ANNUAL RESULTS for the year ended 30 June 2015 STRATEGIC & - - PDF document

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ANNUAL RESULTS for the year ended 30 June 2015 STRATEGIC & - - PDF document

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ANNUAL RESULTS for the year ended 30 June 2015 STRATEGIC & OPERATIONAL OVERVIEW Hyde Park Corner, Johannesburg, Gauteng 2 1 FINANCIAL HIGHLIGHTS 30 June 2015 30 June 2014 Change Distribution 543,0 cps 472,0 cps 15,0% Total return

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ANNUAL RESULTS

for the year ended 30 June 2015

STRATEGIC & OPERATIONAL OVERVIEW

Hyde Park Corner, Johannesburg, Gauteng

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FINANCIAL HIGHLIGHTS

30 June 2015 30 June 2014 Change Distribution 543,0 cps 472,0 cps 15,0% Total return 59,0% 8,0% Total expense to income ratio 36,0% 37,3% (3,3%) Market capitalisation R29,4bn R19,3bn 52,2% Total assets R28,9bn R26,9bn 7,4% Loan to value 22,9% 26,6% NAV (per share) R89,04 R76,02 17,1%

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DISTRIBUTION GROWTH

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Cents per share

202 211 231 262,7 198 213 241 280,3 400 424 472 543,0 100 200 300 400 500 600 700 2012 2013 2014 2015

1st Half 2nd Half Total

10,4%

% growth

9,4% 4,5% 7,5% 9,5% 13,1% 9,9% 6,0% 11,3% 13,7% 16,3% 15,0%

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0,9 1,0 1,1 1,2 1,3 1,4 1,5 1,6

Hyprop SAPY

Q1: 28,5 million* Q2: 15,3 million* Q3: 41,0 million* Q4: 92,8 million*

SHARE PRICE PERFORMANCE

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* Number of shares traded per quarter June 2015 June 2014 % shares traded 73,0% 50,4% % offshore shareholders 25,0% 8,5% Jul 2014 Aug 2014 Sep 2014 Oct 2014 Nov 2014 Dec 2014 Jan 2015 Feb 2015 Mar 2015 Apr 2015 May 2015 Jun 2015

PORTFOLIO MANAGEMENT

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Disposals

  • CapeGate Lifestyle, CapeGate Value Centre and Stoneridge
  • total proceeds of R833m

Developments completed

  • West Hills Mall – total cost of R462m
  • Rosebank Mall - total cost of R932m

Energy

  • Clearwater Mall’s phase 2 - solar photovoltaic plant - completed August 2015
  • The total size (phase 1 and 2) is 1 500kW at peak, with generating capacity
  • f 2,5GWh per annum
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Willowbridge

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100% owned Co-owned Canal Walk (80%) The Glen (75,15%) CapeGate Clearwater Mall Somerset Mall Woodlands Boulevard Hyde Park Corner Rosebank Mall Atterbury Value Mart Held for sale/sold Somerset Value Mart Offices:

  • Glenfield
  • Glenwood
  • Lakefield

Stoneridge (Sold) CapeGate Lifestyle (Sold)

COMPANY STRUCTURE

SOUTH AFRICA

Hyprop Investments Limited

47% 50%

Accra Mall (Ghana)

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Manda Hill (Zambia)

100% owned 37,5%

West Hills (Ghana)

45% 50%

Achimota Mall (Ghana)* Kumasi City Mall (Ghana)

75% 75%

AttAfrica (Mauritius)

COMPANY STRUCTURE

SUB-SAHARAN AFRICA

Hyprop Investments Mauritius

Hyprop Investments Limited

* Under development

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Sub-Saharan Africa

(excluding SA)

R42,4m*

INVESTMENT PROFILE

87,5% 8,2% 4,3% Core South African portfolio R25,0 bn Sub-Saharan Africa

(excluding SA)

R2,3bn Held for sale R1,2bn 88,9% 2,4% 2,9% 5,8% Core South African portfolio R1,6 bn Held for sale R104,8m

Distributable income Investments

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Properties sold R51,4m

* After finance costs

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OPERATING PERFORMANCE

Rosebank Mall, Johannesburg, Gauteng

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SLIDE 6

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Property cost to income ratio reduced to 33,6% (June 2014: 34,4%)

OPERATING PERFORMANCE

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Low impact from load shedding Occupancy rate improved to 98,0% (June 2014: 97,6%) Arrears R19,4 million ‒ 0,6% of rental income (June 2014: R19,2m ‒ 0,5% of rental income) Strong performance from Rosebank Mall Improved tenant mix at Hyde Park Corner

