Secure Income REIT Plc 9 March 2018 www.SecureIncomeREIT.co.uk - PowerPoint PPT Presentation

Secure Income REIT Plc 9 March 2018 www.SecureIncomeREIT.co.uk

Secure Income REIT Plc is a specialist UK REIT, selectively investing in key operating real estate assets in defensive sectors that provide long term rental income with inflation protection. As at 31 December 2017 it owned a £1.77 billion portfolio of 81 high quality assets let to financially strong businesses. An investment in the Company offers secure, growing income streams and strong foundations for sustainable capital growth, while continuing to deliver attractive risk adjusted returns for shareholders over the long term. 2

1. Introduction 2. December 2017 financial highlights 3. New acquisitions: − The Manchester Arena − The Brewery − Stonegate Pubs − Travelodge Hotels − Financing & Pro Forma Enlarged Group NAV 4. Enlarged Portfolio Analysis Warwick Castle

Secure Income REIT Plc ▪ The current portfolio of 81 properties is valued at £1.77bn ▪ Let to substantial businesses in defensive sectors ▪ Long WAULT of 22.2 years with no breaks ▪ 58% subject to fixed annual uplifts averaging 2.8% p.a. and 42% to uncapped, upwards only RPI reviews ▪ The Company has delivered strong Total Accounting Returns of 26% p.a . since listing in June 2014 ▪ The Company has an experienced board , chaired by Martin Moore and with Leslie Ferrar, Jonathan Lane and Ian Marcus along with Nick Leslau, Mike Brown & Sandy Gumm from the external investment adviser, Prestbury ▪ The Prestbury team has a track record of outperformance over many years and is closely aligned with 1 stake – one of the largest management stakes in the sector. shareholders with a c. £137m 4 1 £137 million held at 9 March valued at the Placing Price

Existing Portfolio Multi sector portfolio underpinned by strong tenant covenants Portfolio total passing rent £95.7m at 31 December 2017 from 81 Portfolio Value December 2017: £1.77bn key operating assets with income security from strong operating Travelodge businesses underpinning £1.77bn of property value Hotels 13% Orpea Hospitals: Hospitals ▪ 49% of rent guaranteed by Ramsay Health Care Limited : £7.2bn 3% Merlin UK Theme market capitalisation ASX 50 company and one of the top five Parks private hospital operators in the world 27% Ramsay ▪ 2% of rent guaranteed by Orpea SA , mental health and aged care Hospitals 51% specialists, listed on Euronext with £5.6bn market capitalisation Merlin German Theme Parks: Theme Parks ▪ 34% of rent guaranteed by Merlin Entertainments Plc : FTSE 250 6% company with £3.8bn market capitalisation: second largest visitor attractions company in the world and largest in Europe Portfolio Rent December 2017: £95.7m p.a. Budget Hotels: Orpea ▪ 15% of rent guaranteed by Travelodge Hotels Ltd : a well- Hospitals 2% capitalised business with financial year 2017 revenue growth of Travelodge Hotels15% Merlin 6.6% to £637.1m and an increase in EBITDA to £112.4m; one of Theme the UK’s top two budget hotel brands Parks 34% Overall: ▪ 58% of rent subject to fixed minimum annual uplifts averaging Ramsay Hospitals 2.8% p.a. until at least 2037, 42% to uncapped upwards only RPI 49% uplifts Sources: Market data as at 1 March 2018 using AUD/GBP exchange rate of A$1:£0.56423 and EUR/GBP exchange rate of €1:£0.88826 For further information please see Appendix 2, pages 41 to 43 5

31 December 2017 Financial Highlights 31 December 2017 31 December 2016 % change • Net Assets ↑ 16.7% £860.6m £737.4m • EPRA Net Asset Value ↑ 16.7% £870.8m £745.9m • EPRA Net Asset Value per share ↑ 14.5% 370.4p 323.6p • EPRA NAV per share growth plus dividends ↑ 2.2pp 18.7% 16.5% • Net LTV ↓ 3.9pp 49.6% 53.5% 31 December 2017 31 December 2016 % change 1 • Adjusted EPRA EPS ↑ 20.4% 13.6p 11.3p • Dividends per share (commenced Aug 2016) 13.6p 5.8p n/a • Annualised DPS at year end ↑ 19.1% 14.0p 11.8p ▪ Total shareholder return and total accounting return for the year 18.7% 1 Adjusted to exclude rental income in excess of cash rents received as a result of the accounting requirement to spread the impact of fixed rental uplifts 6 over the lease term and other non recurring items (see slide 47)

