pre-close update 2 a t t a c q | j u n e 2 0 2 0 p r e - c l o s e before covid-19 business overview...

PRE-CLOSE

UPDATE30 JUNE 2020

1

A T T A C Q | J U N E 2 0 2 0 P R E - C L O S E

2 BEFORE COVID-19 BUSINESS OVERVIEW

3 SOUTH AFRICAN PORTFOLIO

13 DEVELOPMENTS AT WATERFALL

16 INVESTMENT IN MAS REAL ESTATE INC

17 REST OF AFRICA RETAIL INVESTMENTS

18 BALANCE SHEET MANAGEMENT

21 STRATEGIC SUMMARY

22 QUESTIONS AND ANSWERS

AGENDA

Deloitte head office interior, Waterfall City

2


BEFORE COVID-19 BUSINESS OVERVIEW DEC 2019

^ Weighted average based on PGLA

** Weighted average lease expiry on PGLA# Weighted average based on gross rent multiplied by PGLA

* Rental escalation excluding rates multiplied by PGLA, excluding BMW Group SA Regional Distribution Centre

01

Gearing

June 2019: 37.7%

39.1%

05

Collections

June 2019: 99.0%

98.8%

09

Occupancy

June 2019: 93.8%

94.0%

02

Interest cover ratio

June 2019: 1.85 times

1.91 times

06

WALE**

June 2019: 6.5 years

6.1 years

10

Trading density growth

December 20189: 6.9%

5.7%

03

Debt expiry profile


3.1 years

07

Average portfolio age^


7.2 years

04

Interest rate hedging

June 2019: 78.7%

80.2 %

08

Rental escalation*

June 2019: 7.3%

7.2%

3


1ST KEY DRIVER: SOUTH AFRICAN PORTFOLIO

Discussion points

1. Asset management focus areas

2. Sector performance

3. Sectoral profile

4. Rent collections

5. Occupancy

6. Retail - tenants performance

7. Retail - foot count trend

8. Retail - trading impact

9. COVID-19 and the social impact

Mall of Africa interior, Waterfall City

4


ASSET MANAGEMENT FOCUS AREAS

Property Fundamentals

• Collection is key

• Tenant relationships in lieu of sustainability

• Portfolio and tenant diversification strength

• Health and safety top priority for shoppers

and tenants

• Community focus

Property Valuations

• Moving to more sentiment and interpretation

driven due to low transactional volume

• Valuation metrics view through the COVID-19

cycle

MooiRivier Mall interior, Potchefstroom

5


SECTOR PERFORMANCE SOUTH AFRICAN PORTFOLIO

Retail

• Essential services spend proving resilient

• Impact of job losses on consumer spending

• Online not problem free which demonstrate the

importance of brick and mortar stores for retailers

• Increased support for local supply chain

Office and mixed-use

• Impact on lease terms and structure

• Greater demand for flexibility in office space

• Rise of agile working supported by technology

• Vibrant precinct / city centers attract and retain

Light industrial

• Knock on effect of retail business failures

• Location is important due to supply chain move

to last-minute logistics in major cities

Hotel

• High occupancy levels before COVID-19

• The industry will recover

Lynnwood Bridge – office and mixed-use, Pretoria

6


SOUTH AFRICAN PORTFOLIO SECTORAL PROFILE

May 2020 May 2020

Tenant sector

Attributable PGLA

as a % of total PGLA Tenant sector

Attributable gross rental

as a % of total gross rent

Fashion 14.0 Fashion 18.6

Financial services 10.9 Financial services 12.9

Food retailers 8.1 Cellular 6.2

DIY 7.5 Consulting engineering 6.0

Cellular 6.3 Government / SOE 5.8

Government / SOE 5.4 Food retailer 5.1

Corporate Branding 5.2 Pharmaceutical 4.1

Pharmaceutical 4.5 Legal services 3.5

Automotive 4.4 Restaurant 3.3

Other 33.7 Other 34.5

Total 100.0 Total 100.0

7


SOUTH AFRICAN PORTFOLIO RENT COLLECTIONS

Collection %* before discounts and deferrals Collection %* after discounts and deferrals

Months Total (%) Retail (%) Non-Retail (%) Total (%) Retail (%) Non-Retail (%)

