Social Housing Reit Plc · LSE:SOHO
Social Housing Reit — Triple Point Social Housing REIT — FY2020 Earnings Presentation
34 slides from Social Housing Reit's earnings presentation, Mar 5, 2021
Slide 1: Supported Housing in the UK
Supported Housing in the UK Results for the year ended 31 December 2020 5 March 2021 1
Slide 2: Contents
Contents Section Page Triple Point Social Housing REIT plc Board Highlights 3-4 CHRIS PHILLIPS IAN REEVES CBE TRACEY FLETCHER-RAY PETER COWARD PAUL OLIVER Financial Overview 5 Chairman Senior Independent Director Non-Executive Director Non-Executive Director Non-Executive Director Triple Point Inves
Slide 3: High Impact Investment Strategy
High Impact Investment Strategy Specialised accommodation for individuals who have their rent Cherry Tree Lane North Walsham funded by central government Resilient investment strategy: 100% of rent due collected in 2020 and valuation yields have remained flat 100% of inflation linked dividend target
Slide 4: Key Performance Indicators
Key Performance Indicators1 445 £31.6m £571.5m 5.27% Properties Annualised Rental Income IFRS Valuation Blended Net Initial Yield (31 December 2019: 388) (31 December 2019: £25.4m) (31 December 2019: £471.6m) (31 December 2019: 5.27%) Providing 3,124 homes for vulnerable Excludes ongoing forward fun
Slide 5: Financial Overview
Financial Overview 5
Slide 6: Statement of Comprehensive Income
Statement of Comprehensive Income Year ended Year ended 31 December 2020 £’000 31 December 2019 £’000 0.89x DIVIDEND COVER - EPRA EARNINGS PER SHARE Rental Income1 28,393 21,112 (31 December 2019: 0.67x) Other Income2 535 - 0.95x Total expenses (6,607) (5,985) DIVIDEND COVER - ADJUSTED EPRA EARNINGS
Slide 7: Rental Income and Dividend Cover
Rental Income and Dividend Cover • We expect to deploy sufficient funds by the end of Q1 2021 to bring dividend cover back to over 1.0x, the level prior to October’s Equity Raise, as measured on an EPRA earnings run-rate basis £35.0m 0.95x1 0.98x2 0.89x2 £32.1m £30.0m 0.76x1 £31.6m £27.8m Annualised
Slide 8: Statement of Financial Position
Statement of Financial Position Year ended Year ended 31 December 2020 31 December 2019 £’000 £’000 5.9% TOTAL ANNUAL ACCOUNTING RETURN (INCLUDING DIVIDENDS) Investment property (IFRS valuation) 572,101 472,349 (31 December 2019: 6.5%) Asset held for sale 110 - Trade and other receivables 4,152 4,28
Slide 9: Fund Trajectory
Fund Trajectory Cumulative Return since IPO including dividends 25% +23.9% 125.00p 20% 120.00p NAV plus Cumulative Dividend Paid per Share Cumulative Total Shareholder Return 15% 115.00p +14.98p +12.39p 10% +9.81p 110.00p +7.27p +4.75p 5% 105.00p +2.25p 106.42p 0% 105.37p 105.34p 100.00p 103.65p 103
Slide 10: Property Valuation
Property Valuation1 The Company has invested a total of £530.7 million2 in Specialised Supported Housing since inception which has been valued by JLL as at 31 December 2020: • IFRS Property Valuation: Independently valued at £571.5 million, an uplift of 7.7% against total invested funds of £530.7 mi
Slide 11: Debt Overview
Debt Overview • To date SOHO has secured two debt facilities with an aggregate value of £228.5m • SOHO announced a £30m increase to its existing £130m RCF in December and extended the term by 12 months • Both facilities represent a conservative leverage position and maintain sufficient covenant head
Slide 12: Operational Overview
Operational Overview 12
Slide 13: Investment Highlights in the Period
Investment Highlights in the Period MAR - MAY 21 OCT 15 DEC POST PERIOD CASH Forward Funding Completions £55 million £30 million £38.4 million1 Three construction projects completed in Cheshire, Scunthorpe Equity Issue Credit Extension Left to Deploy and Northampton containing a total of 49 units: T
Slide 14: Deployment Pipeline
Pipeline • SOHO has a pipeline in excess of £150m through existing relationships with developers, Approved Providers, care providers and local authorities • Pipeline is focused on Specialised Supported Housing and comes through trusted relationships so has a high level of deliverability • Includes a
Slide 15: Adding Value through Forward Funding
Adding Value through Forward Funding1 • SOHO has undertaken 22 construction projects, committing over £55 million over the last 3 years • 21 of the schemes are now complete with the final project due to finish during March 2021 • All projects have been completed on budget Thorne House, Yeovil Hollin
Slide 16: Geographically Diversified Portfolio
Geographically Diversified Portfolio1 % of funds Region Properties Units Invested2 North West 97 772 22.5 West Midlands 81 527 17.3 2 Scotland East Midlands 57 428 12.8 London 26 198 9.6 45 North East North East 45 351 9.2 97 North West Yorkshire 36 277 9.0 36 Yorkshire South East 52 243 8.9 South W
Slide 17: Approved Provider Diversification
Approved Provider Diversification1 • As at 31 December 2020, SOHO had 20 lessees most of whom are specialist Registered Providers that focus exclusively on managing Specialised Supported Housing properties • Care is provided separately by care providers who are contracted with, and paid by, local au
