ANNUAL RESULTS PRESENTATION FOR THE YEAR ENDED 30 JUNE 2014 AGENDA - PowerPoint PPT Presentation

SPACE TO THRIVE ANNUAL RESULTS PRESENTATION FOR THE YEAR ENDED 30 JUNE 2014

AGENDA 1 INTRODUCTION & HIGHLIGHTS 2 FINANCIAL REVIEW 3 CAPITAL MANAGEMENT 4 OPERATIONAL OVERVIEW 5 PROPERTY INVESTMENT ACTIVITIES PROSPECTS 6 ANNEXURES 7 ABSA CAPITAL, Gauteng ABSA CAPITAL, Gauteng

1 INTRODUCTION & HIGHLIGHTS V&A WATERFRONT, Western Cape

INTRODUCTION & HIGHLIGHTS 4 INTRODUCTION TO GROWTHPOINT • The largest listed REIT on the JSE with property assets valued at R76,2 bn, including 100% of Growthpoint Properties Australia (GOZ) and 50% of the V&A Waterfront in Cape Town • Listed investments in Acucap and Sycom of R4,5 bn • Market capitalisation of R56,5 bn at 30 June 2014 (R24.73 per share) • Diversified property portfolio comprising 436 properties in RSA, 51 properties in Australia which are 64.0% owned, and a 50.0% interest in the properties of the V&A Waterfront Office Industrial Australia V&A Waterfront Retail R20,9 bn R15,8 bn R24,3 bn R9,3 bn R5,9 bn AUD2,1 bn • Fully integrated internally managed property company employing 528 staff

INTRODUCTION & HIGHLIGHTS 5 HIGHLIGHTS FOR THE YEAR UNDER REVIEW 161,3 cents 8.3% growth Distribution per share 7.1% Average annual growth in distributions over last 5 years Total cost Market value R1,9 bn additional investment in GOZ R5,3 bn R8,4 bn Income yield Capital growth 25.0% return on R5,3 bn GOZ investment for the year 12.7% 12.3% 66.6% R2,0 bn New equity raised via Distribution Re-Investment Plan participation R2,1 bn R5,7 bn Acquisition and integration of Tiber portfolio equity raised R369 m R1,3 bn Acquisition and integration of Abseq portfolio equity raised Cost Shareholding Investment in Acucap Properties Limited R3,3 bn 34.9% Cost Shareholding Investment in Sycom Property Fund R1,2 bn 23.2% Third consecutive year Overall winner winner Investment Analysts’ Awards for best reporting for best reporting and communication and communication in sector

INTRODUCTION & HIGHLIGHTS 6 GROWTH IN DISTRIBUTION PER UNIT/SHARE Cents Growth 180 8.3% 161,3 Growth Growth 7.2% 149,0 150 Growth 139,0 6.1% 131,0 8.1% 121,2 120 8.5% 7.2% 6.1% 90 8.1% 82,8 76,3 71,2 67,1 62,1 60 8.0% 7.2% 6.1% 30 8.1% 59,1 63,9 67,8 72,7 78,5 0 FY10 FY11 FY12 FY13 FY14 Interim distribution Final distribution

INTRODUCTION & HIGHLIGHTS 7 GROWTH IN TANGIBLE ASSETS AND MARKET CAPITALISATION Rbn Cents 90 2700 80 2400 70 2100 60 1800 50 1500 40 1200 30 900 20 600 10 300 0 0 HY10 FY10 HY11 FY11 HY12 FY12 HY13 FY13 HY14 FY14 Market cap (Rbn) NTAV per unit/share (cents) Tangible assets (Rbn) Unit/share price (cents)

2 FINANCIAL REVIEW EAST 20 KRAMERVILLE, Gauteng

FINANCIAL REVIEW 9 CONTRIBUTION TO DISTRIBUTABLE INCOME Growth Rm 3 497 28.2% 3 600 9.5% 332 Growth 3 000 13.9% 2 728 513 14.7% 2 395 312 11.4% 2 400 293 12.2% 394 14.4% 282 11.8% 1 800 2 652 75.8% 1 200 2 022 74.2% 1 820 76.0% 600 0 FY14 FY13 FY12 RSA GOZ V&A

FINANCIAL REVIEW 10 WEALTH CREATED AND DISTRIBUTION TO STAKEHOLDERS Rm 7 000 6 652 40 0.6% Growth 602 9.1% Growth 17.7% 6 000 5 653 14.7% 35 0.6% 469 8.3% 4 929 1 802 27.1% 5 000 363 7.4% 1 820 32.2% 293 4 000 4.4% 1 710 34.7% 248 4.4% 3 000 182 3.7% 3 497 52.6% 2 000 2 728 48.3% 2 395 48.6% 1 000 418 6.3% 353 6.2% 279 5.6% 0 FY14 FY13 FY12 Employees Shareholders/linked unit holders Minority interest holders Providers of debt Governments - direct taxes Reinvested in the Group • Wealth created based on a look-through principle and therefore includes RSA, GOZ and V&A Waterfront

