Swire Properties Limited · HKEX:1972
Swire Properties — H1 2014 Earnings Presentation
42 slides from Swire Properties's earnings presentation, Aug 14, 2014
Slide 1: 2014 Interim Results | Analyst Briefing
2014 Interim Results | Analyst Briefing 14th August 2014 © Swire Properties Limited 太古地產有限公司
Slide 2: Financial Summary
Financial Summary DE4@ SWiRE PROPERTIES
Slide 3: Result Highlights
Result Highlights Gross Rental Income Underlying Profit Equity Attri. to Shareholders 9,015 9,676 + 7.1% + 34.2% + 1.8% HK$ 5,045 M HK$ 3,775 M HK$ 206.0 Bn 4,711 + 5.0% + 8.0% + 6.5% 2012 2013 1H 13 1H 14 2012 2013 1H 13 1H 14 Dec 12 Dec 13 Jun 14 (restated) (restated) Equity Attri. to Shareholders
Slide 4: Key Developments
Key Developments Jan Acquired DCH Commercial Centre. Feb Completed the purchase of the 2014 Joint venture with 50% stake. 2014 remaining 20% interest of Taikoo Li GFA 389,000 sq ft. Sanlitun in Beijing. Renamed as Berkshire House in July Now 100% owned. 2014. Berkshire House Taikoo Li Sa
Slide 5: Financial Summary
Financial Summary HK$M 1H 2013 1H 2014 Change Turnover 5,754 8,338 +44.9% Valuation gains on investment properties 4,068 2,357 -42.1% Operating profit 7,843 7,103 -9.4% Underlying profit 2,812 3,775 +34.2% Reported profit 6,952 6,461 -7.1% Underlying earnings per share (HK$ per share) 0.48 0.65 +35.
Slide 6: Earnings Reconciliation
Earnings Reconciliation Earnings Reconciliation Movement in Underlying Profit HK$M 1H 2013 1H 2014 HK$’M Attributable profit 6,952 6,461 3,775 + 552 + 50 Revaluation of investment props (4,732) (3,265) Deferred tax on investment props 409 505 Prior revaluation gain realised on (12) sale of props 23
Slide 7: Movement in Investment Properties
Movement in Investment Properties Movement in Investment Properties Fair Value Gains Breakdown (excl. Hotels & Investment Properties held under JVC) HK$’M HK$’M Others 80 HK Office + 2,357 216,264 703 PRC HK$ 870 213,423 + 1,524 (437) + 2,357 M (603) HK Retail 704 Notes: Others include HK residentia
Slide 8: Investment Portfolio
Investment Portfolio DE4@ SWiRE PROPERTIES
Slide 9: Gross Rental Income
Gross Rental Income HK Office + % 6.0 Gross Rental Income Higher occupancy rates and positive rental reversions at Pacific Place and Island East. HK$’M 1H 2014 Gross Rental Income Further improvement shown with modest additional demand in the central district and continued firm rental levels at
Slide 10: HK Office Occupancy
HK Office Occupancy Completed HK GFA (sq ft) Occupancy Area Let (sq ft) Reversion(5) Attri. DCHIsland One Commercial East Centre Island East Office Properties (100% basis) (30th Jun 2014) (New and Renewed (incl. Rent Interest Tenancies) Reviews) Pacific Place 2,186,433 93% 141,574 +5% 100% Cityplaza
Slide 11: HK Retail Occupancy
HK Retail Occupancy Completed HK GFA (sq.ft.) Occupancy Retail Sales Attri. Pacific Place Retail Properties (100% basis) (30th Jun 2014) Growth Interest ( 1H2014) The Mall, Pacific Place 711,182 100% + 0.8% 100% Cityplaza Mall 1,105,227 100% - 5.6% (2) 100% Citygate Outlets 462,428 100% + 5.3% 20% O
Slide 12: HK Portfolio – Tenant Mix and Lease Expiry
HK Portfolio – Tenant Mix and Lease Lease Expiry Profile (1) (2) HK Office HK Retail Strong and diverse tenant base. Well-balanced lease expiry profile. 12 (1) As at 30th Jun 2014. (2) Based on the percentage of the total rental income attributable to the Group for the month ended 30th Jun 2014.
