Growthpoint Properties Australia · ASX:GOZ
Growthpoint Properties Australia — H1 FY2015 Earnings Presentation
39 slides from Growthpoint Properties Australia's earnings presentation, Feb 16, 2015
Slide 1: Half year results presentation
For personal use only Half year results presentation FOR THE SIX MONTHS ENDED 31 DECEMBER 2014 16 FEBRUARY 2015 GROWTHPOINT PROPERTIES AUSTRALIA (ASX CODE: GOZ) Growthpoint Properties Australia Trust ARSN 120 121 002 | Growthpoint Properties Australia Limited ABN 33 124 093 901 AFSL 316409
Slide 2: Important Information
IMPORTANT INFORMATION For personal use only DISCLAIMER compliance with Article 11 of Regulation S-X of the rules and regulations Forward-looking statements including projections, indications or guidance on This presentation and its appendices (“Presentation”) is dated 16 February of the U.S. Securit
Slide 3: Contents
CONTENTS EXECUTIVE MANAGEMENT TEAM For personal use only OVERVIEW STRATEGY & PERFORMANCE Highlights of HY15........................................ 5 Key strategies ................................................ 21 PROPERTY PORTFOLIO Equity capital .................................................
Slide 4: Overview
For personal use only OVERVIEW TIMOTHY COLLYER Managing Director BUILDING BLDG C, GORE ADDRESS HILL TECHNOLOGY TO GO HERE PARK, 219-247 PACIFIC HWY, ARTARMON, NSW
Slide 5: Highlights of HY15
HIGHLIGHTS OF HY15 For personal use only PROPERTY FINANCIAL 1 Significant leasing success 1 7.4% increase in NTA per stapled security (maintenance of 98% occupancy) 2 19.9% total security holder return for CY141 2 4.5% uplift in like-for-like property values 3 19.2% return on equity for CY142 3 CY14
Slide 6: Property Portfolio
For personal use only PROPERTY PORTFOLIO MICHAEL GREEN Head of Property 1BUILDING CHARLESADDRESS STREET, PARRAMATTA, TO GO HERE NSW
Slide 7: Property Portfolio: Key Metrics
PROPERTY PORTFOLIO: KEY METRICS AS AT 31 DECEMBER 2014 For personal use only INDUSTRIAL OFFICE1 TOTAL NO. OF PROPERTIES 34 17 51 NUMBER OF TENANTS 32 63 932 % OF PORTFOLIO VALUE 48% 52% 100% OCCUPANCY 99% 98% 98% LIKE FOR LIKE VALUE CHANGE HY15 ($/% of asset value) $53.7m / 5.0% $41.6m / 3.6% $95.2m
Slide 8: Property Portfolio: Revaluations
PROPERTY PORTFOLIO: REVALUATIONS For personal use only • Property portfolio valued at $2.2 billion following 211 Wellington Road, Mulgrave acquisition and 42-44 Garden Street, Kilsyth disposal • Value increase attributable to revaluations, on a like-for-like basis (excluding the recent acquisition a
Slide 9: Property Portfolio: Leasing
PROPERTY PORTFOLIO: LEASING For personal use only TERM ANNUAL RENT AREA CAR PARKS PROPERTY STATE SECTOR TENANT START DATE (yrs) INCREASES (m2) (No.) 1231-1241 Sandgate Road, Nundah QLD Office Zambrero Property Group Q1, FY15 7.0 Fixed 3.50% 70 – CB1, 22 Cordelia Street, South Brisbane QLD Office Ico
Slide 10: Office Acquisition
OFFICE ACQUISITION For personal use only 211 WELLINGTON RD, PROPERTY KEY METRICS MULGRAVE, VIC $62.6m • Seven level office building 22 kilometres south ACQUISITION AND CONSTRUCTION COSTS east of Melbourne & SUPPORTED BY INDEPENDENT • 12,718m2 of lettable area plus 650 car parks VALUATION ON COMPLETI
