Parkway Life Real Estate Investment Trust · SGX:C2PU
Parkway Life Real Estate Investment Trust — FY2008 Earnings Presentation
37 slides from Parkway Life Real Estate Investment Trust's earnings presentation, Jan 29, 2009
Slide 1: Full Year FY2008 Results Presentation
(“PLife REIT”) Full Year FY2008 Results Presentation 29 January 2009
Slide 2: Disclaimer
Disclaimer • This Presentation is focused on comparing actual results for the period from 1 October 2008 to 31 December 2008 (“4QFY2008”) versus forecasts and for the period from 1 January 2008 to 31 December 2008 (“FY2008”) versus forecasts as stated in the PLife REIT Prospectus of 7 August 2007. T
Slide 3: Agenda
Agenda 1 2008 Highlights 2 Financial Highlights 3 Capital and Financial Management 4 Our Growth Strategy 5 Unit Price Performance 6 Portfolio Highlights 3
Slide 4: 2008 Highlights
2008 Highlights ~-“@ Ae ParkwayLife REIT 4 |
Slide 5: 2008 Highlights
2008 Highlights 3 Strong Revenue growth Gross revenue exceeds forecast by 41.0% Net property income exceeds forecast by 39.2% 3 Strong Distribution Per Unit (DPU) growth Strong DPU growth of 17.9% above forecast 3 No refinancing risks No refinancing risks in the next 24 months, raised debt w
Slide 6: 2008 Highlights (cont'd)
2008 Highlights (cont’d) 3 Downside revenue protection – favourable lease structure No downside risks to Singapore Hospitals revenue as it is protected by minimum guaranteed rent, which is set to grow by at least CPI + 1% yearly (in the event CPI is negative, minimum growth is 1%) Rent review in
Slide 7: Financial Highlights
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Slide 8: Q4FY2008 Revenue and DPU
Q4FY2008 Revenue and DPU - Q4FY2008 revenue outperform forecast and Q4FY2007 by 41.0% and 36.4% respectively - Q4FY2008 DPU outperform forecast and Q4FY2007 by 17.9% and 15.9% respectively Revenue (S$’000) +41.0% +36.4% 16,178 11,475 11,864 Higher quarter-on- quarter revenue F o re c a s t Q4F Y2007
Slide 9: Q4FY2008 performance
Q4FY2008 performance - Strong DPU growth of 17.9% above forecast at 1.84 cents for Q4FY2008 Consolidated Income Statement Q4FY2008 Variance Year-on-Year (Actual) Variance (S$’000) Actual Forecast¹ % 4QFY08 4QFY07 % Gross Rental Revenue 16,178 11,475 41.0 16,178 11,864 36.4 Property Expenses (1,108)
Slide 10: FY2008 Revenue and DPU
FY2008 Revenue and DPU - FY2008 revenue outperform forecast and FY2007 by 17.4% and 14.0% respectively - FY2008 DPU outperform forecast and FY2007 by 9.4% and 8.0% respectively Revenue (S$’000) +17.4% +14.0% 53,887 47,269 45,900 Revenue higher than forecast F Y 2008 F Y 2007* F Y 2008 F o re c a s t
Slide 11: FY2008 performance
FY2008 performance - Strong DPU growth of 9.4% above forecast at 6.83 cents for FY2008 Consolidated Income Statement FY2008 Variance Year-on-Year (Actual) Variance (S$’000) Actual Forecast¹ % FY2008 FY20072 % Gross Rental Revenue 53,887 45,900 17.4 53,887 47,269 14.0 Property Expenses (3,530) (2,606
Slide 12: Net Property Income
Net Property Income Increase in NPI is due to: - Upward rent revision of Singapore hospitals by 6.25%, due to the CPI + 1% formula - Rent contributions from Japan properties in FY2008 4QFY2008 Vs 4QFY2007 FY2008 Vs FY20071 16.0 15.1 60.0 14.0 50.4 50.0 12.0 11.1 44.2 10.0 40.0 8.0 7.3 28.0 6.8 30.0
Slide 13: Continued DPU growth since IPO
Continued DPU growth since IPO¹ DPU has grown steadily from 1.59 cents to 1.84 cents, at a compounded annual growth rate of 15.7% DPU (cents) 2.00 1.84 1.71 1.75 1.62 1.66 1.59 1.50 DP U (S $ cents) 1.25 1.00 0.75 0.50 0.25 0.00 4QFY07 1QFY08 2QFY08 3QFY08 4QFY08 DPU (cents) Notes: 1. Parkway Life
Slide 14: Attractive yield relative to 10-yr SGB yield & fixed deposit rates
Attractive yield relative to 10-yr SGB yield & fixed deposit rates - Parkway Life REIT is trading at an attractive yield of 9.0% - This is 710bps and 810 bps higher than 10-yr Singapore Government Bond and fixed deposit rates respectively - Defensive nature of Parkway Life REIT adds on to the attrac
Slide 15: Capital and Financial Management
Capital and Financial Management 15
Slide 16: Strong Balance Sheet
Strong Balance Sheet - Low gearing of 23% - Parkway Life REIT has maintained the valuation of its assets As at 31 As at 31 Consolidated Balance Sheet December December Variance Commentary (in S$’000) 2008 2007 Increase is due to investment in 10 Investment Properties 1,047,983 831,570 Japan properti
Slide 17: Effective Capital Management
Effective Capital Management - No refinancing risks, secured long term facilities with weighted average tenor of 2.8 years - Strong funding capacity for future acquisitions Parkway Life REIT’s Refinancing Initiatives Secured and drawn down S$218 million • No refinancing risk – committed 3-year ter
Slide 18: Debt Funding Profile
