Capital & Counties Properties PLC Annual Results 2015 24 February 2016 www.capitalandcounties.com
This presentation includes statements that are forward-looking in nature. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Capital & Counties Properties PLC to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Any information contained in this presentation on the price at which shares or other securities in Capital & Counties Properties PLC have been bought or sold in the past, or on the yield on such shares or other securities, should not be relied upon as a guide to future performance. Capco Annual Results 2015 www.capitalandcounties.com
Introduction 1. INTRODUCTION AND OVERVIEW Financial Review Ian Hawksworth 2. FINANCIAL REVIEW Soumen Das Operating Update 3. COVENT GARDEN Soumen Das Looking Ahead 4. EARLS COURT PROPERTIES Gary Yardley 5. LOOKING AHEAD Ian Hawksworth Q&A 6. Q&A Capco Annual Results 2015 www.capitalandcounties.com
Introduction Financial Review Operating Update Ian Hawksworth, Chief Executive Looking Ahead Q&A Capco Annual Results 2015 www.capitalandcounties.com
Capco Annual Results 2015 www.capitalandcounties.com
Total property value Total return NAV per share Total dividend £3.7bn 1 361p 17% 1.5p per share +14% like-for-like +16% STRONG DEMAND FOR COVENT GARDEN PLANS ON TRACK AT EARLS COURT Most active year of leasing Demolition progressing well 74 new leases and renewals, 11% above Lillie Square Phase 1 construction underway and December 2014 ERV Phase 2 sales commenced 12% lfl increase in ERV to £86m Opportunities to evolve and intensify the Masterplan On track to achieve ERV target of £100m by – Dec 2017 Detailed planning consent for West Brompton Village £50m of acquisitions on estate Kings Court on track 1. Group share Capco Annual Results 2015 www.capitalandcounties.com
Total property value Total return NAV per share Total dividend £3.7bn 1 361p 17% 1.5p per share +14% like-for-like +16% OPERATIONAL EXCELLENCE AT OLYMPIA ROBUST AND DISCIPLINED BALANCE SHEET Strong valuation +25% lfl Conservative 16% LTV EBITDA of £15m, +33% Completion of new £705m Covent Garden RCF Successful transition of shows and bright future Over £450m 1,2 of cash and available facilities prospects Weighted average cost of debt 2.8% 2 1. Group share 2. Proforma adjusted for new RCF Capco Annual Results 2015 www.capitalandcounties.com
VALUATION GROWTH Covent Earls Court £300m Garden Properties +16% £2.0bn £1.4bn 1 £250m +16% lfl +9% lfl £200m Initial yield: Total property value 2.1% Equivalent yield: 3.7bn 1 3.5% +9% £150m +14% lfl £100m +25% £50m Venues £0.3bn +25% lfl 0 Covent Garden Earls Court Venues Properties H1 H2 1. Group share Capco Annual Results 2015 www.capitalandcounties.com
Looking Ahead Q&A Introduction Financial Review Operating Update www.capitalandcounties.com Soumen Das Capco Annual Results 2015
2015 2014 Var £m £m £m Net rental income 75.4 70.1 5.3 Administration costs (52.8) (43.2) (9.6) Net finance costs (20.1) (15.1) (5.0) Other 2.0 1.5 0.5 Tax on underlying earnings 3.0 (0.2) 3.2 Non-controlling interest 0.3 - 0.3 Underlying earnings 7.8 13.1 (5.3) Underlying earnings per share 0.9p 1.6p (0.7)p Total dividend per share (proposed final 1.0p) 1.5p 1.5p - Capco Annual Results 2015 www.capitalandcounties.com
80 £75.4m £4.0m £2.0m £70.1m £0.5m 70 £0.2m Venues £19.3m Venues £15.3m 60 50 Earls Court Earls Court Properties £17.8m Properties £18.0m 40 30 Covent Garden 20 Covent Garden £38.8m £36.8m 10 0 2014 Covent Garden Earls Court Properties Venues Other 2015 Venues EBITDA £14.8m Capco Annual Results 2015 www.capitalandcounties.com
£m 90 £15.3m 80 £13.6m 70 60 £1.6m £3.0m £0.4m £4.5m 50 £86.2m 40 £55.7m 30 £47.8m 20 10 Dec-15 Gross Rent-frees/ Stepped Turnover Lease / Under Income Contracted Vacancies Development Under-rented Dec-15 ERV Income Rent/Temporary Non-leased income Contract/Offer & Under Offer lettings Capco Annual Results 2015 www.capitalandcounties.com
Dec-15 Dec-14 Var £m £m £m Investment & Trading Property 3,530 2,905 625 Unrecognised surplus on trading property 100 96 4 Net debt (579) (352) (227) Other 8 (19) 27 EPRA adjusted NAV 3,059 2,630 429 Number of shares in issue (diluted) 848m 846m 2m EPRA adjusted NAV per share 361p 311p 50p ECPL (Capco 63% share) CLSA not yet recognised as an asset on balance sheet Contingent tax liability on investment properties £11m; on trading properties £20m £207m capital commitments Note: A reconciliation to the financial statements can be found in the appendix Capco Annual Results 2015 www.capitalandcounties.com
