Hyprop Investments Limited · JSE:HYP
Hyprop Investments — H1 2022 Earnings Presentation
61 slides from Hyprop Investments's earnings presentation, March 2022
Slide 1: Interim results presentation
Interim results presentation for the six months ended 31 December 2021
Slide 2: Agenda
Agenda Headlines South Africa Eastern Europe Sub-Saharan Africa Financial Results In Closing And Key Metrics 2
Slide 3: Headlines
Headlines Positive progress implementing strategy Group South Africa Eastern Europe Sub-Saharan Africa Non-Tangible Assets • Commercial implementation of • Increase in property valuation • Independent property valuations • Independent property • First SOKO District opened in Hystead liquidity event:
Slide 4: Key metrics
Key metrics Group Distributable income (Cps) / (R’m) IFRS NAV per share (R) Cents 250 80 R501m R473m 200 6.60 60 38.1 25.8 150 21.0 14.2 40 100 198.7 186.5 65.57 160.6 139.6 146.5 20 74.48 62.96 58.97 50 0 0 December 2020 December 2021 December 2020 June 2021 December 2021 GROUP GROUP (6 months) Gro
Slide 5: Key metrics
Key metrics Group Interest Cover Ratio (ICR) Loan to value % 5 60.0% 49.8% 4 45.8% 38.8% 41.5% 3.82 3.62 40.0% 37.2% 3 3.47 34.0% 3.04 3.21 2.57 24.4% 22.8% 2 18.1% 20.0% 1 0 0.0% December 2020 June 2021 December 2021 December 2020 June 2021 December 2021 IFRS ICR Cash ICR Hyprop fully consolidated
Slide 6: Hyde Park Corner, Johannesburg South Africa
Hyde Park Corner, Johannesburg South Africa 99.6% 77% 59% Investment property Distributable income Total GLA South Africa Eastern Europe Sub-Saharan Africa 6
Slide 7: Trading overview
Trading overview South Africa Monthly Footcount (millions) and spend per head (R / person) Trading density (R / m2) 10 350 5 000 9.9% 300 8 4 000 250 42.4% 8.6% 15.5% 19.8% 6.7% 6.4% 1.0% 9.3% 6 200 3 000 17.3% 5.7% 12.3% 4 150 2 000 100 2 1 000 50 0 - 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov D
Slide 8: Leasing activity
Leasing activity South Africa Retail vacancy Lease expiry profile – total portfolio FY 4% 2026+ 18.5% 3.0% 3% 2024/2025 10.0% 2.4% 2.4% 2.4% 2023/2024 22.7% 2% 2022/2023 14.8% 1.1% 2021/2022 17.7% 1% 0.8% Current 12.3% Vacancy 4.0% 0% Jun 2019 Dec 2019 Jun 2020 Dec 2020 June 2021 Dec 2021 0.0% 5.0%
Slide 9: Tenants South Africa
Tenants South Africa Canal Walk Canal Walk Canal Walk CapeGate Rosebank Rosebank Mall Woodlands The Glen CapeGate Somerset Mall Somerset Mall Somerset Mall Somerset Mall 9
Slide 10: City Center One West Zagreb, Croatia Eastern Europe
City Center One West Zagreb, Croatia Eastern Europe 28% 17% 0.6% Investment property Distributable income Total GLA South Africa Eastern Europe Sub-Saharan Africa 10
Slide 11: Macroeconomic and retail environment
Macroeconomic and retail environment Real GDP growth (%) CPI (%) 6 12 5 10 4 8 6 3 4 2 2 1 Bulgaria Croatia Montenegro North Europe Eurozone Bulgaria Croatia Montenegro North Europe Eurozone European Macedonia Macedonia Union plus UK 2021 2022 2023 2024 2025 2021 2022 2023 2024 2025 Unemployment Rat
Slide 12: Trading overview
Trading overview Eastern Europe Monthly Foot Count (millions) and spend per head (€ / person) Trading density (€ / m2) 5 25 400 9.8% 350 4.8% 4 20 10.4% 300 77.9% 12.5% 16.2% 1.7% 3 15 250 0.5% 52.4% 6.2% 18.6% 8.1% 200 2 10 150 100 1 5 50 0 0 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Fe
