ANNUAL RESULTS PRESENTATION For the year ended 30 June 2016
AGENDA Strategy & Highlights Financial Results Capital Management Portfolio Update South Africa V&A Waterfront GOZ Conclusion Annexures Harbour, V&A Waterfront
Value 1 STRATEGY & HIGHLIGHTS Bridgepark, Cape Town
2016 Tough year REVIEW Volatile Increasing interest financial rate environment markets
Depressed local Supply continues and to exceed demand global growth Refining our vision which drives our strategy Optimising and streamlining the existing portfolio Non core properties identified for sale Introduction of new revenue streams Funds management business Trading and development Grow contribution of non-SA distributable income GOZ Europe incl. Eastern Europe
STRATEGY & HIGHLIGHTS Financial Results Capital Management Portfolio Update Conclusion VISION & MISSION VISION To be a leading international property company providing space to thrive MISSION We create value for all our stakeholders through innovative and sustainable property solutions 6
STRATEGY & HIGHLIGHTS Financial Results Capital Management Portfolio Update Conclusion FY16 HIGHLIGHTS 183,8 5.7% 27.2% 30.5% vacancies cents expense-to-income LTV 6.0% Same as FY15 RSA expenses under RSA gearing levels growth control FY16 – strong focus remain conservative, 27.8% FY15 decreased from 32.1% on tenant retention dividend per share FY15 26.1% R5,1bn R112,5bn 19.7% property value growth in gross 19.8% distributable property assets increase revenue income growth GOZ 7
STRATEGY & HIGHLIGHTS Financial Results Capital Management Portfolio Update Conclusion GROWTHPOINT HIGHLIGHTS Excellent corporate #1 R3,8bn 35th Top 7 th governance largest average value largest 5 year Transparent traded/ company on reporting month the JSE Sustainable quality of earnings South African, Most liquid and Inclusion in Constituent Inclusion in primary listed tradeable way FTSE/JSE FTSE Russell FTSE/JSE Proven management REIT to own Top 40 Index EPRA/NAREIT Responsible track record commercial Investment Emerging Index property in SA Index Underpinned by high-quality physical property Market assets capitalisation Diversified across R71,5bn sectors and geography 8
STRATEGY & HIGHLIGHTS Financial Results Capital Management Portfolio Update Conclusion GROWTH IN DIVIDEND PER SHARE (CENTS) Growth Growth Growth Growth 7.2% 8.3% 7.5% 6.0% 183,8 173,4 161,3 6.0% 149,0 7.5% 44,5 139,0 94,3 8.5% 7.2% 82,8 76,3 44,5 71,2 6.0% 7.5% 89,5 8.0% 7.2% 84,4 78,5 72,7 67,8 FY12 FY13 FY14 FY15 FY16 Interim dividend Special dividend Final dividend London Circuit, Canberra, ACT 9
STRATEGY & HIGHLIGHTS Financial Results Capital Management Portfolio Update Conclusion GROWTH IN TANGIBLE ASSETS AND MARKET CAPITALISATION Tangible assets (Rbn) Market cap (Rbn) Share price (cents) NTAV per share (cents) Rbn Cents 120 3 000 2 568c 100 2 500 2 474c 80 2 000 60 1 500 40 1 000 20 500 0 0 FY11 FY12 FY13 FY14 FY15 FY16 10
STRATEGY & HIGHLIGHTS Financial Results Capital Management Portfolio Update Conclusion LONG BOND YIELD VS. GRT FORWARD YIELD Long Bond GRT Forward Yield 11% 10% 9% 8% 7% 6% 5% 4% 01/07/2011 01/01/2012 01/07/2012 01/01/2013 01/07/2013 01/01/2014 01/07/2014 01/01/2015 01/07/2015 01/01/2016 01/07/2016 Jun 2011 Dec 2011 Jun 2012 Dec 2012 Jun 2013 Dec 2013 Jun 2014 Dec 2014 Jun 2015 Dec 2015 Jun 2016 11
Value 2 FINANCIAL RESULTS Hilltop Industrial Park, Elandsfontein
Strategy & Highlights FINANCIAL RESULTS Capital Management Portfolio Update Conclusion CONTRIBUTION TO DISTRIBUTABLE INCOME Growth Growth 21.0% 19.8% R5 072m 0.4% 22 772 R4 232m 15.2% 8.5% 429 345 8.2% R3 497m 658 15.5% 4.7% 165 513 14.7% 368 8.7% 9.5% 332 75.9% 3 849 71.1% 67.6% 2 861 2 487 FY14 FY15 FY16 RSA V&A Waterfront GOZ Listed Investments The Oval, Cape Town 13
Strategy & Highlights FINANCIAL RESULTS Capital Management Portfolio Update Conclusion CONSOLIDATED DISTRIBUTION CALCULATION FY16 FY15 INCREASE/ Rm Rm (DECREASE) Gross property income 9 764 7 740 26.1% RSA 7 589 5 896 28.7% GOZ 2 175 1 844 18.0% Property expenses (2 126) (1 630) 30.4% RSA (1 864) (1 417) 31.5% GOZ (262) (213) 23.0% Net property income 7 638 6 110 25.0% Other operating expenses (308) (303) 1.7% RSA (204) (222) (8.1%) GOZ (104) (81) 28.4% Net property income after operating expenses 7 330 5 807 26.2% Finance costs (2 466) (2 086) 18.2% RSA (1 989) (1 663) 19.6% GOZ (477) (423) 12.8% Finance income 760 987 (23.0%) Investment income from V&A Waterfront 429 368 16.6% Other finance income (1) 331 619 (46.5%) Adjustment for NCI, foreign exchange profit / (loss), normal taxation and profit on sale of Stor-Age (552) (476) 16.0% Distributable profit 5 072 4 232 19.8% Dividend for the period 5 072 4 232 19.8% 1. Includes R39m (FY15: R66m) dividends received on treasury shares held, R31m antecedent dividend, R22m distribution from Stenham (FY15: R345m from Acucap & Sycom prior to the acquisition of the remaining interest on 1 April 2015) and R50m interest on V&A Waterfront development funding. * Average exchange rate at R10.57/AUD (FY15: R9.55/AUD) for GOZ. 14
