Homeco Daily Needs Reit · ASX:HDN
Homeco Daily Needs Reit — FY2024 Earnings Presentation
33 slides from Homeco Daily Needs Reit's earnings presentation, Aug 14, 2024
Slide 1: FY24 Results Presentation
FY24 Results Presentation 14 August 2024
Slide 2: Acknowledgement of Country
Acknowledgement of Country HomeCo Daily Needs REIT acknowledges the Traditional Custodians of Country throughout Australia and celebrates their diverse culture and connections to land, sea and community. We pay our respect to their Elders past and present and extend that respect to all Aboriginal an
Slide 3: Agenda
Agenda 01 02 03 Results Portfolio Growth overview update opportunities 04 05 Financial Outlook & results guidance Paul Doherty Sid Sharma Will McMicking HDN HMC Capital HMC Capital Fund Manager Managing Director, Real Estate Group CFO & HDN CEO Belrose (NSW)
Slide 4: Results Overview
Hawthorn East (VIC) Results Overview
Slide 5: FY24 Performance
FY24 Performance Daily Needs REIT Period of active capital recycling and strong underlying NOI growth driven by improved leasing fundamentals, CPI-linked income and development completions Financial 8.6 cents 8.3 cents $1.44 35% NTA/Unit GEARING2 FFO per unit DPU NOI growth offset by Mid-point of 30
Slide 6: Investment strategy
Investment strategy Daily Needs REIT Owner and developer of strategic last mile infrastructure focused on daily needs & services MODEL PORTFOLIO STRONG INVESTMENT ACCRETIVE DEVELOPMENT STRATEGIC REAL ESTATE CONSTRUCTION FUNDAMENTALS PIPELINE INFRASTRUCTURE Portfolio Target $386/sqm $700m+ ~13m peopl
Slide 7: Portfolio Update
Kellyville (NSW) 2. Portfolio Update
Slide 8: Property portfolio summary
Property portfolio summary Daily Needs REIT $4.8bn portfolio diversified by subsector, tenant and geography Platform Overview Tenant mix Rent composition Key portfolio metrics 39% Large Format 10% Portfolio value $4,784m Retail Fixed Neighbourhood 19% Landbank (sqm) 2.5m sqm CPI 18% Health & Service
Slide 9: Highly defensive and diversified income streams
Highly defensive and diversified income streams Daily Needs REIT High quality and diversified portfolio delivering secure and growing cash flow $386 >83% 3.8% 71% 19% 10% Avg. rent / sqm1 National retailers2 WARR3 Fixed CPI Supermarket4 Top 10 tenants – by gross income2 Portfolio subsectors – gross
Slide 10: National metropolitan footprint
National metropolitan footprint Daily Needs REIT 85% exposure to key metro markets with strong population growth 20% 51 QLD: $1.0bn Properties1 12 Properties1 Total portfolio Greater Brisbane & NT 18% Portfolio value $4.8bn Gold Coast QLD Tenants ~1,250 WA 12 50% SA NSW: $2.4bn 4 Properties 23 5% 1
Slide 11: HDN's model portfolio strategy
HDN’s model portfolio strategy Daily Needs REIT Continuing to execute on re-weighting back to the model portfolio HDN at IPO1 HDN at Aventus Merger HDN today 34% 39% 56% 19% 16% 18% 50% 43% 25% Large Format Retail Neighbourhood Health & Services Significant rebalancing back to model portfolio since
Slide 12: Sustainability achievements
Sustainability achievements Daily Needs Implementing HMC Capital’s Sustainability Commitments across our real estate portfolios1 REIT Environmental Social Governance ✓ Achieved Net Zero Energy Roadmap ✓ 50% gender diversity organisation-wide ✓HDN awarded 2024 ESG Regional Top- target2, including: ma
Slide 13: Sustainability progress
Sustainability progress Daily Needs REIT Net Zero Energy Roadmap Net Zero Progress Baseline Formed Advancing towards a green, low carbon economy & FY22 Net Zero by 2028 FY23 ✓ Solar Baseline Formed ✓ Solar Net Zero Target Solar PV active in 50% ✓ EV Charging 12 sites, with an FY24 Reduction Rollout
Slide 14: Growth Opportunities
Daily Needs REIT Williams Landing (VIC) 3. Growth Opportunities 13
Slide 15: FY24 Acquisitions
FY24 Acquisitions Daily Needs REIT Acquisition of 4 high quality daily needs assets in high growth metropolitan locations funded by the disposal of traditional LFR assets broadly in-line with book value Acquisitions Leppington, NSW Kellyville, NSW Williams Landing, VIC West Ryde, NSW Asset Acquisiti
Slide 16: FY24 Leasing
FY24 Leasing Daily Needs REIT Strong rental reversion & affordable portfolio rents underpin long-term outlook for sustainable and non-cyclical income growth Releasing spreads Average portfolio rents1 HDN continues to generate sector leading releasing spreads HDN’s average portfolio rents are ~30% be
Slide 17: Last mile retail fulfilment
Last mile retail fulfilment Daily Needs REIT Last mile fulfilment continues to drive demand for incremental retail GLA which is being rentalised and driving additional centre visitation Last mile retail fulfilment Kellyville, NSW ▪ The evolution of physical store networks to last-mile logistics hubs
