Goodman Group · ASX:GMG
Goodman — Goodman Property Trust — H1 2020 Earnings Presentation
32 slides from Goodman's earnings presentation, November 2019
Slide 1: Goodman Property Trust Interim Result 2020
Goodman Property Trust Interim Result 2020
Slide 2: Contents
Contents 03 Overview 05 Financial result 11 Capital management 14 Investment portfolio 25 Summary and outlook 28 Appendix Presented by: John Dakin Chief Executive Officer Andy Eakin Chief Financial Officer James Spence Director - Investment Management Unless otherwise indicated, all numerical data p
Slide 3: Gateway warehouse – Highbrook Business Park
Gateway warehouse – Highbrook Business Park 3
Slide 4: Overview
Overview Interim Result 2020 Overview Auckland industrial focus is driving strong operating results: ＋ Occupancy of 99.5%, retention rate of 74%1, WALE of 5.5 years ＋ 128,581 sqm of new leasing and market reviews completed with 7.3%2 rental growth. Portfolio assessed to be 7.6% under-rented ＋ Develo
Slide 5: Premium Apparel – Highbrook Business Park
Premium Apparel – Highbrook Business Park 5
Slide 6: Financial highlights
Interim Result 2020 Financial result Financial highlights $236.4m Profit before tax 30.3% Total Unitholder Return1 6 months to 30 September 2019 $172.4m Portfolio revaluation 3.15cpu Cash earnings 172.8cpu Net tangible asset backing 3.325cpu Cash distributions 17.9% Loan-to-value ratio 4.5 years Wei
Slide 7: Cash earnings
Cash earnings Interim Result 2020 Financial result Cash earnings summary ($m) 1H20 1H19 ＋ 1H20 cash earnings materially consistent with restated 1H192 Adjusted operating earnings after tax 44.7 51.7 ＋ Arrangement by which base fee was required to be used to subscribe Manager’s base fee1 - (4.7) for
Slide 8: Capital growth
Capital growth Interim Result 2020 Financial result Net tangible assets (cents per unit) 175.0 ＋ NTA increased 15.8 cpu (10%) for the year to date to 172.8 cpu +0.7 +0.9 172.8 ＋ 6.5% increase in underlying portfolio valuation main contributor 170.0 ＋ $150 million1 of equity raised at 23% premium to
Slide 9: Interim portfolio valuation
Interim portfolio valuation Interim Result 2020 Financial result Portfolio valuation summary % attributable to cap rate Valuation ($m) Cap rate Change ($m) Change (%) compression Highbrook Business Park 1,430.4 5.2% 102.8 7.7% 54% Savill Link 307.4 5.6% 15.4 5.3% 80% M20 Business Park 272.6 5.7% 23.
Slide 10: Balance sheet strength
Balance sheet strength Interim Result 2020 Financial result Loan-to-value ratio 26% ＋ GMT continues to be conservatively leveraged 24% ＋ LVR of 17.9% at 30 September with fully -0.4% +1.2% -1.3% committed LVR at 20.6% 22% ＋ ICR of 3.9x on a normalised basis1 (covenant: +3.0% not less than 2.0x) 20%
Slide 11: NCI Packaging – Savill Link
NCI Packaging – Savill Link 11
Slide 12: Managing funding risk
Managing funding risk Interim Result 2020 Capital management Bank funding maturity profile 140 ＋ Refinancing of GMT’s bank facility completed in 120 November 2019 ＋ Increased facility size by $100m to $400m, with 100 Bank facility - old funding from BNZ, CBA, HSBC and Westpac 80 150 150 135 135 130
Slide 13: Managing interest rate risk
Managing interest rate risk Interim Result 2020 Capital management Hedging profile 100% ＋ Debt repayment has resulted in elevated hedging levels over the next 12 months 90% ＋ Greater exposure to floating rates from late CY20 80% ＋ Cross currency swaps USD:NZD movement on 70% USPP notes (ITM $34.8 mi
Slide 14: Premium Apparel – Highbrook Business Park
Premium Apparel – Highbrook Business Park 14
Slide 15: Portfolio highlights
Interim Result 2020 Investment portfolio Portfolio highlights 99.5% Occupancy 100% Auckland industrial weighting 5.5 years Weighted average lease term 3.4% Underlying net property income growth $123.2m Development commencements Gateway warehouse – Highbrook Business Park 15
Slide 16: Market update
