Parkway Life Real Estate Investment Trust · SGX:C2PU
Parkway Life Real Estate Investment Trust — 2QFY2008 Earnings Presentation
39 slides from Parkway Life Real Estate Investment Trust's earnings presentation, Jul 25, 2008
Slide 1: 2QFY2008 Results Presentation
(“PLife REIT”) 2QFY2008 Results Presentation 25 July 2008
Slide 2: Disclaimer
Disclaimer • This Presentation is focused on comparing actual results for the period from 1 April 2008 to 30 June 2008 (“2QFY2008”) versus forecasts as stated in the PLife REIT Prospectus of 7 August 2007. This shall be read in conjunction with PLife REIT 2QFY2008 Unaudited Financial Statement and D
Slide 3: Agenda
Agenda 1 Financial Results Highlights 2 Acquisitions Update 3 Portfolio Highlights 4 Our Strategy 5 Key Drivers of Growth 6 Unit Price Performance Since Listing 3
Slide 4: Financial Results Highlights
Financial Results Highlights 4
Slide 5: Summary financial highlights (2QFY2008)
Summary financial highlights (2QFY2008) Revenue (S$’000) Net Property Income (S$’000) + 10.44% +11.00% + 8.83% + 8.14% 11,250 11,475 Japan Portfolio 10,598 10,823 465 515 ‐ 11,973 Singapore Portfolio 11,239 Min. Guarantee Forecast Actual Min. Guarantee Forecast Actual Revenue higher than forecast Ne
Slide 6: Actual performance (2QFY2008) exceeded forecast
Actual performance (2QFY2008) exceeded forecast (DPU exceeded forecast by 6.35%) Consolidated Income Statement 01 Apr to 30 Jun 2008 Variance (S$’000) Actual Forecast¹ S$’000 % Gross Rental Revenue 12,488 11,475 1,013 8.83 Property Expenses (784) (652) 132 20.25 Net Property Income 11,704 10,823 881
Slide 7: Actual performance (1HFY2008) exceeded forecast
Actual performance (1HFY2008) exceeded forecast (DPU exceeded forecast by 5.10%) Consolidated Income Statement 01 Jan to 30 Jun 2008 Variance (S$’000) Actual Forecast¹ S$’000 % Gross Rental Revenue 24,362 22,950 1,412 6.15 Property Expenses (1,545) (1,303) 242 18.57 Net Property Income 22,817 21,647
Slide 8: Introduction of Japanese assets to existing Singapore portfolio
Introduction of Japanese assets to existing Singapore portfolio By Property By Country Japan Portfolio Japan 8% 8% ESH 4% MEH GEH 63% 25% Asset Size Singapore 92% Japan Portfolio Japan 8% 8% ESH 4% MEH 58% GEH Gross Revenue 30% 33% Singapore 92% Japan Portfolio Japan 8% 8% ESH 5% MEH 57% NPI GEH 30%
Slide 9: 2QFY2008 Gross revenue (Singapore Hospitals) higher than minimum guaranteed rent
2QFY2008 Gross revenue (Singapore Hospitals) was 6.4% and 4.3% higher than minimum guaranteed rent and forecast respectively + 6.4% 11.97 + 4.3% Variable 3.8% of Rent Adjusted Min. 4.47 Prorated Hospital guaranteed Revenue total rent of forecast for S$45m Projection (annualised) Year 2008 Base Rent
Slide 10: 2QFY2008 Gross Revenue (Singapore Hospitals) – Breakdown by 3 Hospitals
2QFY2008 Gross Revenue (Singapore Hospitals) – Breakdown by 3 Hospitals + 6.43% S$'000 + 4.34% 14,000 11,973 11,475 12,000 11,250 10,000 + 21.78% 7,425 7,425 7,425 8,000 + 14.29% 6,000 + 2.61% 3,958 3,463 4,000 3,250 + 0.51% 2,000 575 587 590 - Gleneagles Mt Elizabeth East Shore Total Gross Revenue
Slide 11: Stable and Consistent Distributions
Stable and Consistent Distributions The minimum total rent rachets upwards, capturing the compounding effect of Parkway’s turnover growth Sensitivity of DPU Yield to Singapore’s Singapore hospitals’ revenue adjusted hospital revenue growth Adjusted hospital 500 3 year CAGR 21.4% revenue growth FY08E
Slide 12: 2Q 2008 Total Expenses were 22.1% higher than forecast
2Q 2008 Total Expenses were 22.1% higher than forecast Property Expenses (S$’000) • Actual property level expenses were higher than + 20.25% Ja pa n forecast Portfol i o 652 50 – Increase in contributions to management and sinking fund for Mount Elizabeth Hospital 734 – The impact of the increase to
