SIME DARBY PROPERTY BERHAD Citi Asia Pacific Property Conference 2018 Investor Presentation 28 29 June 2018
2 Presentation Outline 1 Sime Darby Property Profile 2 Key Growth Areas and Recent Developments 3 Growth Strategies 4 Financial and Operational Highlights 5 Megatrends & Market Outlook 6 Appendices
1 Sime Darby Property 3
Shareholding Structure 4 55.6% RM1.16 Share Price Share Price Movement (RM) 1.78 As at 22 June 18 1.16 Foreign Shareholdings 1.11 14.8% 4.7% 10.0% RM7.9bn Market Capitalisation Other Domestic Shareholdings 14.9% 6,800,839 Source: Tricor and the public Number of Ordinary Shares (000 )
The Largest Property Developer in Malaysia In terms of land bank size 5 RM1.7bn 9MFY18 Revenue RM637mn 9MFY18 PBIT RM593mn 9MFY18 PATAMI 1,602 Employees GEORGETOWN, PENANG 3,291 acres KEDAH 2,826 acres Key Developments 1,462 acres North-South Expressway THAILAND SELANGOR PENINSULA MALAYSIA 3,297 acres 3,187 acres NEGERI SEMBILAN BANDAR UNIVERSITI PAGOH UNITED KINGDOM AUSTRALIA JOHOR Helensvale, Queensland 65 acres Singapore Property Development 23 Acres of remaining developable land bank to be 20,695 developed over 10-25 years RM96bn 45% Property Investment 1.4mn Hospitality & Leisure 6 Active townships, integrated and niche developments Estimated Remaining Gross Development Value (GDV) Average trading discount to Realised Net Asset Value (RNAV) Sq. ft. of net commercial space in Malaysia and Singapore Assets across 4 countries including 2 golf courses (36-hole & 18-hole respectively) and a convention center
Sustainable Growth With remaining developable land over 10 to 25 years 6 By Remaining Developable Land By Remaining Gross Development Value (GDV) O N G O I N G 334 (3%) 2,826 (23%) 1,461 (12%) 12,265 acres 3,451 (28%) 871 (7%) 3,322 (27%) 28.2 (35%) 7.6 (9%) 13.9 (17%) RM81.5 billion 21.0 (26%) 5.5 (7%) 5.3 (6%) F U T U R E 2,036 (24%) 3,302 (39%) 8,430 acres 3,092 (37%) RM14.4 billion for Guthrie Corridor only Legend: Notes: 1. Township categorisation: Guthrie Corridor: (Ongoing) Elmina West, Elmina East, Denai Alam & Bukit Subang and Bukit Jelutong, (Future) Kota Elmina & Lagong Negeri Sembilan: (Ongoing) Nilai, Bandar Ainsdale, Planters Haven & Chemara, (Future) MVV and others Johor: Bandar Universiti Pagoh and Taman Pasir Putih Greater Klang Valley & Others: (Ongoing) Ara Damansara, ALYA, Putra Heights, KL East, USJ Heights, Taman Melawati, Saujana Impian, SJCC and SJ7 (Future) Jalan Acob, Victoria Estate and others 2. Remaining GDV available only for Guthrie Corridor
Key Growth Areas (Flagship Developments) With remaining development period of about 25 years 7 Guthrie Corridor Expressway Elmina East and West Klang South Selangor Johor Bandar Bukit Raja Serenia City Bandar Universiti Pagoh Remaining Acreage Total Residential Units 3,144 2,826 1,462 3,297 Remaining GDV RM19bn RM14bn RM8bn RM5bn Residential Units Launched 26,809 21,857 12,522 5,671 2,183 7,663 302 383 Total Industrial Park acreage ~90 879 197 238 Industrial 10 314 71 Acreage Sold First launch in 1H19 Key Catalysts Along the Guthrie Corridor >3000 acres of green spaces Highly-connected in Klang, close to Port Klang and KLIA Xiamen University, 1 st university branch outside of China Horizon Village Outlet to open in 1Q19 Pagoh Education Hub, 1 st multi-varsity education hub (506 acres) with ~7200 students
