Frasers Centrepoint Trust · SGX:J69U
Frasers Centrepoint Trust — Investor Presentation (November 2019)
59 slides from Frasers Centrepoint Trust's investor presentation, November 2019
Slide 1: Frasers Centrepoint Trust Investor Presentation November 2019
Frasers Centrepoint Trust Investor Presentation November 2019
Slide 2: Important Notice
Important notice Important Notice Certain statements in this Presentation constitute “forward-looking statements”, including forward-looking financial information. Such forward- looking statement and financial information involve known and unknown risks, uncertainties and other factors which may c
Slide 3: Contents
Contents Outline Overview FCT’s malls are well-positioned to grow Financial and operation highlights Macro-economic and Retail Industry Indicators Going forward Appendices – Highlights from Financial Results Presentation for the Fourth Quarter & Full Year 2019 ended 30 September 2019 – R
Slide 4: Frasers Centrepoint Trust (FCT)
Overview Frasers Centrepoint Trust (FCT) FCT is a Singapore-centric, suburban-focused retail REIT listed on the Mainboard of the Singapore Exchange Market Cap S$3.07 billion1 Investment property portfolio comprises 7 retail properties located in the suburban regions in Singapore Bloomberg: FCT S
Slide 5: FCT's portfolio of suburban retail properties
FCT’s portfolio of suburban retail properties Our properties are located in populous residential areas, enjoy good connectivity to public transportation system, stable footfall and healthy mall occupancy. New addition to FCT Anchorpoint YewTee Point Causeway Point Northpoint City North Wing1 Water
Slide 6: Our malls attract steady shopper footfall
Overview Our malls attract steady shopper footfall • Visits to suburban retail malls are part of many shoppers’ daily routine FCT Portfolio Footfall (million) 146.5 136.8 +7.1% FY2018 FY2019 Fun for the family Total footfall at FCT malls Necessity & convenience shopping Everyday dining Essential ser
Slide 7: Our malls have easy access to public transport
Overview Our malls have easy access to public transport • Northpoint Our City,well malls are located in Yishun to connected Central public transport such as MRT stations and bus interchanges Linkway to the Expo MRT Station of Downtown Yishun Bus Line from basement of Changi City Point Interchange No
Slide 8: Keeping our malls relevant in the digital age
Overview Keeping our malls relevant in the digital age • The future of shopping malls is about experiences and the customer journey • Frasers Experience app (FRx) is the digital platform to redefine how we interact with our shoppers; to enhance shopper experiences at our malls; to offer more benefit
Slide 9: FCT's malls are well-positioned to grow
FCT’s malls are well-positioned to grow Changi City Point
Slide 10: Well-positioned to grow
Well-positioned to grow Key FCT malls are located in outer north and outer north-east regions that enjoy low retail space per capita of about 2.7 per square foot, compared to the nation average of about 6 per square foot Lower retail space per capita implies higher opportunity to grow footfall t
Slide 11: FCT's retail properties are located in growing HDB towns
FCT’s retail properties are located in growing HDB towns The three largest malls in FCT’s portfolio are located in HDB towns with growing number of HDB units and with good growth potential Punggol has 8,806 new flats under construction and is the fastest growing HDB town Current Populati HDB Uni
Slide 12: Woodlands Regional Centre
Woodlands Regional Centre • Woodlands Regional Centre poised to be the largest economic hub in Singapore’s North region under the URA draft Master Plan 2019 • Woodlands Central will be a regional business hub • New business, industry, R&D and learning & innovation institution to be introduced to Woo
Slide 13: Punggol Digital District
Punggol Digital District • The Next Generation Smart & Integrated District under the URA draft Master Plan 2019 • SIT's Punggol campus, Singapore's first university in the north-east, will be up by 2023; able to accommodate 12,000 students - Straits Times, 10 September 2019 • "Punggol Digital Distri
Slide 14: Financial and operation highlights
Financial and operation highlights Waterway Point
Slide 15: Consistent performance
Consistent performance Revenue and Net Property Income (S$ million) Includes Excludes Net Property Income Gross Revenue Includes FRSFRS Excludes FRS adjustments# # FRS adjustments# # adjustments adjustments (as reported) 196.4 197.7 ▲ 1.6% ▲ 2.4% 189.2 193.3 183.8 181.6 168.8 140.6 158.0 139.3 147.2
