Parkway Life Real Estate Investment Trust · SGX:C2PU
Parkway Life Real Estate Investment Trust — Q2 2014 Earnings Presentation
49 slides from Parkway Life Real Estate Investment Trust's earnings presentation, Aug 4, 2014
Slide 1: 2Q 2014 Results Presentation
(“PLife REIT”) 2Q 2014 RESULTS PRESENTATION 4 August 2014
Slide 2: Disclaimer
Disclaimer This Presentation is focused on comparing actual results for the period from 1 April 2014 to 30 June 2014 (“2Q 2014”) versus the period from 1 April 2013 to 30 June 2013 (“2Q 2013”). This shall be read in conjunction with PLife REIT 2014 Second Quarter Unaudited Financial Statement and
Slide 3: Agenda
Agenda 1 2Q 2014 Key Highlights 2 Financial Review 3 Singapore Hospitals Annual Rent Review 4 Capital and Financial Management 5 Appendix I Our Growth Strategy II Portfolio Highlights 3
Slide 4: 2Q 2014 Key Highlights
(“PLife REIT”) 1. 2Q 2014 Key Highlights 4
Slide 5: 2Q 2014 Key Highlights
2Q 2014 Key Highlights Strong DPU Growth for 2Q and 1H 2014 ― DPU for 2Q 2014 at 2.90 cents; DPU for 1H 2014 at 5.72 cents ― DPU grew by 10.2% (2Q Y-O-Y) and 8.5% (1H Y-O-Y) Pre-emptive Terming Out of FY2015 Debt Facilities ― Successful terming out 52% of FY2015 refinancing requirements in July
Slide 6: 2Q 2014 Key Highlights (cont'd)
2Q 2014 Key Highlights (cont’d) Minimum Guaranteed Rent for Singapore Hospitals to increase by 2.81% ― With CPI growth of 1.81%, 8th Year Minimum Guaranteed Rent set to increase by 2.81% above total rent payable for 7th Year of Lease Term based on (CPI + 1%) formula ― Effective for the period 23
Slide 7: Financial Review
(“PLife REIT”) 2. Financial Review 7
Slide 8: Performance at a Glance
Performance at a Glance 2Q 2014 DPU grew by 10.2% to 2.90 cents 1H 2014 DPU grew by 8.5% to 5.72 cents Consolidated Income Year-on-Year Year-on-Year Variance Variance Statement (Actual) (Actual) (S$’000) 2Q 2014 2Q 2013 % 1H 2014 1H 2013 % Gross Revenue 25,339 22,583 12.2 49,943 45,612 9.5 Net P
Slide 9: Strong Revenue Growth
Strong Revenue Growth 2Q 2014 revenue grew by 12.2% to $25.3 million 1H 2014 revenue grew by 9.5% to $49.9 million 2Q Revenue (S$’000) 1H Revenue (S$’000) 28,000 25,339 56,000 49,943 24,000 +12.2% +12.2% 22,583 48,000 +9.5% +9.5% 45,612 20,000 40,000 31,332 15,000 15,666 30,000 16,000 32,000 12,
Slide 10: Strong Net Property Income Growth
Strong Net Property Income Growth Increase in NPI is mainly due to: Rent contributions from properties acquired in 2H 2013 and 1Q 2014 Upward minimum guarantee rent revision of Spore hospitals by 4.44%1 2Q NPI 1H NPI 23.6 50.0 46.6 24.0 21.1 42.6 40.0 +12.0% +12.0% +9.4% +9.4% 16.0 30.0 8.8 9.
