Ingenia Communities Group · ASX:INA
Ingenia Communities — H1 2021 Earnings Presentation
37 slides from Ingenia Communities's earnings presentation, Feb 16, 2021
Slide 1: ASX / Media Release: 1H21 Results Presentation
ASX / MEDIA RELEASE 16 February 2021 1H21 Results Presentation Ingenia Communities Group (ASX: INA) provides its 1H21 results presentation. Authorised for lodgement by the Board. ENDS For further information please contact: Donna Byrne General Manager Investor Relations P 02 8263 0507 M 0401 711 542
Slide 2: 2021 Half Year Results Presentation
Presented by Simon Owen and Scott Noble 16 FEBRUARY 2021 INGENIA COMMUNITIES GROUP 2021 HALF YEAR RESULTS PRESENTATION
Slide 3: Key highlights
Key highlights • Revenue of $122 million – up 4% on 1H20 • EBIT of $40.3 million – up 25% on 1H20 • Underlying EPS of 10.1 cents – down 6% on 1H20 FINANCIAL • Operating cash flow of $59.7 million – up 110% on 1H20 • Growing portfolio – $145 million acquisitions settled or announced so far in FY21 •
Slide 4: Business overview
Business overview Rental base growing through acquisition and development Lifestyle communities 4,327 sites $1.3B $187 av weekly rent $69.3m* revenue (1H21) Property Portfolio Rental communities 1,377 sites $341 av weekly rent $12.9m revenue (1H21) Holiday communities** 3,573 sites $278 av weekly re
Slide 5: Growing interest in sector as cash flows demonstrate resilience
Growing interest in sector as cash flows demonstrate resilience New and established groups seeking scale Competitive Landscape • Market for lifestyle communities increasingly (Total Sites) competitive supported by resilience of cash flows Long Term Tourism Development Pipeline ▫ Cap rates tightening
Slide 6: Performance and Capital Management
Performance and Capital Management
Slide 7: Key financials
Key financials Growth in EBIT as operating conditions improve Key Financial Metrics 1H21 1H20 Revenue growth driven by increase in rental sites from acquisition and Revenue $122.0m $116.9m 4% development and strong performance from holiday assets EBIT1 $40.3m $32.2m 25% Underlying profit and EBIT gr
Slide 8: EBIT growing as business expands
EBIT growing as business expands EBIT 1H21 1H20 Expanding rental base – driven by recent acquisitions, new home settlements, Lifestyle and Holidays Operations $22.4m $16.1m 39% additional rental cabins and strong holidays performance Lifestyle Development $13.4m $15.1m 11% Ingenia Gardens $6.3m $5.2
Slide 9: Capital management
Capital management Capital position enhanced Debt Metrics 31 Dec 20 30 Jun 20 New debt facility with CEFC Loan to value ratio (covenant <55%) 14.7% 8.4% • $75 million, 7-year fixed debt facility with Clean Energy Finance Corporation (CEFC) established February 2021 Gearing ratio1 11.2% 5.7% • Increa
Slide 10: Growth in value across core portfolios
Growth in value across core portfolios Lifestyle capitalisation rates continue to compress Av. Cap Rate Av. Cap Rate Dec 20 • Independent valuation of 20 assets in 1H21 Portfolio Dec 201 Jun 201 Book Value • Ingenia Gardens and Lifestyle and Holidays portfolio value up 3% ($28.1 million) like for li
Slide 11: Performance
Performance core rental business demonstrating resilience
Slide 12: Ingenia Lifestyle and Holidays
Ingenia Lifestyle and Holidays Expanding rental base delivering stable cash flows • Portfolio enhanced as new communities acquired and developments • Focus on continued expansion progressed ▫ $40 million of acquisitions contracted, yet to settle ▫ $105 million in acquisitions 1H21, adding 900 income
Slide 13: Ingenia Lifestyle and Holidays: Resilient rents and improving tourism
