Redefine Properties Limited · JSE:RDF
Redefine Properties — Corporate Update (February 2023)
28 slides from Redefine Properties's corporate update, February 2023
Slide 1: Redefine pre-close update for the half-year ending 28 February 2023
Please follow our LinkedIn page for more details Redefine pre-close update for the half-year ending 28 February 2023
Slide 2: Strategic overview
Strategic overview Property asset platform Financial insights Strategic overview Pivoting our emphasis on what matters most to rapidly shifting market dynamics 2 Redefine pre-close update for the half-year ending 28 February 2023
Slide 3: Our operating context
Strategic overview Property asset platform Financial insights Our operating context Rising costs, an energy crisis and elevated interest rates are converging realities adding up to a polycrisis Fundamentals of commercial property are shaped For 2023, we are optimistic that elevated inflation and the
Slide 4: What keeps us awake at night
Strategic overview Property asset platform Financial insights What keeps us awake at night Elevated risks on our radar Elevated risk Emerging risk Static risk 2023 Emerging risks Opportunities High 1 Geopolitical 9 22 § Re-evaluate asset growth (yield) Political risk 3 § Indexation in Poland 11 Inte
Slide 5: Shifting our emphasis on what matters most
Strategic overview Property asset platform Financial insights Shifting our emphasis on what matters most Responding strategically to evolving market-shifting dynamics Market dynamics Our response § Additional carbon emissions from diesel consumed § Reduce consumption of energy through efficiency int
Slide 6: ESG progress update
Strategic overview Property asset platform Financial insights ESG progress update ESG is a strategic imperative that permeates every aspect of our decision-making and operations Environmental Social Governance Projected Green Star certifications 6 440 m2 rented out to SMMEs and FY23: 189 (FY22:160)
Slide 7: Establishing a presence in the Polish self-storage sector
Strategic overview Property asset platform Financial insights Establishing a presence in the Polish self-storage sector Creating a self-storage platform with scale that will generate meaningful investment returns The Polish self-storage market is § In its infancy with penetration 2.5x smaller than G
Slide 8: The operating environment will be dominated by uncertainty
Strategic overview Property asset platform Financial insights The operating environment will be dominated by uncertainty It is crucial that we focus on what matters most In shooting for the moon and by placing purpose and people at the heart of what we do, we are § Focusing on developing skills to e
Slide 9: Property asset platform: South Africa
Strategic overview Property asset platform Financial insights SOUTH AFRICA Property asset platform SOUTH AFRICA Continuously improving and protecting with a focus on organic growth 9 Redefine pre-close update for the half-year ending 28 February 2023
Slide 10: South Africa portfolio overview
Strategic overview Property asset platform Financial insights South Africa portfolio overview SOUTH AFRICA Operating metrics recovering but margin remains under pressure OVERVIEW AS AT 31 JANUARY 2023 § Total vacancy at 7.5% (FY22: 6.7%) § Renewal success rate of 72.3% by GLA (FY22: 77.1%) § Rent re
Slide 11: South Africa retail portfolio
Strategic overview Property asset platform Financial insights South Africa retail portfolio SOUTH AFRICA Improving trading performance offset by loadshedding disruption and costs OVERVIEW AS AT 31 JANUARY 2023 § Total vacancy at 4.2% (FY22: 4.4%) § Renewal success rate of 78.4% by GLA (FY22: 87.8%)
Slide 12: South Africa office portfolio
Strategic overview Property asset platform Financial insights South Africa office portfolio SOUTH AFRICA Demand for premium quality in the market is improving, rentals remain under pressure OVERVIEW AS AT 31 JANUARY 2023 § Total vacancy at 14.1% (FY22: 14.4%) § Renewal success rate of 50.7% by GLA (
Slide 13: South Africa industrial portfolio
Strategic overview Property asset platform Financial insights South Africa industrial portfolio SOUTH AFRICA Solid performance in a challenging environment OVERVIEW AS AT 31 JANUARY 2023 § Total vacancy at 5.2% (FY22: 3.1%) § Renewal success rate of 82.6% by GLA (FY22: 73.0%) § Renewal growth on ren
Slide 14: Property asset platform: Poland
Strategic overview Property asset platform Financial insights POLAND Property asset platform POLAND Fundamentals remain robust despite the energy crisis and rising interest rates 14 Redefine pre-close update for the half-year ending 28 February 2023
