BHG Retail REIT · SGX:BMGU
BHG Retail REIT — Q4 2017 Earnings Presentation
32 slides from BHG Retail REIT's earnings presentation, Feb 23, 2018
Slide 1: Poised for Growth: Financial Results for 4th Quarter 2017
POISED FOR GROWTH BHG RETAIL REIT FINANCIAL RESULTS FOR 4TH QUARTER 2017 ENDED 31 DECEMBER 2017 23 FEBRUARY 2018
Slide 2: Disclaimer
Disclaimer Certain statements made in this presentation may not be based on historical information or facts and may constitute “forward- looking” statements (including forward-looking financial information). Actual future performance, outcomes and results may differ materially from those expressed i
Slide 3: Contents
Contents 1 Key Highlights 4Q 2017 & 12M 2017 2 Financial Highlights 3 Portfolio Review 4 Beijing Hualian Group 5 Growth Strategy 6 Market Outlook For ease of reference, the following abbreviations are used in this document: “4Q 2016”: For the 3-month period from 1 October 2016 to 31 December 2016; “
Slide 4: Key Highlights 4Q 2017 & 12M 2017
Key Highlights 4Q 2017 & 12M 2017 Photo of Beijing Wanliu 北京万柳 4
Slide 5: Key Highlights: 4Q 2017 & 12M 2017
Key Highlights: 4Q 2017 & 12M 2017 +5.8% +8.1% +2.8% 7.39% Gross Net Property Distribution 2017 Revenue Income Per Unit Distribution 4Q 2017 4Q 2017 12M 2017 Yield2 (SGD)1 (SGD)1 (“DPU”)1 99.7% Strong 2017 32.2% Portfolio Occupancy3 Rental Reversion Gearing3,4 +6.9% +10.2% +6.5% China GDP China Reta
Slide 6: Key Highlights: 4Q 2017 & 12M 2017
Key Highlights: 4Q 2017 & 12M 2017 2017 Annual Distribution Yield of 7.39%2 • Full year Distribution per Unit of 5.47, up 2.8% year-on-year (y-o-y) Delivered Strong Financial Results from Pure Organic Growth • 4Q 2017 Gross revenue (SGD) & Net property income (SGD) outperformed y-o-y by 5.8% and
Slide 7: Financial Highlights
Photo of Beijing Wanliu 北京万柳 Financial Highlights 7
Slide 8: Delivered Strong 4Q 2017 Financial Performance
Delivered Strong 4Q 2017 Financial Performance Portfolio 4Q 20171 4Q 20161 % Change RMB’000 Gross revenue 81,604 76,441 6.8 Net property income 54,399 49,841 9.1 SGD’000 Gross revenue 16,707 15,791 5.8 Net property income 11,137 10,300 8.1 Amount available for distribution 4,879 4,629 5.4 Distributi
Slide 9: Delivered Strong 12M 2017 Financial Performance
Delivered Strong 12M 2017 Financial Performance Portfolio 12M 20171 12M 20161,2 % Change RMB’000 Gross revenue 315,760 300,607 5.03 Net property income 210,172 193,407 8.73,4 SGD’000 Gross revenue 64,519 62,585 3.13 Net property income 42,944 40,286 6.63,4 Amount available for distribution 20,001 18
Slide 10: Attractive Yield
Attractive Yield BHG Retail REIT trading at 539 bps risk premium above Singapore 10-year government bond yield 7.39% Sources: Bloomberg, CPF Board, Monetary Authority of Singapore. 5.3% 539 bps 3.9% 3.1% 2.5% 2.0% 0.3% BHG Retail Singapore China 10Y Straits Times FTSE ST CPF Ordinary 12 month REIT 1
Slide 11: 2H 2017 Distribution Payment
2H 2017 Distribution Payment Distribution Details Distribution Period 1 July 2017 to 31 December 2017 Distribution Per Unit (SGD) 2.73 cents per unit Distribution Timetable Ex-Date 8 March 2018 Books Closure Date 12 March 2018 Payment Date 28 March 2018 11 11
Slide 12: Stable Financial Position
Stable Financial Position As at 31 December 2017 S$’000 Total Assets 888,192 Total Liabilities 305,143 Net Assets Attributable to 416,454 Unitholders Net Asset Value per unit S$0.83 12
Slide 13: Capital Management
Capital Management Low Gearing Average Weighted Average Ratio Cost of Debt Term To Maturity 1 32.2 % 3.70 % 1.7 years 31 Dec 2017 31 Dec 2017 31 Dec 2017 Aggregate borrowings drawn down as at 31 December 2017 was S$ 242.2 million. Low gearing of 32.2%1 allows a comfortable debt headroom for pote
Slide 14: Portfolio Review
Portfolio Review Photo of Hefei Mengchenglu 合肥蒙城路 14
Slide 15: Portfolio Summary
Portfolio Summary1 Investment Mandate: Income-producing real estate used primarily for retail purposes, with an initial focus on China Portfolio Valuation : RMB 3,946 mil2 Beijing Xining 北京 NLA : 155,415 sqm Dalian 西宁 大连 WALE (NLA) : 7.1 years Occupancy : 99.7 % Beijing Mall Valuation : RMB 2,287 mi
Slide 16: Resilient Portfolio & Steady Catchment
