Slide 1: Annual Result
GPT ANNUAL RESULT 14 FEBRUARY 2013 The GPT Group Ly
Slide 2: Agenda
Agenda For personal use only Strategy Business Performance Outlook Michael Cameron CEO Financial Result Capital Management Mark Fookes CFO Portfolio Performance Carmel Hourigan Head of Investment Management Note: All information included in this presentation includes GPT owned assets and
Slide 3: 2012 Annual Result: Exceeding expectations
2012 Annual Result For personal use only Exceeding expectations Actively enhancing our portfolio Deliberately investing in the future 3
Slide 4: Delivering on the strategic journey
2012 Annual Result Delivering on the strategic journey For personal use only Earnings per Security(1) Total Return(2) 22.4c 24.2c 20.7c 9.1% 9.5% +8.1% +8.0% 4.9% (3) 2010 2011 2012 2010 2011 2012 Total Securityholder Return 26.9% 10.5% (1) Earnings per security defined as ROI per ordinary security
Slide 5: 2012 Annual Result highlights
2012 Annual Result highlights A significant year of achievement For personal use only 8.4% 8.0% Significantly exceeded guidance DPS growth EPS growth Sold 50% interest in 111 Eagle St and Casuarina and Woden 5 Murray Rose $1 billion to GWSCF complete asset transactions $10 million 20% Reduced debt c
Slide 6: 2012 strategic achievements
2012 strategic achievements Optimise and Grow strategy delivers results For personal use only ‘Fit for Growth’ Capital management OPTIMISE Successful developments To achieve targets Portfolio re-mixing Customer engagement + 20% growth in Funds Management Logistics & Business Parks deve
Slide 7: 2012 Annual Result summary
2012 Annual Result summary Distribution per security up 8.4% For personal use only GPT Financial Summary 12 months to 31 December ($m) 2012 2011 Total Realised Operating Income (ROI) 456.4 438.8 Changes in fair value of assets 221.3 50.8 Loss on disposals (3.1) (49.1) Financial instruments marked to
Slide 8: Segment performance
Segment performance Strong contributions from all business units For personal use only 12 months to 31 December ($m) 2012 2011 Comment Retail 294.0 295.4 Comparable income growth of 3.0% Office 125.9 123.0 Comparable income growth of 3.8% Logistics & Business Parks 66.3 55.8 Comparable income growth
Slide 9: Earnings attribution
Earnings attribution Earnings underpinned by strong income growth For personal use only EPS attribution 0.2c 0.1c -0.1c -0.5c 0.4c 0.1c 1.6c 24.2c +0.5% +0.7% +0.3% -0.3% +1.8% -2.0% +8.0% 22.4c +7.0% EPS 31 Income Interest Buy-back Fit for Acquisitions Disposals Tax Benefit EPS 31 December Growth R
Slide 10: Management expenses
Management expenses Optimisation delivers significant ‘jaws’ benefit For personal use only Expenses ‘Jaws’ for 12 months to 12 months to 31 Dec ($m) 2012 2011 31 December 2012 Corporate Overheads 22.8 25.4 Portfolio Expenses 58.9 62.3 3.2% Ongoing Management 81.7 87.7 Expenses ‘Jaws’ = (6.8%) 10.0%
Slide 11: Balance sheet
Balance sheet Strong balance sheet with significant capacity For personal use only GPT Balance Sheet 31 Dec 31 Dec 2012 2011 Total assets ($m) 9,343 9,288 Total borrowings ($m) 2,144 2,144 Net tangible assets per security ($) 3.73 3.59 Gearing (%)(1) 21.7 22.9 Look through gearing (%)(1) 23.9 24.4 I
Slide 12: Capital management: Continued reduction in cost of debt
Capital management Continued reduction in cost of debt For personal use only 2012 cost of debt reduced by Average cost of debt 100bps to 5.6% 7.4% - Renegotiation of existing 6.6% loans 5.6% 5.5% - Lower fixed and floating interest rates Fees Forecast 2013 average debt Margin further reduced to
Slide 13: Capital management: Diversification of funding sources
Capital management Diversification of funding sources For personal use only $330m of bonds issued in 2012 – increased tenor and diversification HKD800m (A$100m) 15 year bonds issued at 195bps margin over BBSW - GPT’s inaugural issue to diversify into foreign debt capital markets Sources of debt
Slide 14: Investment Management
Investment Management Quality underpins strong total return of 9.3% For personal use only Portfolio Comparable WALE Occupancy WACR Size(1) Income Growth(2) Retail $4.96 bn 3.0% 4.4 years 99.5% 6.07% Office $2.76 bn 3.8% 5.4 years 95.8% 6.86% Logistics & $0.99 bn 2.7% 5.8 years 98.2% 8.30% Business P
Slide 15: Retail: GPT delivering on strategy
Retail GPT delivering on strategy For personal use only Moving towards Moving towards target weightings and strengthening portfolio quality target weighting - Sale of Casuarina and Woden - Homemaker divestment 3.0% Focus on development and active asset like for like income management growth - Hi
Slide 16: Retail: Despite headwinds portfolio remains resilient
