Desane Group Holdings Ltd · ASX:DGH
Desane — Investor Presentation (October 2006)
35 slides from Desane's investor presentation, Oct 3, 2006
Slide 1: Desane Group Holdings Investor Presentation cover letter
DESAN GROUP HOLDINGS LIMITED Binn A.B.N. 61 003 184 932 3 October 2006 The Manager Companies Australian Stock Exchange (Sydney) Limited 20 Bridge Street SYDNEY NSW 2000 Dear Sir/Madam, Investor Presentation Please find attached a copy of the Investor Presentation. Yours faithfully, DESANE GROUP HOLD
Slide 2: Desane Group Holdings Limited
Desane Group Holdings Limited —_ oe Presented by: Phil Montrone October 2006 DESANE GROUP HOLDINGS LIMITED tam
Slide 3: Overview
Overview Specialises in industrial and commercial properties valued $5 million to $15 million Focus on high value, high growth locations within 5 to 15 kilometres from Sydney CBD Skilled and disciplined investment approach in order to maximise value once property acquired Conservative financing with
Slide 4: Operational Structure
Operational Structure © C) Property investment CL] Property management UO) Rental income U) Project management C) Property redevelopment DESANE GROUP HOLDINGS LIMITED tam
Slide 5: Key Events
Key Events Listed on the ASX on 1 September 1987, raising $2.76 million from the market Purchase of a building contractor business and six freehold commercial and industrial properties Acquisition and restoration of a 3,000m? historic three level office and retail building in Glebe Acquisition and r
Slide 6: Key Events (cont.)
Key Events (cont.) Acquisition of a 50% share in Tuta Laboratories and its industrial property assets located in Lane Cove. Increased to 70% ownership in the multimedia centre at Rozelle Agreement to design and construct a 2,000m? mail delivery centre for Australia Post in the Camperdown Children’s
Slide 7: Property Portfolio Strategy
Property Portfolio Strategy OU The medium term objective of Desane is to grow the property portfolio to $100 million from its current $42 million Desane primarily acquires undervalued properties for medium to long term investment Property acquisitions are targeted to suit clients wishing to enter in
Slide 8: Property Services Strategy
Property Services Strategy Ooovo oOo In addition to the $42 million property portfolio owned, Desane also manages an additional $13 million of industrial properties The medium to long term objective is to increase the external property under management to $100 million Desane derives a 3% rental mana
Slide 9: Property Locations
Property Locations Lane Cove 7-9 Orion Road 13 Sirius Road 318-332 Burns Bay Road Lidcombe bye Homedyth rer nn S FRB — Stanmore aN Af a aN Rozelle 68-72 Lilyfield Road |-3 Nicholas Street DESANE GROUP HOLDINGS LIMITED tam
Slide 10: Orion Rd, Lane Cove
Orion Rd, Lane Cove Address Description Acquisition Date Site Area Lettable Area Occupancy Ownership Book Value Income Other Information 7-9 Orion Road, Lane Cove Six unit industrial complex February 2004 8,000 square metres 5,517 square metres, with six distinct tenancies 100% 100% $11.3 million as
Slide 11: Orion Rd, Lane Cove
Orion Rd, Lane Cove TENANTS: Sagem Australasia, Media Technology, ShowCorp, Pentel, Remedial Building Services Lease Expiry Tenancy Status 72% - 4,000m2 28%-1,550m2 Total Leasable Area - 5,550m2 DESANE GROUP HOLDINGS LIMITED tam
Slide 12: Sirius Rd, Lane Cove
Sirius Rd, Lane Cove Address Description Acquisition Date Site Area Lettable Area Occupancy Ownership Book Value Income Other Information 13 Sirius Road, Lane Cove Office building with 50 basement security parking spaces September 2005 1,600 square metres 2,400 square metres 100% 100% $4.7 million a