Slide 11: Strong Distributable Income Growth
Strong Distributable Income Growth 2Q 2014 DI grew by 10.2% to $17.5 million 1H 2014 DI grew by 8.5% to $34.6 million 2Q DI (S$’000) 1H DI (S$’000) +10.2% +10.2% +8.5% +8.5% 36,000 34,608 19,000 17,542 15,925 31,890 16,000 33,000 13,000 30,000 2Q 2013 2Q 2014 1H 2013 1H 2014 11
Slide 12: Strong DPU Growth Since IPO
Strong DPU Growth Since IPO DPU has grown steadily at a rate of 70.9%1 since IPO2 DPU (cents) 12.0 +70.9% 10.31 3 10.75 Represents 9.60 53% of 10.0 8.79 FY2013 DPU 7.74 6.83 8.0 6.32 5.72 6.0 4.0 2.0 0.0 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 1H 2014 (annualised) Note: 1. Since IP
Slide 13: Attractive Spread Above 10-yr SGS Yield
Attractive Spread Above 10-yr SGS Yield 253 bps higher than 10-yr Singapore Government Securities (“SGS”) 430 bps higher than fixed deposit rates Defensive nature of PLife REIT adds to the attractiveness of 4.85% yield1 Source: Bloomberg Note: 1. Distribution yield based on the share price of
Slide 14: Unit Price Relative Performance
Unit Price Relative Performance PLife REIT’s Unit Price consistently outperformed both the STI and the S-REIT Index and continued to do well in 2Q 2014… 1. FTSE ST: Real Estate Investment Trust Index ; 2. STI Index: Straits Times Index Source: Bloomberg … providing its mettle during both periods of
Slide 15: Distribution Details
Distribution Details Distribution per unit Stock Counter Distribution Period (cents) PLife REIT 01 April 2014 to 30 June 2014 2.90 Distribution Timetable Ex-Date: 8 August 2014 (Units will be traded ex-date) Books Closure Date: 12 August 2014 at 5pm Distribution Payment Date: 2 September 2014 15
Slide 16: Singapore Hospitals Annual Rent Review
(“PLife REIT”) 3. Singapore Hospitals Annual Rent Review 16
Slide 17: Poised to Enjoy Growth in Minimum Rent from the Singapore Hospital Properties
Poised to Enjoy Growth in Minimum Rent from the Singapore Hospital Properties Principal Terms of Master Lease Master Lessee Parkway Hospitals Singapore Pte. Ltd. (“PH”) Term 15 + 15 years wef 23 August 2007 Annual Rent Higher of: Escalation (i) Base Rent (S$30.0 million) + Variable Rent (3.8% of AHR
Slide 18: Capital and Financial Management
(“PLife REIT”) 4. Capital and Financial Management 18
Slide 19: Healthy Balance Sheet
Healthy Balance Sheet Healthy gearing of 35.3% as at 30 June 2014 Consolidated As at As at Balance Sheet Variance Commentary 30 Jun 2014 31 Dec 2013 (in S$’000) Increase is mainly due to the acquisition of two nursing homes and an extended-stay Total Assets 1,588,464 1,528,155 lodging facility in
Slide 20: Debt Maturity Profile
Debt Maturity Profile 2 With the terming out of 52% of FY2015 refinancing requirements to 2H FY2019, the weighted average term to maturity is extended from 2.88 years to 3.48 years Current effective all-in cost of debt of 1.46% Interest cover ratio of 10.4 times Note: 1. Successful terming out
Slide 21: Additional Debt Capacity
Ample Debt Headroom Debt headroom of S$124.1 million, S$279.8 million and S$980.4 million before reaching 40%, 45% and 60% gearing respectively PLife REIT has ample funding to support future acquisitions and growth opportunities Additional Debt Capacity Asset 980.4 (S$ ’M) (S$’M) 124.1 279.8 35.