March 98.0 97.7 99.2 n/a n/a n/a

April and May (average) 70.5 49.9 89.5 82.5 64.3 96.5

June 79.6 66.0 91.7 84.5 72.1 95.0

12 month average to Jun 2020 92.0 87.3 96.8 94.5 90.7 98.3

Deloitte head office, Waterfall City

* as at 23 June 2020

8


SOUTH AFRICAN PORTFOLIO OCCUPANCY

May 2020 Dec 2019

% PGLA m2 % PGLA m2

Retail 96.7 294 177 97.8 289 257

Office and mixed-use 87.3 263 904 85.7 233 714

Like-for-like portfolio 86.2 239 802 86.7 224 234

Buildings completed during the period 100.0 24 102 67.9 9 480

Light industrial 100.0 159 252 100.0 173 266

Hotel 100.0 13 690 100.0 13 690

Year end portfolio occupancy 93.8 731 023 94.0 709 927

Plus: filled post period-end 0.1 728 0.6 4 863

Plus: 2 Eglin 3.1 24 207 2.9 22 215

Adjusted portfolio occupancy 97.0 755 958 97.5 737 005

Waterfall 98.0 478 159 98.6 457 471

Non-Waterfall 95.3 277 799 95.9 279 534

9


TRADING DENSITY* RENT TO TURNOVER#

CENTRE

Mar 2020

R/m2

Mar 2019

R/m2

Growth

%

Mar 2020

%

Mar 2019

%

Change

%

Super-regional 3 220 3 102 3.8

Mall of Africa 3 220 3 102 3.8 8.9 8.7 2.3

Regional 2 800 2 696 3.9

Brooklyn Mall 2 955 2 949 0.2 10.7 10.3 3.9

Eikestad Mall 2 727 2 630 3.7 7.0 6.8 2.9

Garden Route Mall 2 857 2 720 5.0 6.8 6.7 1.5

MooiRivier Mall 2 722 2 594 4.9 6.5 6.5 0.0

Convenience 5 103 5 005 2.0

Glenfair Boulevard 5 204 5 000 4.1 4.8 4.9 (2.0)

Lynnwood Bridge - Retail 4 976 5 011 (0.7) 5.7 5.5 3.6

Neighbourhood 4 240 3 699 14.6

Waterfall Corner 4 240 3 699 14.6 4.4 4.8 (8.3)

Portfolio (effective average) 3 179 3 074 3.4

* Reported tenant turnover divided by PGLA based on a 12 month average # Gross rental including operating costs and rates divided by reported turnover based on a 12 month average

RETAIL TENANTS PERFORMANCE

10


RETAIL FOOT COUNT TREND

Mall of AfricaEikestad Mall

Glenfair BoulevardLynnwood Bridge - Retail

11


RETAIL TRADING IMPACT

LOCKDOWN

ALERT LEVELS

Average

number of

stores trading

Number

of days Description of restrictions

Level 5 43 36Only essential goods and services. Transport and movement restrictions

All our malls partially closed, and only essential services traded

Level 4 331 31Essential goods including children’s clothing, winter goods, IT equipment and office supplies

Restaurants and fast food outlets may open for delivery only

Level 3 492 30Most retail permitted, with strict hygiene protocols in place

Restaurants, personal services and tobacco related trade prohibited

Brit to add MOA photos –

Minisha emailed and

WeTransfered

Mall of Africa interior, Waterfall City

12


Shoppers

• Creating a safe shopping environment

• Virtual customer journey to ensure loyalty

Tenants (including their employees)

• Rental relief and assistance provided

• Healthy and safe spaces top priority

• Sustainable leasing options

Governance

• Attacq task team established

• Risk proactivity managed

• Reliance on secured technology

to do business

COVID-19 AND THE SOCIAL IMPACT

Focus on Health and Safety of our employees, shoppers, tenantsand the wider community

Suppliers, brokers and service providers

• Supporting during lockdown

• Working closely to ensure business

continuity

• Supply chain impact

Community

• Attacq Care campaign launched

within our communities

• Support our communities more in need

and vulnerable

13


2ND KEY DRIVER: DEVELOPMENTS AT WATERFALL

Discussion points

1. Completed developments

2. Reopening of four sites

3. Developments under construction

4. Pipeline

Nexus Waterfall, Courtyard Hotel, Waterfall City

14


COMPLETED DEVELOPMENTS

* Sectional title

Total

PGLA m²

Effective

PGLA m² % Let

Practical

completion date

Lease

commencement date

Waterfall City

Deloitte head office 42 500 21 250 100.0 Q3 FY20 Q4 FY20

The Ingress – Building 2 4 484 4 484 10.4 Q2 FY20 Q3 FY20

The Ingress – PSG Wealth 4 311 4 311 100.0 Q1 FY20 Q1 FY20

Waterfall Point – Buildings 1 and 3* 4 678 4 678 67.7 let/sold Q2 FY20 Inventory

Waterfall Point – Buildings 2 and 4* 5 169 5 169 100.0 Q2 FY20 Q2 FY20

Waterfall Corporate Campus – Building 5 5 530 2 765 100.0 Q3 FY20 Q3 FY20

TOTAL 66 672 42 657 >85.0

Waterfall Point

The Ingress

Deloitte

Waterfall Corporate Campus, Waterfall City

15


DEVELOPMENTS UNDER CONSTRUCTION

* The impacts of COVID-19 on practical completion and lease commencement dates will be assessed once the impacts on program and productivity can be established with more certainty

