Property for Industry Limited · NZX:PFI
Property for Industry — H1 2014 Earnings Presentation
24 slides from Property for Industry's earnings presentation, Aug 13, 2014
Slide 1: 2014 Interim Results Briefing
2014 INTERIM RESULTS BRIEFING
Slide 2: Agenda
AGENDA 1. Highlights 2. Portfolio 3. 2014 Interim Results 4. Market, Outlook & Strategy 5. Questions 6. Appendices PROPERTY FOR INDUSTRY 2014 INTERIM RESULTS BRIEFING 2
Slide 3: 1. Highlights
1. HIGHLIGHTS
Slide 4: Highlights
HIGHLIGHTS • Profit after tax for the six months to 30 June 2014 of $14.4 million or 3.50 cents per share • Distributable profit for the six months to 30 June 2014 of 3.80 cents per share, 10.5% ahead of the previous corresponding period • Second quarter cash dividend of 1.75 cents per share, total
Slide 5: 2. Portfolio
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Slide 6: Portfolio Snapshot
PORTFOLIO SNAPSHOT 30 June 2014 31 December 2013 2 30 June 2013 3 (Adjusted) 1 Number of 79 83 50 properties Number of tenants 136 136 85 Contract rent $65.6m $65.4m $33.3m Occupancy 99.0% 97.1% 98.1% Weighted average 5.36 years 5.31 years 4.72 years lease term 1. Incorporates 143 Hutt Park Road (pu
Slide 7: Lease Expiry Profile
LEASE EXPIRY PROFILE Vacancies % Rent Roll 2014 Expiries Tenant % Rent Roll 2-6 Niall Burgess Road 0.6% 212 Cavendish Drive Chrisco Hampers 1.0% 15a Vestey Drive 0.3% 509 Mt. Wellington H’way Fletcher Distribution 1.0% Other 0.1% 27 Zelanian Drive Goode Industries 0.9% Total 1.0% Other Various 0.2%
Slide 8: Rental Income
RENTAL INCOME • Ex-Direct Property Fund properties contributed $16.34m uplift in rental income • 18 new leases agreed over more than 63,000 sqm of space • 28 rent reviews conducted resulting in an average annual uplift of 1.9% PROPERTY FOR INDUSTRY 2014 INTERIM RESULTS BRIEFING 8
Slide 9: Investment Properties
INVESTMENT PROPERTIES • Four disposals settled during H1 generating $11.3m of gross sales proceeds • Portfolio not revalued by independent valuers, next revaluation 31 December 2014, net tangible assets unchanged at 123 cps PROPERTY FOR INDUSTRY 2014 INTERIM RESULTS BRIEFING 9
Slide 10: Disposals
DISPOSALS 174b Marua 326 Rosebank 19 Omega 19 Omega 18 Ron Driver 5 Cable Street, Road, Road, Street (lot 2), Street (lot 3), Place, Wellington Mt Wellington Avondale North Shore North Shore East Tamaki Gross sales $2.2 m $1.1 m $1.1 m $6.9 m $0.9 m $15.0 m proceeds Valuation1 $2.1 m $1.0 m $1.1 m $
Slide 11: Acquisition and Development
ACQUISITION AND DEVELOPMENT 143 Hutt Park Road, 9a Narek Place, Wellington Wiri Purchase price / development spend $15.4m $3.6m Tenant Masterpet Corporation Ltd Z Energy NZ Ltd Property description Industrial, distribution Industrial, manufacturing Yield 7.6% purchase yield 10% yield on additional c
Slide 12: 3. 2014 Interim Results
3. 2014 INTERIM RESULTS
Slide 13: Comprehensive Income
COMPREHENSIVE INCOME For the six months ended (unaudited, $000) June 2014 June 2013 Change • Operating revenues for Rental income 31,939 15,887 16,052 the six months of $32.1m Insurance, interest and management fee income 131 102 29 more than double the Total operating revenue 32,070 15,989 16,081 p
Slide 14: Distributable Profit (Cents per Share)
DISTRIBUTABLE PROFIT (CENTS PER SHARE) • Distributable profit per share up 0.36 cents per share (cps) or 10.5% • 2014 H1 dividends of 3.50 cps, up 2.9% • 2014 dividend guidance of 7.25 cps reiterated Refer: Appendix 1: Distributable Profit for further detail PROPERTY FOR INDUSTRY 2014 INTERIM RESULT
Slide 15: Treasury
TREASURY • Facilities recently refinanced on competitive terms: average term extended, cost reduced • Gearing and interest cover ratios maintained June 2014 December 2013 Facilities Drawn (excluding overdraft) $311.1M $315.2M Facilities limit $350.0M $350.0 M Facilities headroom $38.9M $34.8M Facili
Slide 16: Treasury
TREASURY • Hedging profile will provide some relief from rising interest rates PROPERTY FOR INDUSTRY 2014 INTERIM RESULTS BRIEFING 16
Slide 17: 4. Market, Outlook & Strategy
4. MARKET, OUTLOOK & STRATEGY
Slide 18: Market & Outlook
MARKET & OUTLOOK • Industrial property market performing well • Positive outlook for rents, yields and values Forecast % Portfolio Forecast Occupancy WALT Rental Value Value Change Change Auckland 86.0% 98.9% 5.18 years 3.0% 5.0% Waikato & BOP 5.0% 100.0% 5.27 years Not forecast Not forecast Welling
Slide 19: Strategy
STRATEGY • Strategy: invest in quality industrial property in NZ’s main urban centres • Solid progress made on 2014’s areas of focus: • Enhance communication with tenants and shareholders • Manage vacancy and upcoming lease expiries • Sale of selected non-core assets, recycle capital into: repositio
Slide 20: 5. Questions
5. QUESTIONS
Slide 21: 6. Appendices
6. APPENDICES 1. HIGHLIGHTS
Slide 22: Appendix 1: Distributable Profit
APPENDIX 1: DISTRIBUTABLE PROFIT For the six months ended (unaudited, $000) June 2014 June 2013 Change Profit for the period attributable to the shareholders of the Company 14,423 11,865 2,558 Adjusted for: Fair value (gain) on investment properties - (368) 368 Loss / (gain) on disposals of investme
Slide 23: Appendix 2: Financial Position
APPENDIX 2: FINANCIAL POSITION As at ($000) June 2014 (unaudited) December 2013 (audited) Change Investment properties 832,873 841,841 (8,968) Goodwill 29,086 29,086 - Other assets 3,081 5,502 (2,421) Total assets 865,040 876,429 (11,389) Borrowings 310,304 314,599 (4,295) Deferred tax liabilities 1
Slide 24: Disclaimer
DISCLAIMER The information included in this presentation is provided as at 13 August 2014. The property statistics included in this presentation incorporate 143 Hutt Park Road (purchased subsequent to balance date), 19 Omega Street and 18 Ron Driver Place (disposed subsequent to balance date); the l
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