3QFY2013 Results Presentation - listed...

23
October 2013 3QFY2013 Results Presentation

Transcript of 3QFY2013 Results Presentation - listed...

Page 1: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

October 2013

3QFY2013

Results Presentation

Page 2: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

This presentation should be read in conjunction with the financial statements of Soilbuild Business Space REIT for the period from 16 August 2013 (“Listing

Date”) to 30 September 2013 (hereinafter referred to 3QFY2013).

This presentation is for information only and does not constitute an offer or solicitation of an offer to subscribe for, acquire, purchase, dispose of or sell any

units in Soilbuild Business Space REIT (“Soilbuild REIT”, and units in Soilbuild REIT, “Units”) or any other securities or investment.

Nothing in this presentation should be construed as financial, investment, business, legal or tax advice and you should consult your own independent

professional advisors.

This presentation may contain forward-looking statements that involve risks, uncertainties and assumptions. Future performance, outcomes and results

may differ materially from those expressed in forward-looking statements as a result of a number of risks, uncertainties and assumptions. You are cautioned

not to place undue reliance on these forward-looking statements, which are based on the current view of management of future events.

The value of Units and the income derived from them, if any, may fall or rise. Units are not obligations of, deposits in, or guaranteed by, the Manager or any

of its affiliates. An investment in Units is subject to investment risks, including the possible loss of the principal amount invested.

Investors should note that they will have no right to request the Manager to redeem or purchase their Units for so long as the Units are listed on Singapore

Exchange Securities Trading Limited (the “SGX-ST”). It is intended that holders of Units may only deal in their Units through trading on the SGX-ST. The

listing of the Units on the SGX-ST does not guarantee a liquid market for the Units.

The past performance of Soilbuild REIT is not indicative of the future performance of Soilbuild REIT. Similarly, the past performance of SB REIT

Management Pte. Ltd. (“Manager”) is not indicative of the future performance of the Manager.

Disclaimer

1

Citigroup Global Markets Singapore Pte. Ltd., DBS Bank Ltd. and Oversea-Chinese Banking Corporation Limited are the joint global

coordinators, issue managers, bookrunners & underwriters of the initial public offering of Soilbuild REIT.

Page 3: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

Content

Key Highlights

3QFY2013 Financial Performance

Financial Position /Capital Management

Portfolio Update

Market Update and Outlook

2

Page 4: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

Key Highlights

Page 5: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

Key Highlights of 3Q FY2013 Results

•Soilbuild Business Space REIT successfully listed on the SGX on 16 August 2013 (hereinafter referred to as “Listing Date”)

•IPO oversubscribed multiple times with strong support from investors amidst challenging market conditions for REITs

•Strong support shown by Soilbuild Group/Mr Lim Chap Huat with a 26% unitholding post listing

Listing of Soilbuild Business Space

REIT

•Distribution per Unit for 3Q FY2013 (Listing Date to 30 September 2013) at SGD 0.760 cents - 3.0% above the Forecast1

•Portfolio Gross Revenue and Net Property Income for 3Q FY 2013 outperformed the Forecast1 by 0.8% and 2.0% respectively

3Q 2013 Results

•75% of debt hedged. Average all-in interest cost of 3.11% as at 30 September 2013

•Conservative gearing at 29.4% as at 30 September 2013 provides debt headroom for future acquisitions

•Healthy interest cover ratio of 5.6 times

Financial Position

•Portfolio occupancy rate increased to 99.8% due to expansion by existing tenant in Eightrium

•3 lease renewals in Eightrium and Tuas Connection resulted in positive rental reversion of 7.9%.

•No further leases due for renewal for the rest of FY2013

Portfolio Update

Notes:

1. The Forecast is derived from the Forecast Year 2013 figures disclosed in the Prospectus dated 7 August 2013 (the “Prospectus”).