Slide 13: Distributable Income exceeds minimum guaranteed rent and forecast
Distributable Income exceeds minimum guaranteed rent and forecast by 8.96% and 6.35% respectively Revenue (S$’000) Distributable Income (S$’000) Japan + 11.00% + 8.83% Portfolio Ja pa n 515 + 8.96% Portfol i o + 6.35% 131 11,250 11,475 11,973 Min. Guarantee Forecast Actual 9,186 9,411 9,878 Net Prop
Slide 14: Strong Balance Sheet
Strong Balance Sheet As at 30 As at 31 Consolidated Balance Sheet June December Variance Commentary (in S$’000) 2008 2007 Increase is due to $70 million Investment Properties 902,232 831,570 investment in Japan properties. Decrease is mainly due to the use of Current Assets 14,871 26,654 cash as par
Slide 15: Debt Funding Profile
Debt Funding Profile Debt headroom (S$m) Up to 45% 640 570 0 0 Up to 60% 1,200 1,130 560 0 60% Optimal debt level of 40% to 45% 1,800 560 60% 45% 1,600 Assets (S$m) Gearing (%) 1,400 40% 10% 1,200 4% 570 570 1,000 20% 70 70 70 800 855 855 855 855 600 0% Mar-08 Post Japan acq 45% target gearing 60% m
Slide 16: Distribution Details
Distribution Details Distribution per unit Stock Counter Distribution Period (Cents) PLife REIT 01 April 2008 to 30 June 2008 1.66 Distribution Timetable Ex-Date: 31 July 2008, 9.00am (Units will be traded ex-date) Books Closure Date: 4 August 2008 at 5pm Distribution payment Date: 27 August 2008 16
Slide 17: Acquisitions Update
Acquisitions Update o--, So” | ParkwayLife REIT 17 ee
Slide 18: Acquisitions Update
Acquisitions Update • On 16 May 2008, Parkway Life REIT completed its first investment of a pharmaceutical products distributing and manufacturing facility in Chiba prefecture Japan, for a total purchase price of S$35 million. • On 30 May 2008, Parkway Life REIT completed its investment of two high
Slide 19: Key Benefits of Recent Acquisitions
Key Benefits of Recent Acquisitions 9 Yield accretive, attractive total returns 9 Taps key market in Japan, where the demand for good quality healthcare real estate assets is expected to grow, driven by the fact that by the year 2050, it is predicted that one in three Japanese will be over 65 years
Slide 20: Portfolio Highlights
Portfolio Highlights ~-“@ Se” | ParkwayLife REIT 20 |
Slide 21: ParkwayLife REIT – Portfolio
Largest Healthcare REIT in Asian ParkwayLife REIT – Portfolio Region with an enlarged portfolio of S$901.4 million 1 Bon Sejour Bon Sejour P-Life P-Life Matsudo Matsudo Shin-Yamashita Ibaraki Mount Elizabeth Gleneagles East Shore Hospital Hospital Hospital Note: 1. Based on latest Appraised Values f
Slide 22: Our Initial Portfolio - Singapore
Our Initial Portfolio - Singapore Property Mount Elizabeth Hospital Gleneagles Hospital East Shore Hospital Total Type Hospital and Medical Centre Land Tenure 67 years 75 years 75 years Average 72 years Gross Floor Area (sq m) 1 58,139 49,003 10,993 118,135 Licensed Beds 2 505 380 154 1,039 Operatio
Slide 23: Our Japan Portfolio
Our Japan Portfolio Property P-Life Matsudo Bon Sejour Shin-Yamashita Bon Sejour Ibaraki Total Pharmaceutical product Type distributing & Paid nursing home with care service - manufacturing facility Land Tenure Freehold Freehold 50 years - Land Area (sq m) 8,449 1,653 3,051 13,153 Net Lettable Area
Slide 24: Portfolio Key Statistics
Portfolio Key Statistics (As at 30 June 2008) Properties Mount Elizabeth Hospital, Gleneagles Hospital East Shore Hospital, P-Life Matsudo Bon Sejour Shin-Yamashita, Bon Sejour Ibaraki Type 3 Hospitals & Medical Centres, 2 Nursing Homes, 1 distributing and manufacturing facility Net Lettable Area 1
Slide 25: Competitive Strengths of the Properties
Competitive Strengths of the Properties 100 % committed Diversified occupancy Portfolio Locked-in Value (Geography & given long-term Asset Type) leases + (weighted average lease Quality Assets Stability and term to expiry of 14.0 yrs1) Sustainability of Returns to Growing Demand Unitholders Good Org
