30 June 2014 Annual Results Agenda S TRATEGIC & OPERATIONAL - PDF document

30 June 2014 Annual Results

Agenda S TRATEGIC & OPERATIONAL OVERVIEW Pieter Prinsloo OPERATING PERFORMANCE - S OUTH AFRICA Pieter Prinsloo INVES TMENT IN S UB-S AHARAN AFRICA (Excl. S A) Kevin Teeroovengadum FINANCIAL RES ULTS Laurence Cohen PROS PECTS Pieter Prinsloo Panel Panel QUES QUES TIONS TIONS & ANS & ANS WERS WERS 2

S S TRATEGIC & OPERATIONAL OVERVIEW TRATEGIC & OPERATIONAL OVERVIEW Hyde Park, Johannesburg, Gaut eng 3

A decade of growth Compound annual growth rate (2005 – 2014) ( ) Focus on sustainable income growth Focus on sustainable income growth Distribution cpu Distribution cpu 11 7% 11.7% Invest in high quality shopping centres NAV/ pu (excl def tax) NAV/ pu (excl def tax) 20 4% 20.4% i in sub-S b S h aharan Africa Af i S pecialised & experience internal Unit price Unit price 18.4% 18.4% management 32.1% Total return S S ound balance sheet ound balance sheet 4

Distribution growth exceeds guidance Financial highlights Financial highlights 30 June 2014 30 June 2014 30 June 2013 30 June 2013 Change Change Distribution 472cpu 424cpu 11.3% S S econd half distribution econd half distribution 241cpu 241cpu 213cpu 213cpu 13.1% 13.1% NAV (per unit) NAV (per unit) R76.02 R76 02 R68 43 R68.43 11 1% 11.1% Total property assets R26.4bn R22.5bn 17.3% Gearing Gearing 28.4% 28 4% 22 9% 22.9% Total tenant arrears* R14.3m R17.1m (16.4% ) * Excludes Rosebank Mall 5

Increased shopping centre focus Increased shopping centre focus Portfolio management Investments  omerset Mall ─ R2.3 billion S  African Land ─ Manda Hill ─ R1.3 billion  Investment in Atterbury Africa up to R812 million Disposals Indirect ─ S   Indirect S ycom Mantrablox amounting to R205 million ycom, Mantrablox amounting to R205 million  Held-for-sale ─ Office Parks, S toneridge, Willowbridge & CapeGate Lifestyle Sub-Saharan Africa (excluding South Africa)   Restructured African Land from 1 July 2014 Restructured African Land from 1 July 2014 6

S S trategic progress trategic progress Portfolio management Developments: R Rosebank Mall (62 000m² ) b k M ll (62 000 ² )  R932 million  Final completion S ept 2014   Yield 7% Yield 7% West Hills, Accra (27 500m² )   US US D 94 million D 94 million Rosebank Mall, Johannesburg, Gaut eng  Completion Oct 2014  Yield 9.6% Achimota Mall, Accra (13 000m² )  US D 52 million  Completion Oct 2015 p  Yield 9.65% West Hills, Accra, Ghana 7

S S trategy - Progress (cont.) trategy Progress ( ) Energy initiatives Savings generated FY2015 R8m solar PV plant R8m solar PV plant  4,9 million kWh (over 22 months) at Clearwater Mall  R5.9 million  Total electricity consumption Introduction of smart Introduction of smart down 5.34% year-on-year metering  Converted 2 536, 50W down lighters C t d 2 536 50W d li ht to 5W LED down lighters  Converted 365, T8 fluorescent tubes t to energy efficient T5 tube ffi i t T5 t b  Participated in CDP & GRES  Participated in CDP & GRES B B The Glen, Johannesburg S out h, Gaut eng 8

S S trategy Progress ( trategy - Progress (cont.) ) Connecting with consumers 320 000 Facebook fans 210 000 website hits High speed Wi-Fi across portfolio = 88 000 registered users to date Gift cards rollout underway at Clearwater Woodlands CapeGate Gift cards rollout underway at Clearwater, Woodlands, CapeGate & S omerset Mall 9

Company structure Hyprop Investments Limited S outh Africa S ub-S aharan Africa (Excl. S A) 100% 00% ow ed owned Co-owned Co ow ed Held-for-sale eld o sale 100% 100% CapeGate Mall Canal Walk S toneridge Hyprop Investments Mauritius (80% ) Clearwater Mall S S omerset Mall omerset Mall Th Gl The Glen 37.5% 50% Willowbridge (75.15% ) Woodlands Boulevard Atterbury Manda Hill, 50% Hyde Park S toneridge CapeGate Africa Zambia (90% ) Lifestyle Rosebank Mall (Mauritius) Offices: Atterbury Value Mart 47%  Glenfield S omerset Value Mart  Glenwood  Glenwood Accra Mall, Accra Mall,  Lakefield Ghana African Land st ruct ure effect ive 1 July 2014 10

Quality & focused growth Rm 30 000 S S ub S ub-S aharan aharan Africa R2,2bn 25 000 S ub-S aharan Africa (Excl. S A) Held-for-sale R1,7bn 20 000 S tand-alone offices Listed property securities Listed property securities 15 000 S hopping centres Core portfolio R22,5bn R22,5bn 10 000 5 000 30 June 2011 30 June 2014 11