Strategy & Highlights FINANCIAL RESULTS Capital Management Portfolio Update Conclusion EXPENSE TO INCOME RATIOS (IFRS) SOUTH AFRICA V&A WATERFRONT GOZ 28.6% 27.8% 27.2% 29.9% 30.7% 30.8% 17.4% 16.0% 16.8% 2.9% 3.1% 3.3% 3.8% 3.8% 2.7% 5.3% 4.8% 27.8% 27.7% 4.4% 26.6% 24.8% 24.5% 24.0% 12.1% 12.0% 11.6% FY14 FY15 FY16 FY14 FY15 FY16 FY14 FY15 FY16 Operating Expense Ratio Property Expense Ratio Operating Expense Ratio Property Expense Ratio Operating Expense Ratio Property Expense Ratio 15
Strategy & Highlights FINANCIAL RESULTS Capital Management Portfolio Update Conclusion CONSOLIDATED BALANCE SHEET (EXTRACTS) FY16 FY15 INCREASE/ Rm Rm (DECREASE) Property portfolio (1) 104 690 93 574 11.9% RSA 73 752 71 550 3.1% GOZ (2) 30 938 22 024 40.5% 50% Investment in V&A Waterfront 6 616 6 047 9.4% Other property-related investments 440 742 (40.7%) Nominal borrowings (3) 38 413 33 811 13.6% RSA (4) 24 653 25 444 (3.1%) GOZ (2) 13 760 8 367 64.5% Shareholders interest 68 295 63 369 7.8% 1. Includes R1 938m of properties classified as held for sale (FY15: R539m), of which R1 674m relates to GOZ. 2. Closing exchange rate at R11.04/AUD (FY15: R9.40/AUD). 3. Excludes fair value adjustments. 4. The total value for FY16 excludes the deferred payments of R165m on the Samrand land purchased. The two outstanding payments are due Sept 2016 and Sept 2017. 16
Value 3 CAPITAL MANAGEMENT Inanda Greens, Sandton
Strategy & Highlights Financial Results CAPITAL MANAGEMENT Portfolio Update Conclusion RSA CAPITAL MANAGEMENT Debt Funding Equity Funding Bank margins increased since last year DCM more liquid R1,8bn raised incl. DRIP More volatility in swap rates post Nenegate & BREXIT Sovereign rating downgrade uncertainty remains FOR RSA FY16 FY15 Unutilised committed facilities (Rbn) 5,9 4,1 Weighted average term of liabilities (years) 3.0 2.9 Weighted average term of fixed interest rate profile (years) 3.4 3.5 Weighted average interest rate (%) 9.3 8.9 Weighted average interest rate (%) (Incl. CCIRS) 8.5 N/A % debt at fixed interest rate (incl. forward starting swaps) 86.6 76.0 Unencumbered assets (incl. V&A Waterfront and listed investments) (Rbn) 37,2 35,1 Unsecured debt (Rbn) 8,1 7,5 Greenfield Industrial Park, Cape Town 18
Strategy & Highlights Financial Results CAPITAL MANAGEMENT Portfolio Update Conclusion RSA CAPITAL MANAGEMENT (CONTINUED) National Scale Aaa.za - one of only two SA corporates MOODY’S Global Scale Baa2/P-2 – capped at sovereign rating RECALIBRATION Negative outlook – based on that of sovereign R1.4bn of bonds and commercial paper repaid BONDS Bond issues well supported, raised R1,6bn for a term of 3-5 years Continued issuance of commercial paper R400m R4,0bn of bank debt repaid BANKING R5,6bn of new bank debt RELATIONSHIPS Continued support for good quality borrowers Total AUD452m representing 59% of the historical cost of GOZ CROSS CURRENCY and 38% of market value of GOZ INTEREST RATE SWAPS Yield on GOZ higher than implied cost of AUD Oxford Corner, Rosebank 19
Strategy & Highlights Financial Results CAPITAL MANAGEMENT Portfolio Update Conclusion RSA DIVERSIFIED BORROWINGS — NOMINAL VALUE R16 499m R25 444m R24 653m 400 Debt capital 400 Debt capital market 2 659 market 12.0% 3 284 Unsecured 14.9% 29.6% Unsecured 32.3% 4 480 4 286 2 053 400 1 803 Debt capital market 3 909 Unsecured 26.1% 37.0% Traditional Traditional 1 796 bank debt bank debt 88.0% 1 450 85.1% Secured Secured 70.4% 15 852 67.7% 14 880 Traditional bank debt Secured 73.9% 63.0% 8 944 (1) FY14 FY15 FY16 Secured bank debt Secured institutional financier Unsecured bank debt and institutional financier Corporate bonds Commercial paper 1. The total value for FY16 excludes the deferred payments of R165m on the Samrand land purchased. The two outstanding payments are due Sept 2016 and Sept 2017. 20
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