Slide 13: Sirius Rd, Lane Cove
Sirius Rd, Lane Cove TENANTS: PMP Digital, FAV IT Group Lease Expiry Tenancy Status 20117 2010- 2009+ 2008 - 2007 5 2006 - 2005 P| 50% -1,200m2 50% -1,200m2 Total Leasable Area - 2,400m2 DESANE GROUP HOLDINGS LIMITED tam
Slide 14: Burns Bay Rd, Lane Cove
Burns Bay Rd, Lane Cove Address Description Acquisition Date Site Area Lettable Area Occupancy Ownership Book Value Income Other Information 318-332 Burns Bay Road, Lane Cove Lane Cove harbour front high tech industrial park December 1999 12,100 square metres 7,100 square metres 100% 50% (through Sa
Slide 15: Burns Bay Rd, Lane Cove
Burns Bay Rd, Lane Cove Lease Expiry TENANTS: Tuta Healthcare, Talman, Pharmalab, Studibaker Fashion, Arrow Scientific Tenancy Status sow | 2009+ 2008 4 2007 5 2006 4 2005+ 100% - 6,900m2 Total Leasable Area - 6,900m2 DESANE GROUP HOLDINGS LIMITED tam
Slide 16: Lilyfield Rd, Rozelle
Address Description Acquisition Date Site Area Lettable Area Occupancy Ownership Book Value Income Other Information Lilyfield Rd, Rozelle 68-72 Lilyfield Road, Rozelle Multimedia high tech park December 1997 7,856 square metres 5,446 square metres 98% 70% $16.0 million as at 31 December 2005 Approx
Slide 17: Lilyfield Rd, Rozelle
Lilyfield Rd, Rozelle TENANTS: Staging Connections, BRE Communications, Point of View Design Lease Expiry Tenancy Status 20107 2009 | 20087 20077 2006 200s al 10% - 550m2 90% - 4,900m2 Total Leasable Area - 5,450m2 DESANE GROUP HOLDINGS LIMITED tam
Slide 18: J.G. Evans Business Centre, Lidcombe
J.G. Evans Business Centre, Lidcombe Address Description Acquisition Date Site Area Lettable Area Occupancy Book Value Income Other Information 1-3 Nicholas Street, Lidcombe Business centre comprising 7 office and warehouse units, with 30 car parking spaces May 2004 4,104 square metres 3,016 square
Slide 19: J.G. Evans Business Centre, Lidcombe
J.G. Evans Business Centre, Lidcombe TENANTS: Kennametal Australia, Eset Tenancy Status 20107 2009+ | 2008- 2007+ Lease Expiry 2006 - | 45% -1,356m2 *55%- 1,660m2 Total Leasable Area - 3,016m2 *Expected to be leased by January 2007 DESANE GROUP HOLDINGS LIMITED tam
Slide 20: Lease Duration and Total m2 of Lettable Area Owned & Managed
Lease Duration and Total m2 of Lettable Area Owned & Managed B7% 05% 7% O 2011 “2010 w 2009 @ 2008 @ 2007 @ Vacant Total Lettable Area = 23,300m2 DESANE GROUP HOLDINGS LIMITED tam
Slide 21: Desane's Properties Summary
Desane’s Properties Summary Oo Oooo oOo Total occupancy rate 93% of floorspace available 43% of properties are leased for 3+ years to high quality tenants, providing stable cash flow through 2009 and beyond Strong track record and established relationships with leading industrial real estate agents
Slide 22: Key Tenants
Key Tenants The Company has also been able to create a strong and diverse long term tenancy portfolio which includes the following companies: Oo OoooOOOCOCO DO Arrow Scientific BRE Electronics Esel Technology Geometric Surveyors JAV.IT Group Kennametal Media Technology Pentel Pharmalab Medical PMP D
Slide 23: 2006 vs 2005 Full Year Profit & Loss
2006 vs 2005 Full Year Profit & Loss To Bull Year i ae SS i : ° 30 Jun 2006 $7000 Property Portfolio Revenue Property rent 1,628 1,907 Net profit on sale of investment properties 235 492 Net increase in asset revaluation of investment properties 2,313 - Net contribution from Samivoni Pty Ltd (Burns
Slide 24: Financial Performance Highlights