Ingenia Lifestyle and Holidays Resilient rents and improving tourism Key Data 1H21 1H20 Lifestyle and Holidays income up 18% Permanent rental income $19.5m $14.7m 33% • Permanent rental income up 33%, driven by development, acquisitions and investment in new long-term rental homes Annuals rental inc
Slide 14: Ingenia Holidays
Ingenia Holidays Benefitting from domestic demand and easing of restrictions Holidays revenue up 12% on prior corresponding period • Strong performance in Q2 as restrictions eased, offsetting loss of revenue in Q1, particularly in Queensland (including Cairns Coconut) • Lower Q1 revenue offset by st
Slide 15: Ingenia Gardens (seniors rental)
Ingenia Gardens (seniors rental) Strong, stable, government supported rent Key Data 1H21 1H20 Record high occupancy of 96.4% supporting ongoing stable cash flows Total revenue $12.9m $12.4m EBIT $6.3m $5.2m • Residents attracted to supported environment and social interaction post COVID-19 EBIT marg
Slide 16: Funds Management
Funds Management Integration of Eighth Gate platform complete Key Data 1H21 1H20 • Nine communities now valued at $143 million Fee income $1.1m $0.8m • Includes 1,570 income producing sites located in key locations across Distributions received $0.4m - Victoria, Queensland and NSW 31 Dec 20 30 Jun 2
Slide 17: Development
Development
Slide 18: Development
Development Creating additional rental contracts in high quality communities Key Data 1H21 1H20 New home settlements down but sales momentum recovering New home settlements1 128 140 9% • Movement restrictions slowed home inspections from March through to Gross new home development September, impacti
Slide 19: Development Joint Venture with Sun Communities
Development Joint Venture with Sun Communities (NYSE: SUI) Growing portfolio and returns First project underway at Burpengary, QLD Key Data 1H21 1H20 • Initial sales program disrupted by COVID-19 Fee income $1.7m $0.2m • Launch of clubhouse December 2020, driving growth in enquiry (19 31 Dec 20 30 J
Slide 20: Driving innovation in new homes
Driving innovation in new homes Meeting customer needs – improving accessibility to allow ageing in place Traditional Manufactured Home Hybrid Evolution – level access and ‘green homes’ • Home elevated off ground with 3 – 5 • Traditional manufactured home ‘inset’ • New design and building methodolog
Slide 21: Sustainability
Sustainability ESG initiatives and reporting are a key focus CEFC funding established February 2021 - providing clear energy Creating a positive impact targets and commitment • Focus on resident and guest health and well-being at forefront of COVID-19 • Complements existing energy reduction projects
Slide 22: Outlook
Outlook
Slide 23: Outlook and Guidance
Outlook and Guidance While COVID-19 has disrupted short-term growth, momentum is rebuilding across the business • The stability of rent from residents has demonstrated the attractiveness of Ingenia’s assets • Holidays business benefitting from enhanced conditions for domestic travel, with increased
Slide 24: Appendices
Appendices
Slide 25: Underlying profit
Appendix 1 Underlying profit 1H21 1H20 ($m) ($m) Lifestyle and Holidays – Operations 22.4 16.1 Lifestyle Development 13.4 15.1 Ingenia Gardens 6.3 5.2 Fuel, food & beverage 0.8 0.5 Other 2.6 0.3 Portfolio EBIT 45.5 37.2 Corporate costs (5.2) (5.0) EBIT 40.3 32.2 Share of income/(loss) of a Joint Ven
Slide 26: EBIT and underlying profit by segment
Appendix 2 EBIT and underlying profit by segment Lifestyle Lifestyle Ingenia Fuel, Food And Corporate And ($m) Total Operations Development Gardens Beverage Other1 Rental income 45.8 - 11.6 - - 57.4 Lifestyle home sales - 49.8 - - - 49.8 Catering income - - 1.3 - - 1.3 Fuel, food and beverage income
