earnings operational capital growth metrics allocation
Slide 9: Strong financial results
STRONG FINANCIAL RESULTS £216m 16.9p 8.1p Adjusted profit before tax Adjusted earnings per share Interim dividend per share +28.6% +22.5% +9.5% Excl SELP fee: 15.6p, +13.0% £20.5bn 1,249p 23% Portfolio valuation (at share) Adjusted NAV per share Loan to value +7.2% +9.8% 9
Slide 10: 19% growth in net rental income
19% GROWTH IN NET RENTAL INCOME Proportionally consolidated net rental income (excluding joint venture fees), H1 2021-22, £ million £17m £255m £21m £(7)m £(4)m JVs £14m £52m £214m1 JVs Like for like NRI £47m Group +7.1% UK +8.9% Reversion CE +4.1% Indexation Group Group £167m £203m 1H21 net Like-for
Slide 11: 29% increase in adjusted PBT
29% INCREASE IN ADJUSTED PBT Adjusted income statement H1 2022 H1 2021 Change SELP performance fee: £m £m – Recognised net £21 million in the period before tax related to the 10-year performance fee - Gross rental income 239 1951 1.3p impact on EPS – Excluding that EPS would have been 15.6p Property
Slide 12: £1.4bn valuation surplus drives increase in NAV
£1.4BN VALUATION SURPLUS DRIVES INCREASE IN NAV Portfolio value at 30 June 2022: £20.5bn Portfolio UK Continental Europe +7.2% +8.2% +5.2% £1,600m Whole portfolio valuation uplift £1,400m £1,200m 650p £1,000m £800m £600m £400m £200m £0m Total London Thames Valley UK Big Box Germany France Poland Ita
Slide 13: Driven by rental growth and asset management
DRIVEN BY RENTAL GROWTH AND ASSET MANAGEMENT Property yield2: 3.8% 6 month ERV growth: 5.9% 31 December 2021: 3.8% H1 2021: 2.8% London 3.5% +6.3% UK: Thames Valley 4.2% +9.8% +7.3% National +7.0% H1 2021: +3.6% 3.8% Logistics Germany 3.5% +3.8% Cont. France 4.0% +3.2% Eur: +3.6% Italy 3.8% +1.8% H1
Slide 14: £2.1bn of new financing from diverse sources
£2.1BN1 OF NEW FINANCING FROM DIVERSE SOURCES SEGRO EMTN programme €650m 1.250% fixed coupon, due 2026 €1.15bn green notes issued €500m 1.875% fixed coupon, due 2030 SEGRO US private placement €50m 3.87% fixed coupon, due 2037 €225m of new long-term debt arranged €175m 4.14% fixed coupon, due 2042 S
Slide 15: No significant refinancing until 2026
NO SIGNIFICANT REFINANCING UNTIL 2026 Debt maturity by type and year, £ million (as at 30 June 2022) 1,600 Debt maturity 8.7 years1 (from 8.6 years at end-2021) 1,400 1,200 Interest rate exposure1 78% fixed, 94% fixed or capped 1,000 £ million 800 600 400 200 0 2022 2023 2024 2025 2026 2027 2028 202
Slide 16: Low average cost of debt and leverage
LOW AVERAGE COST OF DEBT AND LEVERAGE LTV ratio and average cost of debt Credit rating (incl share of joint ventures), 2014-22 A (Fitch senior unsecured) 60% 5.0% Net debt £4.8bn 4.2% (FY 2021: £4.2bn) 3.5% 4.0% 3.4% £2.1bn liquidity1 Average cost of debt 40% cash and available bank facilities 3.0%
Slide 17: Inflation-beating earnings growth
INFLATION-BEATING EARNINGS GROWTH 13% earnings growth (ex SELP fee) driven by lettings, capture of reversion and development Significant rental growth - 7.1% like-for-like (vs H1 21) - 5.9% ERV growth (vs Dec 21) Low leverage and attractive debt profile 2022 interim dividend increased by 9.5% 17 SEG
Slide 18: We create the space that enables extraordinary things to happen
WE CREATE THE SPACE THAT ENABLES EXTRAORDINARY THINGS TO HAPPEN Inflation- Delivering Disciplined Confident beating strong approach to outlook earnings operational capital growth metrics allocation
Slide 19: European vacancy at historic lows
EUROPEAN VACANCY AT HISTORIC LOWS 16 14 UK France Germany Poland Italy Spain 12 10 Vacancy, % 8 6 4 2 0 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 1Q22 Source: CBRE 19
Slide 20: Supply-demand dynamics point to further rental growth