FINANCIAL REVIEW 11 CONSOLIDATED DISTRIBUTION CALCULATION FY14 FY13 Increase/ Rm Rm (decrease) Gross property income 6 422 5 773 11.2% RSA 4 805 4 354 10.4% GOZ 1 617 1 419 14.0% Property expenses (1 386) (1 237) 12.0% RSA (1 190) (1 078) 10.4% GOZ (196) (159) 23.3% Net property income 5 036 4 536 11.0% Other operating expenses (267) (236) 13.1% RSA (182) (175) 4.0% GOZ (85) (61) 39.3% Net property income after operating expenses 4 769 4 300 10.9% Finance costs (1 752) (1 782) (1.7%) RSA (1 285) (1 272) 1.0% GOZ (467) (510) (8.4%) Finance income 841 511 64.6% Investment income from V&A Waterfront 332 312 6.4% Other finance income ¹ 509 199 155.8% Adjustment for NCI, foreign exchange profit and normal taxation (361) (301) 19.9% Distributable profit 3 497 2 728 28.2% Distribution for the year 3 497 2 728 28.2% 1. Includes R110 m relating to cash adjustments on business acquisitions, R165 m included for the distribution received on listed investments, and R25 m of dividends received on treasury shares held * Average exchange rate at R9.53/AUD (FY13: R9.07/AUD) for GOZ ** The distribution calculation includes the results of the equity-accounted investments acquired from Tiber on a see-through principle (refer Annexure 35)

FINANCIAL REVIEW 12 EXPENSE TO INCOME RATIOS RSA GOZ V&A % % % 35 35 35 29.9% 29.5% 28.8% 28.6% 30 30 30 27.4% 3.3% 2.9% 4.0% 3.8% 3.1% 25 25 25 20 20 20 17.4% 15.5% 15.1% 15 15 15 5.3% 4.3% 26.6% 26.6% 4.7% 24.8% 24.8% 24.3% 10 10 10 12.1% 11.2% 10.4% 5 5 5 0 0 0 FY14 FY13 FY12 FY14 FY13 FY12 FY14 FY13 Operating expense ratio Operating expense ratio Operating expense ratio Property expense ratio Property expense ratio Property expense ratio

FINANCIAL REVIEW 13 CONSOLIDATED BALANCE SHEET (EXTRACTS) FY14 FY13 Rm Rm Increase Property portfolio¹ 70 228 54 231 29.5% RSA² 49 369 39 168 26.0% GOZ³ 20 859 15 063 38.5% 50% investment in V&A Waterfront 5 574 5 444 2.4% Listed investments in Acucap and Sycom 4 457 - - Nominal borrowings ⁴ 25 045 19 571 28.0% RSA² 16 499 12 468 32.3% GOZ³ 8 677 7 103 22.2% Shareholders’/linked unitholders ’ interest (NAV) 49 895 36 745 35.8% 1. Includes R265 m of properties reclassified as held for sale (FY13: R545 m) 2. The property value, as well as nominal borrowings of the equity-accounted investments acquired from Tiber are included on a see-through principle (refer Annexure 35) 3. Closing exchange rate at FY14: R9.96/AUD (FY13: R9.03/AUD) 4. Excludes fair value adjustments

3 CAPITAL MANAGEMENT DB SCHENKER, Gauteng

CAPITAL MANAGEMENT 15 LOAN TO VALUE AND INTEREST COVER RATIOS RSA GOZ² GROUP % % % times times times 50 8 50 8 50 8 46.6% 44.4% 40.6% 40 40 40 36.5% 6 6 6 33.9% 30.8% 29.6% 30 30 30 27.4% 23.9% 4 4 4 20 20 20 2 2 2 10 10 10 [VALUE [VALUE [VALUE [VALUE [VALUE [VALUE [VALUE 3.5x ]x ]x ]x ]x ]x 3.3x ]x ]x 0 0 0 0 0 0 FY14 FY13 FY12 FY14 FY13 FY12 FY14 FY13 FY12 LTV¹ LTV¹ LTV¹ Interest cover ratio (incl V&A) Interest cover ratio Interest cover ratio 1. Nominal value of interest-bearing borrowings (net of cash), divided by the fair value of property assets, including investment property held for sale. For RSA and GROUP the 50% equity investment in V&A Waterfront, other equity-accounted investments and listed investments were included in the fair value of property assets 2. Calculated in Rands

CAPITAL MANAGEMENT 16 RSA DIVERSIFIED BORROWINGS – NOMINAL VALUE Rm 18 000 16 499 400 Debt capital 15 000 13 613 market 3 909 Unsecured 12 468 26.1% 800 37.0% Debt capital 400 12 000 market Debt capital 2 510 Unsecured 1 796 24.3% market Unsecured 3 010 39.0% 27.4% 1 450 37.8% 2 000 9 000 1 300 1 450 1 400 Traditional bank debt Traditional 6 000 Secured Traditional bank debt 73.9% 63.0% Secured bank debt 8 944 Secured 75.7% 61.0% 72.6% 6 853 62.2% 6 358 3 000 0 FY14 FY13 FY12 Secured bank debt Secured institutional financier Unsecured bank debt Corporate bonds Commercial paper • For detail, refer to Annexure 19

CAPITAL MANAGEMENT 17 CAPITAL MANAGEMENT • The investment activities (acquisitions, developments and capital expenditure) were financed through a combination of equity and debt: R9,1 bn additional equity and R3,9 bn additional debt was raised • 16,5 m shares were repurchased in October 2013 when the BEE transaction with Phatsima Properties was refinanced. 17,0 m shares were repurchased in March 2014 when the BEE transaction with Quick Leap Investments 429 was restructured. Shares were acquired at R21.50 For RSA FY14 FY13 Unutilised committed facilities (R bn) 3,8 3,3 Weighted average term of liabilities (years) 3.5 3.5 Weighted average term of fixed interest rate profile (years) 4.3 4.9 Weighted average interest rate (%) 9.4 9.7 % debt at fixed interest rate 78.4 87.8 Unencumbered assets (incl V&A and listed investments) (R bn) 32,8 20,2 Unsecured debt (R bn) 6,1 4,7