Frasers Property Thailand Industrial Freehold & Leasehold REIT
1QFY20 Results Presentation
11 February 2020
Laem Chabang 2, Chonburi, Thailand Frasers Property Logistic Center Bangplee 1, Samutprakarn
Frasers Property Thailand Industrial Freehold & Leasehold REIT - - PowerPoint PPT Presentation
Frasers Property Thailand Industrial Freehold & Leasehold REIT 1QFY20 Results Presentation 11 February 2020 Frasers Property Logistic Center Bangplee 1, Samutprakarn Laem Chabang 2, Chonburi, Thailand Important notice This presentation is
11 February 2020
Laem Chabang 2, Chonburi, Thailand Frasers Property Logistic Center Bangplee 1, Samutprakarn
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This presentation is for information purposes only and does not constitute or form part of an offer, solicitation, recommendation or invitation for the sale or purchase
any other securities of FTREIT. No part of it nor the fact of its presentation shall form the basis of or be relied upon connection with any investment decision, contract or commitment whatsoever. The past performance of FTREIT and Frasers Property Industrial REIT Management (Thailand) Company Limited, as the REIT manger of FTREIT (the “Manager”), is not necessarily indicative of the future performance of FTREIT and the Manager. This presentation may contains “forward-looking statements”, including forward-looking financial information, that involve assumptions, known and unknown risks, uncertainties and other factors which may cause the actual results, performance, outcomes or achievements of FTREIT or the Manger, or industry results, to be materially different from those expressed in such forward-looking statements and financial information. Such forward-looking statements and financial information are based on certain assumptions and expectations of future events regarding FTREIT’s present and future business strategies and the environment in which FTREIT will operate. The Manager does not guarantee that these assumptions and expectations are accurate or will be realized. The Manager does not assume any responsibilities to amend, modify or revise any forward-looking statement, on the basis of any subsequent developments, information or events, or otherwise, subject to compliance with all applicable laws and regulations and/or the rules of the Securities and Exchange Commission, Thailand (“SEC”) and the Stock Exchange of Thailand (“SET”) and/or any other regulatory or supervisory body or agency The information and opinions in this presentation are subject to change without notice, its accuracy is not guaranteed and it may not contain all material information concerning FTREIT. None of FPT, FTREIT, the Manager, or any of their respective holding companies, subsidiaries, affiliates, associated undertaking or controlling persons, or any of their respective directors, officers, partners, employees, agents, representatives, advisers or legal advisers makes any representation or warranty, express or implied, as to the accuracy, completeness or correctness of the information contained in this presentation or otherwise made available or as to the reasonableness of any assumption contained herein or therein, and any liability whatsoever (in negligence or otherwise) for any loss howsoever arising, whether directly or indirectly, from any use, reliance or distribution of this presentation or its contents or otherwise arising in connection with this presentation is expressly disclaimed. Further, nothing in this presentation should be construed as constitution legal, business, tax or financial advice. The value of Units and the income derived from them, if any, may fall or rise. Unit are not obligations of deposits of, deposits in, or guaranteed by, the Manager or any of its affiliates. An investment in the Units is subject to investment risks, including the possible loss of the principal amount invested. Investors should note that they have no right to request the Manager to redeem their Units are listed. It is intended that holders of Units may only deal in their Units through trading on SET. Listing of the Units on the SET does not guarantee a liquid market for the Units. Please study relevant information carefully before making any investment decision. Investors are encouraged to make an investment only when such decision correspond with their own objective and only after they have acknowledged all risks and have been informed that the returns may be more or less than initial sum.
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▪ Performance Overview and Distribution Details ▪ Financial Review ▪ Investment and Portfolio Overview ▪ REIT Strategy and Key Objectives
FPIT Bangna
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DPU from 1QFY20 performance
Portfolio Management Earnings and DPU Portfolio value increased to THB 39 Billion
Property and Development (Third-party) (1)
Asset Acquisition 1QFY20
Occupancy Rate as
(1) Total investment value THB 2,050 Million (exclude acquisition cost, tax, transfer fee and advisors fee). (2) Renewal rate that incurred in FY2020 (Oct’19 – Dec’19) (3) Only Debentures cost = 3.30% WAM is around 3.97 Years (4) Reference from loan agreement and debentures at the end of Dec 19 (5) Assume IBD/TAV after repayment bridging loan by using balance sheet as of 31 December 2019
Capital Management
weighted average cost
debt at around 3.07%(3) and average weighted debt maturity 3.07 years(4) .
0.1670 0.1670 1QFY19 1QFY20
Unit : THB per Unit
1. Distribution is mean dividend and capital Reduction, 1QFY18 and 1QFY19 have not capital reuction. 2. FTREIT fiscal year is starting from 1 October to 30 September.
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Distribution per Units(2)
(1)
(Oct’18 – Dec’18) (Oct’19 – Dec’19)
(1)
Distribution Detail
Latest Distribution Details
Distribution Period 1 October 2019 – 31 December 2019 Distribution Per Unit (DPU) THB 0.1670 Ex-date (XD) 24 February 2020 Record Date 25 February 2020 Distribution Payment Date 11 March 2020
FPT Properties Chonburi
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Unit: (THB Million) Oct’19 – Dec’19 (1QFY20)(2) Oct’18 – Dec’18 (1QFY19)(2) +/- %
Analysis
Rental and Service Income
754.2 662.9 14
1QFY2020.