Slide 13: Europe valuations bridge (€'m)
Europe valuations* bridge (€’m) 0.5% 3.1 900.0 800.0 768.4 100.0% 0.9% 0.9% 0.6% 0.9% 700.0 0.7 0.8 1.0 1.3 0.4% 651.2 600.0 (120.3) (0.7) 500.0 400.0 300.0 200.0 100.0 0.0 20 20 ad e ric a Ma ll So fia ast st We eb 02 1 er lgr old) go e E reb r2 mb e B (s o d Cit y all, n O a g n e gr be ce ity yP
Slide 14: Tenants Eastern Europe
Tenants Eastern Europe The Mall, Sofia The Mall, Sofia The Mall, Sofia Skopje City Mall Skopje City Mall Skopje City Mall City Center One East City Center One West City Center One West City Center One West City Center One West City Center One West City Center One West 14
Slide 15: Accra Mall, Ghana Sub-Saharan Africa
Accra Mall, Ghana Sub-Saharan Africa 13% -0.3% 6% Investment property Distributable income Total GLA South Africa Eastern Europe Sub-Saharan Africa 15
Slide 16: Trading overview
Trading overview Sub-Saharan Africa Average Monthly foot count (millions) Spend per head ($ / person) 4 10.0 8.0 3 1.1% 9.1% 13.3% 6.0 13.9% 5.3% 1.1% 2 2.3 5.2 5.1 2.0 2.2 4.0 4.9 1 2.0 0 0.0 December 2019 December 2020 December 2021 December 2019 December 2020 December 2021 Including Ikeja (6 mont
Slide 17: Disposals and interventions
Disposals and interventions Update since June 2021 • New Shoprite lease in Nigeria • No US$ liquidity through official channels • All bank covenants met • Reduced debt in Ghana ($5 million) • Ghana sovereign rating downgrade & Cedi weakness Ongoing initiatives • Cash flow management • Cost control •
Slide 18: Financial results
Le Parc, Hyde Park Corner Financial results 18
Slide 19: Distributable income
Distributable income Change in distributable income (R’m) 550 41 11 501 16 500 57 27 38 473 450 (65) (37) 400 (60) 350 300 250 December Atterbury Covid-19 Income Operating ECL’s Hystead dividends Net Africa Other December 2020 Value Mart sale loss of rental costs and management interest 2021 fee inc
Slide 20: Reconciliation of cash generated from operations to distributable income
Reconciliation of cash generated from operations to distributable income 31 December 2021 31 December 2020 South Africa Eastern Europe Sub-Saharan Africa Group South Africa Eastern Europe Sub-Saharan Africa Group R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000 Cash generated from operations 698 134
Slide 21: Hyprop debt exposure by currency (R'm)
Hyprop debt exposure by currency (R’m) Debt exposure by currency (R’m) Total bank borrowings at year-end (R’m) 25000 22 871 20 397 3 190 19 960 19 598 20000 14.5% 20000 1 167 (23.9%) 4.2% 169 18 209 724 (1.0%) 278 17 815 1 336 1 325 (1 564) (63) 15000 6 553 15000 5 204 (9.6%) 5.1% 12 285 12 737 12 6
Slide 22: Change in LTV and sensitivity
Change in LTV and sensitivity Movement in Hyprop LTV from 30 Jun 2021 to 31 Dec 2021 (%) Forward looking Hyprop (see-through) LTV (%) 40 37.2% 45.0% 8.9% 34.0% 40.0% 38.5% (2.3%) (0.3%) (0.3%) (0.3%) 34.0% (2.8%) 35.0% 30 (2.3%) 30.0% (1.3%) 25.0% 20 20.0% 15.0% 10 10.0% 02 1 art on s ad e es rat er
Slide 23: Group debt maturity profile
Group debt maturity profile Rand equivalent (R’m) 5 000 4 500 500 4 000 3 500 3 000 2 500 3 042 2 000 1 500 2 943 900 2 693 1 000 942 1 425 348 1 474 500 650 950 959 650 200 688 450 452 0 Q1: Q2: Q3: Q4: Q1: Q2: Q3: Q4: Q1: Q3: Q4: Q1: Q1: Q3: Q4: Q4: Q2: 2022 2022 2022 2022 2023 2023 2023 2023 2024