Slide 15: EPP
Strategic overview Property asset platform Financial insights EPP POLAND Good progress has been made to stabilise the business OVERVIEW § The high cost of energy resulting from the disruption of energy supplies from Russia remains a challenge for the retail industry, creating a significant cost burd
Slide 16: European Logistics Investments
Strategic overview Property asset platform Financial insights European Logistics Investments POLAND Our exposure to Polish logistics benefiting from robust tenant demand and market rental growth OVERVIEW § Remains one of the fastest growing real estate sectors in Poland despite supply chain disrupti
Slide 17: Poland portfolio overview
Strategic overview Property asset platform Financial insights Poland portfolio overview POLAND Geographic diversification in an economically stable and hard currency market Priorities for EPP § Renew the Marcelin (EUR47.0 million) and Galeria Echo (EUR116.0 million) debt facilities that mature in Ju
Slide 18: Financial insights
Strategic overview Property asset platform Financial insights Financial insights Sustainable value creation through the cycle 18 Redefine pre-close update for the half-year ending 28 February 2023
Slide 19: Group net operating profit margin
Strategic overview Property asset platform Financial insights Group net operating profit margin Focusing on efficiency to preserve margins and steer organic growth A pro-active group-wide margin protection plan that Group net operating profit margin* aims to manage the impact of energy crises, above
Slide 20: Impact of loadshedding
Strategic overview Property asset platform Financial insights Impact of loadshedding 1% to 1.5% estimated impact on FY23 earnings with palpable impact on stakeholder confidence Stages of loadshedding vs litres of diesel purchased The frequency and intensity of loadshedding drive the overall impact:
Slide 21: Solar roll out initiated in 2016
Strategic overview Property asset platform Financial insights Solar roll out initiated in 2016 9.3% of SA portfolio energy requirements is from renewable sources increasing to 13.1% Solar capex spend per year Solar capex install in progress by building 140 14 35 3,5 120 12 30 3,0 100 10 25 2,5 Mwp i
Slide 22: Balance sheet management
Strategic overview Property asset platform Financial insights Balance sheet management Improving flexibility supports repositioning for growth Biannual, independently performed property Shifting focus to sustainable growth of the valuations are in progress for half-year valuations simplified propert
Slide 23: Debt maturity profile and available facilities
Strategic overview Property asset platform Financial insights Debt maturity profile and available facilities Prudent risk management in a rising interest rate environment R4.2 billion (as at 31 January 2023) of debt maturing in FY23 • R3.2 billion of the debt maturing during FY23 relates to the 14 3
Slide 24: Loan-to-value ratio at acceptable level
Strategic overview Property asset platform Financial insights Loan-to-value ratio at acceptable level Maintaining LTV within target range Projected LTV Projected LTV 1.5% 40.8% 1.7% 40.8% 40.2% 0.5% 0.2% 0.4% 0.2% 0.2% 0.3% 0.1% 0.2% -1.7% -2.2% -0.1% -0.4% -0.3% FY22 Operational EPP SA Vendor Forex
Slide 25: LTV sensitivity analysis
Strategic overview Property asset platform Financial insights LTV sensitivity analysis Sluggish economic outlook and rising interest rates pose downside risk LTV FY22 HY23 Impact Risks Risk level Risk level Liquidity LTV ICR Investment property valuation Medium to Increase in tenant failures Medium
Slide 26: Trading outlook for 2023
Strategic overview Property asset platform Financial insights Trading outlook for 2023 Focusing on the variables under our control in an evolving operating context Focusing on efficiencies and innovation to Improving EPP's cash-backed earnings supports preserve net operating profit margin a sustaina
Slide 27: Overview of our business
Strategic overview Property asset platform Financial insights Overview of our business How we operate The future-fit Redefine is Five pathways The execution of our short- to Investment proposition which bring our moonshot medium-term strategy is driven focuses on delivering sustainable to reality th
Slide 28: Disclaimer
Strategic overview Property asset platform Financial insights This presentation may include forward-looking statements which statements are not based on historical information, but rather premised on certain assumptions, risks, estimates and/or uncertainties (“risks and uncertainties”), which are ta
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