Slide 27: Cash flow
Appendix 3 Cash flow 1H21 1H20 ($m) ($m) Opening cash at 1 July 10.8 20.2 Rental and other property income 79.2 63.0 Property and other expenses (60.3) (51.2) Net cash flow associated with lifestyle home development 36.6 21.7 Net borrowing costs paid (2.9) (5.4) Government subsidy 6.5 - All other op
Slide 28: Consolidated balance sheet
Appendix 4 Consolidated balance sheet 31 Dec 20 30 Jun 20 ($m) ($m) Cash 14.9 10.8 Inventories 26.4 36.2 Investment properties 1,064.9 943.9 Investment in Joint Venture 31.3 15.9 Other financial assets 11.8 13.9 Assets held for sale 18.1 32.6 Other assets 46.1 39.5 Total assets 1,213.5 1,092.8 Borro
Slide 29: Reconciliation: underlying profit to statutory profit
Appendix 5 Reconciliation: underlying profit to statutory profit 1H21 Underlying to Statutory Profit Bridge 70.0 26.2 (16.4) 60.0 50.0 (7.1) 40.0 $m (2.7) 1.6 (1.9) 32.8 32.5 30.0 20.0 10.0 0.0 Underlying Profit H1 Cap rate and other Realisation of Transaction Valuation of Vendor Tax Benefit/(Expens
Slide 30: Capitalisation rates have progressively tightened
Appendix 6 Capitalisation rates have progressively tightened Lifestyle and Mixed-use Communities 12.00% 11.00% Murray River,NSW Hervey Bay,QLD Albury,NSW 10.00% Big4 Mudgee,NSW Implied cap rate % 9.00% Grange,Jun16 East's Ocean,NSW Aspley,QLD 8.00% Green Wattle,QLD Capricorn Palms,QLD Inverloch,VIC
Slide 31: Summary of transactions
Appendix 7 Summary of transactions Acquired year to date ($104.9m) Further $40m in acquisitions yet to settle Community Community Established lifestyle community with Greenfield site Development site (Ingenia owned) – Sunnylake Shores, $16.3m development upside – Beveridge, VIC settlement subject to
Slide 32: Pipeline supporting growth in rental base
Appendix 8 Pipeline supporting growth in rental base Vacant Development Commencement to Completion Sites Remaining1 Key Projects* Dec-20 Dec-21 Dec-22 Dec-23 Latitude One 199 High margin project nearing completion Additional 155 sites (STA) Greenfield projects Plantations 68 Second greenfield projec
Slide 33: Property snapshot
Appendix 9 Property snapshot Ingenia Lifestyle and Holidays snapshot Lifestyle Development snapshot Total properties 40 DA approved sites Total permanent homes 4,327 Ingenia 1,297 Total annual sites 694 Sun Communities Joint Venture 667 Total tourism sites 2,879 Sites yet to be approved (inc. land 1
Slide 34: Property snapshot (cont'd)
Appendix 9 cont’d Property snapshot Ingenia Gardens snapshot Funds Management snapshot Total properties 26 Permanent Tourism Communities Total units 1,377 sites sites Dec 20 $341 • Federation Village, Glenroy, VIC 182 Ave. weekly rent • Federation Village, Sunshine, VIC 142 Dec 19 $342 • Federation
Slide 35: Contact Us
Contact Us Scott Noble Chief Financial Officer Tel: +61 2 8263 0538 snoble@ingeniacommunities.com.au Donna Byrne General Manager Investor Relations Tel: +61 2 8263 0507 dbyrne@ingeniacommunities.com.au Ingenia Communities Group Level 3, 88 Cumberland Street Sydney NSW 2000 www.ingeniacommunities.com
Slide 36: Disclaimer
Disclaimer This presentation was prepared by Ingenia Communities Holdings Limited (ACN 154 444 925) The forward looking statements included in this presentation involve subjective judgment and and Ingenia Communities RE Limited (ACN 154 464 990) as responsible entity for Ingenia analysis and are sub
Slide 37: Rye
Rye ays Ingenia + % # A Ingenia Lifestyle Ingenia Holidays Ingenia Gardens Ingenia Renta’ rn nnn nn nN NNN NN cs
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