Cedar Woods Properties Limited · ASX:CWP
Cedar Woods Properties — RBS Morgans Melbourne Residential Property Conference 2010
24 slides from Cedar Woods Properties's conference presentation, Nov 3, 2010
Slide 1: RBS Morgans Melbourne Residential Property Conference
RBS MORGANS Melbourne Residential Property Conference Wednesday, 3 November 2010
Slide 2: Presentation Outline
Presentation Outline Williams Landing Residential market conditions Cedar Woods’ overview and outlook
Slide 3: Introducing Melbourne's Premier New Masterplanned Community
Introducing Melbourne’s Premier New Masterplanned Community
Slide 4: Project Overview
Project Overview • 275 ha & 19km from CBD – largest infill site in Melbourne. • Master planned community - 2500 dwellings. • 50 ha Town Centre - retail, bulky goods, office, commercial, residential. • Activity Centre integrated with approx $100m of State infrastructure (station, bus terminal & freew
Slide 5: Location Plan
Location Plan Williams Landing
Slide 6: Williams Landing neighbourhood map
: e.. Addison >» EES : aE: > = Secece eS scngwell — Neighbourhood “<ee poe : acs Palit Cooks = => Neighbourhood BB =n us Station Palmers Rd : Ashcroft Neighbourhood Elmstead — 3 —— S. " Neighbourhood rors = =. williamslanding ~ S = a ~.% 5 wo ik ~~ a Hoppers Crossing 7 > . ~ Woods | Awaro WINNING PR
Slide 7: Williams Landing Master Plan
Williams Landing Master Plan cD Iskm (direct line} Pogpascrasng Cedar (7 Woods | mer woo ort seve www.williamslanding.com.au 1300 1122 02
Slide 8: Rail station and busport
Rail station and busport c= Ae williams: A Cedar <(@ Woods AWARD ¥ ROPERTY DEVELOPERS
Slide 9: Town Centre Layout
williamsiandin Cedar@ Woods | AWARD WINNING PROPERTY DEVELOPERS > 9
Slide 10: Project Status
Project Status • 600+ lots sold, 500 lots settled • 1800+ lots remaining • Rail Station/Freeway interchange underway • Stage releases consistently selling out • Display village operating • Current lot prices $280,000- $300,000.
Slide 11: Town Centre Status
Town Centre Status • Planning being finalised with Council / State Govt. • Stage 1 – shopping centre & hardware store • Process to select anchor tenants is well advanced • Marketing to office and other sectors underway • Town centre construction start planned for 2011 • Station/Freeway interchange c
Slide 12: Residential Market Conditions
Residential Market Conditions Population growth – long term driver Housing supply – under supply set to continue Consumer Confidence Employment Availability of finance Incentives Affordability (prices, interest rates) Rental alternative
Slide 13: Population Growth
Population Growth 2.1% 1.6% 2.4% 2.7% 1.3%
Slide 14: State summaries
State summaries Victoria sound fundamentals, continued state stimulus strong first and second home buyer sales population growth/lack of rentals strong price growth, now easing WA resource projects continuing – new Port Hedland project population growth to continue land supply remains
Slide 15: Cedar Woods' overview & outlook
Cedar Woods’ overview & outlook • Well established in WA & Vic • Focus on residential land and dwellings • Solid pipeline of projects to generate earnings growth • Opportunistic approach to acquisitions • Recently established 3 year $110m bank facility • Well positioned to exceed 10%pa EPS target
Slide 16: Key Targets / Objectives
Key Targets / Objectives Earnings focused – targeting min 10% pa EPS growth Return on equity > 12% Gearing range 20-70%, based on shareholders equity (book values) Interest cover minimum of 5 times Dividend pay out ratio – policy unchanged through GFC – 50% of NPAT
Slide 17: Outlook
Outlook Over $115m pre sales for FY11 Strong first half FY11 $24m NPAT forecast for FY11 (up 39%) Forecast FY11 EPS approximately 39 cents (up 35%) Forecast FY11 fully franked dividend approximately 19 cents based on current dividend policy (up 46%) Well positioned for further growth
Slide 18: Impact of GFC – Equity Raisings
Impact of GFC – Equity Raisings Significant raisings in property sector during GFC Dilution of peer group companies from 35% to over 300% CWP’s significant debt reduction through operating cash flow Minimal equity raised in the last 2 years by CWP Low dilution of future earnings
Slide 19: Asset Values
Asset Values Major assets acquired before property boom Projects de-risked, under development Share price significantly understates underlying value of portfolio Underlying value of around $6 per share, pre- tax
Slide 20: Net Asset Value
Net Asset Value $7 Currently trading at a significant discount to market based NTA/share of approximately $6. Estimated market value NTA/share: c$6(1) $6 Current share price $5 approximately 50% Statutory NTA/share based on lower of cost below and net realisable value, estimated market $4 and does n
Slide 21: Potential PE re-rating
Potential PE re-rating 20.0x Cedar Woods – 1 Year Forward PE Multiple Euroz Research (11 October 2010) 18.0x “In general the sector has traded between 10 and 12x earnings, other than during period of exceptional growth. While CWP is growing strongly in 2011, the sector generally is likely steady in
Slide 22: Investment case for CWP
Investment case for CWP CWP AVERAGE FOR PEERS4 PER FY10 actual 8.51 10.5 FY11 forecast 7.12 9.9 Yield FY10 actual 5.4%1 5.6% FY11 forecast 6.3%2,3 6.0% NOTES 1. Based on share price of $2.45 at 30 June 2010 2. Based on share price of $3.00 at 28 October 2010 3. Based on current dividend policy of 50
Slide 23: In summary – the investment case for CWP
In summary – the investment case for CWP Well established company, experienced board and management Clear focus on targets and proven transparent business model Strong profit growth forecast and solid balance sheet Future earnings largely undiluted during G.F.C. Well located and de-risked
Slide 24: Details of Projects
Details of Projects Project Life Lots Pricing Guide Valuation Location Project Type Status Total Lots FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 Remaining ($) Basis(1) WA Projects Rivergums Southern Corridor Residential Mature ## ## ## ## ## ## ## ## 1,200 650 170-185k I Cambridge Waters SE Corridor -
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