Slide 16: Steady and consistent DPU growth
Steady and consistent DPU growth 13 consecutive years of DPU growth Distribution per Unit (S cents) 11.9 12.015 12.07 11.608 11.764 11.187 10.93 10.01 8.2 8.32 7.29 7.51 6.55 6.03 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 (IPO)* *Annualised DPU
Slide 17: Strong financial position
Overview Strong financial position Key financial indicators as at 30 September 2019 Gearing level 32.9%1 Gearing level of SREIT by sector Total borrowings $1,042 million 36.6% 35.7% 35.2% 35.2% 32.9% 34.0% Total assets $3,610 million 28.9% Interest Cover2 5.34 times Overall average 35.1% Weighted av
Slide 18: Well spread out debt maturity profile
Well spread out debt maturity profile Weighted Average Debt Maturity as at 30 September 2019: 2.3 years Type of borrowings Aggregate amount ■Unsecured bank borrowings S$326.1 million (31.3%) ■Medium Term Note S$310.0 million (29.7%) ■Secured bank borrowings1 S$406.0 million (39.0%) Total Borrowing
Slide 19: Maintaining healthy occupancy
Operational performance Maintaining healthy occupancy • FCT’s portfolio occupancy typically outperforms the sector average tracked by CBRE, except during periods when its major properties undergo asset enhancement initiative (AEI) works FCT’s portfolio occupancy versus suburban retail mall average o
Slide 20: Maintaining positive rental reversions through economic cycles
Operational performance Maintaining positive rental reversions through economic cycles FCT’s portfolio average rental reversions1) 15.0% 14.0% 12.8% 12.1% 9.9% 8.6% 7.7% 7.2% 6.5% 6.3% 5.1% 4.8% 3.2% FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 1) Based
Slide 21: Transformational year, poised for growth
Transformational year, poised for growth FY2019 was a transformational year for FCT Invested ~S$910 million in the acquisition of significant stakes in PGIM ARF and in Waterway Point Strong pipeline assets to support exciting phase of growth FCT remains Singapore-centric and suburban-focused
Slide 22: Macro-economic and Retail Industry Indicators
Macro-economic and Retail Industry Indicators Northpoint City
Slide 23: Healthy macro-economic fundamentals
Healthy macro-economic fundamentals Household median income among Singaporeans (citizens and permanent residents) continues to grow Low unemployment rate in Singapore 9,293 3.0 Household 8,846 9,023 median Income 8,666 8,292 (S$) 7,872 7,566 7,037 2.2 2.2 2.2 2.1 2.1 6,100 6,342 2.0 2.0 2.0 6,006 1.
Slide 24: Limited upcoming new retail supply
Limited upcoming new retail supply New Supply next 2 years: Total new supply is ~324k sq ft, accounts for <1% of total retail stock in Singapore Total new supply in suburban region is ~135k sq ft, accounts for ~1% of total suburban retail stock Upcoming new retail space (sq ft) 140,000 118,438 1
Slide 25: Retail prime rents holding steady
Retail prime rents holding steady Suburban prime retail rents holding steady Retail Prime Rent (S$ per square foot per month) $35.00 $31.70 $30.00 $29.15 $25.00 $20.00 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2017 2017 2017 2017 2018 2018 2018 2018 2019 2019 2019 Orchard Road Suburban Source: CBRE, Singap
Slide 26: Going forward
Going forward Causeway Point
Slide 27: Scaling up presence in suburban sector in Singapore
Scaling up presence in suburban sector in Singapore The recent acquisitions of 40% stake in Waterway Point and the 24.82% investment in PGIM ARF1 reinforce FCT’s core strength as a leading suburban retail space provider in Singapore and further expand its market share in this sector Mall Area Popu
Slide 28: 3-pronged growth strategy
3-pronged growth strategy Northpoint 2 Bedok Changi Yishun 10 Investment Waterway Future YewTee Point Point City Retail in PGIM Point Opportunities Point Podium ARF (40%-stake) • Northpoint City Acquisition 2010 2011 2014 2016 2019 2019 South Wing Growth 24.82% in • Acquisition PGIM ARF opportunitie
Slide 29: Summary
Overview Summary The ~S$910 million of investments which FCT made in FY2019 is transformational and will strengthen its position as a leading suburban retail REIT in Singapore Opportunity for Sponsor’s pipeline asset in Northpoint City South Wing Poised for growth The keys malls in FCT’s portf
Slide 30: Experience matters
Experience Ask O) o -) matters. 8 A Nl
Slide 31: Appendix 1 - Highlights from Financial Results Presentation 4Q & FY2019