Slide 11: Case Study: Acquisition of CB1 and CB2, South Brisbane
CASE STUDY: ACQUISITION OF CB1 AND CB2, SOUTH BRISBANE, QUEENSLAND For personal use only Growthpoint acquired the CB1 and CB2 towers in early 2012 with a strategy to: 1 Extend leases of upcoming expiries 2 Increase rents to market rates 3 Improve asset value through amenity improvement and re-leasin
Slide 12: Property Portfolio Summary
PROPERTY PORTFOLIO SUMMARY For personal use only 1 Portfolio in excellent shape across all key metrics (WALE, WARR, near term vacancies, average building age, key tenants and rental yields versus market) 2 Portfolio enhanced by recent acquisitions 3 Successful leasing and competitive acquisition env
Slide 13: Detailed Financial Results
DETAILED For personal use only FINANCIAL RESULTS DION ANDREWS Chief Financial Officer 27-49 LENORE DRIVE, ERSKINE PARK, NSW
Slide 14: Financial Results
FINANCIAL RESULTS For personal use only HY15 HY14 CHANGE % CHANGE STATUTORY ACCOUNTING PROFIT ($'000) 141,824 63,492 78,332 123.4 STATUTORY ACCOUNTING PROFIT PER SECURITY (¢) 25.6 15.0 10.6 70.7 DISTRIBUTABLE INCOME ($’000) 56,447 42,049 14,398 34.2 DISTRIBUTABLE INCOME PER SECURITY (¢) 10.2 9.9 0.3
Slide 15: Movements in Net Tangible Assets per Stapled Security
MOVEMENTS IN NET TANGIBLE ASSETS For personal use only PER STAPLED SECURITY • 7.4% increase in NTA per stapled security over HY15 MOVEMENTS IN NTA PER STAPLED SECURITY $2.36 $2.34 $2.32 $2.30 $2.28 $2.26 $2.24 $2.22 $2.20 $2.18 $2.16 $2.14 30 JUNE 2014 Property Swap Retained Raising equity 31 DEC 20
Slide 16: Debt Management: Gearing
DEBT MANAGEMENT: GEARING For personal use only REDUCTION IN GEARING AND COST OF DEBT AS AT 31 DECEMBER 2014 65% 8.5% BALANCE SHEET GEARING 60% 8.0% ALL-IN COST OF DEBT 55% 7.5% 50% 7.0% 45% 6.5% 40% 6.0% 35% 5.5% 30% 5.0% 25% 4.5% JUN 2010 JUN 2011 JUN 2012 JUN 2013 JUN 2014 DEC 2014 Balance sheet g
Slide 17: Debt Management: Interest Rate Hedging
DEBT MANAGEMENT: INTEREST RATE HEDGING For personal use only INTEREST RATE HEDGING $200m $180m $160m $140m $120m $100m $80m $60m $40m $20m 0 Weighted KEY DETAILS average Time to maturity 1.8yrs 2.5yrs 3.5yrs 3.9yrs 4.1yrs 4.1yrs 4.8yrs 4.9yrs 3.7yrs Fixed Rate 3.80% 3.38% 3.20% 3.84% 3.57% 3.55% 3.7
Slide 18: Operating Expenses
OPERATING EXPENSES For personal use only OPERATING EXPENSES CY14 CY13 Total operating expenses ($’000) 8,6771 7,434 Average gross asset value ($’000) 2,011,095 1,712,474 OPERATING EXPENSES TO AVERAGE GROSS ASSETS (%) 0.43% 0.43% 1. This figure excludes $392,000 associated with one-off charges as the
Slide 19: Financial Results Summary
FINANCIAL RESULTS SUMMARY For personal use only 1 HY15 distribution guidance of 9.8cps achieved 2 FY15 distribution guidance of 19.7cps remains and distributable income of not less than 20.6 cps 3 Balance sheet gearing reduced to 36.7% 4 Investment grade rating issued and banking facilities have bee
Slide 20: Strategy & Performance