Resilient Portfolio & Steady Catchment One-stop destination malls that serve surrounding communities Surrounded by densely populated residential properties Strong focus on experiential and lifestyle segment Well-positioned to capitalise on the rising middle income population 97.6 % 16
Slide 17: Portfolio Summary
Portfolio Summary Breakdown of NLA1 by Property Breakdown of Valuation2 by Property Dalian 4.1% Dalian 9.9% Xining 7.1% Xining 13.4% Hefei Beijing 14.8% Beijing 35.1% Hefei Chengdu 58.0% 16.2% Chengdu 16.0% 25.4% Breakdown of Gross Revenue3 by Property Breakdown of Net Property Income3 by Property D
Slide 18: Track Record of Consistently High Occupancy Rate
Track Record of Consistently High Occupancy Rate 2017 Occupancy Rate 31 Mar 30 Jun 30 Sep 31 Dec Beijing Wanliu 99.5% 100.0% 100.0% 100.0% Chengdu Konggang 95.0% 95.8% 96.1% 96.8% Hefei Mengchenglu 100.0% 100.0% 100.0% 100.0% Xining Huayuan 100.0% 100.0% 100.0% 100.0% Dalian Jinsanjiao 100.0% 100.0%
Slide 19: Optimal Leasing Strategy
Optimal Leasing Strategy Weighted High Strong average lease Retention Rental expiry (years) Rate Reversion 4.0 By GRI Weighted average lease expiry (WALE) as at 31 December 2017 By Gross Rental Income 4.0 years By Committed NLA 7.1 years By Gross Rental Income (GRI) By Committed NLA 52.1% 45.3% 27.7
Slide 20: Well Diversified Portfolio Tenant Mix
Well Diversified Portfolio Tenant Mix Breakdown of Gross Rental Income1 Breakdown of NLA2 by Trade Sector by Trade Sector Specialty Stores 0.6% Specialty Stores 0.3% F&B Lifestyle Fashion Fashion 23.5% 20.4% Supermarket 1.6% 33.8% 40.5% Services Supermarket 7.2% Recreation 20.2% Recreation F&B Servi
Slide 21: Engaging The Community & Tenants
Engaging The Community & Tenants 21
Slide 22: Engaging The Community & Tenants
Engaging The Community & Tenants Beijing Wanliu 北京万柳 Halloween Kids Party Christmas Mascot Parade Art in the Mall Experience 22
Slide 23: Engaging The Community & Tenants
Engaging The Community & Tenants Chengdu Konggang 成都空港 Fall Winter Fashion Runway Creative Fair – Painting Activity Standup Comedy Show Gourmet Journey Experience 23
Slide 24: Engaging The Community & Tenants
Engaging The Community & Tenants Hefei Mengchenglu 合肥蒙城路 古箏 Chinese Zither Performance Temptation of Food Event RISE (English School)’s Xmas Performance 24
Slide 25: Overview of Beijing Hualian Group
Overview of Beijing Hualian Group First China Retail REIT Sponsored by a China Based Group 25
Slide 26: Beijing Hualian Group's Core Businesses
Beijing Hualian Group’s Core Businesses Retail Malls Supermarkets 37 Retail Malls owned and/or More than 150 Supermarkets across entire China under management Beijing Hualian Hypermarket Co., Ltd. Beijing Hualian Department Store Co., Ltd. Listed on Shenzhen Stock Exchange in 1998 Listed on Shan
Slide 27: Growth Strategy
Photo of Chengdu Konggang 成都空港 Growth Strategy 27
Slide 28: Growth Strategy
Growth Strategy Organic Growth Acquisition Growth Explore Acquisition Proactive Proactive 14 Voluntary ROFRs Opportunities In Asset Asset Properties In The Other Quality Management Enhancement Pipeline ^* Income-Producing Retail Properties Reinforce community Identify opportunities 14 ROFR Prope
Slide 29: ROFR Properties & Sponsor Mall Footprint
ROFR Properties & Sponsor Mall Footprint Beijing (16) 5 BHG Retail REIT Portfolio Properties^ Beijing Mall Longbeicun Mall Chifeng (1) Chifeng Mall Anzhen Mall* Pinggu Mall 14 ROFR Properties in Pipeline^#* Changying Mall# Libao Mall# Shangdi Mall Shunyijinjie Mall Shenyang (2) Shenyang Wulihe Mall
Slide 30: Market Outlook
Market Outlook Photo of Chengdu Konggang 成都空港 30
Slide 31: Market Outlook
Market Outlook China economy grew 6.9% year-on-year (y-o-y) in 20171. Retail sales increased 10.2% y-o-y to RMB 36.6 trillion in 20171. Residents' income continue to rise steadily • Disposable income and expenditure per capita of urban residents increased 6.5% and 5.4% y-o-y respectively in 20
Slide 32: Thank You
Thank You For further information and enquiries: Nigel Nai Zi Investor Relations Manager BHG Retail Trust Management Pte. Ltd. Contact: (65) 6805 8283 Email: ir@bhgreit.com Mailing address: 100 Beach Road, #25-11 Shaw Tower, Singapore 189702 Website: http://www.bhgreit.com 32