Market update Interim Result 2020 Investment portfolio ＋ Auckland industrial market near capacity with 1.9% vacancy rate1 ＋ Prime industrial rental growth of 5.6% in year to June 20191 ＋ Prime locations, close to consumers, expected to deliver best returns ＋ Industrial market showing strongest inves
Slide 17: Portfolio leasing
Portfolio leasing Interim Result 2020 Investment portfolio ＋ First half stabilised leasing totalled 67,778 sqm (equates to approximately 7% of the portfolio) ＋ Occupancy of 99.5% with limited expiries remaining in FY20 ＋ FY21 expiries equate to 10.8% of portfolio, down from 15.0% as at March 2019 ＋
Slide 18: Net property income
Net property income Interim Result 2020 Investment portfolio Look-through net property income bridge ($m) 80 ＋ Income from acquisitions and developments in addition to like-for-like rental growth has mitigated 75 74.2 much of the impact of asset disposals 71.3 70 10.2 -10.2 +1.7 +0.3 ＋ Average occup
Slide 19: Rental growth
Rental growth Interim Result 2020 Investment portfolio Rental reversion Income subject Rental increase from 1H20 Rental increase from 1H20 ＋ New leases, renewals and market reviews to reversion in 1H20 reversion events reversion event pa1 (reversion events) across 12.5% of portfolio Total 12.5% 7.3%
Slide 20: Future reversions
Future reversions Interim Result 2020 Investment portfolio Portfolio review profile (% of portfolio income) 90% ＋ Portfolio assessed as being 7.6% under-rented as at 30 September1 80% 11% ＋ 36% of portfolio is subject to market review or expiry prior to the end of 15% FY22. Of these, 34% are subject
Slide 21: Customer expansions
Customer expansions Interim Result 2020 Investment portfolio Expansion of Mainstream at Savill Link and Ingram Micro at M20 Business Park: ＋ 5,972 sqm of expansion space to cater for businesses which are currently operating their facilities at capacity ＋ Average term to expiry of 7.3 years ＋ Develop
Slide 22: Savill Link
Savill Link Savill Drive Units Mainstream expansion 99 % $365.4m 100 % complete1 valuation occupancy 1 Post completion of current development programme 22
Slide 23: M20 Business Park
M20 Business Park M20 9,000 Ingram Micro expansion 100 % $279.9m 100 % complete1 valuation occupancy 1 Post completion of current development programme 23
Slide 24: Current development programme
Current development programme Interim Result 2020 Investment portfolio ＋ 15 warehouses completed by GMT on a build-to-lease basis in FY19 are fully leased ＋ Current development programme of 76,538 sqm is 38% committed (49% terms agreed) and average time to completion of nine months1 — average wareho
Slide 25: Gateway warehouses - Highbrook Business Park
Gateway warehouses - Highbrook Business Park 25
Slide 26: Outlook
Outlook Interim Result 2020 Summary and outlook Underlying fundamentals are expected to continue to drive sustainable growth in the Auckland Industrial market ＋ Scarcity of land in infill locations likely to result in increased brownfield development / site intensification ＋ Industry continues to se
Slide 27: Disclaimer
Disclaimer: The information and opinions in this presentation were prepared by Goodman (NZ) Limited on behalf of Goodman Property Trust and its subsidiaries (Goodman). Goodman makes no representation or warranty as to the accuracy or completeness of the information in this presentation. Opinions inc
Slide 28: NCI Packaging – Savill Link
NCI Packaging – Savill Link 28
Slide 29: Work-in-progress summary
Work-in-progress summary Interim Result 2020 Appendix Total project cost Lettable area Expected Development Estate Leased ($m) (sqm) completion date Underwood 1,000 Highbrook Business Park 3.6 1,026 Oct-19 Uncommitted The Crossing Carpark Highbrook Business Park 12.7 - Dec-19 50% El Kobar Units High
Slide 30: Profit or loss
Profit or loss Interim Result 2020 Appendix 30
Slide 31: Balance sheet
Balance sheet Interim Result 2020 Appendix 31
Slide 32: Cash flows
Cash flows Interim Result 2020 Appendix 32
Goodman Property Trust — H1 2020 Earnings Presentation on 6ix