Slide 13: Property Portfolio – Hong Kong
Property Portfolio – Hong Kong Exp. Attributable Expected Attributable GFA of Completed Property Portfolio in Hong Kong (1)(2) Completed GFA (1) (Investment Props) GFA (‘000 sq ft) 15,709 15.7 M sq ft TaiKoo Place Redevelopment (Ph II) 14,709 14,709 13,975 13,975 CP3 Exchange / TaiKoo Place 13,900 T
Slide 14: Hong Kong Investment Properties Update
Hong Kong Investment Properties Update 2014 2017 Berkshire House (DCH Comm Ctr) 2017 New Kowloon Inland Lot 6312 50% owned, acquired via a joint Tung Chung Town Lot 11 100% owned, a site in Kowloon venture in Jan 2014. Bay acquired by tender in Nov Located in Quarry Bay and next 20% owned, a
Slide 15: Property Portfolio – Mainland China
Property Portfolio – Mainland China Exp. Attributable Expected Attributable GFA of Completed Property Portfolio in Mainland China (1)(2) Completed GFA (1) GFA (M sq ft) (Investment Props) Attributable Valuation (Investment Props) 8.7 8.7 M sq ft HK$ 38.2 Bn Dazhongli Project 7.0 (Shanghai) (3) 7.0 6
Slide 16: Property Portfolio – Mainland China
Property Portfolio – Mainland China Daci Temple Project Dalian Port Project Taikoo Li Sanlitun Façade installation works in progress. Overall occupancy : Framework Pre-sale of Pinnacle 97%. Agreement signed. One (GFA: 89%). Retail sales growth(1) : Mixed-use: retail & Pre-letting: > 80
Slide 17: Daci Temple Project, Chengdu
Daci Temple Project, Chengdu Artist’s Impression Artist’s Impression Pinnacle One (Office) 89% of the office total GFA ( ~1.15M sq.ft) and 350 car parking spaces were pre-sold for approximately RMB 2.1bn in Aug 2013. The Temple House (Service Apartments & Hotel) Artist’s Impression Hotel Rooms :
Slide 18: Brickell City Centre, Miami - Investment
Brickell City Centre, Miami - Investment Artist Impression Artist Impression Artist Impression Located in the centre of the Brickell financial district of Miami, and a light rail system Project Summary (100% Basis) station is within the site. GFA 2.75 M sq ft (Phase I) 1.30 M sq ft (Phase II) Ph
Slide 19: Trading Portfolio
Trading Portfolio DE4@ SWiRE PROPERTIES
Slide 20: HK Trading Portfolio
HK Trading Portfolio MOUNT PARKER RESIDENCES A 24-storey tower of 92 residential units. 73 units (1) sold. 57 units recognised in 1H 2014. Avg Selling Price Achieved (2) =HK$ 24,248 psf Interest : 80% DUNBAR PLACE ARGENTA, Mid-Levels West A 23-storey tower of 53 A 37-storey tower of 29
Slide 21: HK Trading Portfolio
HK Trading Portfolio AZURA, Mid-Levels West Finished / Expected Attributable Residential GFA Completions in Hong Kong in 2014 – 2017 A 50-storey tower of 126 residential units. GFA (sq ft) 122 units (3) sold. 3 units recognised in 1H 2014. Avg Selling Price Achieved (4) = HK$ 30,787 psf In
Slide 22: HK Trading Portfolio
HK Trading Portfolio Trading Properties being Sold Saleable Total Unit Actual Actual / Units of Profit Recognised or Int. (As at 12th Aug 2014) Area(1) Units Sold Completion Expected Expected to be Recognised (Year) (sq ft) Handover (100% basis) AZURA, 2A Seymour Road 6,923 126 122 2012 2012 - 98 (2
Slide 23: Brickell City Centre, Miami - Trading
Brickell City Centre, Miami - Trading Condominiums - REACH Condominium with 390 residential units. Pre-sale began in Jun 2014. To be completed and handover in 2015 / 2016. 204 units (1) pre-sold. Avg Selling Price Achieved (2) = US$ 622 psf REACH- Artist Impression Artist Impression Artist
Slide 24: Financing
Financing SWIRE PROPERTIES
Slide 25: Net Debt and Gearing
Net Debt and Gearing Net Debt Reconciliation (HK$M) Gearing Net debt as at 31st Dec 2013 (32,014) Net rental and fees receipts 4,326 HK$’M 34,535 37,281 Proceeds from property trading / development 2,191 Capex- PP&E and property investment (1,700) Development costs – property trading (1,137) Net inv
Slide 26: Maturity Profile & Liquidity
Maturity Profile & Liquidity Maturity Profile of Available Committed Facilities (as at 30th Jun 2014) HK$M Dec 2013 Jun 2014 Cash 2,521 3,381 Total 42,819 3,260 4,919 7,486 10,676 6,177 2,550 3,875 - 3,876 Undrawn - committed 7,333 6,172 Drawn 36,647 3,260 4,618 6,736 8,305 5,677 300 3,875 3,876 9,8
Slide 27: Capital Commitments
Capital Commitments Profile of Capital Commitments – at 30th Jun 2014 HK$’M Expenditure Forecast Year of Expenditure Commitments* 6 mths ended 6 mths ended 2015 2016 2017 & At 30th Jun 2014 30th Jun 2014 31st Dec 2014 beyond Hong Kong 3,151 811 1,740 3,215 12,089 17,855 Mainland China 1,016 1,346 2,
