Vukile Property Fund Limited · JSE:VKE
Vukile Property Fund — FY2010 Earnings Presentation
41 slides from Vukile Property Fund's earnings presentation, May 24, 2010
Slide 1: Rising to the Next Level: Audited Group Results
RISING TO THE NEXT LEVEL AUDITED GROUP RESULTS for the year ended 31 March 2010
Slide 2: Highlights
Highlights Distribution Di t ib ti ffor 12 months th up 1010.2% 2% Successful acquisition of property asset management business with option (R500m) and right of first refusal Vacancies contained at 4.1% of gross rentals (3.2% March 2009 and 4 4.5% 5% September 2009) Recurring cost to revenue ratio r
Slide 3: Salient features of results
Salient features of results Nett profit N fit available il bl ffor di distribution t ib ti up 11 11.5% 5% ffrom R289.9m to R323.3m Net asset value per linked unit up to 986 cents from 907 cents ( +8.7%) Increase in group finance costs (net of investment and other income) up from R122.6m to R124.2m D
Slide 4: Distribution history
Distribution history @ Interim © Final @ Total 120 107.9) 97.9 80 88.3 70 76.8 68.5 53.8 48.0 44.4 aie Cents per linked unit a oO 40.3 36.0 30.0| 31.5 ! 2005 2006 | | 2007 2008 | 2009 2010 VUKILE PROPERTY FUND LIMITED | a |
Slide 5: Growth in distribution
Growth in distribution @ Interim @ Final @ Total 18 17.1 __ 16) 15.0 14 14.3 4g 126 13.2 12 ta 12.0 . 12.4 - 10.9 o 10 10.0 10.2 g 5 4 83 @ 6 __ 4 2 0 | 2006 2007 2008 2009 2010 VUKILE PROPERTY FUND LIMITED
Slide 6: Condensed group income statement
Condensed group income statement March 2010 March 2009 Cents per Cents per linked unit linked unit Group net rental income 159 150 N t finance Net fi costs t (41) (41) Other (including taxation) (10) (10) H dli earnings Headline i 108 99 Increase over previous 12 month period excluding straight-line
Slide 7: Make-up of increase in distribution
Make-up Make up of increase in distribution 2010 2009 Cents per Cents per linked unit linked unit Contributions to increased rental income Increased rentals on new and renewed leases 15.7 13.9 Additional rentals from prior year property acquisition 0.0 3.4 Additional municipal service recoveries and
Slide 8: Group debt structure
Group debt structure Maturityy and interest rate p profile of long-term g debt at 31 March 2010 8
Slide 9: Group balance sheet
Group balance sheet @ Forsale @ 2010 @ 2009 O¢Ee saiyiqel| JUeLND os SOMIIGE!| = hs 8S¢ © SOl}I|IGel]| JUSINO-UON ee por © SONIGEl| JUBND-UON 06 sjesse sound L9¢ sjesse woul hs 9bS 7 saltedoid JUsW}SeAU| PO £06 saledoid JUSLUSSAU| 2 8 ° UO) IIL VUKILE PROPERTY FUND LIMITED
Slide 10: Group net cash flow
@ Cash flow movement @ Cash inflow ® Cash outflow 1 200 000 Group net cash flow GZE the Z YoeyWy eouRjeg (ZS 721) /* 09 S9UBUI} ION (862 LEr) nonce WO MO}} USED (p16 162) =f uornnquisig 7 £66 2 Lo \ v9 oy s6ulmouog seyeys JO enss| (L8S 9) uolyexe| 928 8Sr suolyesedo Wo} useo 208 09 OZ Ye souRjeg fe
Slide 11: NAV Bridge
NANA oO g co a Z 1 100 (801) @ 986 @ OllL@® v601@ ee 86 @ c®@ 286 @ 8L@ S86 @ 0® 206 @ 150 1.080 10 (0102 oe L€) AVN BuIsoio uoNqUISIG UO)NUISIP G10J8q SNUBAEL JON uolyenjenes dems ayes 1S9s91U| anssi areys xe] sould JO Jou SuOIyeNeney ™W (6002 Ld 1) AN BulusdO 7 Fg g 8 ® Contribution to NAV (LHS) @
Slide 12: Linked unit price performance
Linked unit price performance 12
Slide 13: Linked unit price performance: indexed
Linked unit price performance: indexed to 100 on 1 April 2009 13
Slide 14: Trading volumes
Trading volumes Milli Million 14
Slide 15: Property portfolio
Property portfolio Number N b off properties ti 74 GLA 918 833m² Valuation – Total portfolio Directors’ valuation R4.89 billion – up R357.7m R357 7m (7.9%) (7 9%) from 31/3/2009 – External valuation R2 688.1m compared to R2 541.6m director’s valuation (R146.5m or 5 8% hi 5.8% h on 52% off portfolio)
Slide 16: Property portfolio – 10 largest properties
Property portfolio – 10 largest properties Area Value % of (m²) (R’m) total Durban Phoenix Plaza 24 342 390. 9 8.0 Belville Louis Leipoldt 22 311 218.3 4.5 Randburg Square 51 370 208.2 4.3 Pine Crest (50%) 40 485 197 3 197.3 40 4.0 Durban Embassy 32 346 193.1 3.9 Dobsonville Shopping Centre 23 133 1
Slide 17: Sectoral valuation of portfolio
Sectoral valuation of portfolio 17
Slide 18: Expansion / revamp projects
