New Zealand Rural Land Co. Ltd. · NZX:NZL
New Zealand Rural Land — H1 2024 Earnings Presentation
31 slides from New Zealand Rural Land's earnings presentation, Aug 29, 2024
Slide 1: Result for the six months ending 30 June 2024
LISTED ON: 29 AUGUST 2024 2024 Result for the six months ending 30 June 2024 New Zealand Rural Land Company www.nzrlc.co.nz New Zealand Rural Land Company 1
Slide 2: Disclaimer
NEW ZEALAND RURAL LAND CO OWNS AND LEASES SOME OF THE BEST FARMLAND IN THE WORLD. DISCLAIMER The information and opinions in this presentation were prepared by New Zealand Rural Land Company (NZL). NZL makes no representation or warranty as to the accuracy or completeness of the information in this
Slide 3: Key Messages
KEY MESSAGES Higher yielding further diversified portfolio following recent acquisitions AFFO per share has grown from 1.53 cps in HY23 to 1.94 cps (+26.8%) in HY24 Gearing lowered to 30.5% Dividend resumed with a payout of 1.46 cents per share equivalent to 75% of HY24 AFFO* Roc Partners purchase 2
Slide 4: HY24 Result
HY24 RESULT HY24 NPAT of $12.4m and AFFO of $3.6m NAV per share has grown from $1.250 at listing to $1.552 as at 30 June 2024, total company returns have been +28.6%*. AFFO forecast to be 5.01 to 5.36cps in FY24 due to further acquisitions and CPI linked rental increases CPI linked rental increases
Slide 5: HY24 - Financial Highlights & Metrics
HY24 - FINANCIAL HIGHLIGHTS & METRICS $423.5m $216.9m $1.552 30.5% Total Assets Net Asset Value (NAV) NAV per Share Gearing Total Returns Increasing AFFO Net asset value per share has grown from $1.25 at IPO* HY24 AFFO per share was 1.94 cps***. Full year AFFO to $1.552 (at 30 June 2024); total comp
Slide 6: HY24 Operating Overview
SECTION 1 HY24 OPERATING OVERVIEW New Zealand Rural Land Company 6
Slide 7: New Acquisitions in HY24
0.05 NEW ACQUISITIONS IN HY24 Portfolio as at 30 June 2024 Diversity Increased Overview of Higher AFFO, WALT and Diversity 0.33 During the period NZL settled three acquisitions. These acquisitions are accretive to AFFO and WALT, further diversify NZL’s portfolio, and increase rental adjustment frequ
Slide 8: NZL Financials & Return Metrics
SECTION 2 NZL FINANCIALS & RETURN METRICS for the period ending 30 June 2024 New Zealand Rural Land Company 8
Slide 9: Adjusted Funds from Operations (AFFO)
ADJUSTED FUNDS FROM OPERATIONS (AFFO) AFFO is a proxy for free cash flow commonly used by REITs. AFFO is intended to provide investors with a clearer picture of the company’s free cash flow. NZ$000 30 June 2024 30 June 2023 Net Profit After Tax 12,384 2,492 2.19cps Adjusted for: Unrealised Net Gain
Slide 10: Profit & Loss Statement
PROFIT & LOSS STATEMENT NZ$000 30 June 2024 30 June 2023 Gross Rental Income Rental Income 9,099 6,851 Net Rental Income 9,099 6,851 Less Overhead Costs $12.38m Directors Fees Insurance (114) (44) (114) (41) NPAT Shareholder Registry & Communication (34) (58) Management Fees (662) (503) Repairs and
Slide 11: Balance Sheet
BALANCE SHEET NZ$000 30 June 2024 31 December 2023 Current Assets Cash and Cash Equivalents 6,135 1,258 Trade and Other Receivables 1,164 378 $423.5m Current Tax Receivable Total Current Assets 4 7,303 7 1,643 Total Assets Non-Current Assets Investment Property 393,806 346,281 Loan Receivable 21,000
Slide 12: Debt Summary
DEBT SUMMARY NZL has hedging arrangements in place for 64.0% of its total borrowings costing, on average, 6.2%. The remaining debt is floating and the cost of the floating debt component is 7.2%. Accordingly, NZL’s weighted average cost of debt is currently 6.6%. Key Metrics 30 June 2024 30 June 202
Slide 13: Total Returns
TOTAL RETURNS Since listing on the NZX (21 December 2020), NZL has delivered total company returns of +28.6%* (NAV per share growth plus dividends). NZL delivered $3.6m in AFFO (1.94 cps**) in the six months to 30 June 2024. Post the most recent acquisitions and Roc transaction, NZL forecasts FY24 A
Slide 14: Sustainability Programme
SECTION 3 SUSTAINABILITY PROGRAMME as at 30 June 2024 New Zealand Rural Land Company 14
Slide 15: Sustainability Programme
SUSTAINABILITY PROGRAMME 1 NZL continues to work on mapping its current portfolio for marginal land which can be enhanced with planting and a programme to increase biodiversity. The mitigation of erosion is a key outcome of this planting with potential for carbon sequestration and sediment control.