Cost of rental and Services and administration expenses
94.2 90.6 4
Trust Management fee(4)
93.6 83.6 12
Finance Costs
86.4 57.2 51
average debt maturity is around 3.07 years.
Net Investment Income
482.5 436.0 11
assets that acquired in period of 4QFY19 and 1QFY20
Distributable income to Unitholders(3)
486.3 474.0 3
Which was deducted by:
DPU (THB per Unit)
0.1670 0.1670
(2) Fiscal period start from 1 October to 30 September (3) Distributable income to unitholders = Net investment income adjusted by non cash item (4) Trust management fee = Management fee + Trustee fee + Registrar fee + Professional fee
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Unit: (THB Million) As of 31 Dec 19 As of 30 Sep 19 Change % Investment Properties 39,182.8 37,049.4 6 Investment in Securities at fair value and cash 1,318.2 1,141.8 15 Other Assets 289.1 303.7 (5) Total Assets 40,790.1 38,494.9 6 Interest Bearing Debt 11,790.9 9,740.2 21 Other liabilities 1,462.1 1,265.6 16 Total Liabilities 13,253.0 11,005.8 20.4 Net Asset Value per Unit (THB) 10.5814 10.5630 0.2 ▪ The value of investment properties increased 6% from THB 37,049.4 Million as at September 30, 2019 to THB 39,182.8 Million at December 31,2019, due mainly to: Investment ✓ Completed acquisition of warehouses from Sahathai Property and Development on November 14, 2019 ▪ Interest bearing debt increased THB 2,050 Million, to fund asset acquisition.
800 2,100 1,300 500 1,000 380 500 1,260 600 3,352 FY2020 FY2021 FY2022 FY2023 FY2024 FY2025 FY2026 FY2028 FY2029
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IBD to asset Ratio 28.9% > 21.1% (Jan’20) Total Gross Borrowings(6) THB 11,790.9 million Weighted Average Cost of Borrowings 3.07% p.a.(4) Average Weighted Debt Maturity 3.07 Years(4) Debentures Proportion 72% Interest Coverage Ratio 6.66 times(1) Debt Headroom THB12,683.1 million(2) Net Asset Value per Unit (THB) 10.5814 Credit Rating A (Stable Outlook)(3)
Maintained a Well-spread Debt maturity Profile(7)
Bridging loan Debentures Unit: THB Million
1. Interest Coverage ratio = EBITDA (excluded gain from divestment)/Interest Expense. 2. Prior to reaching the 60.0% regulatory leverage limit 3. Official announcement rating by TRIS on 22 July 2019. 4. Only Debentures cost = 3.30% WAM is around 3.97 Years 5. Post repayment of bridge loan made on 27 Jan 20 6. Debentures is net with issuance cost 7. Bar graph illustrated debentures value before deducted issuance cost
As of 31 December 2019
Frasers logistic Bangna, Chachoengsao, Thailand
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Frasers Property Logistic Center Laem chabang 3 (LCB3)
24 Units 80,216 Sq. m.
Investment Highlight
✓ One of the biggest warehouse in freezone area, located near to LCB port. ✓ Connected to Highway no 7 and Motorway. ✓ Modern warehouse area with floor loading around 3.5 – 5.0 tons and height around 10.5 – 12 meters. Land Area ~125 Rai or ~50,000Sq. w. Net Leasable Area 80,216 Sq. m. (Total under roof area)(4) Asset Type Freehold Occupancy Rate 100%(1)(2) Property Ages 4.62 years(1)(3)
(1) Property ages and occupancy rate is information as of 31 December 2019 (2) Included guarantee performance from Sahathai Property and Development (3) Reference from construction permit (Aor.1) and building construction certificate (Aor.6) (4) Included custom area 204 sq.m
Tenants profile as of 31 December 2019
Suzuyo Distribution Center ALPS Logistics Michelin Siam
LCB3
[Logistics] [Logistics] [Tyre producer] Pacific Sugar [Logistics]
Freehold 75% Leasehold 25% Factory 45% Warehouse 55%
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Quality portfolio concentrated within major industrial and logistics markets
Properties/1 WALE/4
Portfolio Value/2
Avg Property Ages/5
Net Leasable Area/3
Occupancy Rate
Frasers Property Thailand Industrial Freehold & Leasehold REIT
FTREIT listed real-estate investment trust with a quality portfolio concentrated within prime industrial and logistics market in Thailand. Remaining LH Years
No of Tenants
Well balance portfolio by asset type, with predominately freehold land title
North 25% East 13% EEC 62%
Type
Breakdown By Area
1. Factory 315 units and Warehouse 263 units (included Cold Storage 2 units)
4. WALE refers to the weighted average lease expiry based on gross rental income (GRI), being the contracted rental income and estimated recoverable outgoings for the month of December 2019. Excludes straight lining rental adjustments.