Appendix - 1 Highlights from Financial Results Presentation for the Fourth Quarter & Full Year 2019 ended 30 September 2019
Slide 32: 4Q19 results highlights
4Q19 results highlights 4Q19 Financial performance DPU of 2.913 cents,1.8% higher year-on-year (4Q18 DPU: 2.862 cents) Gross Revenue of $48.3 million, down 0.5% year-on-year1 Net Property Income of $32.8 million, down 0.1% year-on-year2 NAV and NTA per Unit of $2.21 as at 30 September 2019
Slide 33: 4Q19 DPU up 1.8% year-on-year to 2.913 cents
4Q19 DPU up 1.8% year-on-year to 2.913 cents Excluding FRS 116 and 109 accounting adjustments: – 4Q19 Gross Revenue was $49.56 million, up 2.8% year-on-year – 4Q19 NPI was $34.14 million, up 4.8% year-on-year Distributable income up 17.9% year-on-year mainly due to additional contributions from
Slide 34: Total DPU for FY2019 at a new high of 12.07 cents
Total DPU for FY2019 at a new high of 12.07 cents Excluding FRS 116 and 109 accounting adjustments: – FY2019 gross revenue was $197.7 million, up 2.4% year-on-year – FY2019 NPI was $140.6 million, up 2.7% year-on-year Distributable income up 6.6% year-on-year mainly due to additional contributio
Slide 35: Steady and consistent DPU growth
Steady and consistent DPU growth 13 consecutive years of DPU growth Distribution per Unit (S cents) 11.9 12.015 12.07 11.608 11.764 11.187 10.93 10.01 8.2 8.32 7.29 7.51 6.55 6.03 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 (IPO)* *Annualised DPU
Slide 36: Another quarter of steady performance
Another quarter of steady performance Excluding non-cash accounting adjustments1, 4Q19 gross revenue was $49.56 million, which is 2.8% higher than 4Q18 revenue of $48.20 million Overall better performance due to higher portfolio occupancy and higher average rental rates Gross Revenue $ million 4
Slide 37: Property expenses 1.4% lower year-on-year
Property expenses 1.4% lower year-on-year Ratio of property expense to gross revenue maintained stable at about 32% Property Expenses $million 4Q19 4Q18 Fewer ad-hoc Lower property Due to additional water maintenance and expense due to charges; repair and replacements; lower absence of one-off mai
Slide 38: Steady net property income for 4Q19
Steady net property income for 4Q19 Excluding non-cash accounting adjustments1, 4Q19 net property income (NPI) was $34.14 million, which is 4.8% higher than 4Q18 NPI of $32.56 million Net Property Income $million 4Q19 4Q18 Excluding FRS adjustments, NPI is the 4.8% higher year on year ($34.14m vs
Slide 39: FCT's share of revenue and NPI in Sapphire Star Trust
FCT’s share of revenue and NPI in Sapphire Star Trust FCT’s share of revenue and NPI in Sapphire Star Trust (which holds Waterway Point), for the period 12 July 2019 - 30 Sep 2019 were $5.72 million and $4.48 million, respectively Occupancy as at 30 September 2019: 98.0% $ million 12 July - 30 S
Slide 40: FY2019 - another year of steady performance
FY2019 – another year of steady performance Excluding non-cash accounting adjustments1, FY2019 gross revenue was $197.7 million is 2.4% higher than the FY2018 revenue of $193.0 million Higher revenue contributions from all properties except Causeway Point which saw lower revenue due to impact fr
Slide 41: FY2019 property expenses 1.7% higher year-on-year
FY2019 property expenses 1.7% higher year-on-year The increase was mainly due to higher property tax expenses from Northpoint City North Wing and marketing expenses. It is partially offset by lower professional fees. Property Expenses $ million 2019 2018 ▲1.7% 57.10 56.16 ▼3.1% 20.69 21.35 ▲6.5% ▲
Slide 42: FY2019 NPI is 1.5% higher year-on-year
FY2019 NPI is 1.5% higher year-on-year Excluding non-cash accounting adjustments1, FY2019 NPI was $140.6 million is 2.7% higher than the FY2018 NPI of $136.9 million Higher contributions from all the properties except Anchorpoint Net Property Income $million Excluding FRS adjustments, 2019 2018
Slide 43: Balance sheet
Balance sheet
Slide 44: FCT's financial position remains strong
FCT’s financial position remains strong Asat 30 September 19 30 September 18 Gearing ratio1 32.9%2 28.6% Interest cover for the Quarter3 4.47 times 5.61 times Total borrowings $1,042 million $813 million % of borrowing on fixed rates or hedged via interest rate swaps 50% 64% Average cost of borrowin
Slide 45: NAV and NTA increased to $2.21 from $2.08
NAV and NTA increased to $2.21 from $2.08 The revaluation surplus was $93.3 million after including accounting adjustments of about $1.3 million1 30 Sep 2019 30 Sep 2018 As at S$’000 S$’000 Non-current assets 3,594,638 2,815,448 Current assets 16,245 24,924 Total assets 3,610,883 2,840,372 Current
