Scentre Group · ASX:SCG
Scentre — H1 2019 Earnings Presentation
26 slides from Scentre's earnings presentation, August 2019
Slide 1: Half Year Results 2019
To update Half Year Results 2019 Westfield Woden, Westfield Doncaster, VIC ACT
Slide 2: Scentre Group Overview
Scentre Group Overview Extraordinary platform with 41 Westfiel Living Centres valued at over $54 billion Creating extraordinary – Leading platform for brands and experiences to connect and interact with customers places, connecting and – Integral infrastructure network with > 65% of the population w
Slide 3: Half Year Results 30 June 2019
Half Year Results 30 June 2019 “We are pleased to Funds From Operations (FFO) per security 12.75 cents + 3.0% deliver these results which demonstrate the Distribution per security 11.30 cents + 2.0% long-term growth and sustainability of our Profit (Statutory) $740.0 million business” PETER ALLEN CE
Slide 4: Operating Performance
Operating Performance 30 June 2019 Customer Visits Per Annum > 535 million “Customers are staying for longer and Comparable Net Operating Income (NOI) Growth + 2.3% visiting more Portfolio Leased 99.3% frequently” PETER ALLEN CEO Total Annual Retail Sales $24.4 billion, increase of $1.2 billion Aver
Slide 5: Highlights
Highlights Customer Focus Development Activity – Customer advocacy continues to improve – The NZ$790 million redevelopment of Westfield Newmarket is progressing well. The first stage will open on 29 August 2019 – Welcomed 118 new brands to the portfolio, while 117 existing brands grew their store ne
Slide 6: Scentre Group Portfolio
Scentre Group Portfolio High quality retail property, in strategic locations - high population-growth trade areas Scentre Group’s portfolio is located in major cities, with population forecast to grow by more than 10 million people by 6 centres 20502 Brisbane $6.4bn 2 WHOLLY OWNED 4 JOINT VENTURES 3
Slide 7: Enhancing the most productive and efficient platform for retailers
Enhancing the most productive and efficient platform for retailers Average annual specialty in-store sales (per store) $m 1.6 Since the establishment of Scentre Group: $1.52m – Annual customer visitation has grown to more than 535 1.5 million – Annual in-store sales across the portfolio have grown t
Slide 8: Active curation of retail mix to meet customer expectations
Active curation of retail mix to meet customer expectations Proportion of stores Scentre Group has a dynamic portfolio of Westfield Living Centres. The active curation of retailer product and service offering is integral to creating extraordinary customer experiences, growing retailer sales and grow
Slide 9: Development Activity
Development Activity Total Project Cost SCG Share Completion $m $m 2019 Active Projects – Westfield Newmarket Newmarket NZD790 NZD400 Q4 2019 development is progressing well with staged openings Doncaster 30 15 1H 2020 commencing 29 August Carindale 50 15 2H 2020 2019 Total 2019 Active Developments
Slide 10: Future Developments
Future Developments Albany (NZ) > $3bn 1 2 Barangaroo (NSW) 3 Booragoon (WA)1 Future Developments 4 Doncaster (VIC) 5 Eastgardens (NSW) 6 Knox (VIC) 7 Liverpool (NSW) 8 Mt Druitt (NSW) 10 12 1 8 11 3 9 Marion (SA) 9 7 2 5 10 Stirling (Innaloo) (WA) 4 6 11 Sydney (NSW) 12 Warringah Mall – stage 2 (NS
Slide 11: We are a responsible, sustainable business
We are a responsible, sustainable business Community People Connecting and enriching communities To be a place where talent thrives – Continued our Westfield Local Heroes program, recognising individuals who enrich and – 2019 Employee Engagement at 84% placing us in the top 2% of companies globally
Slide 12: Financial Performance
Financial Performance Funds From Operations 6 months to 6 months to Growth % $m 30 Jun 2019 30 Jun 2018 Net Operating Income 971.2 924.2 Management Income 23.4 23.2 3.2% Income 994.6 947.4 5.0% Overheads (42.5) (42.1) EBIT 952.1 905.3 5.2% Net Interest (263.6) (238.4) FFO before Project Income Earni
Slide 13: Cash Flow
Cash Flow Cash flows from operating activities – look through basis $m 30 Jun 2019 Receipts in the course of operations (including GST) 1,493.0 Payments in the course of operations (including GST) (510.6) Net operating cash flows from equity accounted entities 61.9 Income and withholding taxes paid
