Corporacion Inmobiliaria Vesta S.a.b. De C.v. · BMV:VESTA
Corporacion Inmobiliaria Vesta S.a.b. De C.v — Q4 2020 Earnings Presentation
43 slides from Corporacion Inmobiliaria Vesta S.a.b. De C.v's earnings presentation
Slide 1: Corporate Presentation 4Q20
CORPORATE PRESENTATION 4Q20
Slide 2: Disclaimer
DISCLAIMER This presentation has been prepared by Corporación Inmobiliaria Vesta, S.A.B. de C.V. (“Vesta” or the “Company”) solely for use at this presentation. This presentation was prepared solely for informational purposes and does not constitute, and is not to be construed as, an offer or solici
Slide 3: Vesta's Snapshot
VesTA Vesta’s Snapshot Bw ma
Slide 4: Fully-integrated industrial real estate owner, operator and developer
Fully-integrated industrial real estate owner, operator and developer: Well positioned in Mexico, one of the world´s most attractive manufacturing and distribution hubs. Internally managed company, with strict focus on shareholders' return. Market benchmark offering innovative and customized solutio
Slide 5: Strong corporate governance with best-in-class practices
Strong corporate governance with best-in-class governance practices, since inception Board of Directors Lorenzo Berho Corona Executive Chairman Stephen B Jose Manuel Craig Thomas J. Luis de la Luis Javier Oscar Francisco John Williams Dominguez Wieland McDonald Calle Solloa Cazares Uranga Foster Soc
Slide 6: Highlights
1 Record-high results Resilient balance 2 sheet 3 Growth per share Consistent dividend 4 growth Highlights Maximizing our stabilized 5 portfolio 6 Level 3 Strategy 7 Attractive discount 8 Vesta Parks development strategy Strong Commitment 9 www.vesta.com.mx and Focus on ESG
Slide 7: Record-high Results
VesTA Record-high Results
Slide 8: Strong foundation built and proved across key milestones
Strong foundation built and proved across key milestones that have consistently accelerated growth Initial Stage Pre IPO Post IPO Vesta 20/20 Vison Level 3 Strategy 1998-2005 2006-2012 Investments 2012 2013 2015 2019 Investments Second Follow on First portfolio from GE and from CALPERS, IPO First Fo
Slide 9: Stable and predictable cash flows and profitability
Stable and predictable cash flows and profitability Highly predictable rental income & stable occupancy rates Strong EBITDA growth with low margin volatility¹ (US$ in millions) (US$ in millions) 97.2% 94.7% 91.1% 94.0% 85.0% 87.0% 95.3% 84.0% 83.7% 84.0% 84.1% 84.2% 83.0% 94.2% 93.8% 82.5% 82.8% 126
Slide 10: Resilient Balance Sheet
VesTA Resilient ff Balance Sh at
Slide 11: Long-term debt at fixed rates, with sound liquidity position
Long-term debt at fixed rates, with sound liquidity position… 31/12/2020 Rate Maturity Secured Debt MetLife I $47.5 4.35% Apr-22 5.1 years average maturity & MetLife II $150.0 4.55% Aug-26 4.4% average interest rate MetLife III $118.0 4.75% Nov-27 MetLife Top Off $26.6 4.75% Aug-26 Total Secured Deb
Slide 12: One of the largest and most modern industrial portfolios in Mexico
…one of the largest and most modern industrial portfolios in Mexico… (As of December 31, 2020, % of GLA) Consolidated: GLA = 31.2 mm sf (2.90 mm m2) Buildings = 188 Land reserves = 39.5 mm sq.ft (3.6 mm m2) Stabilized portfolio occupancy 4Q20 =91.1% Clients = 177 85.2% of rental income is denominate
Slide 13: High-quality client base increasingly diversified by industry and geography
…high-quality client base increasingly diversified by industry and geography with balanced combination of growth and defensive sectors … Balanced portfolio use Long-term and staggered lease maturity profile¹ (% of Occupied GLA, as of December 31, 2020) 4.5 yrs weighted average (% of Occupied GLA, as