Slide 46: Debt maturity profile as at 30 September 2019
Debt maturity profile as at 30 September 2019 Weighted Average Debt Maturity as at 30 September 2019: 2.3 years Type of borrowings Aggregate amount ■Unsecured bank borrowings S$326.1 million (31.3%) ■Medium Term Note S$310.0 million (29.7%) ■Secured bank borrowings1 S$406.0 million (39.0%) Total B
Slide 47: Appraised value of FCT's investment property portfolio
Appraised value of FCT’s investment property portfolio Capitalisation rates remain relatively stable compared to the last financial year FY2019 FY2018 Valuation @ 30 Sep 2019 Valuation @ 30 Sep 2018 Property Valuation Valuation Valuation Valuation Cap rate(a) Valuer Cap rate(a) Valuer ($ million)
Slide 48: Operational performance
~~ ERASERS CENTREPOINT TRUST Operational performance
Slide 49: Portfolio occupancy stable at 96.5%
Portfolio occupancy stable at 96.5% Portfolio occupancy improved 1.8%-point year-on-year on higher occupancy at Northpoint City North Wing, Changi City Point, Bedok Point and YewTee Point Decrease in occupancy at Causeway Point due to ongoing Underground Pedestrian Link (UPL) works which affects
Slide 50: 4Q19 average rental reversion at +3.9%
4Q19 average rental reversion at +3.9% All malls, except Bedok Point, registered positive rental reversion in 4Q19 The larger malls (Causeway Point; Northpoint City North Wing; Waterway Point and Changi City Point) accounted for ~71% of total NLA renewed in 4Q19 Change compared No. of Leased are
Slide 51: Higher year-on-year average rental reversion at +4.8%
Higher year-on-year average rental reversion at +4.8% Portfolio rental reversion for FY2019 was +4.8%. This is higher compared to +3.2% for FY2018 Causeway Point, the largest mall, registered +7.4% rental reversion in FY2019 compared to +6.4% in FY2018 Change compared No. of Leased area As % of
Slide 52: Lease expiry profile in-line with historical average
Lease expiry profile in-line with historical average Average lease tenure remains at around 3 years Lease expiry profile as % of total gross rental income Weighted Average Lease Expiry 35.7% (WALE) 26.9% 28.0% By NLA 1.72 years (3Q19: 1.85 years) 8.6% By Gross Rent 1.57 years (3Q19: 1.67years) 0.6
Slide 53: Lease renewals in FY2020 anchored by larger malls
Lease renewals in FY2020 anchored by larger malls The four larger malls account for ~85% of the leases to be renewed in FY2020, with Causeway Point accounting for the largest portion (~29%) Lease Area Lease Expiries in FY2020 Number of as % of leased area as % of total gross Expiring As at 30 Sept
Slide 54: Shopper traffic and tenants' sales
Shopper traffic and tenants’ sales Portfolio shopper traffic for 4Q19 grew 8.9% year-on-year, attributed mainly to higher traffic registered at Northpoint City North Wing Overall portfolio tenants’ sales per square foot was flat year-on-year. Northpoint City North Wing; Changi City Point and W
Slide 55: Appendix 2 - Additional Information
Appendix - 2 Additional Information
Slide 56: Research coverage
Research coverage Analysts’ calls Count Firm Analysts 1 Bank of America-Merrill Lynch Donald Chua Positive call 11 (Buy, Overweight, Add) 2 CGS-CIMB Eing Kar Mei Neutral Call 8 3 Citi Investment Research Brandon Lee (Hold, Neutral, Equal Weight) 4 CLSA Asia-Pacific Markets Tan Xuan Sell Call 1 5 Cre
Slide 57: Portfolio Net Lettable Area by Property
Portfolio Net Lettable Area by Property • The larger malls account for 84.3% of portfolio’s NLA Net Lettable Area by Property Anchorpoint 70,988 sq ft YewTee Point 4.9% 73,669 sq ft 5.1% Causeway Point 416,301 sq ft Bedok Point 28.7% 82,713 sq ft 5.7% Changi City Point 205,210 sq ft Waterway Point *
Slide 58: Sustainability Framework
Sustainability Framework FCT aligns and adopts Frasers Property Group’s Sustainability Framework. The Framework is driven by three pillars: Acting Progressively, Consuming Responsibly and Focusing on People. These pillars form the multi-disciplinary approach which we direct our efforts to manage and
Slide 59: FCT Sustainability Reporting Performance Highlights FY2018
FCT Sustainability Reporting Performance Highlights FY2018 Frasers Centrepoint Trust’s FY2018 Sustainability Report is part of its Annual Report FY2018 and is available at https://fct.frasersproperty.com/newsroom/20181221_063723_J69U_HT80N6BGW4ZZR31S.1.pdf 59
Frasers Centrepoint Trust — Investor Presentation (November 2019) on 6ix