The Largest Industrial & Logistics REIT in Thailand
Breakdown By Right on assets
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Northern Bangkok Area/2 Eastern Bangkok Area /2 EEC Area /2
68% 69% 77% 75% 69%
71% 75%
0% 20% 40% 60% 80% 100%
Jun'18 Sep'18 Dec'18 Mar'19 Jun'19 Sep'19 Dec'19
59 Units
92% 96% 99% 100% 99% 100% 0% 20% 40% 60% 80% 100%
Jun'18 Sep'18 Dec'18 Mar'19 Jun'19 Sep'19 Dec'19
80% 80% 84% 82% 83% 85%
86%
0% 20% 40% 60% 80% 100%
Jun'18 Sep'18 Dec'18 Mar'19 Jun'19 Sep'19 Dec'19
Overall performance of FTREIT 1QFY20 improved from last fiscal year that came from tenants of existing assets and new assets
100%
1.Rental and service income excluded property tax income 2.Northern Bangkok area = Ayutthaya and Pathumthani, Eastern Bangkok = Samutprakarn and Prachinburi, EEC area = Chonburi, Rayong and Chachoengsao
Occupancy (%)
as of 31/12/19
Net Add (Sq.m)
1QFY2020
WALE (Years)
as of 31/12/19
Rental Revenue
1QFY20(3)
Renewal Rate
1QFY2020
Rate Reversion for agreement that expired in period 1QFY20
85.1%
(+2.0% Q-o-Q)
+102,242 2.18 Years 754 MB
(+14% Y-o-Y)
78% +0.9%
152 Units 367 Units
OCR % OCR % OCR %
75% in the of 1QFY20.
and electronics producers that allocated their production capacity to Thailand.
leased property in EEC area and asset acquisition in 1QFY20.
came from Electronics and Logistics
Summary highlight Q-o-Q Summary highlight Q-o-Q Summary highlight Q-o-Q
Tenants Industry % of GRI(1) Nationality Siam Makro Retail 4.38%
Pacific Sugar
Logistics 2.56% Leschaco Logistics 2.41% Samsung Electronics 2.15% CTD Logistics 1.86% Lazada Electronics 1.81% BJC Logistic Logistics 1.76% Suzuyo DC Logistics 1.54% DTS Automotive 1.43% Kintetsu Logistics 1.41%
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High quality, diversified tenant base underpinned by primary industries including Automotive, logistics services, electronics, retails and e-commerce. Top 10 Tenants (GRI ~21%(2) / WALE 3.14Years(1))
Breakdown of Tenants1 2 By Industry
Automotive 25%
Logistics 24% Electronics 22% Others 18% Retails 8% E-Commerce 3% By Nationality
Japan 45% EU 19% Thais 17% Other Asian 15% US 4%
1. WALE refers to the weighted average lease expiry based on gross rental income (GRI), being the contracted rental income and estimated recoverable outgoings for the month of December 2019. Excludes straight lining rental adjustments. 2. Concentration risk has stable at around 21%.
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THB 486 million/1
Distributable Income
1. Distributable income = adjusted net investment income. 2. As of 31 December 2019 3. LCB3 property value is THB 2,050 Million (Exclude acquisition expenses) 4. Post repayment of bridge loan made on 27 Jan 20
85%/2.18 Yrs/2
Occupancy and WALE
Higher occupancy rate
THB 2,050 million/3
Investment in period
Portfolio value increased to approximately THB 39 bn
Weighted Avg Debt Maturity
Proportion of Debentures
IBD to Total Asset Value Retention/Reversion
[1QFY20]
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Deliver consistently growing and sustainable DPU and NAV per unit to unitholders though FTREIT business framework
Expected outcome
Operation Excellence
Operation Excellence Acquisition Assets and AEI Efficient Capital Management
Strategies to support the business framework
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▪ Proactive leasing: Maintain high retention rate,
▪ Enhance tenant quality and base by leveraging on sponsor’s capabilities and networks.
Strategy Framework
Acquisition Assets + AEI
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▪ Right of first refusal (“ROFR”) for industrial properties from Sponsor. ▪ Third-party asset acquisition. ▪ Search and propose AEI opportunity to target tenants which required additional space in same property. ▪ Divest non-core assets and redeploy capital to acquire/develop higher value-adding properties.
+Sustain ability
Sustainability
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▪ Sustainability initiative project such as Solar Rooftop, Initiative with tenants ecological activities. Efficient Capital Management
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▪ Optimize capital mix and prudent capital management ▪ Manage schedule of debt repayment matching with asset portfolio performance
FIRM will implement business framework to enhance performance and achieve target DPU for unitholders of FTREIT
Frasers Property Industrial REIT Management (Thailand) Co., Ltd 22nd – 23rd Floor, Mitrtown Office Tower l 944 Rama 4 Road l Wangmai Subdistrict l Pathumwan District l Bangkok l 10330 Tel: +66 2078 1999 l Fax +66 2078 1971 l Email: FTREIT.IR@frasersproperty.com www.ftreit.co.th