Retail Despite headwinds portfolio remains resilient For personal use only Key operating metrics 12 months to 31 December 2012 2011 Comparable income growth 3.0% 3.6% Comparable total centre sales growth(1) 1.3% 0.3% Comparable specialty sales growth(1) 1.5% 1.2% Specialty sales psm(1) $8,964 $8,958
Slide 17: Retail: Active owners will continue to evolve the retail mix
Retail Active owners will continue to evolve the retail mix For personal use only Comparable change in retail sales by category 8% Specialties 6.1% 7.2% 6.1% 5.9% 6% 4% 2.2% 2% 1.1% 0.2% 0% -2% -0.2% -0.6% -1.8% -1.8%-2.2% -4% -2.7% -6% -8% -7.5% -10% DDS Mobile Phone Other Retail Retail Services Le
Slide 18: Retail: Leasing strategy focused on certainty of earnings
Retail Leasing strategy focused on certainty of earnings For personal use only Significant leasing activity 585 12 months to 31 December 2012 2011 deals 2012 Vacancies(1) 26 42 Leasing spreads of -5% accounts ‘Critical’ retailers(2) 42 39 for $1.9 million Holdovers 57 n/a(3) Arrears: % annual bi
Slide 19: Retail: Digital strategy customises shopping experience
Retail Digital strategy customises shopping experience For personal use only A unique and innovative approach to ongoing engagement of GPT customers Functionality includes: - Customised offers and messaging - Shopping planner - Shop finding - Rewards program - Car parking directions (in 2013) -
Slide 20: Retail development: Enhancing value through development
Retail development Enhancing value through development For personal use only Highpoint Update Total project cost $300 million Yield on cost 10%(1) Forecast IRR to GPT 15%(2) Stage 1 - Completed October 2012 - Woolworths and 35 specialty tenants - Open 100% leased Stage 2 - David Jones and
Slide 21: Office: 2012 achievements
Office 2012 achievements include strong leasing results For personal use only 152,000 sqm of leases completed in challenging Significant leasing conditions success Portfolio total return above industry benchmarks Strong underlying portfolio metrics Total return of 10.5% Reduction of future e
Slide 22: Office: Continued strong performance
Office Continued strong performance For personal use only Key operating metrics 12 months to 31 December 2012 2011 Comparable income growth 3.8% 4.0% Occupancy (including terms agreed)(1) 95.8% 96.5% Weighted average lease expiry 5.4 years 4.7 years Leases signed(2) 135,646 sqm 93,651 sqm Terms agre
Slide 23: Office: Leasing strategy driving outperformance
Office Leasing strategy driving outperformance For personal use only Significant achievements in 2012 Major leasing transactions - Leased 152,000 sqm in major Asset Tenant Sqm transactions(1) 800/808 Bourke St NAB 60,000 - Reduced 2014 expiry to 14% 2 Park St Citi 18,000 530 Collins St Suncorp 15,
Slide 24: Office: Portfolio well positioned in each market
Office Portfolio well positioned in each market For personal use only sqm (000’s) Expiry (%) Sydney – peak expiry prior to 200 Sydney CBD 25% negative impact of supply in 160 20% 2015/16 120 15% 80 10% 40 5% Melbourne – long WALE and 0 0% limited short term expiries offers -40 -5% 2013 2014 2015
Slide 25: Logistics & Business Parks: Portfolio weighting increased to 12%
Logistics & Business Parks Portfolio weighting increased to 12% For personal use only Delivering on strategy with portfolio weighting Moving towards increased from 9% to 12% target weighting Completion of Toll NQX Berrinba will increase acquisitions to $200 million Total return of 9.4%(1) Stro
Slide 26: Logistics & Business Parks: High occupancy and strong leasing
Logistics & Business Parks High occupancy and strong leasing outcomes For personal use only Key operating metrics 12 months to 31 December 2012 2011 Comparable income growth 2.7% 2.8% Occupancy 98.2% 98.4% Weighted average lease expiry 5.8 years 6.2 years Leases signed 55,696 sqm 35,028 sqm Weighted
Slide 27: Logistics & Business Park development
Logistics & Business Park development Enhancing portfolio through development For personal use only Toll NQX, Brisbane State of the art logistics facility Total project cost $84.6 million On completion cap rate 7.55% Completion date Q1 2014 15 year WALE Fixed reviews 3.5% 27
Slide 28: Sustainability: Leading the sector
Sustainability Leading the sector in sustainability For personal use only GPT is the global leader in the real estate sector Retail leader in the Global Real Estate Sustainability Benchmark (GRESB) Oceania region Multi-award winner in 2012 Energy Award, Business Sustainability Award and Built Enviro
Slide 29: Strategy: Strong foundations for growth
Strategy Strong foundations for growth For personal use only Financial Effective capital strength management High quality Deep portfolio capability 29
