Slide 1: FY2018 Results & Equity Raising
VVR FY2018 RESULTS Viva Energy REIT FY2018 Results & Equity Raising 21 February 2019 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Slide 2: Important Notice and Disclaimer
IMPORTANT NOTICE AND DISCLAIMER NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES This presentation has been prepared by Viva Energy REIT (“VVR” or affect future operations of VVR and the values and the impact that “Viva Energy REIT”) which is a stapled entity comprising shares in This presentati
Slide 3: Important Notice and Disclaimer
IMPORTANT NOTICE AND DISCLAIMER NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Future performance and forward looking statements be entirely at your own risk. This presentation may not be else’s, future financial position and/or performance. The pro forma This presentation contains forward-loo
Slide 4: Important Notice and Disclaimer
IMPORTANT NOTICE AND DISCLAIMER NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES General disclaimer The Limited Parties make no recommendations as to whether you or The underwriters to the Institutional Placement, together with their your related parties should participate in the Equity Raising,
Slide 5: Highlights
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Highlights MARGARET KENNEDY Managing Director VER Manager Pty Limited 5
Slide 6: Key Highlights: Results overview
KEY HIGHLIGHTS VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Results overview VVR continues to deliver on strategic objectives FY2018 Distributable Earnings of 14.02 CPS1, ahead of guidance Continued growth in portfolio size whilst maintaining focus on quality Acquisi
Slide 7: FY2018 key highlights
KEY HIGHLIGHTS VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES FY2018 key highlights Financial Performance Portfolio & Acquisitions Capital Management 14.02 CPS Distributable Earnings 1 $2.5 billion portfolio 36.2% gearing ratio 5 454 high-quality service stations and Reduces
Slide 8: Positioning VVR for future growth
KEY HIGHLIGHTS VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Positioning VVR for future growth Equity raising Pipeline restocked • $100 million fully underwritten Institutional Placement • VVR has identified a ~$130 million pipeline of potential acquisitions, $67 million of
Slide 9: Financial Results
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Financial Results GUY FARRANDS Chief Financial Officer VER Manager Pty Limited 9
Slide 10: Statutory financial performance
FINANCIAL RESULTS VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Statutory financial performance Full year Full year Statutory Profit and Loss 31 December 2018 31 December 2017 % Change • Rental income growth driven by fixed rent FY2018 vs FY2017 escalators and incremental a
Slide 11: Distributable earnings
FINANCIAL RESULTS VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Distributable earnings Ahead of guidance and up 4.5% on FY2017 Full year Full year % Change • Distributable earnings of 14.02 CPS for Distributable Earnings 31 December 2018 31 December 2017 FY2018, exceeding t
Slide 12: Financial position
FINANCIAL RESULTS VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Financial position Full year Full year • NTA increased by 3.8% to $2.20 per stapled Balance Sheet 31 December 2018 31 December 2017 security from $2.12, on a like-for-like basis3 $ million1 $ million1 - VVR now
Slide 13: Capital management – FY2018 achievements
FINANCIAL RESULTS VVR FY2018 RESULTS Capital management – FY2018 achievements NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Debt terms improved, tenor lengthened and sources diversified • Bank Debt Debt Facilities Expiry Profile ($ million): as at 31 December 2018 - Existing $836.6 million sy
Slide 14: Capital management
FINANCIAL RESULTS VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Capital management Active capital management provides opportunity for continued growth • Weighted average cost of debt was 3.83% for FY2018 Full year Full year 31 December 31 December Capital Management 2018 20
Slide 15: Acquisitions, Portfolio and Industry Update
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Acquisitions, Portfolio and Industry Update MARGARET KENNEDY Managing Director VER Manager Pty Limited 15
Slide 16: Acquisition strategy
VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES ACQUISITIONS, PORTFOLIO AND INDUSTRY UPDATE Acquisition strategy VVR will continue to consider acquisition and development opportunities consistent with the following investment criteria: 1. Investment is high quality and strate
Slide 17: FY2018 acquisitions and FY2019 expected pipeline
VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES ACQUISITIONS, PORTFOLIO AND INDUSTRY UPDATE FY2018 acquisitions and FY2019 expected pipeline VVR acquired 16 sites for $129 million1 at a WACR of 6.4%2 • Acquisitions are consistent with VVR’s growth strategy • The addition of C
Slide 18: Acquisitions settled in FY2018
VVR FY2018 RESULTS ACQUISITIONS, PORTFOLIO AND INDUSTRY UPDATE NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Acquisitions settled in FY2018 VVR acquired 16 sites for $129 million1 at a WACR of 6.4% ACQUISITIONS IN FY2018 Purchase Property State Region Cap rate (%) Major tenant Rent reveiws Le