Slide 14: Strong tenant credit profile
…strong tenant credit profile… Automotive Logistics 2.6% E-commerce Automotive 25.6% Logistics 34.0% Manufacturing 66.0% Energy 4.3% Recreational Aerospace Vehicles 7.4% 7.7% Medical Aerospace Devices 1.8% Paper0.1% Plastics 3.1% Other 16.0% * Calculated over total occupied GLA www.vesta.com.mx
Slide 15: Exposure to most stable business component of automotive supply chain
…exposure to most stable business component of automotive supply chain… Post-crisis outcome: Tier 1 manufacturers have strengthened with a significant reduction of OEM suppliers driven by market consolidation where only the best and most profitable survived. OEM 1.1% Tier 1 48.3% Tier 2 19.2% Tier 3
Slide 16: Growth without dilution
VesTA Growth without dilution
Slide 17: Strong buy-back program helps drive key financial metrics
Strong buy-back program helps drive key financial metrics Increasing FFO per share Increasing EBITDA per share 0.22 0.15 0.21 0.14 0.19 0.13 0.12 0.15 0.09 0.12 0.11 0.11 0.07 0.07 2014 2015 2016 2017 2018 2019 2020 2014 2015 2016 2017 2018 2019 2020 Decreasing shares outstanding 631 621 600 591 US$
Slide 18: Consistent dividend growth
VesTA Consistent dividend growth
Slide 19: Accretive development and acquisitions drive strong FFO results and dividend yield
Accretive development and acquisitions, plus accelerated leasing activity and divestments drive strong FFO results and $2.50 pay attractive dividend yield 0 5.9% 0 1.99 1.94 $2.00 5.1% 1.80 1.74 4.9% 4.9% 0 1.68 1.53 $1.50 3.8% 1.36 0 1.21 1.23 2.9% 0 $1.00 0.096 0.088 0.080 0 1.6% 1.7% 1.5% 0.063 $
Slide 20: Maximizing our stabilized portfolio
Maximizing our stabilized portfolio
Slide 21: Development of our portfolio tends to decrease as stabilized GLA increases
The development of our portfolio tends to decrease as our stabilized GLA increases while development costs remain flat GLA under construction Growth derived from various types of buildings 3% 2% 6% 8% 46% 46% 46% 43% 44% 8% 97% 98% 94% 42% 9% 38% 92% 35% 36% 36% 15% 34% 33% 33% 34% 92% 91% 28% 85% 2
Slide 22: Level 3 Strategy
VesTA Level 3 Strategy Bw ma
Slide 23: Business Strategy Overview
Business Strategy Overview Our strategy will be structured around five key business components, which in turn require us to strengthen some elements of our organizational structure Becoming a World-Class Fully Integrated Industrial Real Estate Company I II III Keep strengthening our Manage, maintain
Slide 24: Level 3 Strategy Takeaways
Level 3 Stategy Takeaways • Fully integrated real estate company that creates value throughout the business cycle Our Business Model • Manage, maintain and improve current portfolio Our Strategic • Invest and / or divest for continuous value creation Focus • Further strengthen our balance sheet and
Slide 25: Attractive discount
Attractive discount
Slide 26: Higher Book Net Asset Value vs Market Price
Higher Book Net Asset Value vs Market Price Average Discount/Premium Figures in US$ M 2019 2020 % change 20.0% Properties 1,841 1,964 6.7% 12.2% 0.0% 9.8% Land 167 163 -2.4% 2012 2013 2014 2015 2016 2017 2018 2019 2020 Cash 75 121 61.3% -0.6% -20.0% -12.7% Debt Cash Collateral 4 5 25.0% -23.1% -20.5
Slide 27: Focus on profitability
Focus on profitability… Growth paths for leading industrial real estate public companies Index base year 2015=100 240 2015 ‘16 ‘17 ‘18 ‘19 2Q20 230 2020 220 Vesta 210 FFO ps 2015-20 CAGR: 17.7% FFO1 per share 200 FFO ps CAGR 2015-20 190 Vesta’s peers 180 ▪ Peer 1: 3.7% 170 ▪ Peer 2: 1.8% Prologis In
