Charter Hall Social Infrastructure Reit · ASX:CQE
Charter Hall Social Infrastructure Reit — FY2022 Earnings Presentation
32 slides from Charter Hall Social Infrastructure Reit's earnings presentation, Aug 15, 2022
Slide 1: Full Year Results
CQE FULL YEAR RESULTS Charter Hall Social Charter Hall Retail REIT 2022 FullInfrastructure Year Results REIT
Slide 2: Acknowledgement of Country
Acknowledgement of Country Charter Hall is proud to work with our customers and communities to invest in and create places on lands across Australia. We pay our respects to the traditional owners, their elders past and present, and value their care and custodianship of these lands. Coming Together,
Slide 3: Agenda
Agenda 1. Key Highlights and Strategy 2. Financial Performance 3. Portfolio Update 4. Outlook & Guidance 5. Additional Information Cover: Emergency Command Centre, 33 Richmond Road, Keswick, Adelaide, SA Left: TAFE Queensland, 209 Robina Town Centre Drive, Robina, QLD Charter Hall Social Infrastruct
Slide 4: Key Highlights and Strategy
Charter CharterHall HallSocial SocialInfrastructure InfrastructureREIT 1 Kids Club Key Highlights and Strategy Murrumbeena, VIC 2022 2022Full Full Year Year Results Results
Slide 5: Key Highlights and Strategy
Key Highlights and Strategy Australia largest diversified ASX-listed social infrastructure REIT FY22 EPU of 17.3 cpu, an 8.1% increase on FY21 Financial Balance Sheet Property Portfolio EPU / DPU Gross Assets WALE 17.3c / 17.2c $2.1bn 14.3yrs Increase of 8.1% / 9.6%1 on FY21 Increase of 35.0% from 3
Slide 6: Our Strategy
Key Highlights and Strategy Our Strategy Provide investors with secure income and capital growth through exposure to social infrastructure property Enhancing income sustainability and Targeting ongoing Portfolio resilience capital growth curation ‒ Improving the quality of ‒ Focus on assets with the
Slide 7: Delivering on Strategy
Key Highlights and Strategy Delivering on Strategy $232.7 million of acquisitions in diversified social infrastructure assets with superior tenants on long leases Childcare − 231 high quality childcare assets acquired for $157.3 million with long leases on average of 14.0 years to premium operators
Slide 8: CQE ESG Leadership Achievements in FY22
Key Highlights and Strategy CQE ESG Leadership Achievements in FY22 Partnering with tenant and investor customers to deliver meaningful change Clean Energy Reduction in emissions 1 Innovation in ESG performance Climate action CQE has approved $8.6m to provide CQE has 100% renewable electricity CQE p
Slide 9: CQE ESG Leadership Achievements in FY22
Key Highlights and Strategy CQE ESG Leadership Achievements in FY22 Partnering with tenant and investor customers to deliver meaningful change Community partnerships Responsible Governance Employer of Choice Strong communities CQE and Charter Hall established CQE governed by an independent Charter H
Slide 10: Financial Performance
Charter CharterHall HallSocial SocialInfrastructure InfrastructureREIT 2 Only About Children Camberwell, VIC Financial Performance 2022 2022Full Full Year Year Results Results
Slide 11: Earnings Summary
Financial Performance Earnings Summary $m FY21 FY22 % change Net Property Income1 72.0 84.5 17.4 - Net property income increased by $12.5 million or 17.4% on the previous corresponding period Distribution Income 2.2 1.9 (13.6) (pcp) driven by: Operating Expenses (9.2) (12.0) (30.4) - Like-for-like g
Slide 12: Balance Sheet
Financial Performance Balance Sheet $m 30 June 2021 30 June 2022 - $507.9 million growth in investment properties1, Cash 5.3 10.5 up 34.2% driven by: Investment Properties 1,448.0 1,945.9 - Net property revaluation uplift of $269.4 million1; Investment in JV (Brisbane Bus Terminal) 35.3 45.3 - $168.
Slide 13: Capital Management
Financial Performance Debt & Hedging Summary as at 30 June 2021 30 June 2022 Capital Management Facility Limit ($m) 600 800 Debt Drawn Amount ($m) 300 553 - Facilities extended and increased to $800 Weighted Average Debt Maturity (years) 4.1 3.9 million in February 2022 Balance Sheet Gearing1 (%) 24
Slide 14: Portfolio Update
Charter CharterHall HallSocial SocialInfrastructure InfrastructureREIT 3 Kids Club Murrumbeena, VIC Portfolio Update 2022 2022Full Full Year Year Results Results
Slide 15: Portfolio Summary
Portfolio Update Portfolio Summary June 2021 June 2022 – Property portfolio value increased 38.8% to $1.97 billion for FY22 Number of operating properties 341 368 – Net annual property income up by 17.3% to $92.7 million per annum Number of tenants 38 41 – Weighted average lease expiry (WALE) of 14.
