1H FY 04/05 Results and Proposed Equity Raising Presentation Thursday, 14 October 2004
This Presentation is focused on comparing actual results versus forecasts outlined in the A-REIT Circular of 18 February 2004 and actual results in the prior corresponding period. This shall be read in conjunction with A-REIT’s First Half-Year Financial Statement for the period from 1 April to 30 September 2004 in the Masnet announcement. This presentation may contain forward-looking statements that involve risks and uncertainties. Actual 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. Representative examples of these factors include (without limitation) general industry and economic conditions, interest rate trends, cost of capital and capital availability, competition from similar developments, shifts in expected levels of property rental income, changes in operating expenses, including employee wages, benefits and training, property expenses and governmental and public policy changes and the continued availability of financing in the amounts and the terms necessary to support future business. You are cautioned not to place undue reliance on these forward looking statements, which are based on current view of management on future events. 2
Agenda • Half-Year FY 04/05 In Review – Financial Highlights – Capital Management – Portfolio Update • Proposed Equity Raising – Offer Structure – Benefits to Unitholders – Timetable
Half-Year Review Half-Year • Enhanced Unitholders’ value FY04/05 In Review Financial Highlights – DPU: 10% above previous corresponding period and 4% above forecast Capital Management Unit price (1) : up by 22% in the 6 months under review – Portfolio Update – Quarterly distributions to be paid from 3Q FY 04/05 (Jan – Mar 05) Proposed Equity Raising – Rounding up for odd lots Offer Structure Benefits to Unitholders • Growing through yield accretive acquisitions Timetable – Announced acquisition of 16 properties with yield of ranging from 7.8% - 11.0% – Total assets S$1.25 bn as at 30 Sep 04 up from $1.02 bn as at 31 Mar 04 – Acquisition pipeline remains very strong (1) Based on closing price of S$1.55 per unit on 30 September 2004 and closing price of S$1.27 per unit on 1 April 2004 4
Half-Year Review • Organic growth from active portfolio management Half-Year FY04/05 In Review Financial – Portfolio occupancy of 92.7% as at 30 Sept 04 up from 88.8% as at 31 Mar Highlights 04 through acquisitions and portfolio management Capital Management – New leases and renewals of 52,071 sqm for 6 months ended 30 Sep 04 Portfolio Update Proposed – Adding new GFA Equity Raising Offer Structure – Acquisitions performed beyond expectations Benefits to Unitholders • Creating value from managing capital structure Timetable – Established CMBS programme; expected savings of S$1 million p.a – Private placement of S$115m at S$1.40 / unit in Jun 04 was well received – Market cap up to S$1.2bn as at 30 Sep 04 from S$898m as at 1 Apr 04 – Equity raising planned to fund new acquisitions 5
Half-Year Review • Corporate governance - accolades Half-Year FY04/05 In Review Financial Highlights – Ranked no. 9 in BT Corporate Transparency Index 2004 Capital Management – Awarded Most Transparent Company under REIT Portfolio Update category in SIAS Investors’ Choice Awards 2004 Proposed Equity Raising Offer – Voted Best Investor Relations by Institutional Investor Structure Benefits to Research Group Unitholders Timetable • Management change – Trust manager, Stephen Hawkins will return to Macquarie Goodman with effect from 30 November 2004 6
Strategy Delivers… Half-Year FY04/05 In Review Financial Highlights Portfolio Update Stability Capital Capital Management Management S t Equity Raising a b Strategy Growth i Going l Forward i t y Yield 7
Agenda • Half-Year FY 04/05 In Review – Financial Highlights – Capital Management – Portfolio Update • Proposed Equity Raising – Offer Structure – Benefits to Unitholders – Timetable
Distributable Income Per Unit – 10% above corresponding period last FY Half-Year FY04/05 In Review Actual Actual (1) Financial Variance (%) Highlights (1/4/04 to (1/4/03 to Incr / (Decr) Capital 30/9/04) Management 30/9/03) Portfolio Update Proposed 54,399 31,905 71 Gross revenue Equity Raising Offer Structure (15,599) (8,195) 90 Property operating expenses Benefits to Unitholders 38,800 23,710 64 Net property income Timetable (6,949) (3,247) 114 Non-property expenses 31,851 20,463 56 Net investment income 33,718 22,099 53 Available for distribution Distribution per unit (2) 4.46 4.05 10 Notes: (1) Based on 9 properties in 1H 2003 versus 19 properties in 1H 2004 (2) Based on weighted average number of units 9