Slide 18: FY24 Development completions
FY24 Development completions Daily Needs 100% pre-committed1 tenant demand-led development strategies achieving 7% ROIC2 REIT Gregory Hills Home Centre, NSW Glenmore Park Town Centre, NSW Mackay, QLD Toowoomba, QLD BEFORE BEFORE BEFORE BEFORE AFTER AFTER AFTER AFTER $9m $22m $34m $6m Capex Capex Cap
Slide 19: FY24 Development commencements
FY24 Development commencements Daily Needs ~$85m of 100% pre-committed1 tenant demand-led development projects targeting ~7%+ ROIC 2 REIT Tuggerah, NSW Daily Needs + Leisure & Lifestyle expansion on existing excess land ✓ On track to complete in 1H FY26 100% pre-committed ~11,200sqm ~$45m Leading AS
Slide 20: Pipeline restocking
Pipeline restocking Daily Needs REIT ~30,000sqm of excess land acquired in FY24 Leppington, NSW Williams Landing, VIC TODAY TODAY ▪ New development by Woolworths, opened Aug-23 ▪ Woolworths anchored neighbourhood centre ▪ 6.8% initial yield ▪ Acquisition price of $75.5m ▪ 5.4% initial yield ▪ Opened
Slide 21: FY25 development opportunities
FY25 development opportunities Daily Needs REIT Future development pipeline increased to $700m+ with ~$100-120m of targeted commencements in FY25 at ~7% ROIC1 $700m+ PIPELINE Leisure & lifestyle Daily needs Health & services HomeCo South Nowra (NSW) Gregory Hills Town Centre (NSW) Aurrum Kids Penrit
Slide 22: Financial Results
Daily Needs REIT Gregory Hills Town Centre (NSW) 4. Financial Results 21
Slide 23: Earnings summary
Earnings summary Daily Needs REIT FY24 FFO of 8.6 cents per unit $ million FY23 FY24 Property NOI 261.3 272.9 Distribution from equity-accounted 1.1 2.1 investees ▪ Property NOI grew by $11.6m to $272.9m in FY24 Investment management fees1 (27.9) (27.5) ▪ Strong underlying property revenue growth an
Slide 24: Balance sheet
TBU Balance sheet Daily Needs REIT Resilient portfolio valuation provides platform for continued asset recycling and organic growth $ million Jun-23 Jun-24 Cash and cash equivalents 16.2 12.4 Assets held for sale 15.8 54.0 ▪ HDN has a robust balance sheet as at Jun-24 with net assets of $3.0bn and g
Slide 25: Capital management
Capital management Daily Needs REIT Strong liquidity of $173.2m and 35.1% gearing $ million Jun-23 Jun-24 ▪ Jun-24 gearing of 35.1% is at the midpoint of the 30- Debt summary 40% target range Facility limit (bank debt) 1 1,820.0 1,850.0 ▪ Increased facility limit to $1,850m and refinance of Drawn de
Slide 26: Outlook & Guidance
Daily Needs REIT Gregory Hills Home (NSW) 5. Outlook & Guidance 25
Slide 27: FY25 Outlook and guidance
FY25 Outlook and guidance Daily Needs REIT HDN is pleased to deliver a solid FY25 outlook underpinned by strong underlying property NOI growth and development completions 8.8 cents 8.5 cents 4.0% ~$100-120m Comp NOI FY25 development FY25 FFO/unit FY25 DPU commencements growth FY25 OUTLOOK ▪ Strong t
Slide 28: Supplementary Information
Daily Needs REIT West Ryde (NSW) 6. Supplementary Information 27
Slide 29: Additional financial information
Additional financial information Daily Needs REIT Statutory profit to FFO reconciliation Portfolio value to balance sheet reconciliation $ million FY23 FY24 Jun-24 $ million Property income 347.3 355.4 Portfolio valuation 4,784.0 Share of (loss)/profit of equity-accounted investees 9.1 0.5 Leppingto
Slide 30: Portfolio summary metrics
Portfolio summary metrics Daily Needs REIT Occupancy WALE Asset State GLA (sqm) Site area (sqm) Site Coverage (%)1 Fair Value ($m) Cap rate (%) (by area)2 (by income)3 Operating Armstrong Creek VIC 12,537 59,065 21% 98% 6.7 110 5.20% Bankstown NSW 17,422 40,240 43% 100% 4.1 95 5.75% Belrose NSW 36,5
Slide 31: HDN owns strategic last mile infrastructure
HDN owns strategic last mile infrastructure Daily Needs Strategic footprint spanning 2.5m sqm in Australia’s leading metropolitan markets & growth corridors REIT with 80% of assets located in capital cities Greater Melbourne Greater Sydney Greater Brisbane & Gold Coast Murrindindi Woy Woy Rosenthal
Slide 32: Contacts
Contacts Daily Needs REIT Investors and analysts Media Andrew Dodds Sid Sharma John Frey HMC Capital HMC Capital Corporate Communications Corporate Finance & IR Manager Managing Director, Real Estate & HDN CEO +61 423 810 851 +61 411 361 361 andrew.dodds@hmccapital.com.au +61 434 361 318 john@bright
Slide 33: Disclaimer
Disclaimer Daily Needs REIT This presentation (Presentation) has been prepared by HMC Funds Management Limited (ACN 106 078 635, AFSL 237 257) (Responsible Entity) as responsible entity of HomeCo Daily Needs REIT (ARSN 645 086 620). Summary information This Presentation contains summary information
HomeCo Daily Needs REIT — FY2024 Earnings Presentation on 6ix