investor meetings presentation august 2009 v12 - … investor... · investor meetings august 2009...
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Investor MeetingsAugust 2009
Content
St t i FStrategic Focus
Business Updates
Market Review and Outlook
Going Forward
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STRATEGIC FOCUS
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Focus on Two Core Businesses
Two Core Businesses
Fee based income from
Property
Development
Property
Fund
SINGAPORE
Commercial developments mainly in New Downtown and CBDResidential developments including lifestyle waterfront projects
OVERSEAS Fee‐based income from fund management with greater AUM
K‐REIT Asia to recycle capital
for Sale Management Residential developments including townships, sustainable developments and integrated lifestyle projects
Commercial developments selectively
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Improvement in sentiments :
• Park Infinia at Wee Nam and The Tresor almost fully sold
Singapore Residential
• Good response to previews :
– Madison Residences (46% of 56 units sold)
– Caribbean Residences (45% of 31 launched units sold)
• The Promont : Preparing for launch
7Madison Residences The Promont Caribbean Residences
Singapore Commercial
Marina Bay Financial Centre Ocean Financial Centre
Capitalising on flight to quality with leasing enquiries picking up
NLA : 2.9m sfStrong overall pre‐commitment : 61%
‐ Phase 1 : 66% ‐ Phase 2 : 55%
Expected completion : ‐ Phase 1 : 2010‐ Phase 2 : 2012
NLA : 850,000 sf
4th generation building to rise at former Ocean Building site
Awarded BCA Platinum Green Mark Award
Commenced pre‐lease negotiations
Expected completion : 2011
T2
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Marina Bay Financial Centre
MBR
T3T2
T1
MBS
Ocean Financial Centre
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Singapore Commercial ‐ K‐REIT Asia
Healthy • Aggregate leverage maintained at 27.6%
Quality portfolio provides stable rental income
Stable Portfolio of Five Quality Office Assets with AUM of $2.1bn
yBalance Sheet
Continued Income Growth
gg g g• Debt maturing only in 2011
• 1H 2009 distributable income up 29.6% y‐o‐y to $33.2m• Distribution per unit for 1H 2009 : 5 cents
• 94.9% committed occupancy as at end‐June 2009• Average portfolio gross rental of $8.13 psf per month• 28.2% of portfolio’s NLA accounted by long lease terms
Prudential Tower Keppel Towers GE Tower Bugis Junction Towers One Raffles Quay 9
OVERSEAS
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Positive sentiments spilling into second‐tier cities
Strong township sales• To nship segment less s sceptible to spec lation
Overseas ‐ China
• Township segment less susceptible to speculation
• Achieved good sales over last few months :
– The Botanica, Chengdu : 180 units per month
– Central Park City, Wuxi : 100 units per month
Yangtze River Delta RegionWestern Region
WuxiChengdu
The Botanica Central Park City
Villa Riviera
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Building a model for sustainable development
• Developing 36.8 ha site within SUA : About 5,000 units
Sino‐Singapore Tianjin Eco‐City
• Shareholding structure :‐ KLL : 55%‐ KCL : 45%
• Expected launch of Ph 1 : 2Q 2010‐ Residential : 1,760 homes (170,000 sm GFA)‐ Commercial : 40,000 sm GFA
Tianjin Eco‐City Entire Development Start‐up Area (SUA)
Size 30 sq km 4 sq km
Development period 10‐15 years 3‐5 years
No. of homes > 100,000 >20,000
Population (approx.) 350,000 85,000
Keppel’s 36.8 ha site
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Overseas – Vietnam
Resumed sales at The Estella, Ho Chi Minh City
• Maintained selling price : US$2,000 – US$2,200 psm
• Sales since May 2009 : 52 units sold
• Sales since launch in April 2008 : 346 units sold
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FUND MANAGEMENT
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K REIT A i
Fund Management
K‐REIT Asia and Alpha looking at asset acquisitions in Asia Total AUM: $9.8 bn (1)
