Slide 1: Investor Presentation Q3 2022 Financial Results
INVESTOR PRESENTATION Q3 2022 FINANCIAL RESULTS OCTOBER 2022
Slide 2: Disclaimer
OCTOBER 2022 DISCLAIMER The information contained herein has been prepared by TECOM Group PJSC (“TECOM”) or (the “Company”). The information contained in this presentation may not have been reviewed or reported on by the Company’s auditors. The company relies on information obtained from sources bel
Slide 3: Agenda
OCTOBER 2022 AGENDA Macroeconomic and Real Estate Market Highlights 5-6 TECOM Group’s Value Proposition 7-11 Q3 & 9 Months 2022 Financial Performance Highlights 12-21 Business Districts Performance 22-26 Sustainability and ESG 27-29 Outlook 30-31
Slide 4: TECOM Group Management Presenting
OCTOBER 2022 TECOM GROUP MANAGEMENT PRESENTING ABDULLA BELHOUL MICHAEL WUNDERBALDINGER CEO OF TECOM GROUP CFO OF TECOM GROUP 04
Slide 5: Macroeconomic and Real Estate Market Highlights
MACROECONOMIC AND REAL ESTATE MARKET HIGHLIGHTS
Slide 6: Macroeconomic and Real Estate Market Highlights
OCTOBER 2022 MACROECONOMIC AND REAL ESTATE MARKET HIGHLIGHTS Dubai’s strong underlying Demand outpacing supply in Customer needs and sector trends macroeconomic fundamentals Dubai’s commercial real driving demand for certain types of estate market properties • Dubai’s economy is expanding at a very
Slide 7: TECOM Group's Value Proposition
TECOM GROUP’S VALUE PROPOSITION
Slide 8: A Compelling Investment Opportunity
OCTOBER 2022 A COMPELLING INVESTMENT OPPORTUNITY Leading player in Dubai’s business 7,800+ Robust and attractive Exposure to hub proposition, with over long-term, loyal and financial profile supporting 6 strategic sectors 20 years diversified customer base dividend payout primed for sustainable grow
Slide 9: 10 Business Districts Strategically Located
OCTOBER 2022 10 BUSINESS DISTRICTS Dubai’s strategic business enabler and creator of world’s class business districts STRATEGICALLY LOCATED 09
Slide 10: Delivering Value Through Our Business Segments
OCTOBER 2022 DELIVERING VALUE THROUGH OUR 4 BUSINESS SEGMENTS COMMERCIAL INDUSTRIAL LAND SERVICES LEASING LEASING LEASING & OTHERS • Government services • Registration and licensing • Corporate services 9.5 11.5 164 Incubation services Million sqft Million sqft Million sqft for start-ups GLA (as of
Slide 11: Capturing Growth Through Our Clear and Actionable Strategy
OCTOBER 2022 CAPTURING GROWTH THROUGH OUR CLEAR AND ACTIONABLE STRATEGY 01. 02. 03. 04. CAPITALISING ACTIVATING AMPLE ROOM HEALTHY PIPELINE ON FAVOURABLE AND ACCESSING TO RAMP UP OF DE-RISKED MARKET ADDITIONAL OCCUPANCY BTS PROJECTS DYNAMICS LAND BANK 11
Slide 12: Q3 & 9 Months 2022 Financial Performance Highlights
Q3 & 9 MONTHS 2022 FINANCIAL PERFORMANCE HIGHLIGHTS
Slide 13: Financial Highlights (Q3)
