results for the quarter ended 30 september...
TRANSCRIPT
RESULTS FOR THE QUARTER ENDED 30 September 2012
Embargoed until 5.05 p.m.1 November 20121 November 2012
BUSINESS OVERVIEW
BUSINESS SEGMENTSBUSINESS SEGMENTS
ARA ASSET MANAGEMENT LIMITED
REITs Private Real Estate FundsReal Estate
Management ServicesCorporate FinanceAdvisory Services
Revenue ‐Recurrent
BusinessSegments
Portfolio Management Fees
Base Fees(Gross Property Value)
Property Management Fees
(Primary Basis) (Committed Capital / Gross Property Value)
( p y )
Performance / Variable Fees(Net Property Income)
(Property Gross Revenue)
Convention & Exhibition Service Fees(Gross Revenue)
Performance Fees(IRR above Hurdle)
Acquisition / Divestment Fees(Gross Property Value)
Advisory Fees(Purchase Value)
Revenue ‐One‐off(Primary Basis)
Consultancy Fees(Project Value)
Return on Seed Capital
( y )
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FUNDS & SERVICESFUNDS & SERVICESDiversified & complementary fund platforms & services
REITs
Listing Venue SGX‐ST & SEHK SGX‐ST SEHK Bursa SGX‐ST SEHK
Focus Suburban retail properties in Hong Kong
Prime office & retail properties in Singapore
Office & industrial/ office properties in
Hong Kong
Commercial properties in Malaysia
Logistics properties in the Asia Pacific region
Commercial properties in the
PRC
(1) $ $ $ $
Private Real Estate Funds
Description Flagship strategic and 2nd strategic and Single‐asset private Core‐plus private real estate Strategic alliance with
ARA Harmony FundADF ARA Asia Dragon Fund
ADF IIARA Asia Dragon Fund II
CIPARA China
Investment Partners
Property Value(1) HK$19,268m S$7,554m HK$7,312m RM1,180m S$943m RMB 34,459m
opportunistic private real estate fund investing in Singapore, Hong Kong,
China, Malaysia and other emerging economies in Asia
opportunistic private real estate fund investing in
Singapore, Hong Kong, China, Malaysia and other emerging
economies in Asia
real estate fund which owns the Suntec Singapore Int’l Convention &
Exhibition Centre
fund investing in high quality office and commercial properties in key cities in China, including Hong Kong
Australian specialist real estate investment
manager, APN Property Group(2) for
private funds investing primarily in
Fund Size US$1 1b US$441m S$400m US$500m Australian real estateFund Size US$1.1b
(Committed Capital)
US$441m
(Committed Capital)
S$400m
(Gross Asset Value)
US$500m
(Initial Committed Capital)
Real Estate Management
Services
Description Property managementservices provider
Operations, sales and marketing services provider & consultant for convention, exhibition, meeting and event facilities
(1) Property values as of last publicly‐announced valuation(2) ARA currently holds a 13.9% interest in APN Property Group
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ASSETS UNDER MANAGEMENTASSETS UNDER MANAGEMENTS$21.5 billion (US$17.6 billion) as at 30 September 2012
19.8
21.5
20 0
22.0
20 0
22.0REITs ‐Real Estate
Private RE Funds ‐Real Estate
11.512.7
16.6
12.0
14.0
16.0
18.0
20.0
12.0
14.0
16.0
18.0
20.0Private RE Funds ‐Capital
Real Estate Management Services
N
3.4
5.36.2
9.4
2 0
4.0
6.0
8.0
10.0
2 0
4.0
6.0
8.0
10.0
Assets Under Management(1) (S$ billion) 30 Sep 2012 31 Dec 2011 Change
REIT R l E t t (2) 15 2 14 6 0 6
Notes:(1) Based on exchange rates
as at 30 September 2012(2) Comprises gross property
value of REITs managed by subsidiaries & associated companies
(3) Excludes capital
0.50.0
2.0
0.0
2.0
31 Dec 03 31 Dec 04 31 Dec 05 31 Dec 06 31 Dec 07 31 Dec 08 31 Dec 09 31 Dec 10 31 Dec 11 30 Sep 12
REITs – Real Estate(2) 15.2 14.6 0.6
Private Real Estate Funds – Real Estate 4.8 4.7 0.1
Private Real Estate Funds – Capital(3) 1.2 0.2 1.0
Real Estate Management Services(4) 0 3 0 3 ‐
(3) Excludes capital committed for projects pending completion
(4) Revenue base for real estate management services fee computation
(5) Total S$ equivalent AUM fell from S$21 8 billion as
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Real Estate Management Services( ) 0.3 0.3
Total (5) 21.5 19.8 1.7
fell from S$21.8 billion as at 30 June 2012 mainly due to exchange rate fluctuations
REITs and Private Real Estate FundsREITs and Private Real Estate FundsUpdates
REITs
ARA continues to focus on asset enhancements and acquisitions of existing REITs.
