Metro Holdings Ltd · SGX:M01
Metro — FY2017 Earnings Presentation
54 slides from Metro's earnings presentation, May 30, 2017
Slide 1: SGX Financial Statements and Related Announcement: Full Yearly Results
Financial Statements and Related Announcement::Full Yearly Results Page 1 of 1 Financial Statements and Related Announcement::Full Yearly Results Issuer & Securities Issuer/ Manager METRO HOLDINGS LTD Securities METRO HOLDINGS LIMITED - SG1I11878499 - M01 Stapled Security No Announcement Details Ann
Slide 2: Metro Holdings Limited FY2017 Results Presentation
METRO HOLDINGS LIMITED F Y 2 0 1 7 R E S U LT S P R E S E N TAT I O N
Slide 3: Contents
CONTENTS • About Metro • Property Development & Investment • Retail Operations • Financial Highlights • Growth Strategies • Going Forward • Market Outlook 2
Slide 4: Who We Are
WHO WE ARE A property development and investment group, backed by an established retail track record, with strong presence in China, Indonesia and Singapore. The group has also expanded its geographical presence to the United Kingdom, in particular, Manchester and Sheffield. 3
Slide 5: Our International Presence
OUR INTERNATIONAL PRESENCE List of Investment Properties • Metro City, Shanghai • Metro Tower, Shanghai • GIE Tower, Guangzhou • Shama Century Park, Shanghai (Associate) List of Investments • Top Spring International (Property Developer-HK Listed)(Associate) • MGSA Private Trust (AFS) List of Retail
Slide 6: Property Development & Investment
PROPERTY DEVELOPMENT & INVESTMENT 5
Slide 7: Portfolio Overview
PORTFOLIO OVERVIEW Investment Properties as at 31 March 2017: % owned Site Lettable Valuation No. of Occupancy (S$’m) by Tenure Area Area Tenants Rate (%) Group (“sqm”) (“sqm”) (100%) GIE Tower, 50 yr term 100% - 28,390 33 86.4 97 Guangzhou from 1994 Metro City, 36 yr term 60% 15,434 38,447 172 95.5
Slide 8: Investment Property
INVESTMENT PROPERTY Property Valuation (100%) as at 31 March 2017 and 2016: FY2017 FY2016 FY2017 FY2016 (%) (%) (Rmb’m) (Rmb’m) (S$’m) (S$’m) GIE Tower, Guangzhou 480 479 +0.2 97 100 -3.0 Metro City, Shanghai 1,024 1,059 -3.3 208 221 -5.9 Metro Tower, Shanghai 958 957 +0.1 195 200 -2.5 Exchange rate
Slide 9: Portfolio Overview
PORTFOLIO OVERVIEW Development Properties (Associates/Joint Ventures): Leasable/ Expected % owned by Sale Location completion Group (*) Saleable Area (#) launch date Nanchang, Jiangxi Nanchang Fashion Mark 30% 400,080 sqm Note (1) June 2020 Province, PRC The Crest at Prince Singapore 40% 50,854 sqm
Slide 10: GIE Tower, Guangzhou
GIE TOWER, GUANGZHOU Occupancy Rate: 86.4% Top 10 Tenants: % of Name of Tenant Trade Sector lettable Office Tenant Mix by Lettable Area area (as at 31 March 2017) Yu Cai Restaurant F&B 14.2% Abbott Laboratories Pharmaceutical & Medical 8.6% 17.5% 10.3% Sino-US United MetLife Banking, Insurance & 8.7
Slide 11: GIE Tower, Guangzhou
GIE TOWER, GUANGZHOU RMB/sqm 88.4% 89.4% 90.0% 87.7% 130 86.4% 86.0% 85.6% 85.9% 83.3% 85.0% 120 112 109 109 109 110 107 106 80.0% 103 99 100 75.0% 90 70.0% 80 65.0% 70 60 60.0% Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Average leasing rate as at Occupancy rate as at 10
Slide 12: Metro City, Shanghai
METRO CITY, SHANGHAI Top 10 Tenants: Occupancy Rate: 95.5% % of total Name of Tenant Trade Sector lettable area Retail Tenant Mix by Lettable Area Physical Fitness & Leisure & Entertainment/ 7.7% Beauty Centre Sport & Fitness (as at 31 March 2017) Star Theatre Leisure & Entertainment/ 6.6% Sport & F
Slide 13: Metro City, Shanghai
METRO CITY, SHANGHAI RMB/sqm 95.5% 100.0% 700 94.0% 91.4% 92.2% 89.0% 89.4% 88.2% 90.0% 650 81.7% 636 623 80.0% 600 70.0% 579 549 551 545 60.0% 550 536 539 50.0% 500 40.0% 450 30.0% 400 20.0% Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Average leasing rate as at Occupancy rate as at 12
Slide 14: Metro Tower, Shanghai