Financial Performance Highlights The Property Portfolio division generated the majority of Desane’s income in FY06 Desane’s core property holdings experienced strong asset appreciation, resulting in a net revaluation increase in FY06 of $2.3m in accordance with AIFRS The reduction in rental income f
Slide 25: Balance Sheet Summary
Balance Sheet Summary BALANCE SHEET SUM) at 40 Jon ‘As at 30 Jun | 2006 | 2005 $000 $000 | Cash 330 1,223 Receivables 512 3,014 Investment — properties to be sold - 3,619 Other 105 150 Total Current Assets 947 8,006 Receivables 823 764 Investments ~ properties and joint venture investment Lilyfield
Slide 26: Balance Sheet Highlights
Balance Sheet Highlights Desane’s financial position is prudent and conservative Desane’s 70% share of the joint venture investment in Lilyfield Rd, Rozelle, is consolidated in the Company’s accounts Total net debt as at 30 June 2006 stood at $15.9m, representing gearing (net debt to equity) of 68%
Slide 27: Five Year Historical P&L
Five Year Historical P&L $000 $2,000 $1,800 $1,600 $1,400 $1,200 $1,000- $800- $600- $400- $200- $04 2002 2003 2004 NB: 2005 and 2006 accounts prepared under AIFRS 2005* 2006* DESANE GROUP HOLDINGS LIMITED tam
Slide 28: Net Tangible Assets
Net Tangible Assets $000 $25,000- $20,000- $15,000- $10,000- $5,000- $04 2002 2003 NB: 2005 and 2006 accounts prepared under AIFRS 2004 2005* 2006* DESANE GROUP HOLDINGS LIMITED tam
Slide 29: Net Tangible Assets per Share
Net Tangible Assets per Share $0.90 $0.80 $0.704 $0.60 $0.504 $0.40- $0.30 $0.204 $0.104 $0.00- 2002 2003 2004 2005* 2006* NB: 2005 and 2006 accounts prepared under AIFRS D E S ei N E GROUP HOLDINGS LIMITED tam
Slide 30: Dividends Paid to Shareholders
Dividends Paid to Shareholders Cents per share 2.57 2.04 1.57 1.0+ 0.54 0.0-ia. 2006 DESANE GROUP HOLDINGS LIMITED tam
Slide 31: Share Price
Share Price a PARTESH Charts DGH - DESANE GROUP HLDINGS 27-Sep 13 “B12 14 24 -0.9 O68 OF 0.6 -O0.5 -O4 $0.79 Price (Dollars) Close ] ] i Fr Tote tac T T My T T T T g Feb Jun Oct Feb Jun Oct Feb Jun Oct Feb Jun Oct Feb Jun Oct Feb Jun COrct 1 OF Of 02 Oe 62 60S 60S 60S lod dF 4 06 60S 60S CB COtsCé*S
Slide 32: Market Outlook
Market Outlook Limited supply of quality commercial and industrial properties in inner Sydney, Melbourne and Brisbane leading to stronger competition among investors Increased demand from larger tenants looking to secure long-term premises in prime locations Competing demand from residential propert
Slide 33: Growth Opportunities
Growth Opportunities Desane’s strong balance sheet and free cash flow provides scope for further property acquisition Strong and diverse tenancy mix expected to generate rental growth well above the rate of inflation Leverage low cost base and spare executive capacity to increase profits from proper
Slide 34: Board of Directors / Management
Board of Directors /Management Board of Directors Mr John Sheehan (Chairman) John is a practicing Chartered Town Planner and Registered Valuer. He has formerly served as President of the Australian Property Institute. John has served as company Chairman since 1992 and as a Non-Executive Director sin
Slide 35: Capital Structure
Capital Structure There were 503 shareholders as at 31 August 2006. TOP 20 SHAREHOLDERS AS AT 22 SEPTEMBER 2006 SHARES | oD No. of shares 27 274,467 1 Cupara Pty Lid 9,200,730 33.7 2 | Gemi Financial Services Pty Lt (Gemi Financial Services AIC) $279,134 47 Share price $0.79 3 Mansfield Holdings Pty
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