Slide 24: In closing
The Mall Sofia, Bulgaria In closing 24
Slide 25: Hyprop with the future in mind
Hyprop with the future in mind Environment • Energy audit complete and strategy in planning • Waste audits complete and initiatives being implemented at 6 SA Malls • IoT.nxt pilot project at Clearwater Mall • Propelair toilets being installed at Hyde Park Corner and Rosebank Precinct • Phase 2&3 of
Slide 26: Rationale for acquisition of properties from Hystead
Rationale for acquisition of 4 properties from Hystead • In line with Hyprop’s diversification strategy • Solid base of 4 premium properties to grow EE portfolio • Align economic risk and interest • Understand the centres and have a 4-year history • Retain competent asset management and property man
Slide 27: Improvement at The Mall, Sofia
Improvement at The Mall, Sofia 30 000 Foot fall and car park 01 February 2022 – 16 March 2022 25 000 20 000 15 000 10 000 5 000 0 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 February 2022 March 2022 Foot fall Par
Slide 28: Purpose and priorities
Purpose and priorities Purpose How we do it We create safe environments and By owning and managing dominant retail opportunities for people to connect centres in mixed-use precincts in key economic and have authentic and meaningful nodes in South Africa and Eastern Europe experiences Group South Afr
Slide 29: Questions and answers
Clearwater Mall, Johannesburg Questions and answers 29
Slide 30: Annexures
Rosebank Mall, Johannesburg, South Africa Annexures 30
Slide 31: South African properties
South African properties Portfolio Canal Walk and summary Canal Walk Offices Clearwater The Glen Woodlands CapeGate % Ownership 80% 100% 75.15% 100% 100% GLA 156 950 87 044 80 124 72 477 63 975 Vacancy levels 3.0% Canal Walk Retail 1.3% 5.1% 2.0% 0.8% 34.9% Canal Walk Offices Total foot count (6 mon
Slide 32: South African properties
South African properties Portfolio Hyde Park Corner summary Somerset Mall Rosebank Precinct and offices % Ownership 100% 100% 100% GLA 68 818 91 046 38 692 Vacancy levels 0.0% 3.7% Rosebank Retail 1.5% Hyde Park Retail 14.3% Rosebank Offices 37.4% Hyde Park Office Total foot count (6 months) 4.5m 4.
Slide 33: Top tenant groups by GLA
Top 10 tenant groups by GLA South Africa – at 31 December 2021 % of Total GLA 10% 8% 8.0% 7.5% 7.4% 6% 7.0% 6.0% 5.9% 5.6% 5.6% 5.7% 5.1% 4% 3.6% 3.8% 3.7% 3.7% 3.6% 3.9% 2% 2.5% 2.7% 2.1% 2.2% 0% Woolworths Pick ‘n pay Retailability Foschini Mass Mart Shoprite Mr Price Pepkor Nu Metro Truworths Gro
Slide 34: Operations
Operations South Africa – 6 months Historic statistics updated for most recent available information Trading density (R / m2 / month) Rent ratio – portfolio (%) 5 000 12.0% 0.1% 0.6% 10.0% 4 000 1.5% 0.1% 8.3% 9.9% 8.9% 8.0% 9.3% 3 000 8.3% 3 150 3 106 6.0% 2 000 2 869 4.0% 1 000 2.0% 0 0.0% Decembe
Slide 35: Operations
Operations South Africa - 6 months ending 31 December 2021 Historic statistics updated for most recent available information Turnover (R’m) 20% Effort ratio (%) 4 500 4 000 16% 3 500 13.3% 3 000 12% 1.8% 1.1% 1.8% 0.7% 1.4% 1.4% 2 500 1.1% 0.1% 2 000 9.8% 8% 9.7% 1 500 7.4% 6.8% 3.6% 21.3% 1 000 17.