OCTOBER 2022 FINANCIAL HIGHLIGHTS (Q3) • Strong increase in revenue growth driven by new BTS projects REVENUE EBITDA FFO1 • Continued increase in occupancy AED 490 MN AED 364 MN AED 237 MN rates across all segments vs. 2021 12% vs. 2021 27% YTD ACHIEVEMENT 103% • Exceeded occupancy target for 2022 d
Slide 14: Financial Highlights (9 Months)
OCTOBER 2022 FINANCIAL HIGHLIGHTS (9 MONTHS) OPERATING PERFORMANCE 83.5% Consolidated Occupancy REVENUE EBITDA FFO 1 (Excluding Land Leasing) AED 1,480 MN AED 1,087 MN AED 864 MN vs. 2021 15% vs. 2021 24% YTD ACHIEVEMENT 103% 2.8 Years Overall blended WALT* (Weighted of Commercial [BTS & BTL] and In
Slide 15: Strong Cash Flow Generation & Increase in Growth Capex
OCTOBER 2022 STRONG CASH FLOW GENERATION & INCREASE IN GROWTH CAPEX 1,066 1,065 1,228 1,009 864 FUNDS FROM 644 OPERATIONS (FFO)1 2019 2020 2021 LTM YTD YTD Q3-22 SEP-21 SEP-22 • Sustained growth in FFO and RCFC, driven by improving business conditions, quality of tenants 1,043 691 690 798 • Well-bal
Slide 16: Robust Balance Sheet
OCTOBER 2022 ROBUST BALANCE SHEET DESCRIPTION 30 SEPT 2022 31 DEC 2021 PROPERTY, EQUIPMENT AND INTANGIBLE ASSETS 123 143 INVESTMENT PROPERTY 11,914 13,368 DERIVATIVE FINANCIAL INSTRUMENTS 305 73 TRADE, UNBILLED AND FINANCE LEASE RECEIVABLES 776 744 NON-CURRENT ASSETS 13,118 14,327 TRADE RECEIVABLES
Slide 17: Healthy Leverage Position Supporting Growth Agenda
OCTOBER 2022 HEALTHY LEVERAGE POSITION SUPPORTING GROWTH AGENDA BALANCE SHEET CAPITAL STRUCTURE • Strong balance sheet with AED MN AMOUNT LTV1 LTM EBITDA investment properties valued at DEBT 4,338 AED 7.6BN CORPORATE FACILITY 4,338 22.4% AED 19.4Bn (JLL 31 March 2022) CASH 1,282 TOTAL FINANCIAL DEBT
Slide 18: Portfolio Valuation
OCTOBER 2022 PORTFOLIO VALUATION OUR PORTFOLIO 165MN 21.1MN SQ. FT. SQ. FT. LAND AREA LEASABLE AREA 19.4BN VALUATION 1,128 WAREHOUSES 147 COMMERCIAL BUILDINGS 81 WORKER ACCOMODATION BUILDINGS FAIR VALUES BY SEGMENT COMMERCIAL LAND LEASE INDUSTRIAL COMMERCIAL LAND INDUSTRIAL 10BN 6BN 2BN ASSUMPTION L
Slide 19: EPRA KPIs
OCTOBER 2022 EPRA KPIs KPI Q3 2022 H1 2022 Q1 2022 2021 2020 2019 IFRS EARNINGS 639 428 190 569 579 634 EPRA EARNINGS 832 534 225 898 944 984 IFRS NET ASSETS 6,070 5,718 6,264 5,613 6,168 6,131 EPRA NET ASSET VALUE (NAV) 13,240 13,006 13,621 11,359 12,035 12,705 EPRA NIY 7.1% 7.1% 7.1% 6.8% 6.1% 7.0
Slide 20: Analyst Coverage Report
OCTOBER 2022 ANALYST COVERAGE REPORT 7TH AUG 2022 8TH AUG 2022 8TH AUG 2022 RATING BUY EQUAL-WEIGHT BUY ANALYST HARSH MEHTA NIDA IQBAL CHARLES BOISSIER Harsh.Mehta@gs.com Nida.Iqbal.Siddiqi@morganstanley.com Charles.Boissier@ubs.com 3320
Slide 21: Dividend Policy
OCTOBER 2022 DIVIDEND POLICY TECOM reaffirms its commitment to pay an In line with previously announce dividend Going forward, TECOM intends to maintain annual cash dividend of AED 800Mn for policy, BoD proposed distributing a progressive dividend policy designed to the next 3 years (through to Octo