• K‐REIT Asia
– Portfolio value : $2.1 bn
– Explore opportunities for pan‐Asian acquisitions
• Alpha Investment Partners
– AUM : $7.7 bn (1)
– Alpha Asia Macro Trends Fund
Funds under Alpha
Committed Equity
% Invested
No. of Countries Invested in
Asia No. 1
Property Fund$400m 100% 6
Alpha Core Plus $720m 100% 4
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Acquired a retail property in Tokyo
Strong financial position to seek acquisitions in Asia :
About 11% of $1.7bn invested
(1) When fully leveraged and fully invested As at 1H 2009
Real Estate Fund
AIB Alpha Japan
Fund$259m 46% 1
Alpha Asia Marco
Trends Fund$1.7bn 11% 4
MARKET REVIEW AND OUTLOOK
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Singapore Residential
Strong take‐up of 7,250 units in 1H 09 : 70% higher than FY 2008
Improved Market Sentiments with Stabilising Economy
• Prices are firming and momentum gathering pace
• Good take‐up at recently launched mid‐ and higher‐end projects
Supply fear mitigated with significant amount pre‐sold
• 6,209 units due to be completed in 2H 2009 : 90% already sold
• 5,394 units due to be completed in 2010 : 77% already sold
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Healthy Fundamentals to Sustain Demand
Pent‐up demand from owner‐occupiers and HDB upgraders
Population growth
Low mortgage rates
IRs to elevate Singapore’s profile and attract more foreign buyers
Singapore Commercial
Market
Office demand likely to be subdued in 2009
However, there are signs of stabilisation :
• Singapore GDP forecast upgraded to between ‐6% and ‐4% for 2009Market Sentiments Have Improved
• Investment sales and leasing activities picking up
• Negative take‐up for 2Q 2009 easing from last two quarters
• Pace of decline for office rents eased in 2Q 09
Delays in construction of some office projects have reduced supply
• New office supply from 2Q 2009 – 2012 lowered to 5.9m sf (1)
Growth into a global cosmopolitan city and multi‐hub business destination
Financial sector in Singapore selectively re hiring
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Singapore Remains Key Business Destination in Longer Term
Financial sector in Singapore selectively re‐hiring
Colliers’ Asia‐Pacific Grade A office rents ranking in 2Q 09
• Increased competitive edge with Singapore’s rents below Ho Chi Minh City
Ranked 4th in recent Forbes ranking of Best Countries to do Business
Ranked 15th in CBRE’s 2009 May Global Occupancy Costs Survey
• Behind Asian cities like Tokyo, Hong Kong, Mumbai and New Delhi
(1) Excluding pre‐committed space of about 2.4 million sf as estimated by CBRE
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OverseasAsia : Signs of market stabilisation• Stimulus packages yielding positive effects
• Favourable government policies support marketsFavourable government policies support markets
• Increased buying confidence as affordability improves e.g. lower mortgage rates
• Long‐term growth trend backed by firm fundamentals
HOME OWNERSHIP ASPIRATIONS
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China Better‐than‐expected sales volume in first‐ and second‐tier cities
Vietnam Demand expected to increase with change in Housing Laws
India Affordability improving with lower mortgage rates and prices
Economic Growth
Favourable Demographics
Rising Affluence
Urbanisation Trends
Growing Middle Class
GOING FORWARD
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Accelerating projects for sale in tandem with market recovery
Going Forward
recovery
Seeking acquisitions in Singapore and overseas and capitalising on opportunities from impact of downturn
Continuing to focus on developing quality residential,office, township and sustainable developments
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office, township and sustainable developments
K‐REIT Asia and Alpha seeking acquisitions of quality assets
Monitor market for opportune time to launch :
• Reflections at Keppel Bay (30% stake) : 382 units
Singapore Residential