For personal use only STRATEGY & PERFORMANCE AARON HOCKLY Company Secretary & General Counsel 120 NORTHCORP BLVD, BROADMEADOWS, VIC
Slide 21: Key Strategies
KEY STRATEGIES For personal use only 1 Increase distributions to Securityholders 2 Keep growing where opportunities are available 3 Focus on property fundamentals first 4 Continue as a “pure landlord” 5 Maintain simple and transparent business 20 SOUTHERN CRT, KEYSBOROUGH, VIC GROWTHPOINT PROPERTIES
Slide 22: Equity Capital
EQUITY CAPITAL For personal use only KEY ACHIEVEMENTS: LOCATION OF GOZ SECURITYHOLDERS* GOZ SECURITYHOLDERS* AS AT 31 DECEMBER 2014 AS AT 31 DECEMBER 2014 1 Included in S&P/ASX 300 Index and SOUTH AFRICA 78.9% GRT 64.5% requirements for S&P/ASX 200 Index AUSTRALIA 12.0% INSTITUTIONAL 28.3% have been
Slide 23: Distributions & Security Price
DISTRIBUTIONS & SECURITY PRICE For personal use only DISTRIBUTIONS SECURITY PRICE PER STAPLED SECURITY AS AT 31 DECEMBER 22¢ $2.80 20¢ $2.60 18¢ $2.40 16¢ $2.20 14¢ $2.00 12¢ $1.80 10¢ $1.60 FY11 FY12 FY13 FY14 FY151 2010 2011 2012 2013 2014 17.1¢ 17.6¢ 18.3¢ 19.0¢ 19.7¢ 1 $1.93 $1.93 $2.21 $2.47 $2
Slide 24: GOZ Returns
GOZ RETURNS For personal use only TOTAL RETURN COMPARISON OVER ONE YEAR TOTAL RETURN COMPARISON OVER FIVE YEARS TO 31 DECEMBER 20141 PER ANNUM, TO 31 DECEMBER 20141 30% 30% 25% 25% 20% 20% 15% 15% 10% 10% 5% 5% 0 0 GOZ A-REIT2 SHARES3 GOZ A-REIT2 SHARES3 19.9% 26.8% 5.3% 20.4% 12.0% 6.5% 89 CAMBRIDG
Slide 25: Relative Forecast Income Yields
RELATIVE FORECAST INCOME YIELDS For personal use only TO 30 JUNE 2015 10% 8% 6% 4% 2% 0 GOZ A-REIT A-REIT AUSTRALIAN COMMONWEALTH INFLATION6 DISTRIBUTION DISTRIBUTION DISTRIBUTION SHARES GOVERNMENT YIELD1 YIELD2 YIELD (EX WFD)3 DIVIDEND 10 YEAR BOND5 YIELD4 7.2% 5.0% 5.5% 4.8% 2.5% 1.7% 1. FY distri
Slide 26: Strategy & Performance Summary
STRATEGY & PERFORMANCE For personal use only SUMMARY 1 Building on established five year track record of growth, distributions and execution of communicated strategy 2 High comparative historical returns and forecast income yield 3 S&P/ASX 300 Index inclusion in September 2014 (S&P/ASX 200 Index inc
Slide 27: Conclusion
For personal use only CONCLUSION GE BUILDING 2, 572-576 SWAN STREET, RICHMOND, VIC
Slide 28: Focus for the Period Ahead
FOCUS FOR THE PERIOD AHEAD For personal use only PROPERTY PORTFOLIO • Focus on leasing • Consider potential sales to enhance portfolio • Development opportunities within existing portfolio being assessed FINANCIAL MANAGEMENT • Debt capital markets issue • Utilise historically cheap debt • Focus on k
Slide 29: Appendices
For personal use only APPENDICES 120-132 ATLANTIC DRIVE, KEYSBOROUGH, VIC
Slide 30: Appendix: Growthpoint Properties Limited - South Africa (GRT)
APPENDIX 1 GROWTHPOINT PROPERTIES LIMITED - SOUTH AFRICA (GRT)1 For personal use only • GRT owns 64.5% of the securities of GOZ (at 31 December KEY FACTS 2014) and is its major securityholder LISTING GRT is listed on the Johannesburg Stock Exchange (JSE) • GRT first invested in GOZ in August 2009. G
Slide 31: 2015 Securityholder Calendar
