Results Presentation – 1H 2019
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Table of contents Results summary Section 1 3 Business summary Section 2 7 Growth & strategy Section 3 13 Capital management Section 4 17 Company overview Appendix A 21 PT Pakuwon Permai acquisition Appendix B 42 Land bank Appendix C 46 Healthcare & Hospital expansion Appendix D 54 Senior Unsecured Notes due 2024 Appendix E 57 2
Section 1 Result summary 3
Results summary 1H 2019 1H 2018 Variance Comments (Rp bn unless otherwise stated) 7% increase in recurring revenues and 1% Revenue 3,505 3,377 +3.8% increase in development revenue recognition. Pakuwon Permai contributed Rp 1,352bn (39%) of revenues. Gross Profit 1 2,021 1,968 +2.7% Gross Profit Margin (%) 57.7% 58.3% EBITDA 1 1,973 1,919 +2.8% EBITDA Margin (%) 56.3% 56.8% Net Income for the Period 2 1,568 1,470 +6.6% Net Income Margin (%) 44.7% 43.5% Net Income Attributable to Owners 2 1,299 1,321 (1.6%) Net Income Margin (%) 37.1% 39.1% Earnings Per Share (In Full Rupiah) 2 Basic 26.97 27.42 (1.6%) Notes: 1 Adjusted for acquisition related COGS from goodwill costs of Rp19bn in 1H 2019 and Rp10bn in 1H 2018 2 Adjusted for acquisition COGS from goodwill costs of Rp19bn in 1H 2019 and Rp10bn in 1H 2018, forex gain (loss) of Rp76bn in 1H 2019 and (Rp173bn) in 1H 2018 respectively, gain (loss) on derivative of Rp8bn in 1H 2019 and (Rp8bn) in 1H 2018 respectively. 4
Results breakdown Revenue by segment (1H 2019) Revenue by project (1H 2019) Revenue by geography (1H 2019) Pakuwon Grand Office City Pakuwon Hotel & leasing 4.9% 3.1% Serviced 3.9% Kota Apartments Royal Plaza Kasablanka 7.6% 1.4% 25.1% Jakarta 38.7% Condo sales 41.3% Gandaria Pakuwon City Mall 11.3% Surabaya 34.7% 61.3% Retail Blok M Plaza leasing 1.6% 39.1% Office sales Tunjungan Somerset 1.1% City Landed 0.8% 17.1% houses 7.0% • 51% recurring revenue • Increased revenue contribution of • Jakarta revenue contribution Surabaya projects primarily from expected to grow as PWON • Contribution of recurring income Pakuwon Mall recognizes Kota Kasablanka phase continues to be driven by retail mall 2 condos and develops Bekasi and • Increased revenue contribution of leasing income Simatupang landbank Jakarta projects primarily from Kota • Increased residential sales • Continued management focus on Kasablanka and Gandaria City recognition of condominiums and growing in both Jakarta and landed houses Surabaya • PWON continues to target long term 50/50 recurring/development 5
Key recent developments Received in June 2018 ratings upgrade from S&P and Fitch to BB, stable outlook Opened Tunjungan Plaza Phase 6 retail mall on 23 September 2017 Received in July 2017 ratings upgrade from Moody’s to Ba2, stable outlook Opened Pakuwon Mall Phase 2 & 3 on 22 February 2017 Refinanced USD200m of 7.125% Senior Unsecured Note due 2019 Issued USD250m of 5.0% Senior Unsecured Note due 2024 Acquired in June 2016, 11ha land in Daan Mogot, West Jakarta 6
Section 2 Business summary 7