The Group suspended the IPO of Dynasty REIT until further notice, owing to the worsening of overall market conditions since theregistration of Dynasty REIT’s prospectus with the MAS. The IPO suspension is not expected to have a negative impact on ARA’searnings as the Group will continue to manage these properties in its privately managed funds and therefore continue to accrueearnings, as the Group will continue to manage these properties in its privately managed funds and therefore continue to accrueportfolio management fees on the same assets.
Private Real Estate Funds
ADF IIARA Asia Dragon Fund II
ADF ARA Asia Dragon Fund
CIPARA China Investment Partners
Completed its investment phase inSeptember 2011 – currently in its asset
Completed its third and final close, withcapital commitments of US$441 million,
Initial committed capital of US$500million, with significant contributionp y
management and divestment phase.p $ ,
signifying the continuation of the ADFfranchise.
, gfrom California Public Employees’Retirement System (CalPERS).
Additional capital commitments will bemade available upon deployment of the
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made available upon deployment of theinitial commitment at the discretion ofCalPERS.
FINANCIAL RESULTS
RESULTS SNAPSHOTRESULTS SNAPSHOTStrong quality of earnings
1 ARA’s YTD 3Q2012 net profit at S$55.0 million
2Excluding acquisition and performance fees, YTD 3Q2012 net profit rose 40% year‐on‐year
3 Strong quality of earnings ‐ Recurrent management fees up 9% to S$74.1 million, representing 77% of revenue
4Total assets under management (AUM) of S$21.5 billion as at 30 September 2012, up 11% from a year ago
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FINANCIAL HIGHLIGHTS
Financial Highlights YTD 3Q2012 YTD 3Q2011 Change (%)
R
FINANCIAL HIGHLIGHTSResilient business model delivers consistent performance
Revenue
Management fees(1) (S$’000) 74,059 67,799 9%
Acquisition and performance fees(2) (S$’000) 6,709 20,368 (67%)
O h i (3) (S$’000) 15 802 7 996 98%Other income(3) (S$’000) 15,802 7,996 98%
Total Revenue (S$’000) 96,570 96,163 0%
Operating Profit (Pre‐Tax) (S$’000) 62,428 59,317 5%
Sh f P fit f A i t (S$’000) 3 265 1 881 80%Share of Profit of Associates (S$’000) 3,265 1,881 80%
Net Profit (S$’000) 55,018 54,936 0%
Net Profit (Excluding acquisition and performance fees) (S$’000) 48,309 34,568 40%
Notes:(1) Recurrent management fees from REITs, private real estate funds and real estate management services(2) P i il REIT i i i / di l f d i l f d / f f
EPS(4) (S cents) 7.16 7.15 0%
AUM(5) (S$ billion) 21.5 19.3 11%
(2) Primarily REIT acquisition / disposal fees and private real estate fund arrangement / performance fees(3) Comprises mainly distribution income from financial assets and gains on disposal of REIT units(4) Based on share capital of 768,319,189 shares as at 30 September 2012(5) Based on exchange rates as at 30 September 2012
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REVENUE AND NET PROFITREVENUE AND NET PROFITStrong track record of revenue and net profit growth
Hi t i l R Hi t i l N t P fitHistorical Revenue Historical Net Profit
112 5
122.8
120
140S$m
Recurrent management feesAcquisition & performance feesOther income
63 8
68.270
80S$m
Net Profit
70 0
86.3
112.5
80
100
48.3
63.8
50
60
27 631.3
62.1
70.0
40
6034.0
36.7
20
30
40
27.6
0
20
FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011
13.4 13.5
0
10
20
Y200 Y2006 Y200 Y2008 Y2009 Y2010 Y2011
10
FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011
BALANCE SHEET
Group balance sheet as at 30 Sep 2012 S$’000 S$’000Non‐current assets Non‐current liabilities
BALANCE SHEETRobust balance sheet with strong cash position
Plant and equipment 1,608 Financial liabilities 177 Tenancy deposits 936 Deferred tax liabilities 140 Associates 3,874 Financial assets 118,830
125,248 317 Current assets Current liabilitiesFinancial assets 16,849 Trade and other payables 20,050Derivative assets 30 Financial liabilities 4,923 Trade and other receivables 35,358 Current tax payable 9,459 Cash and cash equivalents 78,573
130,810 34,432
l li bili iTotal liabilities 34,749
Shareholders’ equity 221,309
Total assets 256 058 Total liabilities & shareholders’ equity 256 058Total assets 256,058 Total liabilities & shareholders’ equity 256,058
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DIVIDEND HISTORYDIVIDEND HISTORYGrowing total dividend