• Marina Bay Suites (33.3% stake) : 221 units
22Reflections at Keppel Bay Marina Bay Suites
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Overseas Residential
Vietnam : Expect to launch Riviera Cove in 2H 2009
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Riviera Cove, District 9, HCMCVillasTotal units : 96 villas
Riviera Point, District 7, HCMCCondominium development Total units : 2,400 Expected launch : 2010
THANK YOU
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ADDITIONAL SLIDES
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Financial Highlights 2Q 09 vs 1Q 09
2Q 2009 1Q 2009 % Chg
Turnover ($m) 249.9 145.7 71.5
EBITDA ($m) 47.5 34.3 38.5
Operating Profit ($m) 45.1 31.9 41.4
Pre tax Profit ($m) 83 5 55 7 49 9Pre‐tax Profit ($m) 83.5 55.7 49.9
PATMI ($m) 58.2 36.9 57.7
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Financial Highlights 2Q 09 vs 2Q 08
2Q 2009 2Q 2008 % Chg
Turnover ($m) 249.9 185.9 34.4
EBITDA ($m) 47.5 62.8 (24.4)
Operating Profit ($m) 45.1 61.0 (26.1)
Pre tax Profit ($m) 83 5 75 9 9 9Pre‐tax Profit ($m) 83.5 75.9 9.9
PATMI ($m) 58.2 52.7 10.4
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Financial Highlights 1H 09 vs 1H 08
1H 2009 1H 2008 % Chg
Turnover ($m) 395.6 459 (13.8)
EBITDA ($m) 81.8 135.6 (39.7)
Operating Profit ($m) 77 132.1 (41.7)
Pre tax Profit ($m) 139 1 158 9 (1) (12 5)Pre‐tax Profit ($m) 139.1 158.9 ( ) (12.5)
PATMI ($m) 95.1 113 (1) (15.8)
(1) Includes a gain of $7.3m arising from acquisition of additional interest in K‐REIT Asia
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5‐Year Financial Profile
FY2008 FY2007 FY2006 FY2005 FY2004
T ($ ) 842 2 1407 9 948 0 586 4 476 2Turnover ($m) 842.2 1407.9 948.0 586.4 476.2
Operating Profit ($m) 231.7 312.3 204.1 146.6 111.1
Pre‐tax Profit ($m) 314.0 988.7 263.4 184.6 139.9
PATMI ($m) 227.7 * 779.7 * 200.3 155.7 132.7
Overseas Earnings (% of PATMI) 29.5 39.7 63.6 59.0 43.3
EPS (¢) 31 6 108 3 27 9 21 8 18 7EPS (¢) 31.6 108.3 27.9 21.8 18.7
NTA/Share ($) 3.39 3.18 2.21 2.35 2.26
Net Debt/Equity Ratio (x) 0.52 0.41 1.04 1.14 0.96
* Includes gain on acquisition of additional interest in K‐REIT Asia and net gain on revaluation of investment properties
^ Includes corporate restructuring surplus from sale of ORQ and net gain on revaluation of investment properties less impairment provision
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Post Rights Issue
Financial Ratios
1H 2009 1H 2008 % Chg
Net Debt/Equity Ratio (x) 0.23 0.54 (57.4)
EPS (cents) 8.2 11.1(1) (26.1)
NTA/Share ($) 2.29 3.13 (26.8)
Annualised ROE (%) 7 9 8 (28 6)
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(1) Restated to include the effect of the rights issue in accordance with FRS 33
Annualised ROE (%) 7 9.8 (28.6)
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Active Capital Management
1H 2009 1H 2008
Net Debt ($b) 0.84 1.42
Avg Interest Rate of Borrowings (%) 2.3 2.7
Fixed Rate Debt (%) 23 14
Avg Debt Maturity (Yr) 1.24 1.46
Interest Cover Ratio (X)* 8.08 9.65
* Interest Cover Ratio = Profit Before Interest and Tax
Net Interest Cost Expensed and Capitalised
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Healthy cash balances of $1.2bn
Unutilised credit facilities of $1.6bn
• MTN programme : $0.7bn
• Bank facilities : $0.9bn
Asset Breakdown – Geographical Location
Asset Breakdown ‐ Geographical Location
Singapore64%China
16%
Vietnam8%
Others*12%
g p(30 June 2009)
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* Others include Indonesia, India, Thailand and Philippines
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Rights Issue and Dividend Reinvestment Scheme
Strengthened Balance Sheet and
Well‐positioned to capitalise on attractive acquisition opportunities
47% oversubscribed
Raised gross proceeds of approx. $707.6m
649.2m rights shares issued
i id d i h ( )
Strengthened Balance Sheet and Enhanced Financial Flexibility
Higher cash position : $1.2 bn(1)
Lower gearing : 0.23x(1)
Rights Issue
Dividend Reinvestment Scheme (DRS)