Slide 36: Operations
Operations South Africa - 12 months ending 31 December 2021 Historic statistics updated for most recent available information Turnover (R’m) 20% Effort ratio (%) 7 000 6 000 19.0% 16% 5 000 1.7% 1.1% 1.2% 12% 0.8% 1.6% 0.9% 4 000 0.7% 0.2% 17.8% 3 000 17.7% 8% 8.2% 12.9% 10.8% 19.3% 2 000 19.2% 4% 1
Slide 37: Current projects
Current projects Mall Project Completion date Cost/Budget Yield Status Canal Walk, • Zara May 2022 R26.2 million 14.9% Complete Cape Town Woodlands, • Checkers FreshX and STAX May 2021 R51 million 14.9% Complete Pretoria Somerset Mall, • Ceiling upgrade December 2021 R78 million n/a Complete Cape To
Slide 38: Trading performance
Trading performance South African portfolio % of reported Trading density Primary category growth Total GLA turnover Department Stores: Clicks, Dis-Chem, Edgars, Game, Woolworths 7.8% 26.6% 25.1% Apparel 10.0% 19.0% 20.8% Food (1.8%) 13.2% 13.2% Electronic/Photography/Music 19.9% 8.9% 3.4% Food Serv
Slide 39: SA valuations bridge (R'm)
SA valuations bridge (R’m) 23 500 23 205 100% 1.4% 298 23 000 2% 1% 1% 4% 3% 60 2% 3% 18 17 22 390 22 500 250 0% 40 (9) (35) (43) 22 000 (1 113) 21 500 21 000 21 d) lk r ll ds n er ate nc t 21 20 ( s ol Wa ate Ma dla n Gle rn pe G rec i 20 e ry na l arw et oo Th e Co er Jun bu Ca Cle ers rk Ca kP mb
Slide 40: Eastern European properties
Eastern European properties Portfolio Delta City Skopje City Mall The Mall City Center One East City Center One West summary Podgorica, Skopje, Sofia, Bulgaria Zagreb, Croatia Zagreb, Croatia Montenegro North Macedonia % Ownership 60% 60% 60% 60% 60% GLA 23 650 36 629 61 604 48 608 46 723 Vacancy le
Slide 41: Top tenant groups by GLA
Top 10 tenant groups by GLA Eastern Europe – at 31 December 2021 % of Total GLA 10% 9.7% 8% 8.9% 6% 6.4% 6.4% 4% 5.0% 5.0% 3.6% 3.6% 3.3% 3.3% 2% 2.7% 2.6% 2.5% 2.3% 2.1% 2.1% 2.0% 2.0% 1.8% 1.8% 0% Inditex Interspar Peek & Cineplexx H&M LPP Group Fashion C&A Müller New Yorker Cloppenburg Company Dr
Slide 42: Operations
Operations Eastern Europe – 6 months Historic statistics updated for most recent available information Trading density (€ / m2 / month) Effort ratio – portfolio (%) 400 16% 300 1.3% 12% 0.2% 0.6% 0.6% 11.2% 17.4% 266 10.1% 10.7% 200 244 8% 10.2% 220 100 4% 0 0% December 2019 December 2020 December 2
Slide 43: Operations