SUPPLY-DEMAND DYNAMICS POINT TO FURTHER RENTAL GROWTH Take-up continues to outpace supply in the UK Breakdown of UK take-up by sector 3PL Online Retail Other Retail Manufacturing Other 6 Available supply Take-up 100% 5 90% 80% 4 million sqm 70% Take-up, % 3 60% 50% 2 40% 30% 1 20% 10% 0 0% 2017 2018
Slide 21: Strong, deep and diverse occupier demand
STRONG, DEEP AND DIVERSE OCCUPIER DEMAND Contracted rent1 Net new rent on existing space New rent contracted 60 50 Annualised rental income, £m 40 30 20 10 0 1H15 2H15 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20 2H20 1H21 2H21 1H22 1 Net new rent on existing space reflects headline rent agreed on n
Slide 22: Portfolio delivering strong operating metrics
PORTFOLIO DELIVERING STRONG OPERATING METRICS High levels of customer retention and Consistently capturing reversion from occupancy renewals and reviews2 98 100 25 Occupancy = 97% 97 90 +24% Rent change on review and renewal, % 96 80 20 Customer retention rate, % 95 70 +19% Occupancy rate, % Retenti
Slide 23: Significant reversionary potential already being captured
SIGNIFICANT REVERSIONARY POTENTIAL ALREADY BEING CAPTURED Lease event uplift opportunity1 120 14 113 16 100 Reversion captured so 18 far in 2022 Rental uplift potential, £m 80 89 £13 million 22 60 23 40 20 20 13 0 1H22 2H22 2023 2024 2025 2026 >2027 Current Total FY21 opportunity 1 Reversion on let
Slide 24: £15 million of new rent from development
£15 MILLION OF NEW RENT FROM DEVELOPMENT Space completed 329,900 sq m Number of projects 15 Potential rent £15 million (87% leased) SmartParc SEGRO Derby Yield on Cost 7.3% We target at least BREEAM ‘Excellent’ (or local equivalent) on all of our developments. Slough Trading Estate SEGRO CityPark Fr
Slide 25: We create the space that enables extraordinary things to happen
WE CREATE THE SPACE THAT ENABLES EXTRAORDINARY THINGS TO HAPPEN Inflation- Delivering Disciplined Confident beating strong approach to outlook earnings operational capital growth metrics allocation
Slide 26: Continuing to be disciplined in our capital allocation
CONTINUING TO BE DISCIPLINED IN OUR CAPITAL ALLOCATION DEVELOPMENT ACQUISITIONS DISPOSALS • £284m of construction spend • £145m of asset acquisitions • Big box warehouses in Italy • £80m of infrastructure spend • £220m of land acquisitions • Asset swap to unlock redevelopment potential on the Slough
Slide 27: We create the space that enables extraordinary things to happen
WE CREATE THE SPACE THAT ENABLES EXTRAORDINARY THINGS TO HAPPEN Inflation- Delivering Disciplined Confident beating strong approach to outlook earnings operational capital growth metrics allocation
Slide 28: Supportive long-term structural drivers
SUPPORTIVE LONG-TERM STRUCTURAL DRIVERS DIGITALISATION OF OUR URBANISATION ECONOMIES SUPPLY CHAIN EFFICIENCY & SUSTAINABILITY RESILIENCE 28
Slide 29: Demand-supply conditions remain supportive of further rental growth
DEMAND-SUPPLY CONDITIONS REMAIN SUPPORTIVE OF FURTHER RENTAL GROWTH Demand Supply 1H22 ERV ERV growth Property Type Region % of portfolio1 conditions conditions growth expectations UK 55% STRONG ACUTE 7.4% Urban 3-6% pa warehouses Continental 12% STRONG LIMITED 2.6% Europe UK 9%2 STRONG LIMITED 6.6%
Slide 30: >£500 million of potential rental income from future development
>£500 MILLION OF POTENTIAL RENTAL INCOME FROM FUTURE DEVELOPMENT SEGRO land bank (30 June 2022) gross rent (£m) Estimated cost Development Development to complete Proportion Expected Potential delivery pipeline pre-let (sq m) yield3 (£m) Area 1-12 Current 886,521 5182 84 6.4% 63% months Near-term 12
Slide 31: Potential >£1.2 billion rental income
POTENTIAL >£1.2 BILLION RENTAL INCOME Annualised gross cash passing rent1, £ million (as at 30 June 2022) Potential from current activity: £307m Potential from land bank and land options: £386m 1704 +128% 1,233 2164 34 +57% 84 139 847 50 Plus: further growth potential 540 from redevelopment Plus: fu
Slide 32: Confident outlook