Distributable Income Per Unit – 4% above forecast of 18 Feb 04 Half-Year Six Months FY04/05 In Review (1/4/04 to 30/9/04) Financial Highlights S$’000 Capital Management Variance (%) Actual Forecast (1) Portfolio Update Incr / (Decr) Proposed Equity Raising 54,399 50,497 8 Gross revenue Offer Structure (15,599) (15,210) 3 Property operating expenses Benefits to Unitholders 38,800 35,288 10 Net property income Timetable (6,949) (6,549) 6 Non-property expenses 31,851 28,739 11 Net investment income 33,718 30,560 10 Available for distribution 4.46 4.31 4 Distribution per unit (2) Notes: (1) The extrapolated forecast for the period from 1 April to 30 September 2004 has been derived from the forecast stated in the circular dated 18 February 2004, on a best estimate basis by the Manager to allow for like comparison with the actual results. (2) Based on weighted average number of units 10
Balance Sheet Half-Year Actual as at Actual as at Actual as FY04/05 In Review 30/9/04 31/3/04 at 30/9/03 Financial Highlights S$’000 S$’000 S$’000 Capital Management Portfolio Total Assets 1,252,166 1,020,712 656,709 Update Proposed Equity Raising Borrowings 359,000 263,800 128,500 Offer Structure Benefits to Total unitholders’ Unitholders 839,643 691,650 504,252 funds Timetable Gearing (%) 28.7 25.8 19.6 Adjusted net asset 101 cents 95 cents 88 cents value per unit (1) Notes: (1) A-REIT’s distribution policy is to distribute 100% of its taxable income (other than gains on the sale of real properties determined to be trading gains). The available for distribution amount for the period from 4 March to 30 September 2004 has been excluded in arriving at the adjusted net asset value per unit. 11
Unit Price and Volume • A-REIT’s ability to deliver DPU growth has driven capital growth Half-Year FY04/05 In Review Financial Unit price performance to-date Highlights 1.60 60 Capital Management 1.49 1.55 1.50 1.48 Portfolio 1.43 Update 1.45 50 1.40 Proposed Equity Raising 1.33 Vol Weighted Ave Price S$ Offer 1.30 40 Structure Volume (million) Benefits to 1.26 1.22 Unitholders 1.20 1.2 Timetable 30 1.14 1.10 1.04 1.03 1.00 20 0.90 10 0.80 0.70 0 Oct-03 Nov-03 Dec-03 Jan-04 Feb-04 Mar-04 Apr-04 May-04 Jun-04 Jul-04 Aug-04 Sep-04 Mar 04 Jun 04 1 st equity fund Private raising for placement for S$186.2m S$115.0m 12
Distribution Details Half-Year Stock counter Distribution Period Distribution per FY04/05 In Review unit (cents) Financial Highlights Capital Ascendasreit 4 Mar to 31 Mar 2004 0.63 Management 1 Apr to 30 Sep 2004 4.46 Portfolio Update 5.09 Proposed Equity Raising Ascendasreit A 23 Jun to 30 Sep 2004 2.51 Offer Structure Benefits to Unitholders Timetable Distribution Timetable Notice of books closure date 14 October 2004 Last day of trading on “cum” basis 22 October 2004 Ex-date 25 October 2004 Books closure date 27 October 2004 Distribution payment date 23 November 2004 13
Agenda • Half-Year FY 04/05 In Review – Financial Highlights – Capital Management – Portfolio Update • Proposed Equity Raising – Offer Structure – Benefits to Unitholders – Timetable
Capital Management • Commercial Mortgage Banking Securities (CMBS) Half-Year FY04/05 In Review – Established a S$1 billion multi-currency secured Medium Term Financial Highlights Note Programme Capital Management Portfolio – Initial issuance of S$300m equivalent in Euros of AAA-rated Update Proposed CMBS to refinance existing borrowings Equity Raising Offer Structure • Initial issuance priced at 33 basis points over EURIBOR Benefits to Unitholders Debt Profile 30 Sept 30 Sept Timetable 2004 2003 - Total debt S$359m S$128.5m - Fixed rate debt S$260m S$48.5m - Fixed as a % of total debt 72.4% 37.7% - Weighted average term for fixed debt 3.7 yrs 2.6 yrs 2.35% (1) - Weighted average all-up funding cost 1.99% Including margins and weighted swap rates for hedged debt and current floating rates on unhedged debt, but excluding (1) amortisation of CMBS’ establishment and annual maintenance costs (21 bps) 15
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