Slide 26: Our Strategy
Our Strategy ~-“6 so” ParkwayLife REIT 26 |
Slide 27: Our Strategy
Our Strategy The Manager plans to undertake the following strategies… Complementary and experienced management team Active asset Capital & financial risk Acquisition growth strategy management strategy management strategy • Pro-active asset • Maintain strong balance • Enhance Unitholders’ sheet mana
Slide 28: Acquisition Growth Strategy
Acquisition Growth Strategy PLife REIT will have multiple channels for acquisition growth Sponsor’s existing Future properties to be Third party assets properties developed by Sponsor • Independent operators • 5 year Right of First • Comprising greenfield who require capital or Refusal over Sponsor’
Slide 29: PLife REIT's Target Markets
PLife REIT’s Target Markets Japan Japan US$67.0bn High US$79.6bn Taiwan US$21.8bn S. Korea US$22.4bn Singapore US$3.3bn Australia US$25.2bn Hong Kong US$5.1bn Malaysia Philippines US$3.0bn US$2.3bn India Thailand US$47.8bn US$8.5bn China US$104.5bn Legend Vietnam US$2.9bn Indonesia Core Markets US$7
Slide 30: Acquisition Targets
Acquisition Targets By end of 2009 Portfolio Size Portfolio Mix Geographical Mix • Currently 80.7%* hospitals; 19.3% medical offices • Expect Singapore to • Expect further remain the dominant • Projected to double the diversification with country current asset base to representation from – Asset val
Slide 31: Pro-Active Asset Management Initiatives
Pro-Active Asset Management Initiatives Continuous effort to explore asset enhancement initiatives - Convert non/ lower revenue yielding space to higher revenue yielding space Embark on Revenue Intensifying Initiatives - Eg. Improving service levels at our Hospitals through upgrading of wards & visi
Slide 32: Key Drivers of Growth
Key Drivers of Growth o--, So” ParkwayLife REIT 32 |
Slide 33: Significant Growth in Healthcare Expenditures
1 Significant Growth in Healthcare Expenditures Percentage of Population Over 65 Year Old in Asia 2010 Philippines 2006 Comparison of population over 65 2010 years old, between 2006 and 2010, Malaysia 2006 shows an increasing ageing 2010 India 2006 population in Asia. This will continue 2010 to driv
Slide 34: Ageing Population a Key Driver for Healthcare Real Estate
2 The Ageing Population will Continue to be a Key Driver, Underpinning the Requirement for Healthcare Real Estate Assets Above-65-year-old population in Singapore and Asia Singapore 3% +17 4% 900 wth: 792 Asia h: +31 Gro wt 1,000 Gro 857 (‘000)('000) 600 800 (in million) 431 Singapore 600 456 290 30
Slide 35: Rising Importance of Private Healthcare Services
3 Rising Importance of Private Healthcare Services An increasing percentage of the Asian population is turning to private healthcare… Asia private vs. public healthcare expenditure 320 Healthcare expenditure CAGR (00-06) 285 12.2% 280 254 Healthcare Expenditures (US$ billion) 240 230 112 206 11.8% 1
Slide 36: Growth in Medical Tourism
4 Growth in Medical Tourism World class medical care at competitive rates is attracting increased medical travel to Singapore Asia medical tourism industry International patients inflow to Singapore 0.6 4,500 4,000 R 21% CAG % 3,600 0.4 41 (million) (US$ million) R AG 2,700 C 0.2 1,800 0 900 500 200
Slide 37: Unit Price Performance Since Listing
Unit Price Performance Since Listing 37
Slide 38: Unit price relative performance
Unit price relative performance S-REIT -12.89% STI -13.17% PLife REIT -5.88% 120 115 110 105 100 95 90 85 80 75 70 01-Nov-07 11-Nov-07 21-Nov-07 10-Jan-08 20-Jan-08 30-Jan-08 08-Jun-08 18-Jun-08 28-Jun-08 08-Jul-08 09-Apr-08 19-Apr-08 29-Apr-08 23-Aug-07 02-Sep-07 12-Sep-07 22-Sep-07 02-Oct-07 12-Oc
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