CONFIDENT OUTLOOK Supportive structural trends Restricted Strong land balance availability sheet limits supply response Market leading pan-European Prime operating portfolio platform of existing assets Exceptional landbank for development 32
Slide 33: We create the space that enables extraordinary things to happen
WE CREATE THE SPACE THAT ENABLES EXTRAORDINARY THINGS TO HAPPEN Inflation- Delivering Disciplined Confident beating strong approach to outlook earnings operational capital growth metrics allocation
Slide 34: Q&A 2022 Half Year Results
Q&A 2022 Half Year Results SEGR°
Slide 35: Appendix: Portfolio and Financial Data
APPENDIX 1 Portfolio and Financial Data
Slide 36: Positioning SEGRO to deliver on its purpose
POSITIONING SEGRO TO DELIVER ON ITS PURPOSE Investing in our local Championing Low-carbon growth Nurturing talent communities and environments Segro recognises that the world faces a climate SEGRO is an integral part of the communities in SEGRO’s people are vital to and inseparable from emergency an
Slide 37: Adjusted income statement
ADJUSTED INCOME STATEMENT (JVS PROPORTIONALLY CONSOLIDATED) H1 2022 H1 2021 Group JVs Total Group JVs Total £m £m £m £m £m £m Gross rental income1 239 56 295 195 51 246 Property operating expenses (36) (4) (40) (28) (4) (32) Net rental income 203 52 255 167 47 214 JV management fee income2 57 (27) 3
Slide 38: Impact of SELP 10-year performance fee
IMPACT OF SELP 10-YEAR PERFORMANCE FEE Impact of SELP H1 2022 excl SELP Adjusted income statement H1 2022 performance fee performance fee £m £m £m SELP 10-year performance fee is potentially Gross rental income 239 239 payable October 2023 Calculated based on 10-year IRR versus Property operating ex
Slide 39: Pro forma H1 2022 accounting net rental income
PRO FORMA H1 2022 ACCOUNTING NET RENTAL INCOME Group JVs Total £m £m £m - Pro forma H1 2022 net rental income assuming H1 2022 net rental income 203 52 255 disposals, acquisitions and let developments completed as at 1 January 2022 Half year impact of: - One-off items (e.g. rates refunds) removed Di
Slide 40: Total cost ratio
TOTAL COST RATIO Total cost ratio, Half year 2021-22 (proportionally consolidated) Half year to 30 Half year to 30 Incl. joint ventures at share June 2022 June 20211 £m £m Gross rental income (less reimbursed costs) 294 245 Property operating expenses 36 28 Administration expenses 31 27 JV operating
Slide 41: Balance sheet
BALANCE SHEET (JVS PROPORTIONALLY CONSOLIDATED) 30 June 2022 30 June 2021 Group JVs Total Group JVs Total £m £m £m £m £m £m Investment properties 17,209 3,276 20,485 11,850 2,624 14,474 Trading properties 57 - 57 47 - 47 Total properties 17,266 3,276 20,542 11,897 2,624 14,521 Investment in joint ve
Slide 42: 10% increase in adjusted NAV
10% INCREASE IN ADJUSTED NAV1 Components of Adjusted NAV change, 31 December 2021 to 30 June 2022 111p 1p 17p 1,249p 1,137p (17)p Standing assets: 82p Land & development: 29p 31 December 2021 H1 2022 Dividends Realised and unrealised Exchange rate and other 30 June 2022 Adjusted EPS gains 42 1 Adjus
Slide 43: EPRA performance measures
EPRA PERFORMANCE MEASURES Half year to 30 June 2022 Half year to 30 June 2021 £m £p per share £m £p per share EPRA Earnings 204 16.9 165 13.8 EPRA NTA (Adjusted NAV) 15,139 1,249 10,929 909 EPRA NRV 16,520 1,363 11,868 987 EPRA NDA 15,257 1,259 10,432 868 EPRA LTV 25.1% 23.9% EPRA net initial yield
Slide 44: EPRA capital expenditure analysis
EPRA CAPITAL EXPENDITURE ANALYSIS Six months to 30 June 2022 Six months to 30 June 2021 - Just over 50% of completed properties capex was for major Group JVs Total Group JVs Total £m £m £m £m £m £m refurbishment, infrastructure and fit- out costs prior to re-letting which is Acquisitions 328 37 365
Slide 45: Euro currency exposure and hedging
