Goodman Group · ASX:GMG
Goodman — Goodman Property Trust — FY2020 Earnings Presentation
44 slides from Goodman's earnings presentation, May 28, 2020
Slide 1: Goodman Property Trust Annual Result 2020
Goodman Property Trust Annual Result 2020 1
Slide 2: Contents
Goodman Property Trust Annual Result 2020 Contents 03 Overview 06 Financial result 13 Capital management 17 Investment portfolio 28 Development programme 31 FY21 Outlook & guidance 34 Appendix Presented by: John Dakin Chief Executive Officer + James Spence Director - Investment Management + Andy Eak
Slide 3: Overview
Goodman Property Trust Annual Result 2020 Overview Gateway warehouses, Highbrook Business Park 3
Slide 4: Changing landscape
Goodman Property Trust Annual Result 2020 Changing landscape We acknowledge the unprecedented times we’re experiencing and the impact COVID-19 is having on people’s lives and livelihoods Today’s operating outlook is more uncertain with the social and economic impacts of the COVID-19 pandemic lik
Slide 5: Strategic overview
Goodman Property Trust Annual Result 2020 Strategic overview Targeted investment in the Auckland industrial and Auckland urban logistics market Geographically constrained with limited well-located industrial land supply Focus on long-term total return, through continued value creation within und
Slide 6: Financial result
Goodman Property Trust Annual Result 2020 Financial result NCI Packaging, Savill Link 6
Slide 7: Financial highlights
Goodman Property Trust Annual Result 2020 Financial highlights $284.4m $165.8m 172.7cpu 18.9% Profit before tax Portfolio revaluation Net tangible asset backing Loan-to-value ratio1 28.1% Total Unitholder Return2 6.22cpu Cash earnings3 6.65cpu FY20 distribution 4.0 years Weighted average debt term4
Slide 8: Net property income
Goodman Property Trust Annual Result 2020 Net property income Net property income bridge ($m) Income from acquisitions and developments in 150 addition to like-for-like rental growth has offset the 145.3 145 impact of asset disposals and deleveraging 141.1 +3.0 140 +3.6 -0.2 Underlying like-for-
Slide 9: Cash earnings
Goodman Property Trust Annual Result 2020 Cash earnings Cash earnings’ summary ($m) FY20 FY19 FY20 cash earnings per unit materially consistent with restated FY19 Adjusted operating earnings before tax1 109.7 117.0 Tax on adjusted operating earnings (19.2) (17.5) Distribution of 6.65 cents per u
Slide 10: Capital growth
Goodman Property Trust Annual Result 2020 Capital growth Net tangible assets (cents per unit) NTA increased 15.7 cents per unit (10.0%) for the 180.0 year to 172.7 cents per unit 175.0 5.7% increase in portfolio value main contributor +1.4 -1.5 +1.3 +0.7 172.7 170.0 $175 million of new equity
Slide 11: Investment property
Goodman Property Trust Annual Result 2020 Investment property Investment property ($m) Total investment property increased 3,200 by $440.6 million to $3.1 billion 3,074.0 +63.3 47.3 Acquisitions and developments 3,000 74.9 -4.8 +25.0 adding $221.4 million +148.1 2,800 +5.6 Interests in leaseho
Slide 12: Gearing
Goodman Property Trust Annual Result 2020 Gearing Loan to value ratio GMT continues to be conservatively 28% leveraged 26% LVR of 18.9% at 31 March 2020 with -0.3% fully committed LVR at 20.6% -1.2% 24% +2.6% Medium-term range remains 25% - 22% +3.1% 35% -5.8% 20% +1.3% 20.6% 19.7% LVR coven
Slide 13: Capital management
Goodman Property Trust Annual Result 2020 Capital management Highbrook Business Park 13
Slide 14: Managing funding risk
Goodman Property Trust Annual Result 2020 Managing funding risk Maturity profile ($m) Refinancing of GMT’s bank facility was completed 250 in November 2019 Increased facility size by $100m to $400m, with 200 funding from BNZ, CBA, HSBC and Westpac 100 100 Maintained Standard & Poor’s corporate
Slide 15: Managing interest rate risk
