Frasers Property Ltd. · SGX:TQ5

Frasers Property — Frasers Commercial Trust — 2QFY16 Earnings Presentation

36 slides from Frasers Property's earnings presentation, Apr 21, 2016

  1. Slide 1: Frasers Commercial Trust 2QFY16 Financial Results

    Frasers Commercial Trust 2QFY16 Financial Results 21 April 2016

  2. Slide 2: Important notice

    Important notice Certain statements in this Presentation constitute “forward-looking statements”, including forward-looking financial information. Such forward-looking statement and financial information involve known and unknown risks, uncertainties and other factors which may cause the actual resu

  3. Slide 3: Contents

    Contents 3  Results  Actual vs. forecast results for 357 Collins Street  Portfolio review  Capital management  Moving Forward

  4. Slide 4: Results

    Results Z J Pease TRUST

  5. Slide 5: Results – Key highlights

     Results – Key highlights 5 2QFY16 bolstered by the better performances of Alexandra Technopark and Caroline Chisholm Centre and contribution from 357 Collins Street 19.5% increase in distribution to Unitholders Distribution to Unitholders (S$’000) Only S$0.6 1 Higher contribution from Alexandra Te

  6. Slide 6: Results – 2QFY16 Financial highlights

     Results – 2QFY16 Financial highlights 6  20% rise in distributable income for 2QFY16 1 Jan 2016 – 31 Mar 2QFY16 Y-o-Y Contributing factors 2016 (S$ ‘000) Change (%)  Higher revenue contribution from Alexandra Technopark due to higher rental rates, Gross Revenue 38,994 12% contribution from 357 C

  7. Slide 7: Results – 2QFY16 Financial highlights: Net property income

     Results – 2QFY16 Financial highlights 7 Better performances from Alexandra Technopark and Caroline Chisholm Centre and contribution from 357 Collins Street TOTAL: S$28.8 million 2QFY16 Net Property Singapore: S$15.7 million (55%) Income (S$m) Australia: S$13.1 million (45%) * Affected units were m

  8. Slide 8: Results – Financial highlights: DPU

     Results – Financial highlights 8  Continuous DPU growth for 2QFY16 DPU (Cents) 3%

  9. Slide 9: Results – Distribution payment

     Results – Distribution payment 9 DRP will be applied for the distribution for 2QFY16 Distribution Period 1 January 2016 to 31 March 2016 Distribution of 2.4526 cents per Unit comprising: a) taxable income distribution of 1.7784 cents; Ordinary Unit Distribution Rate b) tax-exempt income distributi

  10. Slide 10: Actual vs forecast results for 357 Collins Street

    Actual vs forecast results for 357 Collins Street

  11. Slide 11: Actual vs forecast results for 357 Collins Street in 2QFY16

     Results - Actual vs forecast results for 357 Collins Street in 2QFY16 11 Actual net property income of 357 Collins Street outperformed forecast by 14% ^ Includes the reimbursement of rent-free periods of A$0.05 million each for the forecast and actual results for 2QFY16. * Profit forecast of 357 C

  12. Slide 12: Portfolio review

    Portfolio review FRASERS COMMERCIAL

  13. Slide 13: Portfolio review – Valuation

     Portfolio review – Valuation 13  Balanced portfolio consisting of Singapore and Australian properties  No one property consist of more than 29% of portfolio value Singapore Perth Canberra Singapore $ 1,209.1 61% Melbourne Australia $ 768.5 39% Total $ 1,977.6 100% As at 31 March 2016. Excludes r

  14. Slide 14: Portfolio review – Occupancy Rates & WALE

     Portfolio review – Occupancy Rates & WALE 14  Healthy average occupancy rate of 92.6%  Healthy WALE of 3.3 years Geographical occupancy and % of NPI contribution As at Key portfolio statistics 31 March 2016 Ave Occupancy 92.6% Portfolio WALE by gross 3.3 years rental income As at 31 March 2016.

  15. Slide 15: Portfolio review – Lease expiry profile

     Portfolio review – Lease expiry profile 15 15  Low lease expiries for FY16  Proactive leasing reduced lease expiries in FY18 and lengthened lease expiry profile  Well spread lease expiry provides income stability Portfolio lease expiry by gross rental income Low lease expiries for the remaining

  16. Slide 16: Portfolio review – Lease expiry profile (Singapore)

     Portfolio review – Lease expiry profile 16 FY16 – Low lease expiries for the Singapore properties Property Lease Expiry in FY16 as a proportion of Portfolio Gross Rental Income  Low lease expiry of 5.6% in year of high office supply  New supply are mainly in Grade A/ Premium Grade space 19 (offi

  17. Slide 17: Portfolio review – Rental reversions

     Portfolio review – Rental reversions 17 Singapore properties continue to achieve positive rental reversions for new and renewed leases that commenced in 2QFY161 despite the challenging leasing market China Square Central: 55 Market Street: Alexandra Technopark: +2.4% +5.4% +5.3% As at 31 March 201

  18. Slide 18: Portfolio review – Robust leasing activities

     Portfolio review – Robust leasing activities 18  Robust leasing activities  Committed, new and renewed tenants in 2QFY16 include: Tenant Industry Property Mallal & Namazie Legal China Square Central Consultancy/business Niimi Singapore Pte Ltd China Square Central services Source Code Asia Pacif

  19. Slide 19: Portfolio review – Mid-term rent reviews

     Portfolio review – Mid-term rent reviews 19 19 More than 52% of leases have built-in step-up rents FY16 - Fixed % and other fixed lease rent reviews FY16 – 19 - Portfolio fixed % reviews GROSS RENTAL INCOME Average Total Property Leases step-up rent Property Portfolio China Square 3 2.5% 4.0% 0.8%