Slide 19: Portfolio overview
VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES ACQUISITIONS, PORTFOLIO AND INDUSTRY UPDATE Portfolio overview PORTFOLIO AT 31 DECEMBER 2018 Properties Value ($m) Average1 value ($m) Average1 size (m2) WACR (%) WALE (years) Metropolitan 316 1,863 5.9 3,683 5.5 13.0 Regional 1
Slide 20: Portfolio lease profile
VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES ACQUISITIONS, PORTFOLIO AND INDUSTRY UPDATE Portfolio lease profile As at 31 December 2018 • 100% occupancy • 3% per annum fixed rental increases1 • Majority of market rent reviews not until 20262 (IPO Portfolio) • Current WALE
Slide 21: Property revaluations
VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES ACQUISITIONS, PORTFOLIO AND INDUSTRY UPDATE Property revaluations Revaluations supported by contracted rental growth Valuation Policy WACR by State (%): as at 31 December 2018 • Fair value of the individual properties are review
Slide 22: Portfolio tenants
VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES ACQUISITIONS, PORTFOLIO AND INDUSTRY UPDATE Portfolio tenants VVR has continued to add to its brand mix • VVR’s portfolio is supported by strong and stable tenants, Tenant Income2 FY20163 FY2017 FY2018 including key tenant, Viva
Slide 23: Retail fuel & convenience property sales
VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES ACQUISITIONS, PORTFOLIO AND INDUSTRY UPDATE Retail fuel & convenience property sales Transaction yields continue to remain attractive Legend: VVR Portfolio Cap Rate 5 Year Swap Curve • VVR portfolio cap rate remains in- 8.0% Rep
Slide 24: Convenience retail market trends
VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES ACQUISITIONS, PORTFOLIO AND INDUSTRY UPDATE Convenience retail market trends Convenience retailing has become an integral component of the service station industry • Structural changes over the past decade have enhanced the attr
Slide 25: Strategy & Outlook
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Strategy & Outlook MARGARET KENNEDY Managing Director VER Manager Pty Limited 25
Slide 26: Competitive strengths
STRATEGY & OUTLOOK VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Competitive strengths Market-leading national service station and convenience retail distribution platform • Irreplicable high-quality, strategically located service station and convenience retail distribution
Slide 27: Strategy and outlook
STRATEGY & OUTLOOK VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Strategy and outlook FY2019 Distributable Earnings per security growth guidance range of 3-3.75%1,2 from FY2018 • Optimise core business and maintain low management expense ratio • Continue to pursue further a
Slide 28: Questions
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES 28 Questions
Slide 29: Equity Raising
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Equity Raising MARGARET KENNEDY Managing Director VER Manager Pty Limited 29
Slide 30: Equity Raising overview
EQUITY RAISING VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Equity Raising overview • Fully underwritten Institutional Placement to raise $100 million • Institutional Placement issue price of $2.32 per New Security Institutional Placement offer − A discount of 4.1% to the
Slide 31: Equity Raising overview (continued)
EQUITY RAISING VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Equity Raising overview (continued) • Following the completion of the Institutional Placement, VVR will offer eligible securityholders 1 the opportunity to participate in a non-underwritten SPP to raise up to $10
Slide 32: Timetable
EQUITY RAISING VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Timetable Event Date Trading halt and announcement of Equity Raising Thursday, 21 February 2019 Institutional Placement Institutional Placement bookbuild Thursday, 21 February 2019 Announcement of outcome of Insti
Slide 33: Pro-forma balance sheet
EQUITY RAISING VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Pro-forma balance sheet The pro forma balance sheet has been derived from VVR’s financial statements for the financial year ended 31 December 2018, adjusted for the effects of the pro forma adjustments described b
Slide 34: Questions
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES 34 Questions
Slide 35: Glossary
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES 35 Glossary
Slide 36: Glossary
GLOSSARY VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Glossary The contractual alliance between Viva Energy Australia and Coles Express (and their associated entities) including the Alliance Alliance Agreement and Site Agreements as outlined in the PDS and as amended in Fe
Slide 37: Glossary
GLOSSARY VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Glossary Interest Coverage Earnings before interest, tax, depreciation and amortisation (excluding any asset revaluations, mark-to-market Ratio or ICR movements and transaction costs) divided by net interest expense IPO
Slide 38: Appendix
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES 38 Appendix 1
Slide 39: Viva Energy Australia snapshot