4

Page 6: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

3QFY2013

Financial Performance

Page 7: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

3Q FY2013 Distribution

For the period from

Listing Date to 30 September 13 Actual Forecast Variance

(%)

Distributable Income (S$000) 6,113 5,929 3.1%

Distribution per Unit (”DPU”) (cents) 0.760 0.738 3.0%

Annualised DPU (cents)(1) 6.03 5.86 2.9%

Annualised Distribution Yield(2) 8.1%

Note:

(1) Based on 803.5 million units in issue as at 30 September 2013

(2) Based on closing price as at 30 Sep 2013 of $0.745

6

Page 8: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

3Q FY2013 Financial Results – P&L

For the period from

Actual Forecast

Variance

(%)

Listing Date to 30 September 2013

(S$000)

Revenue 8,232 8,164 0.8%

Less Property Expenses (1,323) (1,388) 4.7%

Net Property Income 6,909 6,775 2.0%

Managers Fees (611) (593) (3.0%)

Other Trust Expenses (110) (113) 2.7%

Finance Costs (1) (1,101) (1,163) 5.3%

Net Investment Income before Tax

and fair value change 5,087 4,906 3.7%

Fair value change in investment

properties 29,748 - n.m

Net income before tax 34,835 4,906 n.m

Add back Non-Tax Deductible Items(2) (28,772) 1,023 n.m

Distributable Income 6,113 5,929 3.1%

Note:

(1) Finance Costs comprise net interest expense and amortization of upfront debt financing costs.

(2) “Non-tax deductible items” comprise the Manager’s management fees, property management and lease management fees paid or payable in Units, rent free amortisation, net

change in fair value of investment properties, Trustee fees and amortisation of upfront debt financing costs.

7

Page 9: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

3Q FY2013 Distribution

Distribution Timetable 3Q FY2013

Distribution Details 3Q FY2013

Distribution Period 16 August 2013 – 30 September 2013

Distribution Amount 0.760 cent per unit

Last Day of Trading on “cum” Basis Tuesday, 5 November 2013

Ex-Date Wednesday, 6 November 2013

Books Closure Date Friday, 8 November 2013 (5.00 pm)

Distribution Payment Date Wednesday, 4 December 2013

8

Page 10: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

Financial Position/

Capital Management

Page 11: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

3Q FY2013 Financial Results – Balance Sheet

All figures S$000 unless otherwise stated Actual

as at

30 September

2013

Pro-forma

as at

31 December

2012

Investment Properties 935,000 935,000

Other Assets 17,326 1,000

Total Assets 952,326 936,000

Current Liabilities 12,793 8,351

Bank Borrowings 274,881 274,656

Other Liabilities 21,873 13,766

Net Assets 642,779 639,227

Units in Issue (‘000) 803,469 803,469

Net Asset Value per Unit (S$) 0.80 0.80

10

Page 12: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

Capital Management

Borrowing Details

Total Debt Facility S$285 million

Total Debt Drawn Down S$280 million

Aggregate Leverage(1) 29.4%

Average All-in Interest Costs(2) 3.11%

Weighted Average Debt Maturity 2.9 years

Interest Coverage Ratio 5.6x

Debt Maturity Profile (S$ Million)

$95.0 $95.0

$90.0

2013 2014 2015 2016 2017

11

% of Debt

Maturing 0% 0% 34% 34% 32%

% of Fixed Debt 0% 0% 25% 25% 25%

Note:

(1) Ratio of Debt over Deposited Properties under the Property Funds Appendix

(2) Inclusive of margins and amortisation of upfront fees

75% of Debt already hedged

75% of the initial debt drawn down at

IPO has been fixed with 2, 3 and 4 year

interest rate swaps

Weighted average swap rate is slightly

below 1%

No Near Term

Refinancing Risks

Well spread maturity

profile with weighted

average debt maturity

of 3 years

Page 13: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

Portfolio Update

Page 14: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

Portfolio Overview

Keppel

Terminal Sentosa

Jurong Island

Jurong Port

Second Link

(Tuas Checkpoint)

PSA

Terminal

Tuas Port

(2022)

ONE-NORTH

CHANGI SIMEI

EXPO JOO KOON

BOON LAY

PIONEER BUONA VISTA

Solaris NLA: 441,533 sq ft

Valuation: S$303.0 million

Soilbuild REIT Properties are located in key technology, media and back office hubs and logistics clusters, which are near air and sea

transportation ports such as Changi Airport, Jurong Port and the planned mega container port at Tuas expected to be operational around 2022.