Debt Funding Profile - Debt headroom of $300m and $990m before reaching 40% and 60% gearing respectively - Optimal gearing of 40% - Debt headroom provides flexibility and capacity for opportunistic buy, management will be prudent and selective on investment opportunities 1,600 70% • The current mark
Slide 19: Proactive Risk Management Initiatives
Proactive Risk Management Initiatives The Management has undertaken the following initiatives to manage exposure from interest rate and foreign exchange volatilities … Currency Risk – Net Income Currency Risk – Underlying Interest Rate Risk from Foreign Investments Asset Value Entered into Interes
Slide 20: Our Growth Strategy
Our Growth Strategy o--, 2." ParkwayLife REIT 20 |
Slide 21: Long-term Strategy
Long-term Strategy The manager plans to undertake the following strategies… Long term Strategy Acquisition growth strategy Asset management strategy Third Party Acquisition Sponsor’s Acquisition • Pro-active asset management strategy • Acquisition focused on • Acquisition focused on acquiring mature
Slide 22: Market Conditions: Global Financial Crisis
Market Conditions: Global Financial Crisis Adapting acquisition strategy to market conditions Economic Challenges • Credit crisis in the US causing recession in the US and the rest of the world Opportunistic acquisitions – • Falling real estate and equity prices curtail consumption target higher yie
Slide 23: PLife REIT's Core Markets
PLife REIT’s Core Markets Japan High Taiwan US$79.6bn US$21.8bn Sophistication of private healthcare sector2 S. Korea Singapore US$22.4bn Australia US$3.3bn 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
Slide 24: Asset Enhancement Initiatives
Asset Enhancement Initiatives - No capital outlay from ParkwayLife REIT Revenue Intensifying Initiatives - Convert non/ low revenue yielding space to higher revenue yielding space Conversion of Conversion of Administrative Administrative Space Space and space to a 2nd originally used as Rehabilitati
Slide 25: Asset Enhancement Initiatives
Asset Enhancement Initiatives - No capital outlay from ParkwayLife REIT Upgrading of Hospital Facilities MOUNT ELIZABETH Refurbishment of HOSPITAL Maternity Ward GLENEAGLES HOSPITAL Refurbishment of Refurbishment of Conversion of Rehabilitation Parkway Cancer Ward 3B Centre 2 EAST SHORE HOSPITAL EAS
Slide 26: Unit Price Performance
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Slide 27: Unit price relative performance
Unit price relative performance S-REIT -46.7% STI -49.1% PLife REIT -26.1% 125.0 115.0 105.0 95.0 85.0 75.0 65.0 55.0 45.0 35.0 25.0 30 l-08 8 -N 8 -D 8 -M 8 -A 8 -A 8 -S 8 -S 8 -O 8 -D 8 -J 8 -J 8 -F 8 -A 8 -M 8 -J 8 15 -08 -O 8 -N 8 9 -M 8 -M 8 -J 8 -F 8 -M 8 14 ul-0 2 7 v- 0 1 2 v- 0 17 n- 0 01 n
Slide 28: Distribution Details
Distribution Details Distribution per unit Stock Counter Distribution Period (Cents) PLife REIT 01 October 2008 to 31 December 2008 1.84 Distribution Timetable Ex-Date: 04 February 2009, 9.00am (Units will be traded ex-date) Books Closure Date: 06 February 2009 at 5pm Distribution payment Date: 27 F
Slide 29: Portfolio Highlights
Portfolio Highlights ~-“@ Se” | ParkwayLife REIT 29 |
Slide 30: ParkwayLife REIT – Portfolio
Largest Healthcare REIT in Asian ParkwayLife REIT – Portfolio Region with an enlarged portfolio of S$1.05 billion 1 Bon Sejour P-Life Matsudo Shin-Yamashita Bon Sejour Palmary Inn Ibaraki Akashi Bon Sejour P-Life Matsudo Ibaraki Palmary Inn Senior Chonaikai Suma Makuhari Kan Himawari Home Smiling Ho
Slide 31: 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 13.9 yrs1) Sustainability of Returns to Good Organic Growing Demand Unithol
Slide 32: Portfolio Key Statistics
Portfolio Key Statistics (As at 31 December 2008) Properties Singapore Mount Elizabeth Hospital, Gleneagles Hospital East Shore Hospital Japan P-Life Matsudo, Bon Sejour Shin-Yamashita, Bon Sejour Ibaraki, Palmary Inn Akashi, Palmary Inn Suma, Senior Chonaikai Makuhari Kan, Himawari Home Kamakura, S
Slide 33: 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 34: Our Japan Portfolio
Our Japan Portfolio 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) 8,449 1,653 3,051 Net Lettable Area (sq m) 3,240 3,27
Slide 35: Our Japan Portfolio
Our Japan Portfolio 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) 4,864 2,349 2,837 1,309 Net Lettable Area (sq m) 6,811 4,753 4,378 1,715 Num
Slide 36: Our Japan Portfolio
Our Japan Portfolio Smiling Home Medis Fureai no sono Smiling Home Medis Property Total Musashi Urawa Nerima Takanodai Koshigaya Gamo Type Paid nursing home with care service - Land Tenure Freehold - Land Area (sq m) 803 2,281 1,994 29,590 Net Lettable Area (sq m) 1,601 2,608 3,911 35,941 Number of
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Parkway Life Real Estate Investment Trust — FY2008 Earnings Presentation on 6ix