APPENDIX VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Viva Energy Australia snapshot A leading integrated downstream petroleum company in Australia 24%1 of the Australian downstream petroleum market 1,215 service station sites nationwide in Viva Energy’s network 44 fuel im
Slide 40: Retail fuel & convenience property sales
APPENDIX VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Retail fuel & convenience property sales A highly liquid market Legend: 10.0% VVR Portfolio 2016 sales • Sales continue to remain stable 2017 sales 9.0% • Market is highly liquid with tight 2018 sales yields being achie
Slide 41: Australian fuel industry landscape
APPENDIX VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Australian fuel industry landscape • Vehicle ownership in Australia has experienced a +2.2% CAGR from 2013 to 20181 • Composition of fuel demand is expected to change over time due to population growth, improved vehicle
Slide 42: Population map study
APPENDIX VVR FY2018 RESULTS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Population map study National distribution platform aligned with population density Melbourne Sydney % of metro population1 located within a 5km radius of VVR’s 91% 93% property coverage2 1 Metropolitan population as de
Slide 43: Key Risk Factors
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES 43 KEY RISK FACTORS Appendix 2
Slide 44: Key risk factors
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Key risk factors This section sets out some of the key risks associated with: • VVR and its existing business and the industry in which VVR operates • participation in the Equity Raising. The risks set out in this section are not listed in order o
Slide 45: Key risk factors (continued)
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Key risk factors (continued) 3. EXPOSURE TO SITE AGREEMENTS IN THE EVENT THE LEASES ARE TERMINATED If a site lease between Viva Energy Australia and VVR terminates or expires while a site agreement between Viva Energy Australia and Coles Express (
Slide 46: Key risk factors (continued)
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Key risk factors (continued) 6. PROPERTY ILLIQUIDITY VVR may be required to dispose of its property assets in response to adverse business conditions. Given the relatively illiquid nature of property investments, VVR may not be able to achieve the
Slide 47: Key risk factors (continued)
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Key risk factors (continued) VVR does not have direct employees (other than non-executive directors) and consequently is reliant on the expertise and experience of the key executives of Viva Energy Australia made available to the VER Manager which
Slide 48: Key risk factors (continued)
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Key risk factors (continued) 14. BREACH OF DEBT FACILITY AGREEMENT If there is a breach of any of the financial covenants contained in the Debt Facility Agreement which is not remedied within 30 business days by way of an equity cure, an event of
Slide 49: Key risk factors (continued)
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Key risk factors (continued) 19. SECURITIES PRICE RISK There are general risks associated with an investment in the share market. As such, the value of New Securities may rise above or fall below the offer price, depending on the financial positio
Slide 50: Key risk factors (continued)
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Key risk factors (continued) 25. ECONOMIC CONDITIONS The operating and financial performance of VVR’s businesses are influenced by a variety of general economic and business conditions including the level of inflation, interest rates and exchange
Slide 51: Foreign Selling Restrictions
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES 51 Appendix 3 FOREIGN SELLING RESTRICTIONS
Slide 52: Foreign Selling Restrictions
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Foreign Selling Restrictions This presentation does not constitute an offer of New Securities in any jurisdiction in which it would be unlawful. In particular, this presentation may not be distributed to any person, and the New Securities may not
Slide 53: Foreign Selling Restrictions
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Foreign Selling Restrictions New Zealand This document is not a product disclosure statement or any other form of disclosure document under the Financial Markets Conduct Act 2013 ("FMC Act") and has not been registered, filed with or approved by a
Slide 54: Foreign Selling Restrictions
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Foreign Selling Restrictions Switzerland VVR has not been approved by the Swiss Financial Market Supervisory Authority FINMA ("FINMA") as a foreign collective investment scheme pursuant to Article 120 paragraph 1 of the Swiss Collective Investment
Slide 55: Foreign Selling Restrictions
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Foreign Selling Restrictions United States This presentation does not constitute an offer to sell, or the solicitation of an offer to buy, any securities in the United States. The New Securities have not been, and will not be, registered under the