Operations Eastern Europe - 6 months ending 31 December 2021 Historic statistics updated for most recent available information Turnover (€’m) Effort ratio (%) 170 18% 16% 0.7% 130 14% 12% 1.1% 90 13.1% 14.8% 0.3% 10% 0.9% 1.0% 6.3% 39.0% 50 27.4% 8% 6% 10 4% City CentER City Center Skopje City Mall
Slide 44: Operations
Operations Eastern Europe - 12 months ending 31 December 2021 Historic statistics updated for most recent available information Turnover (€’m) Effort ratio (%) 170 18% 18.7% 18.3% 16% 1.1% 130 14% 33.6% 0.4% 12% 0.1% 90 26.5% 0.8% 0.7% 19.4% 10% 50 8% 6% 10 4% City Center City Centreer Skopje City M
Slide 45: Leasing activity
Leasing activity Eastern Europe Retail vacancy Lease expiry profile 1.5% FY 2026+ 49% 1.0% 1.0% 2024/2025 10% 0.5% 2023/2024 19% 0.5% 0.4% 0.3% 0.3% 2022/2023 12% 0.2% 0.1% 2021/2022 10% 0.0% Jun 2019 Dec 2019 Feb 2020 Jun 2020 Dec 2020 Jun 2021 Dec 2021 0% 10% 20% 30% 40% 50% 60% New lettings and r
Slide 46: Current and future projects
Current and future projects Future Mall Project Completion date Cost/Budget Yield Status City Center One East and • Mall extension and constructing TBC TBC TBC Await City Centre One West additional parking approval of Zagreb, Croatia (approximately 14 000m² GLA the each) development rights Current M
Slide 47: Hystead Group
Hystead Group Pro-forma financial information Financial Position Profit and Loss 31 Dec 2021 31 Dec 2020 31 Dec 2021 31 Dec 2020 31 Dec 2021 31 Dec 2020 31 Dec 2021 31 Dec 2020 12 months 12 months 12 months 12 months €’000 €’000 R’000 R’000 €’000 €’000 R’000 R’000 Revenue 81 854 74 263 1 430 866 1 3
Slide 48: Sub-Saharan Africa properties
Sub-Saharan Africa properties Portfolio summary Ikeja City Mall Accra Mall West Hills Mall Kumasi City Mall % Ownership 75.0% 23.5% 29.4% 49.0% GLA 22 223 21 311 28 272 18 534 Vacancy levels 0% 8.5% 26.3% 6.5% Total foot count (6 months) 3.3m 2.9m 2.3m 4.6m 48
Slide 49: Operations
Operations Sub-Saharan Africa – 12 months Historic statistics updated for most recent available information Trading density (Cedi / m2) 16% Trading density (Cedi / m2 / month) 2 500 8.1% 2 000 12% 8.5% 9.1% 11.0% 30.6% 23.0% 8.3% 21.1% 1 217 1 500 23.9% 62.7% 23.5% 18.9% 0.8% 13.9% 4.4% 8% 1 115 1 3
Slide 50: Operations
Operations Sub-Saharan Africa – 12 months Historic statistics updated for most recent available information Spend per head (Cedi / m2 / Person) Monthly Footcount (millions) 35 3.5 0.7% 2.8% 3.0 11.2% 30 31.3 7.8% 2.5 62.5% 19.6% 1.6% 30.5 3.8% 3.4% 9.4% 20.7% 8.7% 19.6% 14.6% 2.0 4.3% 27.4 25 1.5 1.