Growth along the Guthrie Corridor 8 6,543 acres of remaining developable land bank along Guthrie Corridor Expressway with remaining GDV of more than RM35 billion 53% of total land bank are on ongoing developments 47% on future developments (Kota Elmina and Lagong) Good connectivity: GCE, DASH, NKVE, LATAR and NSE Mass Rail Transit-1 (MRT 1) and Keretapi Tanah Melayu Line (KTM) Elmina East and West A Wellness Hub RM18.8bn Estimated Remaining GDV 26,809 units (Launched: 2,183) Total estimated residential units 300 acres Elmina Central Park 2,700 acres Tasik Subang Dam Forest Reserve
Bandar Bukit Raja - Highly Connected Industrial / Township 9 KEY HIGHLIGHTS 4,333 acres (Remaining: 2,826 acres) Close proximity to KLIA and Port Klang RM13.9bn Estimated Remaining GDV 21,857 units Total estimated residential units 82,000 residents Expected population at full capacity 879 acres Industrial Business Park 125 acres Town Park High Connectivity via major road infrastructure New North Klang Straits Bypass (Shapadu Highway) and upcoming West Coast Expressway (WCE) RECENT DEVELOPMENTS 7,663 Residential Units Launched To-date 39 Acres of industrial land to be jointly developed for built-tosuit industrial facilities via 50:50 JV with Mitsui 50 Acres of industrial land sold to Vinda Group in Bandar Bukit Raja 2 Launches to date with total GDV of >RM3.8bn Persada Azira (2-storey house) (2-storey house) Casira 2 (2-storey house) 230 units From RM658,888 111 units From RM678,888 111 units From RM738,888
Serenia City - Industrial and High Technology Hub 10 KEY HIGHLIGHTS 2,370 acres (Remaining: 1,462 acres) Close proximity to Kuala Lumpur, Putrajaya, Cyberjaya and KLIA RM7.6bn Estimated Remaining GDV 12,522 units Total estimated residential units 197 acres Industrial Components High Connectivity Accessible via ELITE Highway, Federal Road, ERL & KLIA Educational & Retail Catalysts Xiamen University First Chinese university branch campus in Malaysia with a capacity of 10,000 students. Opened in February 2016. Current student population of 3,300 Horizon Village Outlet one-storey retail lots over total net lettable area of 400,000 sq ft with 2,000 covered parking bays. Target to be completed by 1Q 2019. RECENT DEVELOPMENTS ~100% take-up in the first hour of 1 st residential launch Serenia Amani (2-storey house) 302 units From RM536,888 71 acres of industrial land launched worth GDV of RM179 million
Bandar Universiti Pagoh A University Town 11 Balance University Land (295 acres) Pagoh Education Hub Private University Land (116 acres) KEY HIGHLIGHTS 4,099 acres (Remaining: 3,297 acres) Malaysia s First Integrated Township with an Education Hub RM5.1bn Estimated Remaining GDV 5,671 units Total estimated residential units 238 acres Industrial Business Park Pagoh Education Hub First Multi-Varsity Education Hub and Catalyst to BUP 506 acres development 4 major institutions Maximum student capacity of 10,800 students 60:40 JV between Sime Darby Property and Tunas Selatan Construction RECENT DEVELOPMENTS 383 Residential Units launched Todate 7,200 current student population in Pagoh Education Hub 100% Handover of vacant possession of Harmoni Vista 1 on 12 June 2018 Launches to date with total GDV of >RM108mn Harmoni Vista Sarjana Square (2-storey house) (Shop Office) Sarjana Promenade (Shop Office) 383 units From RM365,888 35 units From RM888,888 35 units From RM950,000
12 Transit Oriented Developments (TOD) and Transit Adjacent Developments (TAD) Total of 9 Developments, with an estimated remaining GDV of >RM10bn SJ 7 6T