APPENDIX 2 2015 SECURITYHOLDER CALENDAR* For personal use only 16 February 27 February 3 March 17 August Results for the half year Distribution paid for Half year report sent to Results for the year ended 31 December the half year ended Securityholders ended 30 June 2015 2014 announced to 31 Decembe
Slide 32: Distributable Income Reconciliation
APPENDIX 3 DISTRIBUTABLE INCOME For personal use only RECONCILIATION FROM STATUTORY PROFIT TO DISTRIBUTABLE INCOME HY15 HY14 CHANGE CHANGE $’000 $’000 $’000 % PROFIT AFTER TAX 141,824 63,492 78,332 123.4 LESS NON-DISTRIBUTABLE ITEMS: - STRAIGHT LINE ADJUSTMENT TO PROPERTY REVENUE (2,047) (2,856) 809
Slide 33: Distributable Income (continued)
APPENDIX 3 DISTRIBUTABLE INCOME (continued) For personal use only COMPONENTS OF DISTRIBUTABLE INCOME HY15 HY14 CHANGE CHANGE $’000 $’000 $’000 % Property income 98,077 83,764 14,313 17.1 Property expenses (12,723) (11,348) (1,375) 12.1 NET PROPERTY INCOME 85,354 72,416 12,938 17.9 Interest income 42
Slide 34: Financial Position
APPENDIX 4 FINANCIAL POSITION For personal use only AS AT 31 DEC 2014 AS AT 30 JUN 2014 ($’000) ($’000) ASSETS Cash and cash equivalents 28,251 21,321 Investment properties 2,177,950 2,075,893 Other assets 20,331 31,565 TOTAL ASSETS 2,226,532 2,128,779 LIABILITIES Borrowings 816,225 871,214 Distribu
Slide 35: Property Portfolio - Diversity of Income and Assets
APPENDIX 5 PROPERTY PORTFOLIO - DIVERSITY OF INCOME AND ASSETS For personal use only SECTOR DIVERSITY (%) KEY METRICS BY MARKET VALUE, AS AT 31 DECEMBER 2014 AS AT 31 DECEMBER 2014 INDUSTRIAL OFFICE1 TOTAL TOTAL / AVERAGE VALUE $1,079.0m / $31.7m $1,154.6m / $67.9m $2,233.6m / $43.8m INDUSTRIAL 48%
Slide 36: Market Overview - Industrial
APPENDIX 6 YIELDS The national weighted average yield for the forecast markets decreased 23 MARKET OVERVIEW - INDUSTRIAL 1 basis points to 7.39% this quarter. This was a result of broad-based tightening For personal use only across all markets (see below). However, the national weighted prime yield
Slide 37: Market Overview - Office
APPENDIX 6 OFFICE VACANCY RATES MARKET OVERVIEW - OFFICE1 AS AT 4Q14 For personal use only 30% 25% Four of the six markets have 20% experienced the worst of 15% the downturn and are now GROWTH RENTS SLOWING FALLING expected to record positive 10% rental growth over the short PERTH 5% to medium term.
Slide 38: Glossary
GLOSSARY For personal use only A-REIT Australian Real Estate Investment Trust GOZ/Group/ Growthpoint Properties Australia comprising the Company, the Trust and Growthpoint their controlled entities ASX Australian Securities Exchange Growthpoint SA/GRT Growthpoint Properties Limited of South Africa (
Slide 39: Thank You
For more information contact us at: Email: info@growthpoint.com.au For personal use only Investor services line: 1800 260 453 www.growthpoint.com.au Growthpoint Properties Australia Level 22, 357 Collins Street Melbourne VIC 3000 THANK YOU GROWTHPOINT 70 DISTRIBUTION ST, PROPERTIES LARAPINTA, QLDAUS
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