Residential market update Residential sales in prime locations by established developers remain resilient despite moderate softening in broader non-prime locations ASPs of condos in Jakarta (Rpm psm) ASPs of condos in Surabaya (Rpm psm) 60 40 50 35 30 40 25 30 20 20 15 10 10 5 0 0 1Q 2014 1H 2014 3Q 2014 4Q 2014 1Q 2015 1H 2015 3Q 2015 4Q 2015 1Q 2016 1H 2016 3Q 2016 4Q 2016 1Q 2017 1H 2017 3Q 2017 4Q 2017 1Q 2018 1H 2018 3Q 2018 Central Surabaya West Surabaya East Surabaya South Surabaya Colliers Apartment Market Report – Jakarta 3Q 2018 Colliers Apartment Market Report – Surabaya 1H 2018 Source: Source: 8
Residential development – Strong take-up of existing projects Strong pre-sales across all residential and office projects underpins future growth Historical Pre-sales (Rp bn) Pre-sales and construction update (excludes residential township) GSA Superblock / Project name Segment % Sold Progress update (sqm) Township 3,500 100% 1 Completed 88 Kasablanka A Office 36.3K 3,137 Casa Grande Condo 96.2K 100% Completed 3,061 Angelo Condo 36.9k 84% Finishing stage 3,000 Kota Kasablanka Bella Condo 36.8k 81% Finishing stage Chianti Condo 47.3k 68% Finishing stage 2,505 11% 1 Pakuwon Tower Office 32.1k Finishing stage 2,500 2,277 94% 1 2,203 Pakuwon Center Office 10.0K Completed TP Residence Condo 30.0K 100% Completed Tunjungan City 2,000 One Icon Condo 57.8K 66% Finishing stage 46% 1 Pakuwon Tower Office 16.4K Finishing stage Harvard Condo 26.0k 100% Completed 1,500 Stanford Condo 25.5k 100% Completed Pakuwon City Yale Condo 25.4k 100% Completed Princeton Condo 25.7k 100% Completed 1,000 Amor Condo 47.4k 78% At level 10 711 Orchard Condo 27.6K 100% Completed 500 Tanglin Condo 32.3K 100% Completed La Riz Condo 41.4K 99% Completed Pakuwon Mall Anderson Condo 57.1k 85% Finishing stage 0 Benson Condo 53.4k 71% Topping off 2014 2015 2016 2017 2018 1H 2019 La Viz Condo 26.7k 42% At level 19 Company data as at June 30, 2019 Note: 1 As % of saleable area, excluding approximately 50-60% of area set aside for lease 9
Retail market update Retail property market helped by limited new supply in Jakarta and Surabaya – driving up occupancy and rents Average asking base rental rates in Jakarta Cumulative retail supply in Surabaya (sqm) (Rp'000 psm / month) Very limited new supply from 2019 - 2021 CBD 1,400 900 800 1,200 Outside 700 CBD 1,000 600 800 500 400 600 300 400 200 200 100 0 0 2014 2015 2016 2017 2018 2019F 2020F 2021F 2014 2015 2016 2017 1Q 2018 2Q 2018 3Q 2018 Cumulative Supply New Supply Colliers Retail Market Report – Surabaya 1H 2018 Source: Colliers Retail Market Report - Jakarta 3Q 2018 Source: 10
Retail malls – Continued strong leasing interest Wide appeal of PWON's malls demonstrated by consistently high occupancy Historical Occupancy Lease Expiry Profile (NLA breakdown) 25% 3% 6% 11% 14% 41% • Maintained strong occupancy across portfolio (sqm) 2014 2015 2016 2017 2018 1H 2019 300,000 1 96% Tunjungan Plaza 99% 98% 94% 98% 97% 250,000 Kota Kasablanka Mall 99% 99% 99% 98% 99% 99% Gandaria City Mall 98% 98% 96% 96% 94% 98% 200,000 2 95% Pakuwon Mall 91% 91% 89% 94% 96% 150,000 Pakuwon Trade Center 91% 92% 92% 94% 92% 90% Royal Plaza 96% 97% 97% 97% 96% 97% 100,000 Blok M Plaza 93% 92% 93% 91% 96% 96% 50,000 1 Includes Tunjungan Plaza 6 opened on 23 September 2017 2 Includes Pakuwon Mall 2 & 3 opened on 22 February 2017 0 Vacant 2019 2020 2021 2022 2023 Onwards Kota Kasablanka Mall Gandaria City Mall Tunjungan Plaza Pakuwon Mall Pakuwon Trade Center Royal Plaza Blok M Plaza 11
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