14 September 2015 Lend Lease presentation at CLSA Hong Kong Investors - - PDF document

14 September 2015

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Lend Lease presentation at CLSA Hong Kong Investors’ Forum

14 September 2015

Attached is the presentation given by Lend Lease Group Chief Executive Officer and Managing Director, Steve McCann at today’s CLSA Hong Kong Investors’ Forum. ENDS FOR FURTHER INFORMATION, PLEASE CONTACT: Investors: Media: Suzanne Evans Nadeena Whitby Tel: 02 9236 6464 Tel: 02 9236 6865 Mob: 0407 165 254 Mob: 0467 773 032

Global Mega-trends

Urbanisation a key driver of growth

Steve McCann Group CEO and Managing Director Lend Lease

2

We operate in four regions across 12 countries

URBANISATION A KEY DRIVER OF GROWTH Our operations are centred around four regions.

AUSTRALIA ASIA AMERICAS EUROPE

NEW YORK Operating since 1979 LONDON Operating since 1991 SINGAPORE Operating since 1973 SYDNEY Operating since 1958

3 URBANISATION A KEY DRIVER OF GROWTH

$(669)m to $493m

Profit after tax Geographies Development Pipeline

Circa 40 countries $25.6bn

Construction Backlog

$12.3bn

FUM

$9.9bn $501m to $549m 12 countries $37.4bn $16.2bn $15.0bn

Restore

(2009 – 2011)

Key Metrics

LTIFR 3.1 to 2.9

Safety

LTIFR 2.7 to 2.3 Restructuring and cost out

Focus

Reshaping and growing the portfolio $619m Major gateway cities $44.9bn $17.3bn $21.3bn LTIFR 2.2 Leading positions and a leading safety culture

Build

(2012 – 2013)

Lead 2015+

Following successful execution of our 5 year ‘Restore Build Lead’ strategy we have moved to a new framework ‘Focus & Grow’

4 URBANISATION A KEY DRIVER OF GROWTH

Six mega-trends driving the markets in which Lend Lease operates

5

Urban regeneration projects comprise approximately 70%

• f Lend Lease’s

$44.9 billion development pipeline

URBANISATION A KEY DRIVER OF GROWTH

Urban regeneration a key part of our ‘Focus & Grow’ strategy

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Characteristics of major urbanisation projects 1. Scale – estimated end development value >$1bn 2. Location – city and city fringe, typically government owned land 3. Mixed-use – residential, retail, commercial, infrastructure and place making 4. Density – medium to high density development 5. Timeframe – long-dated development typically with staged land payments 6. Sustainability – deliver economic, social and environmental outcomes and create a legacy

7

Growing and geographically diversified portfolio of urban regeneration projects

URBANISATION A KEY DRIVER OF GROWTH

5 10 15 20 25 30 35 40 45 50

2011 2012 2013 2014 2015 100% of estimated project remaining end development value ($ billion)

Communities Developments Australian Urbanisation Developments International Urbanisation Developments

$37.2 billion Australia Asia Europe Americas

FY15 Urbanisation Developments by region

$44.9 billion $37.7 billion $37.4 billion $32.8 billion $34.7 billion

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Portfolio of major urban regeneration projects

URBANISATION A KEY DRIVER OF GROWTH

Project End value1 FY15 FY16 FY17 FY18+ Integrated development projects Barangaroo South, Sydney A$6.9 billion     Darling Harbour Live, Sydney – Darling Square & ICC Hotel Sydney A$1.9 billion     Victoria Harbour, Melbourne A$5.5 billion     Melbourne Quarter, Melbourne A$1.9 billion    Brisbane Showgrounds, Brisbane A$2.3 billion     Waterbank, Perth A$1.2 billion Tun Razak Exchange, Kuala Lumpur A$2.8 billion Paya Lebar Central, Singapore A$3.0 billion    Elephant & Castle, London ₤2.0 billion     The Wharves, Deptford, London ₤0.4 billion The International Quarter, London ₤2.3 billion     River South, Chicago US$1.5 billion Active project In planning  Expected earnings contribution