Strong shareholder participation
34.3m new shares issued
Enlarged share base : 1.4 bn(1) shares
Larger market capitalisation : $3.8 bn(2)
(1) As at 30 Jun 2009(2) As at 13 Aug 2009
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Singapore Residential Landbank
A ib bl A ib bl T lP j L i KLL' T Attributable AttributableLand Area GFA
(%) (sf) (sf)
Reflections at Keppel Bay (1) Keppel Bay 30% 99‐yr 269,930 624,521 1,129Marina Bay Suites Marina Bay 33.3% 99‐yr 19,015 156,462 221The Promont Cairnhill Circle 100% Freehold 11,183 31,310 15Keppel Bay Plot 3 Keppel Bay 30% 99‐yr 125,366 152,999 307Keppel Bay Plot 4 Keppel Bay 11.7% 99‐yr 36,114 40,300 234Keppel Bay Plot 6 Keppel Bay 30% 99‐yr 141,429 67,813 94Total 603,037 1,073,405 2,000
Total Units
Project Location KLL's Stake
Tenure
Total 603,037 1,073,405 2,000
(1) Includes units sold
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China Residential Launches
Units to Launch 2009 2010 2011
8 Park Avenue, Shanghai (1) ‐ 90 277
Villa Riviera, Shanghai (1) 20 50 ‐
The Botanica, Chengdu (1) 234 892 1,070
The Arcadia, Tianjin (1) 68 50
Central Park City, Wuxi (1) 169 877 900
Shenyang Township (2) ‐ 560 675
Residential Development, Nanhui, Shanghai (2) ‐ 265 300
Integrated Marina Lifestyle Development Zhongshan (2) ‐ ‐ 343
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Integrated Marina Lifestyle Development, Zhongshan 343
Stamford City, Jiangyin (1) 22 80 80
Summer Ville, Changzhou (1) 54 ‐ ‐
Serenity Cove, Tianjin (1) 28 100 100
Total 595 2,964 3,745
(1) Balance units ; (2) New launches
Other Overseas Residential LaunchesProject 2009 2010 2011
VietnamThe Estella, Dist. 2, HCMC (1) 60 200 525 (3)
Waterfront Condo, Binh Thanh Dist., HCMC (2) ‐ ‐ 350(2)Riviera Point, Dist. 7, HCMC (2) ‐ 200 300
Prime Condo, Dist. 2, HCMC (2) ‐ ‐ 350Prime Condo, Dist. 9, HCMC (2) ‐ ‐ ‐Riviera Cove (Villa Devt.), Dist. 9, HCMC (2) 20 76 ‐Villa Devt., Dist. 9, HCMC (2) ‐ ‐ 76Saigon Sports City, HCMC (2) ‐ ‐ 355Dong Nai Waterfront City (2) ‐ ‐ 100
ThailandVilla Arcadia at Srinakarin, Bangkok (1) 45 50 50Villa Arcadia at Watcharapol, Bangkok (1) 27 30 30
India
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Elita Promenade, Bangalore (1) 208 116 ‐Elita Horizon, Bangalore (2) ‐ ‐ 187Elita Garden Vista, Kolkata (1) 316 390 200
IndonesiaJakarta Garden City (1) 308 366 107
Middle EastWaterfront Apartment Devt., Jeddah, Saudi Arabia (2) 300 300 300
Total 1,283 1,728 2,930
(1) Balance units ; (2) New launches; (3) Includes SoHo units
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China Residential Landbank
Site Location Total TotalLand Area GFA
(%) (sm) (sm)
Remaining Units for
Sale
KLL's Stake
Remaining Area for Sale
(sm)
8 Park Avenue Shanghai 99% 33,432 133,393 65,424 394Park Avenue Central Shanghai 99% 28,488 99,708 99,708 708Villa Riviera Shanghai 99% 153,726 53,796 20,558 70The Arcadia Tianjin 100% 127,970 74,826 52,785 118Central Park City Wuxi 49.7% 352,534 670,510 (2) 437,442 (1) 3,676The Botanica Chengdu 44.1% 419,775 1,042,846 470,488 (1) 5,168Stamford City Jiangyin 76.8% 82,987 301,338 (2) 259,824 (2) 979Shenyang Township Shenyang 100% 338,287 743,847 (2) 705,463 (1) 6,256Residential Devt., Nanhui Shanghai 99% 264,090 332,906 (2) 320,222 (1) 2,676Integrated Marina Lifestyle Devt. Zhongshan 80% 827,641 408,274 402,774 2,855Integrated Marina Lifestyle Devt. Zhongshan 80% 827,641 408,274 402,774 2,855Summerville Changzhou 85.4% 46,108 64,890 7,374 54Serenity Cove (Ph 1 & Ph 2) Tianjin 85.4% 195,170 66,910 8,024 28Total 2,870,208 3,993,244 2,850,086 22,982
(1) Excludes commercial area(2) Includes commercial area
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Other Overseas Residential LandbankKLL's Total Land Total GFA Remaining Area RemainingStake Area (sm) (sm) for Sale (sm) Units for Sale
India Elita Promenade 51% 96,618 193,237 49,139 324
Elita Horizon 51% 79,177 150,680 150,680 1,138
Elita Garden Vista 37.7% 93,998 195,355 143,978 906Sub‐total 269,793 539,272 343,797 2,368
Country Project