Rosebank Mall & Hyde Park Corner, Johannesburg, Gauteng

TRADING OVERVIEW

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8,0% 7,8% 6,8% 7,0% 7,4% 7,0% 7,0% 6,9% 6,9% 7,1% 3,30% 3,4% 2,7% 2,4% 2,0% 0% 2% 4% 6% 8% 10% 12% Jun 2011 Jun 2012 Jun 2013 Jun 2014 Jun 2015 Trading density growth Rent ratio (rental as % of turnover) Vacancies

1st half

6,9%

2nd half

7,9%

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VACANCIES

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Vacancies 30 June 2013 30 June 2014 30 June 2015 Retail 2,1% 1,2% 1,3% Offices 8,1% 13,8% 8,3% Total 2,7% 2,4% 2,0% 2,1% 1,2% 1,3% 8,1% 13,8% 8,3% 2,7% 2,4% 2,0% 0% 5% 10% 15% 20% 30 Jun 2013 30 June 2014 30 June 2015 Retail Offices Total

LEASING TERMS

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4,3% 3,4% 6,3% 8,3% 7,6% 8,0% 8,8% 7,4% 8,2% 8,2% 0% 2% 4% 6% 8% 10% 12% 2011 2012 2013 2014 2015 Rental growth Contractual escalation

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LEASING ACTIVITY

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Leasing % of total portfolio Area m² Rental growth % Contractual escalation %

  • No. of

leases Retail 20,3% 143 240 8,1% 8,2% 486 Offices 43,9% 33 111 2,5% 8,1% 90 Total 22,6% 176 350 7,6% 8,2% 576

LEASE EXPIRY PROFILE

2015 / 2016

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Retail Total rentable area m² Area m² % Rentable area of centre Canal Walk 146 599 46 461 32% The Glen 79 665 17 172 22% Willowbridge 39 904 15 258 38% Somerset Mall 66 354 13 431 20% Cape Gate Mall 63 700 13 046 20% Atterbury Value Centre 47 785 9 278 19% Clearwater Mall 86 081 7 228 8% Hyde Park Corner 27 929 5 681 20% Rosebank Mall 62 410 4 753 8% Somerset Value Mart 12 546 3 900 31% Woodlands Boulevard 71 659 2 508 3% Retail 704 632 138 716 20% Offices 75 440 13 924 18% Portfolio Total 780 072 152 640 20%

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DEVELOPMENTS

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Woolworths extensions:

  • Canal Walk completed within budget
  • Somerset Mall to be completed in October 2015

Focus on continuous improvements /refurbishments – R180m for 2016 Clearwater Mall refurbishments and extensions to accommodate international fashion brands

  • Including H&M, River Island and Top Shop
  • Total cost of R36,6 million

New generators at Hyde Park Corner Equipment replacement – R93m for 2016

Hyde Park Corner, Johannesburg, Gauteng

INVESTMENT IN SUB-SAHARAN AFRICA (excluding SA)

West Hills Mall, Accra, Ghana

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West Hills Mall, Accra, Ghana

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INCOME PRODUCING PROPERTIES

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Rentable area m² Hyprop's effective shareholding % 30 June 2015 Investment R'000 12 months June 2015 Distributable earnings* R'000 12 months June 2014 Distributable earnings* R'000 AttAfrica (Mauritius) Accra Mall (Accra, Ghana) 19 000 17,6% 229 659 7 726 6 525 West Hills Mall (Accra, Ghana) 27 500 16,8% 461 926 6 695 Manda Hill (Lusaka, Zambia) 44 000 68,8% 984 710 30 657** 30 308** Expenses 46,403 (2 710) (1 755) 90,500 1 722 698 42 368 35 078 Loans advanced to AttAfrica for developments (not yet income producing) 528 652 Capitalised interest 81 033 Other 6 738 Total investment 2 339 121 * After interest on funding costs in Hyprop Investments Mauritius ** Effective interest in Manda Hill reduced from 87,0% to 68,8% on 1 July 2014

DEVELOPMENT PROPERTIES

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Centre name Rentable area m² Hyprop’s effective shareholding % Hyprop’s effective cost USD’000 Comments Achimota Mall (Accra, Ghana) 14 624 28,1 15 178

  • Under construction
  • Opening October 2015

Kumasi City Mall (Kumasi, Ghana) 18 360 28,1 40 026

  • Under construction
  • Opening April 2017

Waterfalls Project Lusaka, Zambia) 9,4 1 031

  • Land holding
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CURRENCY

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0,7 0,8 0,9 1,0 1,1 1,2 1,3

Performance of currencies over one year against USD SA Rand Zambian Kwacha Ghanian Cedi Nigerian Niara