Slide 30: Capability: Senior team focused on strategy and performance
Capability Senior team focused on strategy and performance For personal use only Nicholas Harris Funds Carmel Management Matthew Faddy Hourigan Asset Michael O’Brien Investment Management Mark Fookes Corporate Management CFO Development Phil Taylor Judy People & Barraclough Performance Strategy Anth
Slide 31: Growth platforms
Growth platforms Progress on all four growth platforms in 2012 For personal use only Funds Management + Development + New profit sources + Asset acquisitions 31
Slide 32: Growth platform 1: Funds Management
Growth platform 1: Funds Management Two pathways: grow existing, create new products For personal use only Total FUM of $6.6 billion, up 20% in 2012 $1.6 billion in capital raised over past three years Additional team members to create new product opportunities GWOF Growth in FUM ($million) •
Slide 33: Funds Management: Compelling returns for GPT
Growth platform 1: Funds Management Compelling returns for GPT For personal use only Enhanced income return of 8% Increased scale will result in improved margins for GPT Returns to GPT ($m) 2012 GPT Income Return Total fees received 27.0 2.5% (1.0%) Expenses (11.0) 8.0% Net Profit Before Tax 16.
Slide 34: Growth platform 2: Development
Growth platform 2: Development Dual approach, building capability For personal use only Logistics and Business Retail & Major Projects Park Development Objectives Objectives Run as a profit centre Build capability Accretive development returns Convert existing landbank Create and enhance v
Slide 35: $2.3 billion development pipeline
Growth platform 2: Development $2.3 billion pipeline to support dual approach For personal use only Retail & Major Projects LBP Development ($ million) ($ million) Underway Underway GPT Funds GPT Highpoint 50 150 Toll NQX 56 Wollongong Central 200 150 Collins St 181 Planned 161 Castlereagh St 390 GP
Slide 36: Growth platform 3: New profit sources
Growth platform 3: New profit sources Initial activities represent exciting opportunities For personal use only Innogen Australia Parcel Locker Trial (GPT Energy) Online marketplace for Shared-use, secure Internal GPT start-up workspaces lockers for collection of Developing and Taps into t
Slide 37: Strategic journey – the next phase
Strategic journey – the next phase Shaping the future For personal use only Our goal Our promise To be Australia’s best To provide our securityholders performing property company with a secure, reliable investment, delivering superior, risk adjusted Delivering strong, sustainable returns over time
Slide 38: Shaping the future
Shaping the future Investing in strategy and innovation For personal use only People - Established Corporate Development unit - Seven senior external appointments Learning - Input from best practice outside of property - ‘Innovation tour’ to Silicon Valley Strategy - Five-year strategic plan u
Slide 39: 2013 Group strategic priorities
2013 Group strategic priorities Four priorities to optimise and grow For personal use only Streamlining processes and maintaining expense discipline Optimise GPT Minimising cost of funding OPTIMISE Equip Reinforcing GPT’s culture employees for high Accelerating development of high potential
Slide 40: Outlook for 2013
Outlook for 2013 Earnings and value drivers For personal use only Portfolio Steady income growth based on structured rental income increases and high occupancy Strong focus on leasing ahead of major expiries Continued move towards target weightings Growth Increased fees from growth in wholes
Slide 41: Guidance for 2013
Guidance for 2013 For personal use only Targeting EPS(1) growth of at least 5% for 2013 Payout ratio of 80% of ROI 41 (1) EPS defined as Realised Operating Income (ROI) per ordinary security
Slide 42: 2012 Annual Result: Exceeding expectations
2012 Annual Result For personal use only Exceeding expectations Actively enhancing our portfolio Deliberately investing in the future 42
Slide 43: Contact Information
Contact Information For personal use only Michael Cameron Mark Fookes Wendy Jenkins Chief Executive Officer and Chief Financial Officer Group Investor Relations Manager Managing Director Tel: +61 2 8239 3518 Tel: +61 2 8239 3732 Tel: +61 2 8239 3565 Mob: +61 412 279 833 Mob: +61 418 226 889 Mob: +61
Slide 44: Disclaimer
Disclaimer The information provided in this presentation has been prepared by The GPT Group comprising GPT RE Limited For personal use only (ACN 107 426 504) AFSL (286511), as responsible entity of the General Property Trust, and GPT Management Holdings Limited (ACN 113 510 188). The information pro