Keppel Dc Reit · SGX:AJBU
Keppel Dc Reit — FY2016 Earnings Presentation
36 slides from Keppel Dc Reit's earnings presentation, Jan 23, 2017
Slide 1: Fourth Quarter & Full Year 2016 Financial Results
Fourth Quarter & Full Year 2016 Financial Results 23 January 2017
Slide 2: Important Notice
Important Notice The past performance of Keppel DC REIT is not necessarily indicative of its future performance. Certain statements made in this presentation may not be based on historical information or facts and may be “forward-looking” statements due to a number of risks, uncertainties and assump
Slide 3: Content
Content Key Highlights Financial Review Portfolio Expansion Portfolio Performance Capital Management Outlook Additional Information 2
Slide 4: Key Highlights
Key Highlights
Slide 5: Key Highlights
Key Highlights $ € £ DPU Declared1 Portfolio Occupancy Aggregate Leverage2 2.80 cents 94.4% 28.3% for 2H 2016 as at 31 Dec 2016 as at 31 Dec 2016 FY 2016 Distribution Yield1 Portfolio WALE Interest Coverage 6.60% 9.6 years 9.4 times based on IPO price $0.930 by leased lettable area as at 31 Dec 20
Slide 6: Financial Review
Financial Review
Slide 7: Distributable Income: Actual vs Forecast
Distributable Income: Actual vs Forecast1 4Q 2016 4Q 2016 +/(-) FY 2016 FY 2016 +/(-) ($’000) Actual Forecast1 % Actual Forecast1 % Distributable Income to Unitholders2 14,770 14,756 +0.1 61,048 58,710 +4.0 Comprising: Gross Revenue 26,840 25,767 +4.2 99,139 102,510 (3.3) Property Expenses (1,898) (
Slide 8: Distributable Income: Year-on-Year Comparison
Distributable Income: Year-on-Year Comparison 4Q 2016 4Q 2015 +/(-) FY 2016 FY 2015 +/(-) ($’000) Actual Actual % Actual Actual % Distributable Income to Unitholders1 14,770 14,482 +2.0 61,048 57,440 +6.3 Comprising: Gross Revenue 26,840 24,764 +8.4 99,139 102,462 (3.2) Property Expenses (1,898) (2,
Slide 9: Balance Sheet Highlights
Balance Sheet Highlights As at As at +/(-) 31 Dec 2016 31 Dec 2015 % ($’000) ($’000) Investment Properties 1,225,938 1,102,685 +11.2 Total Assets 1,582,999 1,211,171 +30.7 Gross Borrowings1 439,321 341,848 +28.5 Total Liabilities 509,131 397,683 +28.0 Unitholders’ Funds 1,073,525 813,114 +32.0 Units
Slide 10: Aggregate Leverage
Aggregate Leverage As at As at +/(-) 31 Dec 2016 31 Dec 2015 % ($’000) ($’000) Investment Properties1 1,193,540 1,071,358 +11.4 (excluding finance lease liabilities commitments) Total Assets1 1,550,258 1,179,470 +31.4 (excluding finance lease liabilities commitments) Gross Borrowings + Deferred Paym
Slide 11: Preferential Offering Completed
Preferential Offering Completed Pro-rata and non-renounceable preferential offering of 241,988,877 new Units at $1.155 per new Unit Approximately 1.6 times subscribed Raised gross proceeds of approximately $279.5 million New Units rank pari passu with the Units in issue before the listing of t
Slide 12: Distribution Declared
Distribution Declared DPU of 2.80 cents declared for 2H 2016 Adjusted DPU for FY 2016 would have been 6.68 cents, 0.5% higher than IPO forecast, while the adjusted distribution yield1 for FY 2016 would have been 7.18%, 3 bps above IPO forecast, excluding the impact from: i. the pro-rata preferen
Slide 13: Portfolio Expansion
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Slide 14: Portfolio Growth since Listing
Portfolio Growth since Listing 2016 2015 AUM of $1.40b1 IPO AUM of $1.07b AUM of $1.02b Keppel DC Singapore 1 Keppel DC Singapore 2 maincubes Data Centre2 Milan Data Centre Gore Hill Data Centre iseek Data Centre Intellicentre 2 Cardiff Data Centre Basis Bay Data Centre GV7 Data Centre Keppel DC Sin
Slide 15: Acquisitions in FY 2016
Acquisitions in FY 2016 1 2 3 Foray into Italy Deepen Presence in UK Strengthen Foothold in Singapore Milan Data Centre Cardiff Data Centre Keppel DC Singapore 3 Shell and core asset Shell and core asset 90% interest in colocation asset situated Fully leased to one of the Fully leased to o
Slide 16: Enhanced Portfolio Resilience
Enhanced Portfolio Resilience Acquisitions made since IPO listing further diversified income streams as well as provided long-term growth and income sustainability Portfolio AUM Portfolio AUM Portfolio AUM Breakdown Breakdown Breakdown (as at 31 December 2015) (as at 31 December 2016) (including K
Slide 17: Completed Acquisition of Keppel DC Singapore 3
Completed Acquisition of Keppel DC Singapore 3 Completed acquisition of 90% interest in Keppel DC Singapore 3 (KDC SGP 3), from Keppel Data Centres Holding1 (KDCH) on 20 January 2017 Entered into agreement with KDCH so that the rights and obligations of the 90% interest shall pass to the REIT as
Slide 18: Investment Update: maincubes Data Centre
Investment Update: maincubes Data Centre Data centre’s building shell fully completed as of end-2016 Construction on track for completion in 1H 2018 Shell of maincubes Data Centre was completed in Offenbach am Artist impression of development when fully completed Main, Germany 17