Slide 16: HY24 Sustainability Highlights
HY24 SUSTAINABILITY HIGHLIGHTS SPOTLIGHT ON: Native Forest Regeneration In the first half of FY24, NZL completed two forestry land acquisitions, deploying a further $16.8m into 2,606 hectares of high quality forestry land in the Manawatū-Whanganui region. These transactions serve to further diversif
Slide 17: HY24 Sustainability Highlights (cont)
HY24 SUSTAINABILITY HIGHLIGHTS (CONT) Enduring Land For Life NZL has published the programme it uses to ensure land and partnerships are enduring. Commitments between NZL and tenants are developed and refined jointly, incorporating industry best practice, latest scientific research and learnings fro
Slide 18: Dividend and Outlook
SECTION 4 DIVIDEND AND OUTLOOK New Zealand Rural Land Company 18
Slide 19: Dividend Reinstatement & Share Buyback Programme
DIVIDEND REINSTATEMENT & SHARE BUYBACK PROGRAMME Dividend NZL has resolved to pay a dividend of 1.46 cps equivalent to 75% of NZL’s HY24 AFFO*. NZL’s dividend policy targets a pay-out ratio of 60% - 90% of AFFO. The pay-out range grants the company greater flexibility to deploy NZL’s cash operating
Slide 20: Outlook & FY24 Forecast
OUTLOOK & FY24 FORECAST NZL’s leases incorporate regular, uncapped, CPI reviews. Accordingly, inflation will result in rental growth. Furthermore, NZL is insulated from inflation-impacted (and all other operational) on-farm costs by owning only the land. NZL has seen the impact of inflation in 2024,
Slide 21: Appendices
APPENDICES New Zealand Rural Land Company 21
Slide 22: Investment Summary
INVESTMENT SUMMARY NZL PROVIDES INVESTORS WITH EXPOSURE TO: NEW ZEALAND Rural Land Co Favourable Industry A Proven Value Add Attractive Total Returns High Quality Tenants A Significant Growth Dynamics Acquirer of Land with Attractive WALT Opportunity Long term demand for key Successfully acquired NA
Slide 23: Portfolio Overview - As at 30 June 2024
PORTFOLIO OVERVIEW - AS AT 30 JUNE 2024 Rural Sub-Sector Breakdown 33% 21.0% 51% 46.4% 6% 32.5% 10% Dairy Support Apples Forestry Central North Region Hawke’s Bay Canterbury Otago Southland Total Island Land Area (ha) 97 5,649 6,332 3,992 1,386 17,4571 Pastoral, Forestry & Rural Asset Class Horticul
Slide 24: Roc Partners Transaction
ROC PARTNERS TRANSACTION Overview On 19 January 2024 NZL announced it had entered into an agreement to sell a 25% equity interest in its land portfolio to Roc Partners (Roc). This transaction settled on 9 February 2024. Roc acquired the equity interest for approximately $44.2m in cash. NZL used the
Slide 25: Tenant Concentration, Lease Profile & Lease Overview
TENANT CONCENTRATION, LEASE PROFILE & LEASE OVERVIEW - AS AT 30 JUNE 2024 NZL expects tenant diversification to increase as it continues to grow its asset base. NZL’s Weighted Average Lease Term (WALT) is currently 12.7 years (100% occupancy). NZL’s pastoral farm leases all have three, six and nine
Slide 26: Carbon & Dairy Market Updates
CARBON & DAIRY MARKET UPDATES Carbon Carbon markets rallied strongly in 2023 with the price of New Zealand Emissions Units (NZUs) rising to $75 from $33. This comes after the government made a U-turn on it’s alignment with Climate Change Amendment Regulations, which lay out rules surrounding auction
Slide 27: Key People
KEY PEOPLE New Zealand Rural Land Co The Rural Land Investors ROB CAMPBELL SARAH KENNEDY TIA GREENAWAY CHRISTOPHER SWASBROOK Independent Chair Independent Director Independent Director Non-Independent Director & Founder Chancellor - AUT CEO - Calocurb Limited Hailing from Ngāti Tūwharetoa and Managi
Slide 28: Foreign Ownership Rules & Levels
FOREIGN OWNERSHIP RULES & LEVELS New Zealand Current Listed Current NZL Buyer Company Foreign Foreign NZL is highly advantaged Ownership Rules Ownership because it is a Under the Overseas Investment As at 30 August 2024, NZL had New Zealand buyer Amendment Act 2021, NZL can have foreign domiciled sh
Slide 29: Index Inclusions and Broker Research Coverage
INDEX INCLUSIONS AND BROKER RESEARCH COVERAGE Index Inclusions Broker Research Coverage FTSE Global Micro Cap Index S&P / NZX All Real Estate Index Nicholas Hill Arie Dekker nicholas.hill@craigsip.com arie.dekker@jarden.co.nz Kieran Carling Vishhal Bhula kieran.carling@craigsip.com vishal.bhula@jard
Slide 30: Investor Relations Contacts
INVESTOR RELATIONS CONTACTS Richard Milsom Xavier Lynch richard@nzrlm.co.nz xavier@nzrlm.co.nz +64 21 274 2476 +64 27 282 8046 Level 1 Level 1 85 Fort Street 85 Fort Street Auckland Central Auckland Central Auckland 1010 Auckland 1010 New Zealand New Zealand New Zealand Rural Land Company 30
Slide 31: New Zealand Rural Land Co
New Zealand Rural Land Co The Rural Land Investors New Zealand Rural Land Company +64 9 217 2905 Level 1, 85 Fort Street info@nzrlc.co.nz Auckland Central www.nzrlc.co.nz Auckland 1010 nzrlc New Zealand nzrlc LISTED ON: New Zealand Rural Land Company 31
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