Goodman Property Trust Annual Result 2020 Managing interest rate risk Hedging profile Hedging levels provide over 30% exposure to 100% low floating rates 90% Interest rate swaps net ITM $16.5 million 80% Cross currency swaps fully hedge USPP notes 70% (ITM $44.6 million) 60% FY21 WACD expect
Slide 16: Distribution policy
Goodman Property Trust Annual Result 2020 Distribution policy Updated distribution policy which better aligns distributions with the underlying cash flows from GMT’s stabilised portfolio: + Remains linked to cash earnings1; GMT’s preferred measure for analysing underlying financial performance + P
Slide 17: Investment portfolio
Goodman Property Trust Annual Result 2020 Investment portfolio Big Chill Distribution, Highbrook Business Park 17
Slide 18: Portfolio repositioned
Goodman Property Trust Annual Result 2020 Portfolio repositioned Over the last 6 years, $1.2 billion of asset sales and Investment activity2 ($m) $1.0 billion1 of investment into acquisitions and 400.0 development commencements has transformed and 282.5 significantly improved GMT’s portfolio quali
Slide 19: GMT's property portfolio
Goodman Property Trust Annual Result 2020 GMT’s property portfolio Efficient and desirable distribution locations. $3.1bn Property portfolio 1.1m sqm Net lettable area 11 Estates 19
Slide 20: Portfolio metrics
Goodman Property Trust Annual Result 2020 Portfolio metrics 99.4% Occupancy 100% Auckland industrial weighting 5.5 years Weighted average lease term $158.6m Development completions1 1.5% Land weighting 1 Valuation upon completion Gateway warehouses, Highbrook Business Park 20
Slide 21: Portfolio leasing
Goodman Property Trust Annual Result 2020 Portfolio leasing Portfolio review profile (% of portfolio income) Leasing for the year across stabilised portfolio totalled 140,269 sqm (12.6% of portfolio) 25.0% 20.0% Occupancy of 99.4% with FY21 expiries reducing from 15.0% to 7.7% over the last 12 m
Slide 22: Portfolio reviews
Goodman Property Trust Annual Result 2020 Portfolio reviews FY21 Portfolio review profile (% of portfolio income) FY20 saw 72% of portfolio income subject to review by way of fixed, indexed or market review1 during the year for an average increase of 3.7%2 + Average fixed and indexed increases of
Slide 23: Customer base
Goodman Property Trust Annual Result 2020 Customer base Top ten customers Top 10 customers accounting for 31% of portfolio income, generally (% of portfolio income, including subsidiary companies) focussed on storage, logistics and distribution NZ Post 1.2% of GMT’s portfolio weighted towards re
Slide 24: COVID-19 impact
Goodman Property Trust Annual Result 2020 COVID-19 impact COVID-19 has had a significant impact on the businesses of many customers, particularly those not classed as essential services during Alert Level 4 + Approximately 40% of GMT’s customers, representing around 70% of the Trust’s total annual
Slide 25: COVID-19 response
Goodman Property Trust Annual Result 2020 COVID-19 response GMT has received ~90% of rental due for April and May 2020 GMT’s response to requests for rental relief have been made on a case by case basis, and have included: + Targeted support by way of abatement for the most vulnerable businesses
Slide 26: New investments
Goodman Property Trust Annual Result 2020 New investments Strategic infill investments with holding income. $116.9m Purchase price 14.7 ha Land area 4.7 % Passing yield New investments include FY20 settlements of acquisitions of properties at Favona Road, 2-6 Monahan Road (Mt Wellington), 7-8 Monaha
Slide 27: Portfolio valuation
Goodman Property Trust Annual Result 2020 Portfolio valuation Portfolio summary as at 31 March 2020 Valuation $m Cap rate Initial Yield WALE years Occupancy Net lettable area sqm Highbrook Business Park 1,443.3 5.3% 5.0% 6.3 100% 432,640 Savill Link 361.9 5.1% 5.1% 6.7 100% 129,466 M20 Business Park