Slide 28: Prospects
Prospects D4 SwirE PROPERTIES
Slide 29: Prospects
Prospects Hong Kong Office Hong Kong Retail Demand for our office space is expected to show further The fall in retail sales in Hong Kong has resulted in retailers improvement with modest additional demand for office becoming more cautious. space in the central district and continued firm rental
Slide 30: Swire Properties in Five Years
Swire Properties in Five Years Expected Attributable GFA by Segment Expected Attributable GFA by Region Expected Attri. Trading GFA Sales to Complete GFA (‘000 sq ft) + 32% GFA (‘000 sq ft) + 32% 27,291 27,291 Exp. Units HK Residential (5.1%) N/A 425,735 sq ft 352 (3.1%) + 36% (10.6%) + 487% 20,627
Slide 31: Appendix
Appendix D4 SwiRE PROPERTIES
Slide 32: Property Portfolio
Property Portfolio Investment Props / Hotels Office Retail Hotels(3) Resid. Under- Total Attributable Investment Props by Attributable GFA (M sq ft)(1) Planning Region (GFA) Completed 11% Hong Kong 10.2 2.5 0.7 0.5 - 13.9 U.S.A. Mainland China 2.0 3.2 0.9 0.1 - 6.2 and others 2.9 M U.S.A. and Others
Slide 33: Completed Investment Portfolio
Completed Investment Portfolio Expected Attributable GFA of Completed Investment Portfolio (incl. Hotels) (1) (2) (3) GFA (‘000 sq ft) 20,161 20,627 21,427 22,528 23,153 23,800 24,991 26,291 27,291 TKP Redevelopment Brickell City Centre (Ph II) (3) Somerset House (Phase II) redevelopment TKP Redevel
Slide 34: Turnover Analysis
Turnover Analysis 1H 2014 Turnover Breakdown by Segment 1H 2014 Turnover Breakdown by Region HK$’M HK$’M 9 88 0.1% 1.1% 522 64 6.3% 0.8% 1,050 12.6% 2,707 32.4% 8,338 8,338 HK$’M 5,045 HK$’M 7,191 60.5% 86.2% Comparison Comparison 1H13 1H14 1H13 1H14 Rental 4,711 5,045 HK 4,753 7,191 Trading 571 2,7
Slide 35: HK Portfolio Map
HK Portfolio Map 75,063 sf 35 (1) The simplified maps are not to scale and are for illustrative purpose only. (2) GFA figures are for reference only.
Slide 36: Taikoo Li Sanlitun, Beijing
Taikoo Li Sanlitun, Beijing The increase in gross rental income reflected continued improvement in reversionary Project Summary (100% Basis) rents. GFA 1.47 M sq ft Overall occupancy (1) at Taikoo Li Sanlitun was 97% as at 30th Jun 2014. Components TKL Sanlitun South TKL Sanlitun North Retail
Slide 37: TaiKoo Hui, Guangzhou
TaiKoo Hui, Guangzhou TaiKoo Hui is our largest investment property in Mainland China. Project Summary (100% Basis) GFA 3.84 M sq ft Occupancy rate of the shopping mall was 99% as at 30th Jun 2014. The first major renewal of leases at the TaiKoo Hui mall takes place later this year and discussio
Slide 38: INDIGO, Beijing
INDIGO, Beijing Occupancy rate (1) of the shopping mall was 95% as at 30th Jun 2014 and retail sales Project Summary (100% Basis) increased by 94% in 1H 2014. GFA 1.89 M sq ft The office tower, ONE INDIGO, was 96% leased as at 30th Jun 2014 . There has been Components Shopping Mall strong demand
Slide 39: Daci Temple Project, Chengdu
Daci Temple Project, Chengdu Artist’s Impression Artist’s Impression Artist’s Impression Artist’s Impression Artist’s Artist’s Impression Impression Artist’s Impression Artist’s Impression Artist’s Impression A large-scale retail-led development comprising a street style retail complex (2-3 storey
Slide 40: Dazhongli Project, Shanghai
Dazhongli Project, Shanghai Artist’s Impression Artist’s Impression A large-scale retail-led mixed-use development comprising a retail mall, two office Project Summary (100% Basis) towers and three hotels, and is expected to become a landmark development in GFA 3.46 M sq ft Shanghai. Prime locat
Slide 41: Hotel Portfolio
Hotel Portfolio Managed Hotels No. of Interest Owned but Non-managed Hotels No. of Rooms Interest Rooms Completed (100% basis) Completed (100% basis) HK The Upper House 117 100% HK Island Shangri-La HK 565 20% HK EAST, Hong Kong 345 100% HK JW Marriott Hotel HK 602 20% HK Headland Hotel 501 0% HK Co
Slide 42: Valuation of Completed Investment Properties
Valuation of Completed Investment Properties Consistent value creation through continuous property investment and asset reinforcement. 2004 – Jun 2014 Valuation of Completed Investment Properties (excl. Hotels) * 201,981 213,423 216,264 Valuation of investment portfolio tripled in 10 years 42 * Pe