Update on KL-Singapore High Speed Rail (HSR) Two HSR hubs were initially earmarked at Sime Darby Property s land 13 Brief facts of HSR and KTM Rail Network: HSR KTM Rail Projected Cost ~ RM65 bil < RM20 bil Est. Travel Time 90 mins 130 mins Speed 320 km/hr 200 km/hr 30 MAY 12 JUN 19 JUN Proposed Work New alignment Upgrade existing alignment, will largely be in Johor Key Difference Duplication of existing rail network Complements existing network Reported that HSR has been scrapped in a move to control government s spending and reduce debt KL-Singapore high-speed rail is postponed for further review - not scrapped A cheaper option to upgrade the railway link between KL and Singapore by upgrading the existing KTM Rail Network Sime Darby Property is in ongoing conversation with both Federal and State Governments
Update on Malaysia Vision Valley (MVV) Sime Darby Property to ride on the State Government s support 14 Nilai MVV Total Area: 379,086 acres Sime Darby Property s Interest: Owned: Parcel A of 3,196 acres MVV Option Agreements with SD Berhad: 8,793 acres Key Catalysts: A new 18km dual carriageway linking Nilai and Labu to Bandar Enstek Expected completion by July 2021 State Government s Support post GE-14 The infrastructure work and construction of the dual carriageway is ONGOING The State Government s commitment to spur economic growth is in line with our strategy to accelerate the MVV development
Land Options Agreements Option to Increase Land Bank Totaling ~20k acres 15 1. Land Options Agreement with Sime Darby Plantation 1 1, 8 0 6 a c r e s SD Plantation entered into 9 call option agreements with SD Property pursuant to which SD Property has options to purchase these lands at future market value Penang Kedah Byram estate: 864 acres 2 0, 5 9 9 a c r e s Bukit Selarong estate: 148 acres 2. MVV Options Agreement with Sime Darby Berhad 8, 7 9 3 a c r e s Kumpulan Sime Darby and Sime Darby Property entered into several call option agreements for lands within the MVV development region Options Validity: 5 years effective Nov 2017, extendable by 3 years Sungai Kapar estate: 993 acres West Estate, Carey Island: 2,000 acres Sepang estate: 2,000 acres Lothian Estate: 485 acres Selangor Negeri Sembilan Options Validity: 5 years effective Nov 2017, extendable by 3 years Labu, New Labu (Kirby), New Labu (Main) and Hamilton estates Ainsdale estate: 268 acres Kulai, Johor Kulai estate - A: 1,862 acres Kulai estate - B: 3,186 acres
Update on Battersea Power Station Project The next profit recognition will be from FY2020 onwards 16 2012 ~ 9bn 40:40:20 Acquisition of land for 400mn (c.4% of estimated GDV) Estimated GDV JV between Sime Darby Property : SP Setia : EPF 42 acres Site Area Proposed Disposal of Phase 2 s Commercial Assets Opportunity to secure ownership of an iconic asset which will be able to deliver a sustainable income stream Enable Sime Darby Property to focus as a property developer and realise development returns of Phases 3 7 Target to complete by July 2018 Phase 1 Circus West Phase 2 The Power Station No. of Residential Units 867 253 Take-up Rate 99% 92% Target Completion 100% Q4 2020 Units Handed Over 832 - Profit Recognition (RM mn) 252 - GDV ( mn) 917 2,305 R e c e n t D e v e l o p m e n t H i g h l i g h t s : Apple HQ, Battersea Target to open in 2021 (Expects 3,000 Apple employees ) Occupy 50% of total Phase 2 s commercial space, equivalent to 100% of the office space Northern Line Extension On-track and target to complete by end 2020 US Embassy, Nine Elms Completed in 2017 & fully operational in May 2018
2 Growth Strategies 17