METRO TOWER, SHANGHAI Occupancy Rate: 92.7% Top 10 Tenants: % of total Name of Tenant Trade Sector lettable area Office Tenant Mix by Lettable Area Swatch Group Consumer Products 16.4% (as at 31 March 2017) Exxon Mobil Petroleum & Chemicals 15.2% Energy Source Others 14.5% 25.3% 18.7% Pizza Hut F&B
Slide 15: Metro Tower, Shanghai
METRO TOWER, SHANGHAI RMB/sqm 98.0% 99.4% 100.0% 100.0% 100.0% 95.4% 96.1% 210 93.6% 92.7% 95.0% 190 182 181 181 181 90.0% 179 179 174 175 170 85.0% 80.0% 150 75.0% 130 70.0% 110 65.0% 90 60.0% Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Average leasing rate as at Occupancy rate as at 14
Slide 16: Property Investment – Expiry Profile
PROPERTY INVESTMENT – EXPIRY PROFILE Expiry Profile by Gross Rental Income: 1H2018 (%) 2H2018 (%) GIE Tower, Guangzhou 3.6 9.4 Metro City, Shanghai 6.3 13.0 Metro Tower, Shanghai 4.5 15.2 15
Slide 17: Shanghai Shama Century Park
SHANGHAI SHAMA CENTURY PARK Key Statistics Acquisition date 27 December 2013 Land use rights tenure ending on 30 December 2072 Total consideration (Rmb million) – 524 30% interest Saleable/Leaseable GFA (sq.m.) *7,355 Valuation (Rmb million) – 100% *515.5 Interest attributable to us (%) 30% * As at
Slide 18: Nanchang Fashion Mark
NANCHANG FASHION MARK • Joint-venture project with a Hong Kong-listed company Top Spring International Holdings Limited • Located at Hong Gu Tan CBD, Nanchang City of Jiangxi Province in the PRC • Mixed-use development – residential, retail and office components for sale; retail shopping mall and se
Slide 19: Nanchang Fashion Mark
NANCHANG FASHION MARK Key Statistics % owned by Group 30% Site Area (sq.m.) 269,455 Construction start date May 2013 Expected completion date June 2020 Land cost (RMB million) 1,978 Total GFA (sq.m.) 1,030,475 Serviced Total Residential Retail Office apartments Saleable/Leasable GFA (sq.m.) (1) 400,
Slide 20: The Crest
THE CREST Key Statistics % owned by Group 40% Site Area (sq.m.) 23,785 Tenure 99 years from 2012 TOP February 2017 Total saleable GFA (sq.m.) 50,854 Land cost (S$’m) 516.3 • 469 units condominium development comprising 4 blocks of 5-storey and 3 blocks of 24-storey residential buildings • Basement c
Slide 21: Manchester – The Hatbox
MANCHESTER – THE HATBOX Key Statistics % owned by Group 25% Site Area 1.06 acres Tenure Freehold Sales launch Mid 2015 Completion date 1Q 2016 Estimated total saleable GFA 112,400 sqft • The second phase of Milliners Wharf is situated in New Islington at the Eastern gateway to the city centre and ne
Slide 22: Manchester – Middlewood Locks
MANCHESTER – MIDDLEWOOD LOCKS • The 24 acre site at Middlewood Locks will provide a vibrant new neighbourhood of approximately 2,200 new homes and 750,000 sqft of space for offices and mixed commercial uses such as shops, restaurants, hotels, gym and bars • Middlewood Locks will offer modern apartme
Slide 23: Sheffield – Sheffield DC
SHEFFIELD – SHEFFIELD DC Key Statistics % owned by Group 50% Site Area 1.03 acres Tenure Freehold Expected completion date 2017/2020 Estimated total saleable GFA 131,226 sqft • Centrally located on Sheaf Street and adjacent to the City’s main railway station, this striking contemporary landmark is a
Slide 24: Retail Operations
RETAIL OPERATIONS 23
Slide 25: Retail Operations
RETAIL OPERATIONS Upgraded merchandise selections for customers in all our retail operations, through close collaboration with international and local business partners: Singapore:- Indonesia:- • Metro Centrepoint • Metro Pondok Indah • Metro Pacific Place • Metro Paragon • Metro Plaza Senayan • Met
Slide 26: Financial Highlights
FINANCIAL HIGHLIGHTS 25
Slide 27: FY2017 Results Highlights
FY2017 RESULTS HIGHLIGHTS • Property division’s performance takes impact from decreases in share of results of associates and joint ventures − Property division’s profit before taxation down 33.5% to S$81.2 million mainly due to: S$33.1 million decline in share of results of associates following l
Slide 28: Financial Highlights