EPRA NAV Progression £m Pence • EPRA NAV at 31 December 2016 745.9 323.6 • Valuation uplifts: • Healthcare 51.6 22.4 7.6% uplift • UK Leisure 33.2 14.4 £124.9m since • German leisure (constant currency) 7.8 3.4 December ’16 • Travelodge Hotels 32.3 14.0 at constant currency • Net results 31.4 13.7 • Incentive fee - (7.4) • Irrecoverable VAT on incentive fee (1.6) (0.6) • Currency translation movements 1.4 0.5 • Dividends paid (31.2) (13.6) • EPRA NAV at 31 December 2017 870.8 370.4 up 14.5% ▪ Portfolio valuation up 7.8% since 31 December 2016 to £1.77 billion ▪ Passing rents up 3.3% like-for-like to £95.7m at 31 December 2017 ▪ Valuation net initial yield 5.1%: 22bps yield compression on portfolio since December 2016 For further information please see page 45 for the detailed Dec 2017 property valuation uplift 7

Adjusted EPRA Earnings 2017 2016 £m Pence £m Pence Net rent: Like for like portfolio 80.5 34.9 77.9 40.9 Travelodge (from Oct 2016) 13.9 6.0 2.4 1.1 Net finance costs Like for like portfolio (49.1) (21.2) (49.2) (25.7) Travelodge (from Oct 2016) (1.9) (0.8) (0.4) (0.2) Admin & corporate costs (11.9) (5.1) (9.1) (4.8) Tax (0.3) (0.2) - - Adjusted EPRA EPS 31.2 13.6 21.6 11.3 +20% ▪ Positive impact of 3.3% rental uplifts resulting in Adjusted EPRA EPS growth and therefore dividend growth ▪ Fully covered quarterly dividends with in-built uplifts providing inflation protection 8

Delivering Strong Total Returns Performance since listing in June 2014 ▪ ▪ Net LTV down from 80% to under 50% NAV per share up 113% ▪ Annualised DPS 14p per share (3.8% on Dec ‘17 EPRA ▪ Like-for-like portfolio value up 36% NAV) Total Accounting Return 425p 7.0p 6.6p • CAGR since Mar 5.9p 2016 secondary 325p 370.4p 355.5p placing 27.4% p.a. 323.6p 225p 300.2p 282.8p 275.3p • 258.5p CAGR since Oct 125p 2016 placing 184.5p 25.7 % p.a. 25p -75p 1 Jun-14 Dec-14 Jun-15 Dec-15 Jun-16 Dec-16 Jun-17 Dec-17 EPRA NAV per share Dividends per share Adjusted EPRA EPS Dividends and DPS Net Loan to Value 14.0p 13.1p 13.6p 69.7% 11.3p 61.0% £14.0m 53.5% 49.6% 11.8p £12.0m £15.1m £16.1m 2.6p 0.0p £7.0m Dec-14 Dec-15 Dec-16 Dec-17 Dec 2016 June 2017 Dec 2017 Dec-14 Dec-15 Dec-16 Dec-17 1 Pro forma figures for the completion of the sale of Madame Tussauds and the refinancing of the Group’s entire debt which occu rred subsequent to the balance sheet date 9

New Acquisitions Warwick Castle

Delivering on our growth strategy: Two simultaneous off-market acquisitions ▪ Leisure portfolio : ▪ £225m gross cost ▪ Manchester Arena, The Brewery at Chiswell Street, 17 Travelodge Hotels & 18 Stonegate Pubs 1 − WAULT c.18.0 years − NIY 5.9% − 72% of rents with RPI reviews; 26% with fixed reviews; 2% upwards only open market reviews − 100% occupational leases on FRI terms ▪ Hotels portfolio : Total Acquisitions by Cost ▪ £212m gross cost ▪ 59 Travelodge Hotels Manchester Arena 1 − WAULT c.23.5 years 24% − NIY 6.1% Travelodge − 100% of rents with uncapped upwards only five yearly RPI reviews Hotels Stonegate 57% Pubs − 100% occupational leases on FRI terms Brewery 6% 13% ▪ £436m gross cost ▪ Placing to raise £315.5m at Pro Forma EPRA NAV of 365.0p per share ▪ £128.7m of new non-recourse debt at 30% loan to cost and expected 3.4% p.a. ▪ Management & board investing £5.25m cash at the placing price bringing the value of their aggregate holding to over £143m at the placing price 1 WAULT is calculated from 9 th March 2018 and excludes any rent-free incentives 11

Acquisitions: Benefits for the Group ▪ Dividend accretive: post acquisition dividend yielding 4.3% on placing price ▪ Material deleveraging: from 49.6% to 45.8% ▪ Total returns: base case outlook c. 10% p.a. over the next 5 years 1 ▪ Long term secure income: − WAULT of 21.7 years 2 − Rent subject to upwards only RPI reviews increases from 42% to 51%. − 48% of rents subject to fixed uplifts with the remaining 1% subject to upwards only open market reviews − 70% of rent subject to annual uplifts (as opposed to five yearly) ▪ Value-enhancing asset management opportunities ▪ Increases EPRA NAV to c. £1.2bn 1 EPRA Net Asset Value growth plus dividends. See assumptions on page 38 12 2 WAULT is calculated from 9 th March 2018 and excludes any rent-free incentives

Manchester Arena