Slide 28: Development programme
Goodman Property Trust Annual Result 2020 Development programme Active Healthcare, Highbrook Business Park 28
Slide 29: Completed developments
Goodman Property Trust Annual Result 2020 Completed developments Leasing outcomes 11 developments completed across 34,977 sqm of NLA 22,075 sqm developed on a pre-committed basis for customers Quest, NCI, Big Chill and Panasonic 12,901 sqm developed on a build-to-lease basis and are 100% lease
Slide 30: Current development programme
Goodman Property Trust Annual Result 2020 Current development programme Work-in-progress summary Estate Total project cost Lettable area Expected Leased Current development programme consists of 33,790 $m sqm completion date1 sqm across 7 projects at Highbrook, Savill Link, Highbrook 53.7 16,029 F
Slide 31: FY21 outlook & guidance
Goodman Property Trust Annual Result 2020 FY21 outlook & guidance NCI Packaging, Savill Link 31
Slide 32: Outlook and guidance
Goodman Property Trust Annual Result 2020 Outlook and guidance While the operating environment has deteriorated and the immediate outlook is uncertain, we will continue to pursue an investment strategy focused on the urban logistics’ market: The important role industrial property plays in the supp
Slide 33: Thank you
Goodman Property Trust Annual Result 2020 Thank you Disclaimer: The information and opinions in this presentation were prepared by Goodman (NZ) Limited on behalf of Goodman Property Trust and its subsidiaries (Goodman). Goodman makes no representation or warranty as to the accuracy or completeness o
Slide 34: Appendix
Goodman Property Trust Annual Result 2020 Appendix Westney Industry Park 34
Slide 35: Work-in-progress
Goodman Property Trust Annual Result 2020 Work-in-progress Total project cost Lettable area Development Estate Completion date Leased $m sqm Savill Drive Units Savill Link 18.0 5,480 May-20 100% OfficeMax Expansion Highbrook Business Park 20.3 7,353 Sep-20 100% 68 Westney Road Westney Industry Park
Slide 36: Completed developments
Goodman Property Trust Annual Result 2020 Completed developments NCI Estate Savill Link Completion July 2019 NLA 14,206 sqm Westney hardstand Estate Westney Industry Park Completion August 2019 Area 3,279 sqm 36
Slide 37: Completed developments
Goodman Property Trust Annual Result 2020 Completed developments Big Chill expansion Estate Highbrook Business Park Completion February 2020 NLA 5,203 sqm Panasonic expansion Estate Highbrook Business Park Completion February 2020 NLA 2,666 sqm 37
Slide 38: Completed developments
Goodman Property Trust Annual Result 2020 Completed developments Paramount Estate Highbrook Business Park Completion December 2019 NLA 2,999 sqm Hellmann Estate Highbrook Business Park Completion December 2019 NLA 3,548 sqm 38
Slide 39: Completed developments
Goodman Property Trust Annual Result 2020 Completed developments Quest expansion Estate Highbrook Business Park Completion April 2019 NLA 59 rooms Crossing carpark Estate Highbrook Business Park Completion December 2019 NLA 343 carparks 39
Slide 40: Completed developments
Goodman Property Trust Annual Result 2020 Completed developments Underwood 1,000 Estate Highbrook Business Park Completion October 2019 NLA 1,024 sqm Waiouru yard Estate Highbrook Business Park Completion June 2019 Area 7,020 sqm 40
Slide 41: Completed developments
Goodman Property Trust Annual Result 2020 Completed developments El Kobar units Estate Highbrook Business Park Completion March 2020 NLA 5,330 sqm 41
Slide 42: Profit or loss
Goodman Property Trust Annual Result 2020 Profit or loss 42
Slide 43: Balance sheet
Goodman Property Trust Annual Result 2020 Balance sheet 43
Slide 44: Cash flows
Goodman Property Trust Annual Result 2020 Cash flows 44
Goodman Property Trust — FY2020 Earnings Presentation on 6ix