Slide 51: Operations
Operations Sub-Saharan Africa – 6 months ending 31 December 2021 Historic statistics updated for most recent available information Turnover ($m) Turnover (Cedi ‘m) 60 300 50 40 200 11.1% 30 7.9% 20 100 26.1% 19.1% 19.6% 13.7% 10 0 0 Accra Mall West Hills Mall Kumasi City Mall Accra Mall West Hills M
Slide 52: Operations
Operations Sub-Saharan Africa – 12 months ending 31 December 2021 Historic statistics updated for most recent available information Turnover ($m) Turnover (Cedi ‘m) 80 400 16.6% 60 13.5% 300 40 200 26.9% 23.0% 18.8% 13.4% 20 100 0 0 Accra Mall West Hills Mall Kumasi City Mall Accra Mall West Hills M
Slide 53: Currency and interest rate analysis
Currency and interest rate analysis Sub-Saharan Africa Cedi rental – June 2012 to June 2021 Cedi / USD 450 7.0 400 6.0 350 300 5.0 250 4.0 200 3.0 150 2.0 100 50 1.0 - - Dec -12 Dec -13 Dec -14 Dec -15 Dec -16 Dec -17 Dec -18 Dec -19 Dec -20 Dec -21 Dec -12 Dec -13 Dec -14 Dec -15 Dec -16 Dec -17 De
Slide 54: Segmental performance
Segmental performance South Africa Eastern Europe Sub-Saharan Africa 31 Dec 2021 31 Dec 2020 31 Dec 2021 31 Dec 2020 31 Dec 2021 31 Dec 2020 R’000 R’000 R’000 R’000 R’000 R’000 Revenue 1 233 220 1 179 762 - - 120 314 111 282 Rental and other lease income 918 892 917 785 - - 96 760 91 988 Gross contr
Slide 55: LTV calculations
LTV calculations 31 December 2021 30 June 2021 Fully Fully HYPROP consolidated HYPROP consolidated LTV LTV LTV LTV Hyprop total assets 27 509 721 27 509 721 26 878 086 26 878 086 Less: Goodwill and intangible assets (17 197) (17 197) (20 133) (20 133) Financial asset (330 623) (330 623) (297 235) (2
Slide 56: Bank and DCM debt profile
Bank and DCM debt profile as at December 2021 Standard Bank Group ZAR bank facilities 41.1% RMB On balance sheet debt 40.1% On balance sheet 43.4% 41.1% USD bank facilities by lender by currency Nedbank ZAR DCM DCM 15.5% 15.5% 3.3% 19.9% 21.0% 26.5% Standard Bank Group ZAR bank facilities Group Nedb
Slide 57: Debt maturity profile
Debt maturity profile as at February 2022 South African Debt (ZAR’m) December June December 2000 2021 2021 2020 1500 Property value (Rbn) 22.4 23.2 24.4 500 925 LTV 14.97% 20.41% 23.70% 1000 950 959 Weighted average cost of debt 500 7.6% 7.8% 8.1% 400 250 200 (incl. hedges) 450 452 500 348 Weighted
Slide 58: Investment property and capital expenditure
Investment property and capital expenditure 31 December 2021 30 June 2021 South Africa R24.6bn (59%) R25.4bn (59%) Hyprop share R22.4bn R23.2bn 13% Exit cap rate range 6.75% - 9.25% 6.8% - 9.3% Weighted average exit cap rate 7.4% 7.4% Implied forward yield 7.4% 7.6% South Africa Eastern Europe R11.7
Slide 59: Equity bridge
Equity bridge Hyprop Group (R’m) 21 000 20 500 91 33 60 876 2 20 159 285 474 (1) 20 000 19 357 10 7 19 500 (1 035) 19 000 18 500 18 000 17 500 17 000 21 e on d d on TR d g x e r V 20 om ati ea an are llin Ta ssu he NA 1 e inc lu ys t ts nts ss L o o f IP FC ec l tro rest i Ot 2 Jun g va fH e n e sd
Slide 60: Disclaimer
This presentation and any materials distributed in connection with this presentation may include certain forward-looking statements beliefs or opinions including statements with respect to the company’s business financial condition and results of operations. These statements which contain the words
Slide 61: Investor Relations
Investor Relations Lizelle du Toit - lizelle@hyprop.co.za