EURO CURRENCY EXPOSURE AND HEDGING Balance sheet, £m - €1.16:£1 as at 30 June 2022 (30 June 2022) - € assets 69% hedged by € liabilities 7,000 6,000 - €2,298m (£1,981m) of residual exposure – 13% of Group NAV Assets 69% - Illustrative NAV sensitivity vs €1.16: 5,000 hedged 4,000 - +5% (€1.22) = -£94
Slide 46: Look-through loan-to-value ratio and cost of debt
LOOK-THROUGH LOAN-TO-VALUE RATIO AND COST OF DEBT 30 June Weighted average cost of debt, 2022 Fixed Interest Cover % 1 %1 £m Gross debt, Net debt, including excluding Fixed Cover of Net Fixed and Capped commitment fees and commitment fees debt cover of net debt non-cash interest and non-cash interes
Slide 47: Urban and big box warehouses – complementary asset types
URBAN AND BIG BOX WAREHOUSES – COMPLEMENTARY ASSET TYPES Urban warehouses (67%) Big boxes (31%) Portfolio by type: - Smaller units, generally <10,000 sq m - Larger units, generally over 10,000 sq m (valuation, SEGRO share) Data as at 30 June 2022 - Diverse range of uses (including ‘last mile’ - Main
Slide 48: Enhanced, de-risked development programme
ENHANCED, DE-RISKED DEVELOPMENT PROGRAMME Development-led growth1 The majority of which is pre-let 700 100% 600 80% Development capex, £m 500 60% 400 300 40% 200 20% 100 0 0% 1H22 2012 2013 2014 2015 2016 2017 2018 2019 2021 2013 2014 2015 2016 2017 2018 2019 2020 2021 1H22 Pre-let Speculative Let a
Slide 49: Land bank provides optionality and opportunity for growth
LAND BANK PROVIDES OPTIONALITY AND OPPORTUNITY FOR GROWTH 1600 8.0% 1400 7.0% Net land utilisation, 2015-1H22 Land bank value, £m (Based on opening book value or acquisition value) 1200 6.0% 400 1000 5.0% 300 200 Land value, £m 135 800 4.0% 100 86 109 68 0 (28) (84) (40) 600 3.0% -100 (118) -200 400
Slide 50: SEGRO European Logistics Partnership (SELP) headline figures
SEGRO EUROPEAN LOGISTICS PARTNERSHIP (SELP) HEADLINE FIGURES Assets under Management (as at 30 June 2022) Land and assets Equivalent yield €2,126m €7.6bn 4.0% 2.2 2.0 Assets under management, €bn 1.8 €1,629m Capital value change ERV growth 1.6 €1,450m €1,414m 5.7% 4.9% 1.4 1.2 Headline rent ERV 1.0
Slide 51: Appendix II: Market Data
APPENDIX II Market Data SEGRO
Slide 52: European industrial investment volumes
EUROPEAN INDUSTRIAL INVESTMENT VOLUMES European industrial investment volumes European industrial investment volumes By geography, €bn By quarter, €bn 70 70 60 60 50 50 40 40 30 30 20 20 10 10 0 0 1H22 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 1H22 2006 2007 200
Slide 53: Prime logistics yields vs 10 year bond yields
PRIME LOGISTICS YIELDS VS 10 YEAR BOND YIELDS 12.0 10.0 8.0 6.0 Yield, % Warsaw: 4.4% 4.0 London: 3.3% Paris: 3.5% Dusseldorf: 3.2% 2.0 UK 10yr bond: 2.2% Germany 10yr bond: 1.3% 0.0 -2.0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 1H22 Source: Prime yie
Slide 54: European industrial and logistics — take-up statistics
EUROPEAN INDUSTRIAL AND LOGISTICS — TAKE-UP STATISTICS Take-up of warehouse space – UK1 Take-up of warehouse space >5,000 sq m – France2 (m sq m) (m sq m) 6.0 6.0 5.0 5.0 4.0 4.0 3.0 3.0 2.0 2.0 1.0 1.0 0.0 0.0 1H22 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 1H22 2008
Slide 55: European industrial and logistics — availability statistics
EUROPEAN INDUSTRIAL AND LOGISTICS — AVAILABILITY STATISTICS UK warehouse space supply1 Vacant warehouse space >5,000 sq m – France2 (m sq m) (m sq m) 10.0 25% 4.0 9.0 New / Early Marketed 3.5 Vacancy rate 8.0 20% 3.0 7.0 2.5 6.0 15% 5.0 2.0 4.0 10% 1.5 3.0 1.0 2.0 5% 0.5 1.0 0.0 0% 0.0 1H22 2009 201
Slide 56: Forward-looking statements and disclaimer
FORWARD-LOOKING STATEMENTS AND DISCLAIMER This document has been prepared by SEGRO plc (SEGRO) solely for use at the presentation of SEGRO’s results announcement in respect of the period ended 30 June 2022 (the Results Announcement). For the purposes of this disclaimer, ‘Presentation’ shall mean thi