Eightrium NLA: 177,286 sq ft

Valuation: S$101.0 million

NLA: 1,240,583 sq ft

Valuation: S$319.0 million

COS Printers NLA: 58,752 sq ft

Valuation: S$11.0 million

Tuas Connection NLA: 651,072 sq ft (5)

Valuation: S$125.0 million

BK Marine

NLA: 73,737 sq ft

Valuation: S$15.0 million

BizCentral

NLA: 312,375 sq ft

Valuation: S$61.0 million

( (1) As at 30 September 2013. (2) Based on the higher of CBRE and Colliers’ valuations. (3) By Gross Rental Income for the month of 30 September 2013.

(4) As at 30 September 2013; (5) NLA includes some dedicated common areas within tenants’ compounds but does not constitute GFA.

NK Ingredients

Total Valuation (2) S$935 million

Total NLA 2,955,338 sq ft

WALE (3) 3.82 years

Occupancy (4) 99.8%

IPO Portfolio Summary (1)

CBD

13

Industrial Properties

Business Park Properties

Page 15: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

Portfolio Summary

(1) Age from issue of CSC (as at Sep 30, 2013). (2) Assumes master leases in place. (3) Phase 1 of development received CSC in July 1991 and Phase 2 of development received CSC in Aug 2007. (4) As at Sep 30, 2013.

Property Type

Lease

Arrangement

Property

Age (1)

(Years)

Remaining

Land Lease

(Years)

Occupancy

Rate(2)

as at 30 Sep 13

Occupancy

Rate as at

IPO

Purchase

Price

(S$ Million)

Solaris Business

Park

Master

Lease 2.0 55 100.0% 100.0% $293.4

West Park BizCentral Multi-User

Ramp-up

Factory

Multi

Tenanted 1.0 55 100.0% 100.0% $313.0

Eightrium Business

Park

Multi

Tenanted 6.0 52 97.4% 95.3% $91.4

Tuas Connection Multi-User

Land Based

Factory

Multi

Tenanted 3.2 37 100.0% 100.0% $122.7

NK Ingredients Single-User

Factory

Master

Lease

Ph1: 22.2

Ph2: 6.1 33 100.0 % 100.0 % $60.0

COS Printers Single-User

Factory

Master

Lease 16.7 29 100.0% 100.0% $10.3

Beng Kuang Marine Single-User

Factory

Master

Lease 13.4 43 100.0% 100.0% $14.5

Portfolio 3.6 50(4) 99.8% 99.7% $905.3

(3)

14

Portfolio occupancy as at 30 Sep 2013 increased by 0.1% since IPO due to space expansion of an existing tenant

Page 16: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

16.4%

16.2%

12.4%

11.8%

7.2%

4.6%

4.6%

4.5%

22.5%

Marine Offshore, Oil & Gas

Precision Engineering, Electrical andMachinery productsSupply Chain Management, 3rdParty Logistics, Freight ForwardingChemicals

Fabricated Metal Products

Electronics

Publishing, Printing & Reproductionof Recorded MediaConstruction

Others

Key Portfolio Metrics

Portfolio Income by Property 1

Well Spread Trade Sectors(1) 2

Diversified Tenant Base(1) 3

Balanced portfolio with Growth Upside 4

% of Occupied

NLA of 2.93

million sq ft

Eightrium @ Changi

Business Park 14%

Tuas Connection

16%

West Park BizCentral

34%

Solaris 26%

NK Ingredients 7%

COS Printers 1%

BK Marine 2%

3QFY2013

Gross

Revenue of

S$8.2 million

Multi-tenanted Properties

58%

Properties under Master

lease 42%

3QFY2013

NPI:

S$6.9

million

(1) Inclusive of underlying tenants for Solaris

Total of

104

tenants in

portfolio

(1) Inclusive of underlying tenants for Solaris

15

MNC 65%

SME 29%

Government Agency

6%

Page 17: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

Leasing Update

16

16%

33%

12%

37%

2%

1%

1%

0%

5%

10%

15%

20%

25%

30%

35%

40%

2013 2014 2015 2016 >2016

3Q 2013 Lease expiries renewed Area up for expiry as % of total NLA

All the expiries

due in 2013 have

been renewed

3Q FY2013 Leasing Update

No of Leases up for

Renewals No of Leases Renewed

Retention rate Rental reversion

achieved (by area)