KEY ENABLERS TARGETS BY 2023 STRATEGIC PRIORITIES Sustainable & Balanced Growth Strategies 18 No. 1 Property Developer in Malaysia F I V E K E Y S T R A T E G I C O B J E C T I V E S #1 Re-balancing & #2 Launching #3 expanding new growth development areas portfolio income Enhancing overall customer experience #4 Achieving #5 Elevating Cost & Organisational Operational Effectiveness Efficiencies Township: Enhance GDV and review strategic masterplan Integrated: Improve capabilities & income contribution New Business Segment: Industrial & Logistics Development Focus on profitable affordable housing projects Review MVV project Enhance data driven customer insights Roll-out online community marketplace and digital innovation Diligent cost management Review Leisure Management s business model Shorter end-to-end development cycle for both township & integrated products Improve project management governance Executive optimal strategic partnership model Strengthen talent & performance management Consistent Shareholders Return Sustainable PATAMI growth Consistent Sales Performance The Preferred Employer within Real Estate Brand value & marketing People & HR capabilities Operating Model & Business Process Innovation & technology
K e y A r e a s O n g o i n g J V P a s t R e c o r d s Dynamic and Active Land Bank Management 19 Three-pronged approach to maximize investment returns of our sizeable land bank D e v e l o p Prioritise on growth of high performing townships to extract highest economic value Drive cost reduction initiatives to enhance profitability S t r a t e g i c P a r t n e r s h i p s Earmark potential developers to co-develop ongoing and greenfield townships as a mean to: Accelerate development of our sizeable land bank Leverage on partners expertise and resources M o n e t i s a t i o n Strategic land sale outside key development focus to: Expedite the development via other developers Speedy realisation of land value Target disposal:~1,700 acres 2015: Elmina land (135 acres) to E&O 2016: Serenia City land (375 acres) to Sunsuria & Semenyih land (238 acres) 2017: Semenyih land (803 acres) to I&P 2018: New Lunderston land (298 acres)
Strategies: Property Development 20 1. Build home for specific target groups: Assisted living Multi-generational living Customised Built-to-Suit products Themed townships 2. Focus on Time, Cost and Quality 3. Lengthen planning visibility & adopt portfolio perspective Township Development Integrated Development 1. Tackle major operational challenges around cost and quality issues 2. Focus on Transit Oriented (TOD) and Transit Adjacent (TAD) developments 3. Formation of specialist team for central Project Management and Strata Management Ongoing Launches Review pricing and positioning Completed Review campaign strategy & increase incentive Future Launches Plan towards achieving zero incoming stock Unsold Completed And Ongoing Stocks Industrial & Logistics Development Portfolio Two-Pronged Approach 1. Identified 461 acres of industrial land with an estimated GDV of ~RM5.1bn 253 acres in Elmina East, BBR1 & 2 and Serenia City to be developed as Industrial Build-to-Suit facilities and retained by Property Investment as a recurring income pool