30% 23% 20% 4% One year

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FINANCIAL RESULTS

The Glen, Johannesburg, Gauteng

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NET INCOME

YEAR-ON-YEAR CHANGE

1 148 600 1 319 619 100 521 86 363 43 370 7 290 (37 265) (15 694) (11 475) (2 091) 1 000 000 1 100 000 1 200 000 1 300 000 1 400 000 1 500 000

30 Jun 2014 Existing portfolio Rosebank Mall Somerset Mall Sub- Saharan Africa (excl. SA) Sycom Net interest Properties sold Other 30 June 2015

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R’000

1,288 1,441 1,504 1,539 1,149 1,392 1,551 1,701 1,743 1,320 0,0 0,5 1,0 1,5 2,0 Investment property income Add Somerset Mall Add Rosebank Mall Add Sub-Saharan Africa (excluding SA) Add net interest and other

NET INCOME

DRIVERS OF GROWTH

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Rbn

30 June 2014 30 June 2015

* Excludes Somerset and Rosebank Malls ** 2014 includes Sycom 8,1% 7,7% 13,1% 13,3% 14,9%

** *

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INCOME STATEMENT

EXTRACTS

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30 June 2015 Rm 30 June 2014 Rm Revenue 2 617 2 392 Investment property 2 617 2 355 11,2% Listed investments 37 Property expenses (865) (821) 5,4% Net property income 1 752 1 571 11,5% Other operating expenses (58) (56) 3,9% Operating income 1 694 1 515 11,8% Investments in sub-Saharan Africa (excluding SA) 42 35 Net income before interest 1 736 1 550 12,0% Net interest (417) (401) 3,9% Net income 1 319 1 149 14,9% No of shares for distribution (000) 242 990 243 102 Distribution per share (cents) 543,0 472,0 15,0%

BALANCE SHEET

EXTRACTS

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30 June 2015 Rm 30 June 2014 Rm Investment property 25 003 24 081 3,8% Investments in sub-Saharan Africa (excluding SA) 2 339 812 187,9% Held for sale 1 235 1 705 Other assets 279 267 Total assets 28 856 26 865 7,4% Total debt 6 692 7 199 (7,0%) Net asset value per share (R) 89,04 76,02 17,1%

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PROPERTY VALUATIONS

SOUTH AFRICAN PORTFOLIO

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Category Size m² Hyprop share Rm % change (from June 2014) Value R/m2 Average yield % Shopping centres 642 978 23 791 13,0% 40 816 6,8% Value centres* 102 709 1 927 2,3% 18 762 8,3% Stand-alone offices 34 386 509 11,3% 14 796 9,1% Total 780 072 26 226 12,1% 6,9%

* Excludes Stoneridge and CapeGate Lifestyle

DEBT MANAGEMENT

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Borrowings 30 June 2015 30 June 2014 Total debt R6,7bn R7,2bn Loan to value 22,9% 26,6% Debt at fixed rates 94,5% 71,4% Average fixed rate / swap maturity 5,2 4,2 Debt capital market (DCM) % of total debt 32% 32% Cost of funding 7,1% 7,5%

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2 297 1 393 3 509 2 172 2 193 2 327

500 1 000 1 500 2 000 2 500 3 000 3 500 4 000

DCM funding (SA) Bank facilities (USD) Bank facilities (SA)

30 June 2015 30 June 2014 32% 32% 19% 33% 49% 35% % of total debt

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SOURCES OF FUNDING

R million

COST OF FUNDING

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Average interest rate 30 June 2015 30 June 2014 Total debt 7,1% 7,5%

  • SA debt

8,4% 8,2%

  • USD debt

4,4% 4,6%

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PROSPECTS

Canal Walk, Cape Town, Western Province

PROSPECTS

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Emerging market opportunities Disposal of non-core properties Low GDP growth – few opportunities in SA Refurbishments and tenant mix improvements Distribution forecast - approximately 10%

The Glen and Woodlands Boulevard

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APPENDICES

Rosebank Mall, Johannesburg, Gauteng

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6,9 7,7 8,7 9,4 17,4 18,7 20,2 26,4 28,6 7,5 7,0 7,6 9,5 12,9 17,7 19,0 19,3 29,4 3,6% 8,9% 13,0% 12,6% 26,2% 23,1% 22,9% 26,6% 22,9% 0% 15% 30% 45% 60% 4 8 12 16 20 24 28 32 2007 2008 2009 2010 2011 2012 2013 2014 2015 Investment property Market cap LTV % Rbn LTV %