FINANCIAL HIGHLIGHTS Profit & Loss Accounts: 4QFY17 4QFY16 FY2017 FY2016 Change Change (S$'000) (S$'000) (S$'000) (S$'000) Turnover 33,716 32,568 3.5% 131,224 154,595 -15.1% Profit Before Tax 32,489 1,239 n.m. 82,541 122,332 -32.5% Comprising: Metro City, Metro Tower, GIE Tower 7,904 6,973 13.4% 26,
Slide 29: Full Year Financial Summary
FULL YEAR FINANCIAL SUMMARY Financial Ratios: FY2017 FY2016 Earnings per share after tax and non-controlling 9.7 13.7 interests (cents) Return on shareholders’ funds (%) 5.9 8.2 Return on total assets (%) 5.2 7.1 Number of issued shares (million) 828.0 828.0 Net asset value per share (S$) 1.63 1.66
Slide 30: 4Q Revenue Breakdown
4Q REVENUE BREAKDOWN (S$’m) 1.6 1.8 30 32.1 29.6 20 10 1.2 0 4QFY2017 4QFY2016 Retail discontinued stores Retail continuing stores Property revenue • Group revenue up by 3.4% − Higher retail sales from continuing department stores offset discontinued business − Property rental income remains steady
Slide 31: Full Year Revenue Breakdown
FULL YEAR REVENUE BREAKDOWN (S$’m) 7.4 1.1 6.5 27.8 150 100 118.3 124.7 50 0 FY2017 FY2016 Retail continuing stores Retail discontinued stores Property divested Property • Retail revenue fell by $21.4m (14.6%) − Sales declined due to closure of Metro Sengkang and Metro City Square − These were parti
Slide 32: Balance Sheet Highlights
BALANCE SHEET HIGHLIGHTS 2017 2016 Change As at 31 March Remarks (S$'000) (S$’000) (%) Plant and Equipment 5,062 4,872 3.9% Investment Properties 104,423 106,653 -2.1% Associates 507,650 467,051 8.7% Joint Ventures 382,674 345,221 10.8% Investment in Other Non-current Assets 96,023 52,870 81.6% MGSA
Slide 33: Dividend Payout
DIVIDEND PAYOUT Gross Cents per Share 8.0 80.0% 54.1% 6.0 60.0% 51.3% 51.1% 45.9% 51.2% 46.5% 5.0 4.0 4.0 4.0 4.0 40.0% 3.0 34.8% 3.0 20.3% 2.0 1.0 2.0 20.0% 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 0.0 0 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017* Payout rate Ordinary Special * FY2017’s propose
Slide 34: Growth Strategies
GROWTH STRATEGIES 33
Slide 35: Growth Strategies
GROWTH STRATEGIES Property Development & Investment • Continue to invest in core PRC market – Through potential property investments and acquisitions with JV partners – Capitalise on strong foothold and know-how in China • Selective investments to broaden asset base and geographical spread – Working
Slide 36: Growth Strategies: Property Development and Investment
GROWTH STRATEGIES Property Development and Investment Covering a fuller spectrum of properties in key markets to broaden revenue stream and build sustained profitability • Leverage on Rich Retail Experience − Optimise tenant mix − Continual asset enhancement of lettable space − Improve efficiency of
Slide 37: Growth Strategies: Retail Operations
GROWTH STRATEGIES Retail Operations • Improve trading performance − Intensify sales performance − Improve gross margins − Leverage on new technologies to improve productivity − Continue to improve and expand the e-commerce and mobile channel • Enhance Merchandise Offering − Expand in-house developme
Slide 38: Growth Strategies: Retail Operations
GROWTH STRATEGIES Retail Operations • Enhancing Customer Service − Cross-store merchandising and selling; customers can buy, collect, exchange and return merchandise from any Metro store − Provide Online and Offline Omni-channel shopping for customer convenient − Implement Customer Relationships Man
Slide 39: Going Forward
GOING FORWARD 38
Slide 40: Going Forward: Property Segment
GOING FORWARD Property Segment: • Asset rebalancing to continue − Expect to continue to make investments in China, a core market − Seek out good investment opportunities in other geographic regions to prudently grow quality asset portfolio Commercial − Grade A office building, Acero Works at Sheffie
Slide 41: Going Forward: Property Segment
GOING FORWARD Property Segment: Residential − Middlewood Locks in Manchester, UK Launching in June 2017 of 571 freehold residential apartments under Phase 1 (out of about 2,200 units planned) Phase 1 completing in 2018 − The Crest in Singapore Subdued sales given cautious market sentiment 40