2 / (1.8% of NLA) Renewed 3 / (2.2% of NLA) (1) 100% 7.9%

TOTAL 3 / (2.2% of NLA) 100% 7.9%

(1) Inclusive of forward renewal of future lease expiries

Page 18: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

0.0%

17.3%

33.1%

12.7%

36.8%

0.0%

15.8%

28.2%

11.5%

44.5%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

50.0%

2013 2014 2015 2016 >2016

Lease Expiry Profile By total NLA Lease Expiry Profile By Gross Income

Well Staggered Lease Expiry Profile

17

No leasing risk for the remainder of 2013

100% YTD retention rate since IPO reflects proactive tenant relationship management

Tenant Lease Expiry Profile (% of total NLA & Gross Rental Income)

WALE (by occupied NLA)

3.9 years

WALE (by Gross Income)

3.8 years

Page 19: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

26.8%

7.7%

5.6%

4.6%

2.5%

1.9%

1.8%

1.6%

1.5%

1.4%

Soilbuild(2)

NK Ingredients Pte Ltd

Schenker (Singapore) Pte Ltd

Nestle Singapore (Pte) Ltd

Barclays Technology Centre Limited

Dyson Operations Pte Ltd

PICCO Enterprise Pte Ltd

Knowledge Universe Singapore Pte Ltd

C.O.S Printers Pte Ltd

Huawei International Pte Ltd

Quality and Established Tenant Base

18

Top 10 Tenants (By Gross Rental Income) (1)

Top 10 tenants (excluding Soilbuild) accounts for less than 30% of Gross Rental Income (1)

Mitigation for

Sponsor Concentration Risk:

Strong underlying tenant base of established tenants

Rentals secured with 12-months rental deposits

Best-in-class properties with strong demand

Established Sponsor with successful track record

(1) For the month of September 2013

(2) Soilbuild’s exposure includes SB Solaris (Investment) Pte.Ltd. and SB Storage Pte Ltd

.

Soilbuild(2)

Page 20: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

Market Update

and Outlook

Page 21: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

Median Rents of Business Space

0.00

0.50

1.00

1.50

2.00

2.50

2007 2008 2009 2010 2011 2012 1H 2013

$ p

sf

pe

r m

on

th

Islandwide West Region

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

4.50

5.00

2007 2008 2009 2010 2011 2012 1H 2013

$ p

sf

pe

r m

on

th

Islandwide IBP CBP MBC and Singapore Science Park

0.00

0.50

1.00

1.50

2.00

2.50

2007 2008 2009 2010 2011 2012 1H 2013

$ p

sf

pe

r m

on

th

Islandwide West Region

0.00

0.50

1.00

1.50

2.00

2.50

2007 2008 2009 2010 2011 2012 1H 2013

$ p

sf

pe

r m

on

th

Islandwide West Region

Median Rents for Private Business Park 1

Median Rents for Private Single-user Factory 2

Median Rents for Private Multiple-user Factory 3

Median Rents for Private Warehouse 4

Source: Realis

20

Page 22: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

Market Update and Outlook

21

•Singapore’s economy grew 3.8% y-o-y in 2Q 2013 as a result of robust growth in the manufacturing, wholesale & retail trades, transportation & storage, and finance & insurance sectors

•Despite modest growth expectations for the advanced and Asian economies and concerns of future interest rate hikes, Singapore’s economy is forecast to grow between 2.5-3.5%

Singapore’s Economy

•For 1H 2013, the URA All Industrial Property price and rent index recorded slower growth of 3.8% and 0.35% respectively as a result of new government policies

•Market rents expected to remain steady for conventional industrial premises and record a marginal uptick for higher quality hi-tech and business park space

•Transactions likely to remain subdued for remainder of 2013 given the cooling policy measures and fragile economic outlook

Industrial

Property

Sector

•Nil leasing risk for the remainder of 2013 with approximately 17% of the portfolio NLA due for expiry in 2014

•Barring any unforeseen events, Management believes that Soilbuild REIT is well placed to deliver on its stated forecast distribution for this financial year

Soilbuild

REIT

Source: Ministry of Trade and Industry, URA, Colliers Research

Page 23: 3QFY2013 Results Presentation - listed companysoilbuildreit.listedcompany.com/newsroom/20131030_180747...2013/10/30  · 3Q FY2013 Financial Results – Balance Sheet All figures S$000

Key Contacts:

Thank You

Shane Hagan Chief Executive Officer Tel: (65) 6415 5980

Email: [email protected]

Roy Teo Chief Operating Officer Tel: (65) 6415 5983

Email: [email protected]