Slide 16: Portfolio Summary
Portfolio Update Portfolio Summary Tenant profile by % of annual rent as at 30 June 2022 44% of rental income subject to G8 Education market rent reviews in next 5 years 9% Only About Children – Key portfolio income metrics: 9% – Top 5 tenant customers: 69% – Metropolitan location: 80% Mater Miseric
Slide 17: Portfolio Valuations
Portfolio Update Portfolio Valuations Like-for-like Portfolio Valuations No. Assets Value ($m) Yield (%) Valuation Uplift ($m) Valuation Uplift (%) Valuation uplift of $269.4 million1 highlights continuing income 337 1,657.7 4.7% 269.4 19.4 resilience and essential nature of social infrastructure as
Slide 18: Childcare Development Pipeline
Portfolio Update Childcare Development Pipeline 5 developments due for completion in HY23, providing purpose-built, high quality assets Mont Albert Completed Developments 30 June 2022 Mount Waverley Number 6 Valuation upon completion ($m) 42.3 Valuation Uplift ($m) 8.6 Doncaster East Average yield o
Slide 19: Childcare Industry
Portfolio Update Childcare Industry Government funding to sector forecast to increase by 25% over next four years – Importance of sector continues as labour supply mechanism to Australian economy and provision of quality educational outcomes to children: – Annual government funding expected to incre
Slide 20: Outlook & Guidance
Charter CharterHall HallSocial SocialInfrastructure InfrastructureREIT 4 Brisbane Bus Terminal Eagle Farm, QLD Outlook & Guidance 2022 2022Full Full Year Year Results Results
Slide 21: Outlook & Guidance
Outlook & Guidance Outlook & Guidance − Continue to execute on strategy and pursue opportunities with strong tenant and property fundamentals in the social infrastructure Click sector icon to add pictur e − CQE confirms that based on information currently available and barring any unforeseen events,
Slide 22: Additional Information
Charter CharterHall HallSocial SocialInfrastructure InfrastructureREIT 5 Additional Information 2022 2022Full Full Year Year Results Results
Slide 23: Portfolio Overview
Additional Information Portfolio Overview As at 30 June 2022 No. Value ($m) % Portfolio1 Passing Yield (%) − Majority of leases in the portfolio are triple net QLD 121 530.3 25.7 4.7 − Combination of fixed (75%) and CPI linked (25%) annual rent reviews VIC 83 463.0 22.5 4.6 − Total land holdings of
Slide 24: CQE Case Studies - Partnering with tenant and investor customers
Additional Information CQE Case studies - Partnering with tenant and investor customers to deliver meaningful change Supporting 55 vulnerable children in vital early Setting the foundations for healthier, safer and more Driving ESG into asset acquisition, new developments learning resilient places f
Slide 25: Delivering on Strategy
Additional Information Delivering on Strategy $232.7 million deployed into diversified social infrastructure assets with superior tenants on long leases Asset Name TAFE Queensland / Wise Medical Healius Specialist Diagnostic Services Childcare Portfolios Number of assets 21 1 232 Location Robina, QL
Slide 26: Social Infrastructure Overview
Additional Information Social Infrastructure Overview Spending on social infrastructure forecast to increase, providing further opportunities for CQE Childcare Education Health Transport and Communication Rising female workforce participation rate Tertiary education in Australia generates The propor
Slide 27: Statutory Profit Reconciliation
Additional Information Statutory Profit Reconciliation FY21 FY22 Statutory Profit Reconciliation ($m) ($m) Operating Earnings 58.0 62.9 Net fair value gain on investment properties 110.0 269.9 Net movements on derivative financial instruments 2.6 20.3 Straightlining of rental income, amortisation of
Slide 28: Debt Facility Summary
Additional information Debt facility summary Debt summary ($m) – 30 June 2022 Limit Drawn Maturity Gearing (covenant) ICR (covenant) Balance sheet debt - $0.8 billion of look through debt facilities across International bank bilateral debt facility 100.0 100.0 Jan-25 CQE’s head trust and joint ventu
Slide 29: NTA Reconciliation
Additional Information NTA Reconciliation NTA per Unit: June 2021 to June 2022 - As at 30 June 2022 CQE had a NTA per unit of $4.08 reflecting an increase of 25.5% from 4.10 $3.25 as at 30 June 2021 4.00 - Increase in NTA per unit primarily driven by: 3.90 - property revaluation uplift of $270.5 mil
Slide 30: Key Statistics
Additional Information Key Statistics Financial & Capital Management Metrics FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 NTA ($) 1.82 2.14 2.51 2.78 2.96 2.92 3.25 4.08 NTA Growth (%) 21.3 17.6 17.3 10.8 6.5 (1.4) 11.3 25.5 DPU (c) – Ordinary 12.8 13.4 14.2 15.1 16.0 16.0 15.7 17.2 DPU (c) – Special - -
Slide 31: Glossary
Additional Information Glossary ACECQA Australian Children’s Education and Care Quality Authority ASX Australian Securities Exchange Balance sheet gearing Calculated as the ratio of net drawn debt less cash to total tangible assets, less cash CPI Consumer Price Index CPU Cents per unit CQE Charter H
Slide 32: Further Information
Additional Information Further information Investor Relations Click icon to Tel 1300 365 585 (within Australia) add pictur e +61 2 8651 9000 (outside Australia) Email reits@charterhall.com.au charterhall.com.au/cqe IMPORTANT NOTICE & DISCLAIMER Charter Hall Social Infrastructure Limited ACN 111 338
Charter Hall Social Infrastructure REIT — FY2022 Earnings Presentation on 6ix