interim results presentation - december 2016 · 18 suni avenue corporate park logistics 5 640 7 575...
TRANSCRIPT
INTERIM RESULTS PRESENTATION - DECEMBER 2016
22 ON SLOANE
HIGHLIGHTS
Market capitalisation R53.9 billion
Dividend (FFA) 5.0%
Dividend (FFB) 25.12%
NAV (FFA) R16.32
NAV (FFB) R24.73
Vacancies 6.0%
Average cost of debt 8.92%
Interest rate hedging 93.5%
STATE OF THE MARKET
Logistics demand
Retail trade
Offices
Rand hedges
Interest rates
FINANCIAL PERFORMANCE
Dec 2016 Jun 2016 Dec 2015 Jun 2015
Dividend per A share (cents) 67.96 64.45 64.72 61.38
Dividend per B share (cents) 78.59 74.69 62.81 39.20
Shares in issue at period end
- A 1 172 508 991 1 119 708 334 1 091 747 728 466 251 105
- B 1 067 026 847 1 014 226 190 986 265 584 466 251 105
Shares used for dividend per share calculation
- A 1 165 408 991 1 112 608 334 1 112 608 334 466 251 105
- B 1 067 026 847 1 014 226 190 1 014 226 190 466 251 105
A shares held in treasury 7 100 000 7 100 000 7 100 000 -
Fair value information
NAV Fortress A R16.32 R15.62 R16.61 R15.72
NAV Fortress B R24.73 R25.73 R24.14 R16.21
Loan-to-value ratio* 25.2% 23.8% 25.3% 27.3%
* The loan-to-value ratio is calculated by dividing interest-bearing borrowings adjusted for cash on hand by the total of investments in property, listed securities and loans advanced.
Information based on proportionate consolidation, accounting for Greenbay and Rockcastle at fair value and the Hammerson equity derivative position on a gross basis.
FACILITY EXPIRY
6 000
5 000
4 000
3 000
2 000
1 000
0Jun 2017 Jun 2018 Jun 2019 Jun 2020 Jun 2021 Jun 2022 Jun 2023
Faci
lity
expi
ry (R
’m)
1.28%
1.64%
1.65%
1.71%
1.79%
1.91%
1.70%
1.67%
Average margin over Jibar
The all-in weighted average cost of funding
was 8.92% at December 2016
1.75% 1.99%
Jun 2024 Jun 2027
INTEREST RATE DERIVATIVES
0
300
600
900
1200
1500
Jun 2018 Jun 2019 Jun 2020 Jun 2021 Jun 2022 Jun 2023 Jun 2024 Jun 2025
1 500
1 200
900
600
300
0
Swaps Caps
Swaps and caps: Total R5 950 million. Average hedge term:
4.1 years.
(R’m
)
FUNDING
RMB:
Standard Bank:
Libfin:
ABSA:
Nedbank:
Sanlam:
DMTN 3 years:
DMTN 2 years:
DMTN 1 year:
DMTN 6 months:
Dec 2016
R5 628m
R7 479m
R600m
R300m
R740m
R500m
R1 008m
R122m
R200m
R250m
DIRECT vs INDIRECT ASSETS
Direct:
ROC:
NEP:
RES:
HMN:
GRP:
Information shown on a fair value/proportionately consolidated basis.
49.9%
21.1%
16.0%
7.8%
2.2%
3.0%
Dec 2016
SECTORAL SPLIT BY PROPERTY VALUE
Logistics:
Retail:
Offices:
Industrial:
Other:
35.7%
34.1%
15.9%
12.7%
1.6%Dec 2016
EQUITY INVESTMENTS AT FAIR VALUE
Investment No of sharesFair valueDec 2016
(R’000)
Greenbay (GRP) 1 069 101 000(R1.59)
1 699 871
Hammerson (HMN) 13 300 405(R96.07)
1 277 770
Nepi (NEP) 57 876 000(R159.00)
9 202 284
Resilient (RES) 39 455 000(R114.41)
4 514 047
Rockcastle (ROC) 350 490 000(R34.50)
12 091 905
28 785 877
LOGISTICS - DEVELOPMENTS COMMENCED
Property name % Owned GLA (100%)Development cost (100%)
Estimated yield
Completion date
C. Steinweg Bridge* 51% 30 000m2 R160m 10.3% Oct 2017
Louwlardia Logistics Park 100% 23 711m2 R128m 9.5% Feb 2017
Westlake One 100% 20 000m2 R110m 9.3% Mar 2017
Union Park 100% 13 300m2 R109m 9.3% Sep 2017
Montague Business Park# 25% 4 894m2 R12m 8.6% Sep 2017
R519m
* 15-year lease to C Steinweg Bridge Group and sale of 49% share in the development to the tenant.# 5-year lease to Geberit Southern Africa.