12 OPERATING PERFORMANCE Clearwat er Mall, Johannesburg, Gaut eng OUTH AFRICA S

S trong operating performance 9.5% like-for-like growth in distributable earnings from regional, large regional & super regional malls (excludes Rosebank & S omerset Malls) Occupancy rate remains high at 97.6% Property expenses well contained – cost-to-income ratio 34.4% Arrears 0.4% of rental income including S g omerset Mall 13

Trading indicators hold steady 12% Trading density growth Rent ratio (rental as % of turnover) 10% Vacancies Vacancies 8 0% 8.0% 7.8% 8% 7.0% 7.0% 7.0% 6.9% 6.9% 6.8% 6% 6% 3.40% 4% 3.30% 2.70% 2.70% 2 40% 2.40% 2% 0% 2011 2012 2013 2014 14

Core portfolio Core portfolio Vacancies remain low Vacancies 30 Jun 2014 30 Jun 2013 Retail Retail 1.2% 1 2% 2.1% 2 1% Offices 13.8% 8.1% Total 2.4% 2.7% Significant reductions at value centres Office portfolio improves to 9.5% after year-end Rosebank Mall, Johannesburg, Gaut eng 15

Leasing terms remain favourable 12.0% Rental growth Contractual escalation 10.0% 8.8% 8.3% 8.3% 8.2% 8 2% 8.0% 8 0% 8.0% 7.4% 6.3% 6 0% 6.0% 4.3% 4.0% 3.4% 2.0% 0.0% 2011 2012 2013 2014 16

Leasing activity Leasing activity S trong uplift Rental Contractual Area No. of growth growth escalation escalation ( (m²) ²) Leases L (% ) (% ) Retail New lettings 45 156 8.0% 8.0% 118 Renewals 68 050 9.0% 8.0% 136 Total 113 206 8.2% 8.2% 254 % of total portfolio 15.7% Offices New lettings 7 335 10.0% 8.0% 15 Renewals 14 416 7.0% 9.0% 9 Total 21 751 8.6% 8.4% 24 % of total portfolio 28% T t l l Total lease activity ti it 134 957 134 957 8 3% 8.3% 8 2% 8.2% 278 278 % of total portfolio 16.9% 17

Lease expiry profile Lease expiry profile 2015 Total Area % GLA of Opport unit ies pp Retail GLA m² m² centre CapeGate Regional 63 699 34 452 54% Clearwater 86 028 24 649 29% The Glen 76 849 24 545 32% Replace underperforming tenants W Woodlands Boulevard dl d B l d 71 617 71 617 15 973 15 973 22% 22% ‒ The Glen & Clearwater Mall S toneridge 48 584 14 115 29% S omerset Mall 66 831 14 076 21% Hyde Park Hyde Park 28 097 28 097 13 518 13 518 48% 48% Introduce new brands Canal Walk 146 941 12 784 9% ‒ River Island & Forever 21 CapeGate Lifestyle 32 446 8 410 26% Atterbury Value Centre 47 786 6 457 14% Willowbridge 40 519 4 348 11% S omerset Value Mart 12 386 3 368 27% Upgrade & enlarge national tenants ‒ flagship stores 721 783 176 695 24% g p Offices 77 791 25 116 32% Total 799 575 201 811 25% 18

Developments Focus on continuous improvements Equipment replacement – R28 million Extensions planned – R150 million Sh Shopping centre i t P Project j t Capex C C Completion date l ti d t Canal Walk Mr Price & Forever 21 R14m S ept 2014 Willowbridge Will b id R l Relocation of Dis-Chem i f Di Ch R12 R12m S S ept 2014 2014 CapeGate Foodcourt tenants R4m Oct 2014 Dion Wired Dion Wired Hyde Park R25m Nov 2014 Various high-end tenants 19

20 Various high-end tenants Hyde Park Hyde Park

21 AHARAN AFRICA UB-S TMENT IN S A) (Excluding S Manda Hill, Lusaka, Zambia INVES

S S ub S ub-S aharan Africa (S aharan Africa (S S S A) A) Long-term growth remains strong GDP growth % 6 5.3 5 3 5.0 5 4.4 4 4 3.2 3 2.4 1.9 1.8 2 1.7 1.3 1 0 2013 2014F 2015F Developed World Developed World S S ub-S ub S aharan Africa aharan Africa S S outh Africa outh Africa S ource: JP Morgan & NKC 22

Ghana and Zambia GHANA ZAMBIA  S  Growth impacted, but still strong olid economic growth p g  Good appetite for government debt  Pressure on local currency (Cedi)  Ambitious infrastructure development  Government committed to long term programme ‒ economic reform economic reform Maj or investment in roads & power Maj or investment in roads & power GDP growth % 9 8 8 7.3 7.0 6.7 7 6.3 5.9 6 5.5 5 4 2013 2013 2014F 2014F 2015F 2015F Ghana Zambia S ource: NKC 23

The African consumer The African consumer S ustained middle-class growth Million households 180 160 140 120 120 100 80 60 40 20 0 2000 2014 2030 (est) Lower income Lower income Lower middle class Lower middle-class Middle class Middle-class Upper middle class Upper middle-class S ource: S t andard Bank 24