Total

PGLA m²

Effective

PGLA m² % Let

Practical

completion date*

Waterfall City

Waterfall Corporate Campus – Building 4 4 976 2 488 Under negotiation Q3 FY21

Nexus Waterfall, Courtyard Hotel (168 keys) 6 273 6 273 100.0 Q2 FY21

Ellipse Waterfall, Newton and Kepler towers (269 units) 17 044 8 522 81.0 sold Q1 FY22

Waterfall Logistics Hub

Nespresso warehouse 4 757 4 757 100.0 Q1 FY21

TOTAL 33 050 22 040 >80.0

Corporate

Campus

Nespresso

Nexus Waterfall

Ellipse

Nexus Waterfall, Courtyard Hotel, Waterfall City

16


3RD KEY DRIVER: INVESTMENT IN MAS REAL ESTATE INC

Discussion points

• 20.7% shareholding

• Strong liquidity position and high ICR ratio

• Most developments put on hold in March

2020 and being re-assessed

• High % essential services in WE resulted

in strong collections for March to May 2020

• WE asset sales will take longer. EUR106m

underway with further EUR234m expected

for 2020 calendar year

• No final FY20 dividend

› No impact on Attacq’s FY20 results

• Restructure of Attacq’s EUR debt

› Fall of MAS share price necessitated

restructure of existing share cover covenant

› ± R500m of EUR debt attributed to MAS

› 2.3 times share cover required

Current cover is ±4 times

• Recent acquisition of shares by PKM JV

Roman Value Centre, Romania

17


4TH KEY DRIVER: REST OF AFRICA RETAIL INVESTMENTS

Discussion points

• 2.2% of Attacq’s total assets (31 Dec 2019)