TRACK RECORD

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MATURITY PROFILE

FIXED RATES AND SWAPS

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Rm

Average maturity 5,2 years

200 1 289 318 1 914 1 200 1 000 400

  • 500

1 000 1 500 2 000 2 500 June 16 June 17 June 18 June 19 June 20 June 21 June 22 June 23 June 24

DEBT MATURITY PROFILE

BANK FACILITIES AND DCM

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Rm

Average maturity 3,2 years

789 1 538 783 227 1 184 772 750 650

  • 200

400 600 800 1 000 1 200 1 400 1 600 1 800 June 2016 June 2017 June 2018 June 2019 June 2020 SA bank facilities USD bank facilities Bonds / Commercial paper

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June 2014 June 2015

REVENUE SPREAD

12 MONTHS

% GROSS RENT TO TURNOVER

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9,2% 8,8% 8,7% 8,3% 7,9% 7,0% 7,0% 6,4% 5,5% 4,4% 0,0% 1,0% 2,0% 3,0% 4,0% 5,0% 6,0% 7,0% 8,0% 9,0% 10,0% 11,0% Canal Walk Atterbury Value Mart Hyde Park Corner The Glen Shopping Centre Clearwater Mall Woodlands Boulevard Somerset Mall Cape Gate Mall Somerset Value Mart Willow Bridge

Portfolio average: +7,1% (2014: +6,9%) % Gross rent to turnover

Deterioration Improvement 1% 8% 1% 3% 9% 2% 2% 0% 1% 0%

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TRADING DENSITY

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4 023 3 147 2 992 2 850 2 695 2 632 2 488 2 337 2 331 1 918 500 1 000 1 500 2 000 2 500 3 000 3 500 4 000 4 500 Hyde Park Corner Canal Walk Somerset Mall Clearwater Mall Willow Bridge The Glen Shopping Centre Woodlands Boulevard Cape Gate Mall Somerset Value Mart Atterbury Value Mart

Per month (R/m²) Average portfolio growth: +7,4% (2014: +7,1%)

6% 7% 7% 15% 1% 9% 4% 8% 8% 6%

Canal Walk

(80% undivided share)

Clearwater Mall

Region Johannesburg Valuation (Rm) 3 944 000 Total rentable area (m²) 86 081 Vacancy levels 0% Footcount 10,1 million Region Cape Town Valuation (Rm) 6 732 800 Total rentable area (m²) 156 689 Vacancy levels 0,9% Footcount 21,2 million

Woodlands Boulevard

Region Pretoria Valuation (Rm) 2 296 000 Total rentable area (m²) 71 659 Vacancy levels 0% Footcount 8,5 million

TOP 8 PROPERTIES BY VALUE

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Rosebank Mall

Region Johannesburg Valuation (Rm) 2 495 000 Total rentable area (m²) 80 712 Vacancy levels 1,3% Footcount 8,6 million* * Oct 2014 - Jun 2015

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CapeGate Regional

Region Cape Town Valuation (Rm) 1 534 000 Total rentable area (m²) 63 700 Vacancy levels 1,4% Footcount 10,7 million

TOP 8 PROPERTIES BY VALUE (cont.)

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The Glen

(75,15% undivided share)

Region Johannesburg Valuation (Rm) 2 329 830 Total rentable area (m²) 79 665 Vacancy levels 1,2% Footcount 14,2 million

Hyde Park Corner

Region Johannesburg Valuation (Rm) 2 009 000 Total rentable area (m²) 38 117 Vacancy levels 1,2% Footcount 5,1 million

Somerset Mall

Region Cape Town Valuation (Rm) 2 450 000 Total rentable area (m²) 66 354 Vacancy levels 1,6% Footcount 10,8 million

DISCLAIMER

FORWARD-LOOKING STATEMENTS

  • This document contains forward-looking statements that, unless otherwise

indicated, reflect the group’s expectations as at 30 June 2015.

  • Actual results may differ materially from the group’s expectations if known

and unknown risks or uncertainties affect its business, or if estimates or assumptions prove inaccurate.

  • The group cannot guarantee that any forward-looking statement will

materialise and, accordingly, readers are cautioned not to place undue reliance on any forward-looking statements.

  • The group disclaims any intention and assumes no obligation to update or

revise any forward-looking statement even if new information becomes available as a result of future events or for any other reason, other than as required by the JSE Listings Requirements.

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