Slide 19: Portfolio Performance
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Slide 20: Diversified & Resilient Portfolio
Diversified & Resilient Portfolio Long portfolio WALE of 9.6 years and healthy portfolio occupancy of 94.4% enhance the stability of the REIT’s income streams Portfolio Metrics As at 31 December 2016 As at 31 December 2015 Lettable Area 843,084 sq ft 597,909 sq ft Valuation $1.20 billion $1.07 bil
Slide 21: Diversified & Resilient Portfolio (Cont'd)
Diversified & Resilient Portfolio (Cont’d) Exposure to fast growing industries such as internet enterprise, information technology services, telecommunications and financial services Rental income breakdown by trade sector1 Top 10 clients (based on rental income) 1 Client Industry % of Rental Inco
Slide 22: Diversified & Resilient Portfolio (Cont'd)
Diversified & Resilient Portfolio (Cont’d) A diversified and resilient portfolio balanced by a mix of master-leased facilities with stable long leases, as well as colocation facilities comprising diversified clients with comparatively shorter and staggered lease expiries Rental income breakdown by
Slide 23: Capital Management
Capital Management
Slide 24: Prudent Capital Management
Prudent Capital Management Hedging of borrowing costs Comfortable debt headroom: Aggregate leverage As at 31 December 2016 Un- lowered to 28.3% post preferential offering hedged 17% Managing interest rate exposure: Locked in interest rates of the long-term loans by entering into Hedged 83% float
Slide 25: Prudent Capital Management (Cont'd)
Prudent Capital Management (Cont’d) Mitigating impact of currency fluctuations: Hedged the REIT’s foreign-sourced distribution up to 1H 2018 using foreign currency forward contracts Adopted natural hedging by borrowing in currencies that match the corresponding investments Debt currency breakd
Slide 26: Outlook
Outlook
Slide 27: Capturing Value
Capturing Value Positioned to capture opportunities across Asia Pacific and Europe Focused on three-pronged strategy to tap growth potential of the data centre industry and deliver sustainable value to stakeholders Ireland Proactive Keppel DC Dublin 1 Asset 1 Management United Kingdom GV7 Data C
Slide 28: Continued Data Centre Demand
Continued Data Centre Demand Demand for data centre space remains strong in Asia Pacific and Europe Cities with Keppel DC REIT’s presence 2014 - 2021E 2021E Location Notes Absorption CAGR Utilisation Singapore: Strong demand backed by good telecommunications, financial and 23.6% 87% trading infr
Slide 29: Committed to Deliver Value
Committed to Deliver Value Vision: To be the preferred data centre real estate investment trust, serving as a trusted partner to our stakeholders. Mission: Guided by the Keppel Group’s operating principles and core values, we will create value for our investors by growing a quality portfolio of data
Slide 30: Additional Information
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Slide 31: Keppel DC REIT Structure
Keppel DC REIT Structure Keppel Institutional and Keppel Capital Telecommunications Keppel Land Public Investors & Transportation 50% 50% 30.1% 4.9% 65.0% Management Acting on behalf services of Unitholders REIT Manager Trustee Management Keppel DC REIT Trustee’s fees fees Keppel DC REIT Perpetual (
Slide 32: Portfolio Overview (as at 31 December 2016)
Portfolio Overview (as at 31 December 2016) Lettable area5 No. of Occupancy Valuation4 WALE Asia Pacific Location Interest Lease type Land lease title (sq ft) clients1 rate (%) ($m) (years) Leasehold Keppel DC Keppel lease / 3.2 (Expiring 30 Sep 2025, Singapore 100% 109,711 20 84.7 279.0 Singapore 1
Slide 33: Portfolio Overview (as at 31 December 2016) (Cont'd)
Portfolio Overview (as at 31 December 2016) (Cont’d) Lettable area5 No. of Occupancy Valuation4 WALE Location Interest Lease type Land lease title Europe (sq ft) clients1 rate (%) ($m) (years) London, Leasehold Triple-net GV7 Data Centre United 100% 24,972 1 100.0 67.5 10.1 (Expiring (Fully fitted)
Slide 34: Overview of Lease Arrangements: Asia Pacific
Overview of Lease Arrangements Asia Pacific Responsibilities of Lessor / Owner Management Maintenance Maintenance Lease Day-to-day Insurance Property Description Property Facilities Building Arrangement Refresh Capex Opex Tax Keppel lease1 / Client: Pays cost of rent and all expenses recharged to
Slide 35: Overview of Lease Arrangements: Europe
Overview of Lease Arrangements (Cont’d) Europe Responsibilities of Lessor / Owner Management Maintenance Maintenance Lease Day-to-day Insurance Property Description Property Facilities Building Arrangement Refresh Capex Opex Tax GV7 Data Centre Triple-net lease Client: Pays all outgoings; responsi
Slide 36: Thank you.
Thank you. KG y-y-1) DC REIT 35