• No debt against investment

• Exit will be DE enhancing

• Increased alignment iro AttAfrica

› Exit of minority shareholders for nominal

consideration

› Joint control with Hyprop

› All rights to shareholder loans are now pari

passu

› Attacq has 26.9% share of all cash flows

• Portfolio level debt refinance of in-country

debt to be implemented in near future with

interest savings expected

• Progress being made on disposal

of Ikeja City Mall

• COVID-19 resulted in lockdowns in Ghana

and Nigeria, with resultant impact on trade

and foot count. Situation starting to improve

with lockdowns easing

Accra Mall, Ghana

18


BALANCE SHEET MANAGEMENT

Discussion points

1. Liquidity

2. Debt maturity

3. Covenants

Mall of Africa, Waterfall City

19


ABSA INVESTEC LIBERTY

MMI NEDBANK OLDMUTUAL

RMB SANLAM SBSA

INTEREST-BEARING DEBT

Funding mix (%) as at May 2020

27.7

May 2020 Dec 2019

Gross interest-bearing debt (R’000) 11 532 778 10 779 330

ZAR debt (R’000) 10 072 435 9 440 412

EUR debt (R’000) 1 460 344 1 358 918

Total hedged as a percentage of total committed facilities (%) 78.8 80.2

Weighted average term of loans (years) 2.8 3.1

Weighted average term of hedges (years) 3.7 3.8

Committed liquidity facilities (R’000) 310 000 310 000

Unrestricted cash balances (R’000) 741 051 602 949

5.5

2.62.6

4.1

42.5

4.2

8.1

2.7

• All funding is provided by local banks and non-bank financial institutions

• The group does not have a domestic medium-term note programme

• No funded or guaranteed B-BBEE shareholding structures

• Foreign currency debt of EUR74.0m but no cross-currency swaps

• No ICR group covenant

20


INTEREST-BEARING DEBT | CONTINUED

Negotiations with funders

completed

• Positive impact on maturity date

with weighted average loan term

increasing to 3.3 years

• Credit approval received to

extend debt maturities

to October 2021 and beyond

• No covenant breaches expected

for June 2020

• Credit approval received to relax

portfolio ICR covenants for

December 2020

0 0

852

3 993 3 824

191

2 574

42

1 481

445

1 051

2 160

1 479

2 628

0

1 000

2 000

3 000

4 000

5 000

6 months 12 months 18 months 24 months 36 months 48 months Beyond

48 monthsLoan maturity Swap maturity

30 Jun 2020

31 Dec 2019

0

1 178

3 521

924

2 966

39

2 171

0

1 023572 637

2 843

1 676

2 225

0

1 000

2 000

3 000

4 000

5 000

6 months 12 months 18 months 24 months 36 months 48 months Beyond

48 monthsLoan maturity Swap maturity

21


BC World

• South Africa portfolio

› Excellent collections

› High occupancy

› Real growth in trading densities

› Long WALE

• Balance sheet management

› Improved ICR

› Only local funders

› Exit investment in Newtown precinct

› Reduced Rest of Africa exposure

STRATEGIC SUMMARYDC World

• South Arica portfolio

› Tenant collaboration

- Manage the environment

- Collections

- Sectors are behaving differently

- Industries are behaving differently

› Valuations

• Developments at Waterfall

› Closed and opened sites

• Investment in MAS

› Restructured Euro debt

DC World continued

• Rest of Africa retail investment

› Continue implementation of exit strategy

› Will reduce debt with proceeds

• Balance sheet management

› Frequent engagements with funders

› Manage liquidity

- Cash flow

- Maturity of debt

• No final dividend for FY20 or interim dividend

for FY21 to be paid

Cummins SA Regional Office, Waterfall Logistics Hub Ikeja City Mall interior, Nigeria Zimmer Biomet interior, Waterfall City

22


QUESTIONS AND ANSWERS

Corporate Campus, Waterfall City

23


DISCLAIMER

This presentation and any materials distributed in connection with this presentation may include certain forward-looking statements beliefs or opinions including

statements with respect to the company’s business financial condition and results of operations. These statements which contain the words “anticipate”

“believe” “intend” “estimate” “expect” “forecast” and words of similar meaning reflect the directors’ beliefs and expectations and involve risk and uncertainty

because they relate to events and depend on circumstances that will occur in the future. No representation is made that any of these statements or forecasts

will come to pass or that any forecast results will be achieved. There are a number of factors that could cause actual results and developments to differ

materially from those expressed or implied by these statements and forecasts. Past performance of the company cannot be relied on as a guide to future

performance. Forward-looking statements speak only as at the date of this presentation and the company expressly disclaims any obligations or undertaking to

release any update of or revisions to any forward-looking statements in this presentation. No statement in this presentation is intended to be a profit forecast.

As a result you are cautioned not to place any undue reliance on such forward-looking statements.

This document speaks as of the date hereof. No reliance may be placed for any purposes whatsoever on the information contained in this document or on its

completeness accuracy or fairness. This information is still in draft form and has not been legally verified. The financial information included herein is in draft form

and unaudited. The company its advisers and each of their respective members directors officers and employees are under no obligation to update or keep

current the information contained in this presentation to correct any inaccuracies which may become apparent or to publicly announce the result of any

revision to the statements made herein except where they would be required to do so under applicable law and any opinions expressed in them are subject to

change without notice. No representation or warranty express or implied is given by the company or any of its subsidiary undertakings or affiliates or directors

officers or any other person as to the fairness accuracy or completeness of the information or opinions contained in this presentation and no liability whatsoever

for any loss howsoever arising from any use of this presentation or its contents otherwise arising in connection therewith is accepted by any such person in

relation to such information.

24


CORPORATE INFORMATION

01

Independent non-executive directors

P Tredoux

(Chairman)

HR El Haimer

(Lead independent)

04

Attacq Limited

Incorporated in the Republic of South Africa

Registration number 1997/000543/06

JSE share code: ATT ISIN: ZAE000177218

Approved as a REIT by the JSE

Attacq or the company or the group

02

Executive directors

M Hamman (CEO)

R Nana (CFO)

JR van Niekerk (COO)

05

Registered office

ATT House, 2nd Floor

Maxwell Office Park

37 Magwa Crescent

Waterfall City

2090

03

Company secretary

A Matwa

06

Postal address

PostNet suite 016

Private Bag X81

Halfway House

1685

IN Mkhari

BT Nagle

S Shaw-Taylor

JHP van der Merwe

07

Transfer secretaries

Computershare Investor Services (Pty) Ltd

Rosebank Towers, 15 Biermann Avenue,

Rosebank, 2196

(PO Box 61051, Marshalltown, 2107)

08

Sponsor

Java Capital

09

Contact details

Head of Investor Relations: B Botha

Landline number: +27 12 010 3457

[email protected]

pre-close update 2 a t t a c q | j u n e 2 0 2 0 p r e - c l o s e before covid-19 business overview...

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