Strategies: Property Investment 21 To achieve 10% of PBIT contribution by FY2023 via: 1. Actively grow high-yielding asset portfolio 2. Monetisation of non-core assets 3. Generate steady recurring income via Built-to-Suit Industrial Facilities (BTS) and Managed Industrial Business Parks 01 Actively grow high-yielding asset portfolio Expansion plan to increase recurring income Optimise value creation of existing strategic partnerships Opportunistic acquisition of 3 rd party assets 03 Actively grow high-yielding asset portfolio Divest non-core hospitality assets in Australia, Singapore & Vietnam by Dec 2019 Generate recurring income via BTS and Managed Industrial Business Parks 02 Joint venture (JV) and strategic partnerships with Industrial experts to transform our land bank into a thriving industrial / logistics park The JV with Mitsui on 39 acres at Bandar Bukit Raja is the first step
Sime Darby Property s Rigorous Asset Monetisation Journey 22 2015 2016 2017 2018 Beyond Sold 135 acres of Elmina land to Eastern & Oriental (E&O): RM48mil Sale of Subang Avenue Mall: RM55mil Sale of 50% stake in Sunsuria JV: RM157mil Sold 375 acres of Serenia City land to Sunsuria and 238 acres of Semenyih land: RM320mil Sale of Equatorial Hotel in Melaka and 2 properties in Singapore: RM486mil Sold 803 acres of Semenyih land to I&P: RM413mil Sale of 1 investment property in Singapore: RM131 mil Sold 298 acres of New Lunderston estate land: RM84mil Sale of 40% equity stake in Seriemas Development and 100% stake in MLDC: RM318 mil Target disposal of ~1,700 acres of land 3 hospitality assets Rigorous focus on monetising non-strategic land bank and non-core assets which translated to over RM2 billion of gains
4 Financial and Operational Highlights 23
5-Year Financial Highlights 24 Revenue RM mn Profit Before Interest & Tax RM mn Margin Return on Invested Capital (ROIC) % 5-Year Average ROIC: 9% Gross Sales Value RM mn Units Sold Units FY2017 2,616 824 31% 7.4 FY2017 IC RM11.0bn 1,917 1,765 FY2016 3,371 1,203 36% 11.9 1,745 1,894 FY2015 3,624 931 26% 10.3 2,134 1,659 FY2014 2,792 575 21% 7.7 2,750 3,049 FY2013 2,367 536 23% 7.6 2,149 2,103 Note: FY2013 and FY2014 were not restated for adoption of MRFS Framework and MRFS 15 Includes both continuing and discontinuing operations
Nine Months of Financial Year 2018 Ended 31 March 2018 25 YOY 9MFY2018 9MFY2017 Continuing Operations % RM mn RM mn Revenue 18 1,691.4 1,439.5 Segment Results 4 316.1 303.2 PBIT 61 633.9 393.2 PBT 58 641.6 405.3 PATAMI 108 592.5 284.4 Basic EPS (sen) 43 10.9 7.6 Discontinuing Operations Revenue 39 44.3 31.9 PBIT >100 3.1 (5.3) PATAMI (92) 0.9 12.0 TOTAL Revenue 18 1,735.7 1,471.3 PBIT 64 637.0 387.9 PATAMI 100 593.4 296.4 Basic EPS (sen) 38 10.9 7.9 Note: Included in 9MFY17 is a gain on disposal of Glengowrie Estate, Semenyih of RM202 million (Minority interest share of RM45mn)
Financial Position as at 31 March 2018 26 TOTAL CASH EQUIVALENTS RM1,048mn RM900mn 472.7 533.4 16% RM753mn 506.2 575.2 366.7 246.8 30 SEP'17 31 DEC'17 31 MAR'18 Bank balance, deposit & cash Cash under Housing Development Account TOTAL BORROWINGS (CONTINUING OPERATIONS) RM1,331mn RM1,100mn RM1,477mn 866.5 826.1 1,292.5 11% 233.8 504.6 183.4 30 SEP'17 31 DEC'17 31 MAR'18 Short-term Long-term Lower cash equivalents due to: Loan amortisation payment of RM113mn Additional equity injection for Battersea Power Station project of RM108mn Repayment to related companies of RM245mn (Net of purchase of MVV land of RM690mn) Offset by the proceeds from the disposals of assets, subsidiaries and associates of RM747mn Higher borrowings raised in 3QFY18 for: Developments of KL East and Bandar Universiti Pagoh Excluding discontinuing operations: Gross Debt/Equity Ratio: 16% Net Debt/Equity Ratio: 8% Including discontinuing operations (RM893mn): Gross Debt/Equity Ratio: 24% Net Debt/Equity Ratio: 15%