Indonesia Jakarta Garden City, Jarkata ‐ Phase 1 51% 144,510 173,412 113,063 781
Jakarta Garden City ‐ Remaining Phases 758,428 1,283,874 1,052,941 8,117Sub‐total 902,938 1,457,286 1,166,004 8,898
Thailand Villa Arcadia at Srinakarin 45.5% 159,706 84,440 72,564 229
Villa Arcadia at Watcharapol 66.7% 124,912 68,314 81,227 258Sub‐total 284,618 152,754 153,791 487
Vietnam Saigon Sports City, HCMC 90% 640,477 713,222 (1) 290,100 (2) 2,318
The Estella, Dist. 2, HCMC 55% 47,906 279,851 158,917 1,047
Waterfront Condo, Binh Thanh Dist., HCMC 60% 17,428 87,140 74,069 549
Riviera Point, Dist. 7, HCMC 75% 85,118 340,472 289,401 2,394 Dong Nai Waterfront City 50% 3,667,127 1,979,727 (2) 1,576,190 (1) 10,155
Prime Condo, Dist. 2, HCMC 60% 51,000 244,800 166,464 1,500 Villa Devt., Dist. 9, HCMC 55% 135,142 55,746 74,328 177
Prime Condo, Dist. 9, HCMC 55% 62,727 250,908 213,272 1,777
Riviera Cove (Villa Devt.), Dist. 9, HCMC 60% 97,000 35,190 49,492 96 Sub‐total 4,803,925 3,987,056 2,892,233 20,013
Middle East 51% 36,236 253,652 253,652 993 Sub‐total 36,236 253,652 253,652 993
Philippines Palmdale Heights(Ph2), Manila 30.9% 15,976 62,751 62,751 1,264
SM‐KL Residential Devt. Manila 24.2% 7,068 56,000 56,000 430 Sub‐total 23,044 118,751 118,751 1,694
Total 6,320,554 6,508,771 4,928,228 34,453
Waterfront Apartment Devt., Jeddah, Saudi Arabia
(1) Excludes commercial area; (2) Includes commercial area 38
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Singapore Commercial – K‐REIT AsiaTenant Business Sector by Net Lettable Area as at 30 Jun 2009
Accounting & consultancyShipping & marine
111 tenants in total
Accounting & consultancy services4.0%
Banking, insurance & financial services
35.4%Pharmaceuticals & healthcare
Real estate & property services8.2%
Services9.3%
Shipping & marine services7.4%
Conglomerate8.7%
Government agency7.3%
Hospitality & leisure3.0%
IT services & consultancy5.7%
Others6.6%
4.4%
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Singapore Residential Developments to benefit from new Downtown Line (DTL)
– Values of properties nearby expected to rise (JLL)
KLL’s Development
Location DTL Station
The Tresor Duchess Road Tan Kah Kee
Madison Bukit Timah Stevens/
( )
Source: LTA as at 13 July 2009DTL 1 & DTL 2 : Its schematic profile, alpha‐numeric codes and end destination numbers are subjected to confirmation
Madison Residences
Bukit TimahRoad
Stevens/BotanicGardens
Interchange
Park Infinia Wee Nam Road
NewtonInterchange
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Strategically located in the Tianjin Binhai New Area
Benefit from the economic vibrancy of the region
Sino‐Singapore Tianjin Eco‐City
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AwardsBest Annual Report (Gold) at Singapore Corporate Awards
‐Market capitalisation of $1 bn and above
Governance and Transparency Index(1)
R k d 8th t f 677 i‐ Ranked 8th out of 677 companies‐ Only property company placed in Top 10
Five new BCA Green Mark Awards ‐MBFC Ph 2 (Commercial) – Gold Plus ‐Marina Bay Suites – Gold ‐Madison Residences – Gold ‐ The Promont – Gold ‐ One Raffles Quay – Gold (First building to achieve a Green Mark Award under new guidelines for existing developments)
Won six awards at the Asia Pac Property Awards‐Best High‐Rise Development, Residential : Reflections at Keppel Bay ‐ Best Development, Residential : 8 Park Avenue‐ Best Property, Residential : The Arcadia, Tianjin‐ Best Development, Residential : Villa Riviera ‐ Best Mixed‐Use Development, Commercial : Saigon Centre‐ Best Development, Residential : Elita Promenade
(1) Replaced Business Times Corporate Transparency Index42
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This release may contain statements which are subject to risks and uncertainties that could cause actual results to differ materially from such statements. You are
cautioned not to place undue reliance on such statements, which are based on the current views of Management on future developments and events.
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