Slide 22: Business Districts Performance
BUSINESS DISTRICTS PERFORMANCE
Slide 23: Commercial Segment
OCTOBER 2022 COMMERCIAL SEGMENT ENCOURAGING PERFORMANCE UNDERPINNED BY CONSTRUCTIVE DEMAND/SUPPLY DYNAMICS IN OFFICE PROPERTIES AND EXPANSIONARY DUBAI ECONOMY • Revenue growth driven by: % CHANGE • New BTS projects DESCRIPTION Q3 2022 Q3 2021 9 MONTHS 2022 9 MONTHS 2021 % CHANGE YOY YOY • New leases
Slide 24: Industrial Segment
OCTOBER 2022 INDUSTRIAL SEGMENT CONTINUED STRONG GROWTH MOMENTUM AS SEGMENT BENEFITS FROM STRUCTURAL LONG-TERM TAILWINDS IN THE INDUSTRIAL, CONSTRUCTION AND LOGISTICS AND E-COMMERCE SECTOR % CHANGE DESCRIPTION Q3 2022 Q3 2021 9 MONTHS 2022 9 MONTHS 2021 % CHANGE YOY • Revenue growth driven higher oc
Slide 25: Land Lease Segment
OCTOBER 2022 LAND LEASE SEGMENT INCREASED REVENUE DRIVEN BY HIGHER LAND LEASE OF DPC AND BACKDATED ACTIVATION OF DIC LAND LEASE HIGHER EBITDA AND IMPROVING EBITDA MARGINS DRIVEN BY LOWER G&A AND LOWER PROVISIONS LAND BANK LEASED VACANT DEVELOPMENT INDUSTRIAL LAND COMMERCIAL LAND % CHANGE 9 MONTHS 9
Slide 26: Services & Other Segment
OCTOBER 2022 SERVICES & OTHER SEGMENT GROWING REVENUE STREAM GENERATED FROM COMPLEMENTARY SERVICES OFFERED IN BUSINESS DISTRICTS TO NEW AND EXISTING TENANTS/CUSTOMERS % CHANGE 9 MONTHS 9 MONTHS % CHANGE DESCRIPTION Q3 2022 Q3 2021 2022 2021 YOY YOY REVENUE 51 42 21% 168 124 35% EBITDA 42 25 71% 124
Slide 27: Sustainability and ESG
SUSTAINABILITY AND ESG
Slide 28: Environment & Sustainability Goals
OCTOBER 2022 ENVIRONMENT & SUSTAINABILITY GOALS Strategic National/international objectives OUR CORE PILLARS mandates Governance and Risk UAE Centennial 2071 Stabilise core • Ethical business • Robust • Prudent risk • Responsible sourcing business policies & practices governance management and procu
Slide 29: ESG Update
OCTOBER 2022 ESG UPDATE ENVIRONMENT ENERGY WASTE MANAGEMENT Operation of two new solar power projects in e-Waste awareness raising campaign Dubai Industrial City and Dubai Production City Created Art Installation (in collaboration with Lebanese Upcycling Artist) TECOM Group total energy sourced from
Slide 30: Outlook
dette yo amaze Eremres corre {WE LEADING Locisrics Yolo MANUFACTURING HUB
Slide 31: Highly Visible Organic Growth Drivers
OCTOBER 2022 HIGHLY VISIBLE ORGANIC GROWTH DRIVERS 2022 TARGETS Occupancy rate (end of period) Revenue ~85% ~83% ~AED 1.9BN (Commercial) (Industrial) (~+8% YoY) Occupancy Rental Completed Rates Growth Rates Growth Projects Robust recovery in occupancy Capitalizing on increase in rental Completed lon
Slide 32: Thank You
TECOM GROUP mee aerate: Teh? Paks THANK YOU em ri = aaaae ee aie ee