Slide 14: Financial Position
Financial Position Balance Sheet $m 30 Jun 2019 31 Dec 2018 $37.5bn Total Property Investments 37,461.7 39,101.1 Property Investments Total Assets Total Liabilities 40,055.5 15,334.7 40,982.3 16,419.6 $23.8bn Net Assets Net Assets before Minority Interest 24,720.8 24,562.7 Operating Platform Minorit
Slide 15: Debt Management
Debt Management 30 June 2019 Debt metrics $4.0bn 96% Net Debt $11.8bn FFO to Debt 11.3% Interest Cover 3.5x Interest rate exposure hedged percentage 96% Liquidity Interest Weighted average interest rate 4.25% rate hedging Weighted average debt maturity 4.5 years Liquidity Gearing (look through basis
Slide 16: Debt Management
Debt Management 30 June 2019 Maturity Profile Facilities & Liquidity $A billion % $bn 3.5 Bonds 3.0 EUR 30% 4.8 2.5 USD 22% 3.5 GBP 10% 1.5 2.0 AUD 3% 0.4 1.5 Total 65% 10.2 1.0 Bank Facilities 0.5 Drawn 13% 2.1 Undrawn 22% 3.5 - 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 Total 35% 5.6 T
Slide 17: Outlook 2019 Forecast
Outlook 2019 Forecast approx. +3% excluding transactions1 “We are excited about FFO per security growth approx. +0.7% including transactions1 the future of our Distribution per security 22.60 cents, +2.0% business and our Comparable NOI Growth +2.0% - 2.5% ability to generate long-term sustainable g
Slide 18: Appendix
Appendix Westfield Tea Tree Plaza, SA Half Year Results 2019 18
Slide 19: Developments
Developments Active project Westfield Newmarket, NZ Overview Project Cost NZ$790m (SCG share: NZ$400m) Commencement Q1 2018 Completion Q4 2019 Highlights Incremental Project GLA 52,000sqm Westfield Newmarket, NZ Completed Centre GLA 88,150sqm New Anchors David Jones, Farmers, Countdown, Event Cinema
Slide 20: Leasing & Retail Solutions
Leasing & Retail Solutions 30 Jun 2019 Comparable Net Portfolio Leased 99.3% Operating Income grew by 2.3% in the Specialty Occupancy Cost (< 400 sqm) 18.0% first six months of Lease Deals Completed Number 1,189 2019. This was primarily driven by Lease Deals Completed Area (sqm) 202,259 contracted a
Slide 21: Retailer In-Store Sales
Retailer In-Store Sales Comparable specialty in-store sales growth1 6 months to 12 months to Total in-store sales grew 1.5% for the half and 1.2% for the year 30 Jun 2019 30 Jun 2019 Retail Services 5.0% 4.9% Specialty in-store sales grew 1.1% for the half and 1.3% for the year Leisure 2.8% 2.7% Foo
Slide 22: Retailer In-Store Sales
Retailer In-Store Sales Comparable specialty in-store sales growth by region1 4% 3.1% 6 months MAT 2.4% 2.1% 2.2% 2% 1.3% 1.0% 1.0% 1.1% 0.2% n/a2 0% (0.3%) (0.2%) (0.9%) -2% (1.6%) (2.4%) -4% (3.7%) (4.2%) -6% NSW QLD VIC WA SA ACT NZ Total 1. Total stable portfolio – total dollar sales growth 2. W
Slide 23: Profit & FFO
Profit & FFO Reconciliation from Profit to FFO Profit FFO FFO Financial 6 months to Adjustments 1 6 months to Statement $m 30 Jun 2019 30 Jun 2019 Notes A B C=A+B 1. FFO adjustments relate to property Net operating income 930.7 40.5 971.2 Note 3(iii) revaluations, mark to market of interest rate Man
Slide 24: Balance Sheet
Balance Sheet Balance Sheet – Proportionate1 $m Consolidated EquityAccounted 30 Jun 2019 A B C = A +B Cash 693.6 7.9 701.5 Property Investments 1. Period end AUD/NZD exchange rate 1.045 – Shopping centres 33,762.5 2,805.5 36,568.0 at 30 June 2019 – Development projects and construction in progress 5
Slide 25: Interest Rate Hedging
Interest Rate Hedging 30 June 2019 Hedge Maturity Profile Interest Rate Hedging $A billion $bn Fixed Rate1 12.0 Net Debt 11.8 10.0 8.0 Fixed Rate Debt 6.0 $ Fixed rate debt 0.4 3.31% 4.0 Derivatives 2.0 $ Swap Payable 10.2 2.60% - NZ$ Swap Payable 0.7 2.83% Jun-19 Dec-19 Dec-20 Dec-21 Dec-22 Dec-23
Slide 26: Important Notice
Important Notice All amounts in Australian dollars unless otherwise specified. The financial information included in SCENTRE GROUP LIMITED ABN 66 001 671 496 this document is based on the Scentre Group’s IFRS financial statements. Non IFRS financial information included in this document has not been