Slide 42: Going Forward: Retail Segment
GOING FORWARD Retail Segment: • Seek to improve sales performance amidst challenging retail market conditions through more aggressive marketing and omni-channel selling − Continue to adopt fresh concepts to entice consumers • Prudently identify new sites for store expansion – both departmental store
Slide 43: Market Outlook
MARKET OUTLOOK 42
Slide 44: Market Outlook: China
MARKET OUTLOOK: CHINA China’s economy grew faster-than-expected, while the consumer sector enjoyed robust growth CBRE, Marketview – China, Q1 2017 • Domestic Gross Domestic Product (“GDP”) growth stood at 6.9% in Q1 2017, the strongest for six quarters • The faster-than-expected economic growth was
Slide 45: Market Outlook: Shanghai, Office
MARKET OUTLOOK: SHANGHAI, OFFICE Grade A office rents remained steady, with new space absorbed by vigorous demand Knight Frank, Shanghai Office Market Report, Q1 2017 • In Q1 2017, 720,000 sqm of new Grade A offices were completed in Shanghai with an increase of nine per cent quarter-on-quarter (“Q-
Slide 46: Market Outlook: Shanghai, Retail
MARKET OUTLOOK: SHANGHAI, RETAIL Retail property market and rents stayed healthy Knight Frank, Shanghai Retail Market Report, Q1 2017 • Retail property market remained stable in Q1 2017 − While store closures continued, there were new brands that entered the Shanghai market for the first time; for e
Slide 47: Market Outlook: Guangzhou, Office
MARKET OUTLOOK: GUANGZHOU, OFFICE Rental buoyed by limited new supply CBRE, Marketview – China, Q1 2017 • New supply reached the lowest level since Q2 2014, resulting in 1.1 percentage points (“ppts”) decrease Q-o-Q in vacancy rates to 11.3% • In the next six months, a total of 150,000 sqm of new su
Slide 48: Market Outlook: Nanchang, Mixed-Use
MARKET OUTLOOK: NANCHANG, MIXED-USE Nanchang sees positive trends China Daily, Home prices up in lower-tier cities, 19 April 2017 • According to data issued by the National Bureau of Statistics released on Tuesday, home prices in lower-tier cities rose faster in March, and home prices in some first-
Slide 49: Market Outlook: Manchester, Residential
MARKET OUTLOOK: MANCHESTER, RESIDENTIAL Outlook for Manchester’s property market remains robust PWC, Emerging Trends in Real Estate, New Market Realities, Europe 2017 • While overall sentiment is that Brexit is expected to impact the market, the impact on Manchester is limited; at the same time, the
Slide 50: Market Outlook: Sheffield, Office
MARKET OUTLOOK: SHEFFIELD, OFFICE Attractive market for office investment Knight Frank, UK Regional Cities, Office Market Review 2017 • With deal numbers up, office investment in 2016 increased to its highest total since 2010. Yields remained at the lowest level since 2014, but continue to offer dis
Slide 51: Market Outlook: Singapore, Residential
MARKET OUTLOOK: SINGAPORE, RESIDENTIAL Overall market sentiment improved Jones Lang Lasalle, Singapore Property Market Monitor, 1Q2017 • Overall market sentiment improved after tweaks to the government cooling measures in March 2017 • Despite the absence of fresh launches, total sales volumes in the
Slide 52: Market Outlook: Singapore, Retail
MARKET OUTLOOK: SINGAPORE, RETAIL Singapore: Cautiously optimistic Savills World Research, Singapore, Briefing Retail Sector, February 2017 • Based on the advanced estimates released by the Ministry of Trade and Industry, the Singapore economy expanded 2.9% Y-o-Y in the last quarter of 2016, outperf
Slide 53: Market Outlook: Indonesia, Retail
MARKET OUTLOOK: INDONESIA, RETAIL Indonesia: Remains Resilient Cushman & Wakefield, Retail Snapshot Q4 2016, Jakarta • The Central Bank of Indonesia (Bank Indonesia) predicts GDP to grow in the range of 5.0% to 5.4% next year, influenced by robust consumption and investment, as well as improvements
Slide 54: Thank You!
THANK YOU! 53