Slide 22: Appendix
5. Appendix Se” ParkwayLife REIT
Slide 23: Our Growth Strategy
(“PLife REIT”) Our Growth Strategy 23
Slide 24: PLife REIT's Next Phase of Growth
PLife REIT’s Next Phase of Growth 24
Slide 25: Our Long Term Strategy
Our Long Term Strategy The manager plans to undertake the following strategies… Acquisition GROWTH Strategy ASSET MANAGEMENT Strategy Third Party Acquisition Sponsor’s Acquisition • Sustain Revenue • Focused on acquiring • Focused on acquiring • Grow revenue organically quality assets from 3rd asset
Slide 26: Portfolio Highlights
(“PLife REIT”) Portfolio Highlights 26
Slide 27: PLife REIT Portfolio
PLife REIT Portfolio Largest listed healthcare REIT in Asian region with an enlarged portfolio of S$1.5 billion1 Core Strengths: Defensive long term lease structure with downside protection Stable income stream supported by regular rental revision Diversified portfolio of high quality and yiel
Slide 28: Our Properties - Singapore
Our Properties - Singapore 1 A portfolio of 3 strategically-located world-class local private hospitals worth S$1.0 billion Master Lease with Parkway Hospitals Singapore Pte. Ltd, a wholly owned subsidiary of Parkway Pantai Limited (“Parkway”), the largest private healthcare operator in Singapor
Slide 29: Our Properties – Japan
Our Properties – Japan A portfolio of 43 high quality healthcare properties worth 1 S$493 million , comprising: 1 pharmaceutical product distributing and manufacturing facility P-Life Matsudo (P-Life Matsudo) 42 private nursing homes Master tenancy with 19 lessees Nursing Home Properties B
Slide 30: Our Properties - Japan
Our Properties - Japan 2 Unique features of our Japan assets: Favorable Lease Structure Long term lease structure with weighted average lease term to expiry of 1 13.75 years “Up only” Rental Review Provision for most of our nursing homes Master Tenanted Signifies 100% committed occupancy N
Slide 31: Diversified Nursing Home Operators
Diversified Nursing Home Operators 18 high quality nursing home operators Diversifies tenant risk Back-up operator arrangements Minimises operator default risks Rental guarantee by vendors For a period of seven years, capped at 5% of the purchase price for properties acquired from Kenedi
Slide 32: Our Properties – Malaysia, Kuala Lumpur
Our Properties – Malaysia, Kuala Lumpur 1 A portfolio of high quality healthcare assets worth S$8.6million within Gleneagles Intan Medical Centre Kuala Lumpur, next to the 330-bed Gleneagles Hospital Kuala Lumpur Multi tenancies with lessees Gleneagles Hospital (Kuala Lumpur) Sdn. Bhd. and CIMB
Slide 33: Our Portfolio - Singapore
Our Portfolio - Singapore Property Mount Elizabeth Hospital Gleneagles Hospital Parkway East Hospital Type Hospital and Medical Centre Land Tenure 67 years 75 years 75 years Total Area (sq m) 1 58,139 49,003 10,994 Beds 2 345 272 113 Operating theatres 2 13 12 4 Strata Units / Car Park Lots 30 strat
Slide 34: Our Portfolio - Japan
Our Portfolio - Japan Property P-Life Matsudo Bon Sejour Shin-Yamashita Bon Sejour Ibaraki Pharmaceutical product distributing & Type Paid nursing home with care service manufacturing facility Land Tenure Freehold Freehold 50 years Land Area (sq m) 8,450 1,653 3,051 Net Lettable Area (sq m) 3,240 3,
Slide 35: Our Portfolio - Japan
Our Portfolio - Japan Senior Chonaikai Himawari Home Property Palmary Inn Akashi Palmary Inn Suma Makuhari Kan Kamakura Type Paid nursing home with care service Land Tenure Freehold Freehold Freehold Freehold Land Area (sq m) 5,891 2,676 2,853 1,307 Net Lettable Area (sq m) 6,562 4,539 4,361 1,689 N
Slide 36: Our Portfolio - Japan
Our Portfolio - Japan Smiling Home Medis Fureai no sono Smiling Home Medis Property Musashi Urawa Nerima Takanodai Koshigaya Gamo Type Paid nursing home with care service Land Tenure Freehold Land Area (sq m) 802 2,282 1,993 Net Lettable Area (sq m) 1,603 2,526 3,824 Number of Units (Rooms) 44 64 10
Slide 37: Our Portfolio - Japan
Our Portfolio - Japan Supercourt Takaishi- Maison de Centenaire Property Amille Nakasyo Supercourt Kadoma Hagoromo Ishizugawa Type Paid nursing home with care service Land Tenure Freehold 50 years 30 years Freehold Land Area (sq m) 2,901 1,518 2,010 1,111 Net Lettable Area (sq m) 3,259 2,794 3,021 2