1 Reflects 100% of the estimated total project end development value

Values for any project can vary as planning approvals are obtained

9 URBANISATION A KEY DRIVER OF GROWTH

Barangaroo

Concrete Apron

Created in 1970s to accommodate bulk offloading for shipping containers

Closed in 2003, renamed Barangaroo in 2006 and Lend Lease selected as master developer in 2009

10 URBANISATION A KEY DRIVER OF GROWTH

490,000 sqm

Gross Floor Area

7.7 Hectares

Mixed Use Development Australia’s first large scale

Carbon Neutral

community Up to90 new retail outlets New headland park and recreated foreshore with

6,600

sandstone blocks

Barangaroo

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Urbanisation delivering multiple income streams

URBANISATION A KEY DRIVER OF GROWTH FY12 FY13 FY14 FY15

5 10 15 20 25 30 35

Property Development Urbanisation Pipeline ($bn)

Property Development Urbanisation projects now make up circa 70% of Lend Lease’s $44.9 billion development pipeline globally. At 30 June 2015 there were 12 major urban regeneration projects. Construction With core skills in building, engineering and services we have the internal delivery capability to deliver major urbanisation projects. At 30 June 2015, major urban regeneration comprised circa 16% of our $17.3 billion backlog revenue position. Apartment Pre sales In the last 3 years Lend Lease has pre sold over 5,000 apartments that will settle between FY16 and FY19. The vast majority of apartments are

• n major urbanisation projects.

At 30 June 2015, residential pre sold revenue associated with apartments totalled $4.7 billion.

FY12 FY13 FY14 FY15

5 10 15 20 25

Construction Backlog Revenue ($bn)

FY12 FY13 FY14 FY15

5 10 15 20 25

Funds under management ($bn)

Investment Management The creation of new investment vehicles associated with assets

• n major urbanisation sites has

driven growth in funds under management and increased the portion of stable fee income for Lend Lease. Lend Lease is a global leader – having raised circa $5 billion of new equity between 2009 and 2014.

FY12 FY13 FY14 FY15

1 2 3 4 5

Pre sold apartment revenue ($bn)

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Region Target gateway cities Key Economic and Cycle Drivers Lend Lease Position

Capital

Americas New York

• Larger economy than Australia
• Largest metro area by population in US, highly dense (esp. Manhattan)
• Major cross-border capital target
• Operating since 1979
• Delivered construction services on more than 4,800

projects across the Americas over the last 25 years including the National September 911 Memorial

• A leading high rise residential builder and managing

contractor in the United States

Chicago

• Third largest metropolitan economy in the US
• Minimal scope to expand city boundaries (support for urban

regeneration)

• Consistently exhibits relatively high residential affordability

Boston

• Ninth largest metro economy in US and high disposable income per

capita.

• Major focus on higher education and also a hub for healthcare/life

sciences

Capability

Europe London

• Global leader for attracting international capital
• Economic growth supported by size of Services sector (>90% of

economy) and robust tourist demand

• Major international financial services centre
• Operating since 1991
• Completed over 250 UK education projects
• Delivered the 2012 Olympic Athletes’ Village
• Developed Bluewater Shopping Centre

Asia Singapore

• Fast turnaround (vs. major cities) for planning approvals
• Strong population density and (expected) new household formation
• Regional financial centre for Asia (with Hong Kong)
• Operating since 1973
• Notable projects in Singapore include

313@Somerset, JEM and Parkway Parade

Cycle

Kuala Lumpur

• High income per capita cf. country average (versus other major cities)
• Despite recent economic turbulence and lower oil prices, Kuala Lumpur

is expected to outperform most major cities

• Tenth Malaysian Plan (2011) outlined strategy for significant growth of

Kuala Lumpur

• Operating since 1979
• Delivered more than 100 projects across a broad

range of sectors in Malaysia

• Notable projects in Malaysia include the iconic

Petronas Twin Towers, Setia City Mall and Pinewood Iskandar Malaysia Studios

Future focus on target international gateway cities – disciplined capital allocation approach focused on local capabilities/knowledge & cycle

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Urbanisation: a key driver of future growth for Lend Lease