Slide 18: Portfolio Performance
Portfolio Performance • Strong portfolio performance ensured through dedicated Triple Point social housing team made up of 26 people with a broad range of skill sets and experiences Resident Safety Operational Financial Regulation o Care providers have o Closer collaboration between o 100% of rent d
Slide 19: ESG & Impact
ESG & Impact • ‘Early adopters’ of standardised sector-wide ESG metrics which will be tested throughout 2021 • Each year, our impact will be independently audited by social impact consultants The Good Economy • Our impact will be measured against five impact objectives which have been defined to mea
Slide 20: Sector Overview
Sector Overview 20
Slide 21: Covid-19 Accelerating the Housing Crisis
Covid-19 Accelerating the Housing Crisis Pre Covid-19: Tens of thousands of vulnerable Chronic underinvestment in 4 million people on people with care needs in social housing social housing waiting list inappropriate accommodation Since Covid-19: Societal Challenges Financial Challenges o Increased
Slide 22: Chain of Covenant – Provision of Rent
Chain of Covenant – Provision of Rent for Individuals in Specialised Supported Housing • Individuals living in Specialised Supported Housing have their rent funded by central government through housing benefit • Housing benefit consists of a core rent and a service and maintenance charge which contr
Slide 23: Chain of Covenant – Provision of Care
Chain of Covenant – Provision of Care • The local authority is responsible for contracting and paying for the care received by individuals in Specialised Supported Housing • The cost of the care is paid for out of the local authority’s devolved social care budget which is allocated by the MHCLG Vuln
Slide 24: Outlook
Outlook LN SN £N 4. SLNL™ f\ f~\ £~ LN LN LS vavavave.
Slide 25: Support Continued Strong Performance
Outlook Continued Strong Support Progress Performance Government wants private investment to Resilient rent collection expected Strong pipeline of investment sit alongside Government funding to continue opportunities Local authorities want more Specialised Performing well against ESG and Further eng
Slide 26: High Impact Investment Strategy
High Impact Investment Strategy Specialised accommodation for individuals who have their rent Ashmount Court Doncaster funded by central government Resilient investment strategy: 100% of rent due collected in 2020 and valuation yields have remained flat 100% of inflation linked dividend targets met,
Slide 27: Appendix
Appendix 27
Slide 28: Investment Process
Investment Process Deal Origination DDQ with Impact Core Due Investment Board Approval Diligence Property Assessment Committee Approval Management • Lawyers, valuers and surveyors are instructed to begin due diligence • Triple Point completes their Due Diligence Tracker with over 400 items capturing
Slide 29: Asset Management
Asset Management The Triple Point asset management team has made three new hires since the start of 2020 Rent Monitoring Data Collection Relationship Property RP Collection Compliance and Analysis Management Inspections Support Making sure that Health and Safety, Data collected includes Regular enga
Slide 30: SOHO Board
SOHO Board Chris Phillips, Chairman Chris has extensive experience of real estate and listed companies. He was Managing Director of PB Securities, the UK subsidiary of Prudential Bache, for three years, before joining Lombard Odier as the Managing Director of its London broking business. He then joi
Slide 31: Investment Manager Team Overview
Investment Manager Team Overview BEN BEATON JAMES CRANMER Managing Partner Managing Partner 135 STAFF 33 INVOLVED WITH SOHO ASSET & FUND INVESTMENT LEGAL COMPLIANCE MANAGEMENT MAX SHENKMAN ISOBEL GUNN-BROWN JUSTIN HUBBLE MICHAEL BAYER 14 STAFF 10 STAFF 3 STAFF 2 STAFF 31
Slide 32: Key Terms
Key Terms UK listed REIT The Company London Stock Exchange Main Market, Premium Segment Management Triple Point Investment Management LLP as Investment Manager • the Group will only invest in social housing assets located in the United Kingdom • the Group will only invest in social housing assets wh
Slide 33: Glossary
Glossary Approved Provider a housing association, local authority or other regulated organisation in receipt of direct payment from local government including a care provider; Board the Directors of the Company from time to time; Company Triple Point Social Housing REIT plc (company number 10814022)
Slide 34: Disclaimer
Disclaimer This presentation, including any oral presentation, any question or answer session and any written or oral material discussed or distributed during the presentation meeting (together, "this presentation") is for general information only regarding Triple Point Social Housing REIT plc (the
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