Slide 38: Our Portfolio - Japan
Our Portfolio - Japan Maison de Centenaire Fiore Senior Residence Property Hapine Fukuoka Noke Iyashi no Takatsuki Kan Haruki Hirakata Type Paid nursing home with care service Land Tenure Freehold Freehold Freehold Freehold Land Area (sq m) 801 1,396 727 2,023 Net Lettable Area (sq m) 1,263 2,912 1,
Slide 39: Our Portfolio - Japan
Our Portfolio - Japan Property Sawayaka Obatake Ichibankan Sawayaka Obatake Nibankan Sawayaka Shinmojikan Paid nursing home Short stay / Paid nursing home Type with care service Day care facility with care service Land Tenure Freehold Freehold Freehold Land Area (sq m) 1,786 1,042 2,813 Net Lettable
Slide 40: Our Portfolio - Japan
Our Portfolio - Japan Property Sawayaka Nokatakan Sawayaka Nogatakan Sawayaka Sakurakan Sawayaka Fukufukukan Type Paid nursing home with care service Land Tenure Freehold Freehold Freehold Freehold Land Area (sq m) 5,748 2,707 6,276 1,842 Net Lettable Area (sq m) 4,566 3,147 5,044 3,074 Number of Un
Slide 41: Our Portfolio - Japan
Our Portfolio - Japan Property Sawayaka Higashikagurakan Sawayaka Hirakatakan Sawayaka Parkside Shinkawa Type Paid nursing home with care service Land Tenure Freehold Freehold Freehold Land Area (sq m) 4,813 1,850 1,445 Net Lettable Area (sq m) 5,335 3,696 2,855 Number of Units (Rooms) 110 108 58 20
Slide 42: Our Portfolio - Japan
Our Portfolio - Japan Fureai no Sono Legato Higashi Property As Heim Nakaurawa Musashi Nakahara Sumiyoshi Type Paid nursing home with care service Land Tenure Freehold Land Area (sq m) 1,762 935 951 Net Lettable Area (sq m) 2,692 1,847 2,828 Number of Units (Rooms) 64 47 71 Year of Completion 2006 2
Slide 43: Our Portfolio - Japan
Our Portfolio - Japan Property Royal Residence Gotenyama Legato Katano Type Paid nursing home with care service Land Tenure Freehold Freehold Land Area (sq m) 794 1,139 Net Lettable Area (sq m) 1,560 1,688 Number of Units (Rooms) 44 49 Year of Completion 2006 2004 Committed Occupancy 100% Name of Le
Slide 44: Our Portfolio - Japan
Our Portfolio - Japan Property Heart Life Toyonaka Palmary Inn Shin-Kobe Type Paid nursing home with care service Land Tenure Freehold Freehold Land Area (sq m) 628 1,034 Net Lettable Area (sq m) 1,254 3,964 Number of Units (Rooms) 42 71 1992 Year of Completion 2007 Conversion works were completed i
Slide 45: Our Portfolio - Japan
Our Portfolio - Japan Property Sawayaka Seaside Toba Sawayaka Niihamakan Sawayaka Minatokan Type Paid nursing home with care service Land Tenure Freehold Freehold Freehold Land Area (sq m) 2,803 4,197 3,551 Net Lettable Area (sq m) 7,360 7,382 2,246 Number of Units (Rooms) 129 135 50 Year of Complet
Slide 46: Our Portfolio - Japan
Our Portfolio - Japan Property Sawayaka Mekari Nibankan Sawayaka Kiyotakan Type Paid nursing home with care service Land Tenure Freehold Freehold Land Area (sq m) 1,354 2,597 Net Lettable Area (sq m) 2,133 5,661 Number of Units (Rooms) 61 108 Year of Completion 2012 2013 Committed Occupancy 100% Nam
Slide 47: Our Portfolio - Japan
Our Portfolio - Japan Maison des Centenaire Property Maison des Centenaire Hannan Sunhill Miyako Ohhama Paid nursing home with care Paid nursing home with care Type Extended-stay lodging facility service service Land Tenure Freehold Freehold Freehold Land Area (sq m) 7,827 10,867 1,281 Net Lettable
Slide 48: Our Portfolio - Malaysia
Our Portfolio - Malaysia Property Gleneagles Intan Medical Centre, Kuala Lumpur Type Medical Centre Land Tenure Freehold Land Area (sq m) 3,450 Strata Area of Property (sq m) 2,444 (owned by Parkway Life REIT) Number of Car Park Lots 69, all of which owned by Parkway Life REIT Year of Completion 199
Slide 49: Our Portfolio - Summary
Our Portfolio - Summary Portfolio Singapore Japan Malaysia Total 42 nursing homes; 4 Hospitals & medical centre; 1 pharmaceutical product 42 nursing homes; Hospital & Medical Type distribution & manufacturing Medical Centre 1 pharmaceutical product Centre facility distributing & manufacturing facili
Parkway Life Real Estate Investment Trust — Q2 2014 Earnings Presentation on 6ix