LOGISTICS - DEVELOPMENT PIPELINE
Property name GLA
(100%)Development cost
(100%)Estimated
yieldCommencement
date
Clairwood Logistics Park 358 000m² R2 680m 8.3% Apr 2017
R21 Logistics Park (65.0%)^ 500 000m² R2 500m 9.5% Apr 2017
Cornubia Logistics Park (50.1%)* 120 000m² R722m 9.0% Jul 2017
Linbro Park East Logistics^ 100 000m² R550m 9.5% #
Louwlardia Logistics Park 70 000m² R378m 9.5% Apr 2017
Montague Business Park (25.0%) 55 000m² R315m 8.5% #
Rivergate Cape Town 30 000m² R170m 8.5% #
Linbro Logistics (50.0%) 23 000m² R125m 9.5% Jun 2017
Westlake Logistics Two 20 000m² R110m 9.3% Jun 2017
R7 550m
* Transferred.# Subject to pre-leasing.^ Transfer subject to regulatory approval.
RETAIL PROJECTS
Name GLA (100%)Estimated construction cost
(100%)Completion date
Estimated yield
White River Phase 1 (50.0%) 12 000m² R130m Jun 2018 8.0%
Weskus 6 500m² R65m Nov 2017 8.0%
Jeffreys Bay Centre - R50m Nov 2017 6.0%
R245m
WHITE RIVER
WHITE RIVER
LEBOWAKGOMO CENTRE
LEPHALALE CROSSING
LEPHALALE CROSSING
RETAIL - FUTURE DEVELOPMENTS AND EXTENSIONS
Name GLA (100%)Estimated
commencement date
Evaton Mall – Phase 2 15 000m² Feb 2018
Sterkspruit Plaza 3 000m² Jul 2017
Vryheid Plaza – Phase 2 2 000m² Jun 2017
PROPERTY DISPOSALS
Property name SectorBook value
R’000Net proceeds
R’000Exit yield Transfer date
Makhaza Shopping Centre Retail 110 400 115 681 8.8% Dec 2016
40 Brakfontein Century Park Logistics 88 300 90 000 * #
Van Riebeeck Mall Retail 77 497 74 000 9.3% ##
11 Naivasha Road Office 68 000 70 938 9.5% Nov 2016
7 Wilcox Road Prospecton Logistics 52 400 53 500 9.2% Nov 2016
Homeworld Centre Retail 47 000 50 500 9.1% Nov 2016
7 Old Pretoria Road Nelspruit Industrial 54 900 50 000 11.7% Dec 2016
Citrus Street Logistics 30 900 30 600 9.2% Nov 2016
Cranberry Street Logistics 28 700 28 800 9.2% Nov 2016
Albert Amon Road Meadowdale Industrial 26 000 27 500 8.8% #
Bofors Circle Park Epping Logistics 18 600 21 500 8.3% ##
93 Goodwood Road Pinetown Logistics 20 600 20 800 9.1% Dec 2016
Absa Towers Vanderbijlpark Office 15 000 13 000 14.0% ##
18 Suni Avenue Corporate Park Logistics 5 640 7 575 * Nov 2016
3 Arbeid Street Industrial 6 400 6 500 * ##
9 Linbro Village Linbro Park Industrial 4 300 4 400 9.0% Dec 2016
TOTAL 654 637 665 294
* Vacant.# Held for sale at 31 December 2016 and transferred after reporting period.## Held for sale at 31 December 2016. Transfer pending.
PROPERTY PORTFOLIO - PERFORMANCE
Arrears
Operating expenses
Vacancies
Renewals and letting
VACANCIES DECEMBER 2016
Total Logistics Retail Offices Industrial Other
18
15
12
9
6
3
0
6.0%5.0%
15.7%
6.2%
10.7%
3.7%
Perc
enta
ge (%
)
LEASE EXPIRY PROFILE
Year Based on contractual rental revenue
Jun 2017 15.0%
Jun 2018 19.5%
Jun 2019 20.9%
Jun 2020 13.7%
Jun 2021 10.9%
> Jun 2021 20.0%
CHALLENGES FOR 2017
Political uncertainty
Low growth environment
Rating downgrade
OUTLOOK
Logistics developments
Acquisitions
Foreign currency investments
Dividend growth
QUESTIONS AND ANSWERS
CHECKERS MAYVILLE