Slide 28: Higher yields, even as price per share rises
Higher yields, even as price per share rises EBITDA yield Adjusted FFO yield (EBITDA per share/share price US$) (Adjusted FFO per share/share price US$) 13.8% 9.6% 9.5% 12.2% 11.5% 11.3% 7.8% 7.8% 9.9% 7.2% 8.2% 7.0% 6.1% 5.7% 4.5% 3.2% 3.2% 3.5% 2012 2013 2014 2015 2016 2017 2018 2019 2020 2012 201
Slide 29: Vesta Parks growth Strategy
VesTA Vesta Parks growth Strategy
Slide 30: Continued Organic Growth through development Strategy
Continued Organic Growth through development Strategy North • is a sustainable City Park Name GLA (000's sf) Stage gated industrial park with TJ Lagoeste 552 state-of-the-art class A TJ Tijuana III 619 buildings designed for TJ VP Alamar 602 35% Bajio advanced light CDJ VP Juarez Sur 720 66% Cit
Slide 31: Focus on ESG
VesTA Focus on ESG Bw ma
Slide 32: Commitment and Focus on ESG
Commitment and Focus on ESG We Contribute to our clients’ and suppliers’ competitiveness and society’s well-being, while minimizing our environmental impact and related climate change risks. All our ESG initiatives are aligned with Vesta’s Level 3 Strategic Plan Key Performance Indicators (% of GLA)
Slide 33: Solid Corporate Governance
Solid Corporate Governance Board of Directors Committees Lorenzo Manuel Berho Corona • Review and analysis of quarterly and annual financial Chairman of the Board statements Audit • Review of compliance with tax obligations • Analysis, approval and follow-up of Company’s operating budget Stephen B.
Slide 34: Appendix
VesTA Appendix
Slide 35: Historical Results
Historical Results 36 36 36 36 38 37 37 38 34 35 31 32 28 29 26 27 25 22 23 20 20 21 21 19 19 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 Revenue 96.8% 96.9% 96.5% 96.8% 96.7% 96.9% 97.0% 96.2% 95.3% 96.4% 96.4% 95.7% 9
Slide 36: Historical Results
Historical Results LTV 36% 35% 35% 35% 37% 38% 38% 37% 34% 35% 34% 32% 32% 30% 25% 24% 23% 23% 23% 23% 23% 23% 23% 24% 24% 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 Net Debt / EBITDA 5.9x 5.7x 5.6x 5.5x 5.6x 5.7x 5.7x
Slide 37: Historical Results
Historical Results Debt/EBITDA 6.9x 6.5x 6.6x 6.9x 6.8x 6.7x 6.3x 6.3x 6.2x 6.0x 5.8x 5.9x 5.9x 5.8x 5.5x 5.7x 5.4x 5.3x 5.1x 5.0x 4.8x 4.7x 4.5x 4.7x 4.5x 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 EBITDA/Interest Exp
Slide 38: Case Studies: Querétaro Aerospace Park
Case Studies Querétaro Aerospace Park Construction start 2006 GLA 2.18 million sf 13 buildings www.vesta.com.mx
Slide 39: Case Studies: Douki Seisan Park
Case Studies Douki Seisan Park Construction start 2013 GLA 2.13 million sf 8 buildings www.vesta.com.mx
Slide 40: Case Studies: Vesta Park Toluca II
Case Studies Vesta Park Toluca II Construction start 2013 GLA 1.47 million sf 6 buildings www.vesta.com.mx
Slide 41: Positive industry trends driving growth
Positive industry trends driving growth Industrial Real Estate Inventory Industrial market absorption¹ (m2 in millions) (m2 in millions) Bajio Central North 90 80 CAGR ‘10–2019: 5.6% 74 77 30% 08 68 72 25% 70 01 63 60 53 20% 01 47 49 50 51 50 15% 06 40 10% 02 30 03 03 03 7% 6% 5% 02 03 06 01 20 6% 5
Slide 42: High occupancy and growing new deliveries
High occupancy and growing new deliveries (4Q20) Net Under Construction Stock Availability Absorption Vacancy Rate Average Rent Growth Speculative 2020 (m2) (m2) YTD (m2) % USD/m2/month YTD % YTD (m2) Delivered (m2) Aguascalientes 3,296,713 42,890 3,861 1.30% 4.36 0.00% - - Guadalajara 4,926,449 99,
Slide 43: Thank you!
Thank you! www.vesta.com.mx
Corporación Inmobiliaria Vesta, S.A.B. de C.V. — Q4 2020 Earnings Presentation on 6ix