370 1p 0.9p 50p 360 1.5p 350 340 330 320 361p 310 300 311p 290 280 Dec-14 Valuation of property Underlying Profits Dividend Other Dec-15 Diluted EPRA NNNAV 356 pence per share Capco Annual Results 2015 www.capitalandcounties.com
Proforma 1 Dec-15 Dec-14 New £705 million unsecured RCF for Net Debt 2 £579m £352m Covent Garden LTV 16% 12% – Replaces existing £665m facility signed in Group interest cover 123% 188% February 2014 Cash and available facilities 2 £452m £412m £648m – Reduces weighted average cost of debt from Weighted average cost of finance 2.8% 3.3% 3.4% 3.3% to 2.8% upon drawing Weighted average maturity 5.3 yrs 4.1 yrs 5.1 yrs Predominantly unsecured debt model % WEIGHTED AVERAGE COST OF DEBT 6.5 5.9% 6.0 5.5 5.0 4.5 4.0 3.3% 3.5 2.8% 3.0 2.5 2.0 2010 2011 2012 2013 2014 2015 Proforma 1. Proforma adjusted for new RCF 2. Group share Capco Annual Results 2015 www.capitalandcounties.com
700 £655m 600 500 £462m £210m 400 £543m 300 £361m £65m 200 £40m £7m 100 £285m £8m £112m £101m 0 Dec-14 Operating cash Non controlling Net borrowings Investing activities Dividend & Other Covent Garden Dec-15 1 flow interest drawn RCF Cash Undrawn Facilities 1. Proforma adjusted for new RCF 2. Numbers on a proportionate consolidation basis Capco Annual Results 2015 www.capitalandcounties.com
Looking Ahead Q&A Introduction Financial Review Operating Update www.capitalandcounties.com Soumen Das Capco Annual Results 2015
Capco Annual Results 2015 www.capitalandcounties.com
Asset management Tactical acquisitions Target Return 10 – 12% Strategic development Creativity Planning Land assembly Target Return 12 – 15% Land enablement Selective development Capco Annual Results 2015 www.capitalandcounties.com
Portfolio value ERV New lettings & renewals Acquisitions £2.0bn +12% (lfl) +11% £50m +16% like-for-like £86m Ahead of Dec-14 ERV Brands attracted to the estate’s retail environment and customer experience Most active year of leasing – 74 new leases and renewals – 100 th brand signed to estate New Zone A rental levels achieved Continued investment activity on the estate Capco Annual Results 2015 www.capitalandcounties.com
ITZA psf (£) – December 2015 £1,600 £1,400 £1,200 £1,000 £800 £600 £400 £200 -- * Based on 30 ft Zone A, includes Old Bond St, Oxford St West and Regent St. (Covent Garden based on 20 ft Zone A.) ** Covent Garden average based on all streets, including Market Building. Capco Annual Results 2015 www.capitalandcounties.com
£1,000+ £600 - £999 £450 - £599 £300 - £449 £200 - £299 £0 - £199 Acquisitions Since Dec 2009 Capco Annual Results 2015 www.capitalandcounties.com
Capco Annual Results 2015 www.capitalandcounties.com
Capco Annual Results 2015 www.capitalandcounties.com
SushiSamba to occupy Opera Terrace – Redevelopment of iconic rooftop restaurant 6 new concepts brought to the estate All day dining in the Market Building – Aubaine Complementary dining offer on Henrietta Street – Flat Iron – Frenchie First London flagship for Mariages Frères on King Street Capco Annual Results 2015 www.capitalandcounties.com
Introduction Financial Review Operating Update Gary Yardley Looking Ahead Q&A Capco Annual Results 2015 www.capitalandcounties.com
Capco Annual Results 2015 www.capitalandcounties.com
Earls Court Partnership Limited – Investment vehicle with TfL in respect of EC1 & EC2 land – Capco share 63%; business and development manager – Includes certain assets on and around Lillie Road Empress State Building – 100% owned by Capco Lillie Square – 50:50 JV with KFI Land subject to CLSA – Option exercised and binding agreement in place Lillie Bridge Depot – 100% owned by TfL – Feasibility report published Capco Annual Results 2015 www.capitalandcounties.com
Asset management Tactical acquisitions Strategic development Creativity Planning Land assembly Land enablement Selective development Capco Annual Results 2015 www.capitalandcounties.com
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