  20. Slide 20: Portfolio review – Stability of income

     Portfolio review – Stability of income 20 Top 10 tenants:  Established and well diversified across various sectors  MNCs, government department or public listed companies  Contribute 57% of portfolio gross rental income and have a long WALE of 5.5 years Top 10 tenants by gross rental income % (

  21. Slide 21: Asset updates – Developments at China Square Central

     Asset updates – Developments at China Square Central 21  Construction work for the development of a 16 storey hotel commenced in 1Q 2016 and are on track1  New retail and commercial spaces with better frontage and visibility will also be created2  Hoardings have been erected to demarcate constr

  22. Slide 22: Asset updates – Alexandra Technopark

     Asset updates – Alexandra Technopark 22  Proactive leasing has reduced lease expiries substantially in FY16  Only 2.4% of leases by gross rental income left to be renewed at Alexandra Technopark for the remainder of FY16 As at 31 March 2016.

  23. Slide 23: Portfolio review – Singapore asset updates

     Portfolio review – Singapore asset updates 23 China Square Central – full 55 Market Street – Alexandra Technopark – occupancy at office tower healthy occupancy rate healthy occupancy rate Occupancy 88.6%* (office tower: 100.0%) 95.8% 94.8% ^ WALE 1.5 years 1.2 years 1.7 years New leases, Mallal &

  24. Slide 24: Portfolio review – Australia asset updates

     Portfolio review – Australia asset updates 24 Caroline Chisholm Centre Central Park – Healthy WALE of – full occupancy with 357 Collins Street – full 2.6 years long WALE of 9.3 years occupancy Occupancy 80.3%^ 100.0% 100.0% WALE 2.6 years (7.2 years with new lease#) 9.3 years 5.1 years New leases,

  25. Slide 25: Capital management

    Capital management FRASERS COMMERCIAL

  26. Slide 26: Capital Management – Debt statistics

    26  Capital Management – Debt statistics 26  Healthy interest coverage ratio of 4.61 times  Low average interest rate of 3.07%  Borrowings in AUD provide natural hedge for the Australian properties Statistics Borrowings and assets by currency As at 31 March 2016 Total Assets (S$’000) 2,049,743 G

  27. Slide 27: Capital Management and debt statistics

    27  Capital Management and debt statistics 27  Well spread debt maturity profile  No refinancing required until FY17  All debts are unsecured  Hedged 81% of gross borrowings on fixed rate Debt maturity Debt composition – floating vs. hedged Weighted average term to maturity: 2.8 years 1 Hedging

  28. Slide 28: Moving forward

    Moving forward

  29. Slide 29: Solid fundamentals - Singapore office rents

     Solid fundamentals - Singapore office rents 29 Singapore office - Grade B rents relatively more stable Singapore Grade A and Grade B office rents1 Grade A CBD Core ↓ 4.8% qoq to S$9.90 psf Grade B Islandwide ↓ 2.6% qoq to S$7.50 psf Grade B CBD Core ↓ 3.0% qoq to S$7.95 psf Source: CBRE Research 1

  30. Slide 30: Solid fundamentals - demand, supply and outlook for Singapore CBD office

     Solid fundamentals - demand, supply and outlook for Singapore CBD office 30 Office supply-demand dynamics and vacancy rates 1  Q1 2016 total Islandwide office net absorption was negative 133,474 sf, the third consecutive quarter of negative absorption  Recent turmoil in the energy sector is impa

  31. Slide 31: Solid fundamentals - Singapore business park rents

     Solid fundamentals - Singapore business park rents 31 Singapore business park rents trend – Rents have remained stable1 Singapore Business Park (city fringe) rents1 Source: CBRE Research 1 CBRE, Singapore Market View, Q1 2016

  32. Slide 32: Solid fundamentals - demand, supply and outlook for business park

     Solid fundamentals - demand, supply and outlook for business park 32 Business Park supply-demand dynamics and future pipeline1  Business parks vacancy increased narrowly from 8.8% in Q4 2015 to 9.2% in Q1 2016  Vacancy rates have been largely stable and have tracked within a one percentage point

  33. Slide 33: Perth CBD office supply and rents

     Perth CBD office supply and rents 33  Rebound in net absorption of 42,387 square metres, after six consecutive half-yearly periods of negative net absorption  Average Perth CBD prime net face rent was A$579 per square metre per annum  Tenants seeking better quality space, increasing demand for

  34. Slide 34: Melbourne CBD office supply and rents

     Melbourne CBD office supply and rents 34  Melbourne CBD A Grade office average net face rent to increase from A$467 to A$486 psm per annum in the next 12 months  Incentives expected to decline from 32% to 28% by end-2016  Positive outlook and vacancy to drop to 6.3% by end-2017  Forecast 100,0

  35. Slide 35: Delivering growth

     Delivering growth 35 35 Organic and in-organic initiatives to deliver growth in distributable income Grow portfolio organically and inorganically Proactive Asset enhancement management of expiring leases DPU initiatives Prudent capital management

  36. Slide 36: Thank you

    Thank you Frasers Centrepoint Asset Management (Commercial) Limited Level 21 | 438 Alexandra Road | Alexandra Point | Singapore 119958 Tel: +65 6276 4882| Fax: +65 6276 8942| Email: fcot@fraserscentrepoint.com www. fraserscommercialtrust.com

Frasers Commercial Trust — 2QFY16 Earnings Presentation on 6ix