Dividend Per Share (Period)Dividend Per Share (FY)*
0.025 0.025
0.027
0 025
0.030S$
0.058
0.066
0 060
0.070S$
0.019
0.0220.022 0.023 0.023 0.023 0.023
0.020
0.025
#
0.038
0.0440.048
0.040
0.050
0.060
#
0.010
0.015
0.020
0.030
0.000
0.005
2H07 1H08 2H08 1H09 2H09 1H10 2H10 1H11 2H11 1H12
0.000
0.010
FY07 FY08 FY09 FY10 FY11# d
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* computed based on 582,060,000 shares at listing date, excluding the shares allotted under the 1‐for‐5 bonus issue in May 2010 and the 1‐for‐10 bonus issue in June 2011
# pro‐rated
STRATEGYSTRATEGYPoised for the next phase of growth
REITs‐ Work with various partners to launch new REITs in new sectors and geographies
Private Real Estate Funds‐ Explore RMB funds in China
‐ Establish specialist funds for strategic investors
Real Estate Mgmt Services‐ Support REITs and private realestate funds and increaseproperties under management
‐ Existing REITs to continue to focus on asset enhancements and acquisitions
‐ Leverage on the Suntec brandto expand geographical reachof convention services
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MANAGEMENT TEAMMANAGEMENT TEAMExperienced team with a proven track record
Group CEO
John Lim
Group CEO
John Lim
CEO CEOCEOCorporate Divisions
Finance & ComplianceCheryl Seow
Senior Director, Group Finance
Management Services
APM Property MgmtAnthony Yip
Deputy ChairmanSusan Sim
CEO Private MarketNg Beng Tiong
ADF INg Beng Tiong
CEO
CEO Principal Investments
Moses Song
CIPDerek Lai
Senior Portfolio Manager
CEO Public Market
John Lim
Suntec REITYeo See Kiat
CEO
Corporate Finance
Advisory Services
ARA FinancialLow Poh ChooSenior Director
Corporate OfficeNg Beng Tiong
Director
Corp Business DevMoses Song
Susan SimCEO, Singapore
Mun Hon PhengCEO, China
Suntec SingaporeArun Madhok
CEO
ADF IIPaul YiCEO
ARA Harmony FundSiew Siew Hoon
Australia DeskMoses Song
Head
China RMB FundJustina Fan
Fortune REITAnthony Ang
CEO
Prosperity REITMavis Wong Moses Song
Director
Capital MarketsMark ChuDirector
G Ri k M t & IA
CEO
Suntec International
Fund Director
China DeskMun Hon Pheng
Head
CEO
Japan Desk
gActing CEO
Cache Logistics TrustDaniel Cerf
CEO
AmFIRST REIT Group Risk Mgmt & IATang Boon KangSenior Manager
Group HR & Corp DevPauline Lim
Senior Manager
India Desk
GCC Desk
AmFIRST REITLim Yoon Peng
CEO
Hui Xian REITTom Cheung
CEO
Group Office AdminSerene Yeo
Senior Manager
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Established Regional NetworkEstablished Regional Network
Tianjin DalianBeijing
• Established regional
Guangzhou
Hong Kong
NanjingShanghai
network spanning 13 cities in the Asia‐Pacific, including 6 cities in the China
Singapore
Kuala Lumpur
Mainland
• Network extends across Singapore, Hong Kong, China, Malaysia
Klang
Ipoh
SingaporeMalacca and Australia
• Staff strength of approximately 983(1) as at 30 September 2012
g
Notes:(1) Inclusive of real estate management
Melbourne
(1) Inclusive of real estate management services business division and employees in joint‐venture entities of the Group and various funds under management
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DISCLAIMERDISCLAIMER
These slides may contain forward‐looking statements that involve risks and uncertainties. Actual future performance, outcomes and results maydiffer materially from those expressed in forward‐looking statements as a result of a number of uncertainties, risks and assumptions. Representativeexamples of these factors include but are not limited to general market and economic conditions, interest rate trends, competition from other realestate investors, changes in operating expenses including employee wages and benefits, changes in government policies, and the continuedavailability of financing in the amounts and terms necessary to support future business. You are cautioned not to place undue reliance on theforward‐looking statements in these slides, which are based on the current view of management on future events. Information from externalsources in these slides has not been independently verified by us nor have the external sources quoted consented to the inclusion of the information.
ContactCheryl SeowSenior Director, Group [email protected]
Global Headquarters:6 Temasek BoulevardSuntec Tower Four, #16‐02Singapore 038986Singapore 038986
Tel: (65) 6835 9232Fax: (65) 6835 9672
Website: www.ara‐asia.com