Expansion / revamp projects C it l Capital Yi ld Yield (R’m) (%) Oshakati Shopping Centre 13 4 13.4 10 4 10.4 Oshikango Centre 26.8 10.5 Mala Plaza 14.5 9.3 54.7 10.2 Louis Leipold Hospital 33.5 Randburg Square 13.0 46.5 18
Slide 19: Portfolio geographical profile
Portfolio geographical profile % of GLA 19
Slide 20: Portfolio sectoral profile
Portfolio sectoral profile % of gross rental 20
Slide 21: Portfolio vacancy profile
Portfolio vacancy profile % of gross rental 21
Slide 22: Individual properties vacancy profile
Individual properties vacancy profile m² vacant (% of GLA) 22
Slide 23: Portfolio lease expiry profile
Portfolio lease expiry profile % of GLA 23
Slide 24: Portfolio tenant profile
Portfolio tenant profile % of gross rental 24
Slide 25: Individual properties: weighted average gross rentals – Retail
Individual properties: weighted average gross rentals R t il – R/m² Retail R/ ² 25
Slide 26: Individual properties: weighted average gross rentals – Industrial
Individual properties: weighted average gross rentals Industrial – R/m² 26
Slide 27: Individual properties: weighted average gross rentals – Commercial
Individual properties: weighted average gross rentals Commercial – R/m² 27
Slide 28: Sectoral renewal rental escalation
Sectoral renewal rental escalation 28
Slide 29: Sectoral new transactions: rental concluded / budgeted
Sectoral new transactions: rental concluded / budgeted 29
Slide 30: Sectoral budgeted rental escalation profile
Sectoral budgeted rental escalation profile 30
Slide 31: Gross recurring cost to property revenue ratio
Gross recurring cost to property revenue ratio 31
Slide 32: Gross recurring cost to property revenue ratio (excl electricity, rates & taxes)
Gross recurring cost to property revenue ratio (excl electricity and rates & taxes) 32
Slide 33: New leases and renewals
New leases and renewals for 12 months ended 31 March 2010 Total contract value R364 million Total rentable area 194 813m² Tenant retention 67% Contract value (R’m) Cityy of Tshwane - 227 Andries Street 18.6 Claremont Holdings – Barlows Audi 17.0 Pick n Pay – Mala Plaza 10.8 Shoprite Checkers – Dobso
Slide 34: Proposed acquisition of property portfolio from Sanlam
Proposed acquisition of property portfolio from Sanlam Nine properties (previously 13) R531 million (p (previously y R780m)) Price increase by 6.2% per annum from 1 May 2010 Funding: – R100m cash – R200m debt – R230m vendor placement Detailed announcement approximately 25 May 2010 34
Slide 35: Transformation
Transformation BEE rating ti performed f dbby NERA – results lt expected t d shortly Structured plan approved by Board to increase number of black executives Contribute R800 000 to Dobsonville Development Trust Contribute R100 000 pper annum to NOAH Pursue investment/development opportunities with L
Slide 36: Acquisition of asset management business, R500m option and right of first refusal
Acquisition of asset management business, R500m option and right of first refusal Transaction approved on 18 December 2009 Implemented p on 1 January y 2010 Funded by way of issue of 36 470 000 linked units to Sanlam Properties p Total purchase consideration R363.9 million Merger process completed C
Slide 37: Strategic priorities for previous year
Strategic priorities for previous year Implement transaction with Sanlam Properties Retain tenants Manage bad and doubtful debts Further revamps/upgrades/expansions p pg p of existing g properties Manage g energy gy situation 37
Slide 38: Strategic priorities for coming year
Strategic priorities for coming year Complete R531 million acquisition of properties from Sanlam Exercise option for R500 million portfolio Continued focus on vacancies, bad debts and tenant retention Energy management Procurement Transformation 38
Slide 39: Prospects
Prospects Signs that economy has turned the corner GDP growth of between 2% and 3% expected Property cycle follows economic cycle More bad news before g good news Full effect of acquisition of asset management business – however,, no repeat p of R10m distributions not paid to Sanlam Properties Benef
Slide 40: Acknowledgements
Acknowledgements Board Service providers – Sanlam Properties – JHI – Hermans & Roman – Kuper Legh – Old Mutual Investment Group Property Investments Brokers and developers Tenants Investors Funders 40
Slide 41: Questions
Questions ? 41