Segment Results For 9MFY2018 9MFY2018 vs 9MFY2017 27 21% 1,587.1 1,307.1 REVENUE (RM'mn) 12% 339.2 303.3 SEGMENT RESULTS (RM'mn) 27.6 43.2 76.7 89.2 (4.6) 10.6 (18.5) (10.7) Property development Property investment Leisure and hospitality Property Development Property Investment Leisure and hospitality Property Development: Higher sales and development activities at Elmina West, Elmina East, Serenia City, Taman Melawati and Serenity Cove, Australia despite the lower contribution from Nilai Impian and Bandar Bukit Raja townships Property Investment: Lower revenue by 36% YoY largely due to the termination of master lease at Wisma Sime Darby, reducing revenue by RM5 million Leisure & Hospitality: Lower revenue by 14% YoY from TPC KL, Sime Darby Convention Centre & the Australian asset Property Development: 9MFY18: Included: Gain of RM11.1mn from the sale of 21 residential plots in Serenity Cove Gain on New Lunderston land sale of RM84.4mn Share of profit from Battersea of RM103.1mn Reversal of RM13.2mn on compulsory land acquisition gain in prior year 9MFY17: Included: Gains on compulsory acquisition / disposal of land of RM259.8mn Battersea s share of profit of RM86.5mn Provision for unsold stocks of RM79.0mn Property Investment: 9MFY18: Included a share of loss of RM7.2mn from Melawati Mall (9MFY17: Loss of RM3.2mn) Leisure & Hospitality: 9MFY17: Included the reversal of an impairment of asset in Harvard Golf & Country Club of RM10mn
Unbilled Sales as at 31 March 2018 28 Total: RM1,531 million, 4% QoQ (31 Dec 17: RM1,594 million) RM Million 213 Sustained unbilled sales due to a steady stream of launches of ~RM360 million in 3QFY18 216 192 185 158 93 80 83 66 63 19 38 32 26 6 34 29 Elmina West Elmina East Denai Alam & Bukit Subang Bukit Jelutong BBR 2&3 BBR 1 Ara D'sara ALYA Putra Heights SJCC KL East Serenia City Tmn Others* Bdr. Melawati Ainsdale QoQ %: (31) 1 >100 20 10 (20) 0 (1) 63 NA (34) (58) (40) 27 9 (51) (36) Nilai Pagoh & Tmn. Pasir Putih Along Guthrie Corridor Expressway (GCE) Bdr. Bukit Raja (BBR) Klang Greater Klang Valley Negeri Sembilan Johor * Others: USJ Heights and Saujana Impian
Steady Stream of Quarterly Launches 29 G S V YTD9MFY18: RM2,215mn 689 Actual O F 358 Forecasts L A U N C H E S 1,176 681 800-1,000 Jul-Sep 2017 Oct-Dec 2017 Jan-Mar 2018 Apr-Jun 2018 Jul - Dec 2018 2 TOTAL UNITS 1,983 995 580 709 1,500 1,800 TAKE UP RATES 41% 68% 92% ~80% of total YTD9MFY18 Gross Sales Value launched are from residential launches Of the total residential YTD9MFY18 units launched: ~50% are priced at RM400k and below per unit, which are from the launch of 1,700 units of RSKU apartments (average price of RM228,800 per unit) ~30% are priced from RM400k to RM800k from launches in Elmina (EG1), Bandar Bukit Raja (Azira), Serenia City (Serenia Amani), SJCC (Lot 15), Bandar Ainsdale (Redup) and Nilai Impian (Orkid) Notes: 1. Includes launch of Rumah Selangorku (Jul Sept 2017: 1,700 apartments in Putra Heights) and (Jul Dec 2018: target of 562 apartments in Elmina West) 2. Future/forecast launches for residential and commercial launches only
Focusing on The Demand Momentum in the Medium Range Properties 30 Breakdown of Future Total Launches by Type Double storey link homes (DSLH) make-up 60% of total upcoming launches Breakdown of Future Residential Launches by Price 54% of the residential units are priced between RM400k - RM800k per unit 4% 9% 3% 15% 13% 36% 22% 21% 1% 7% 5% 2% 54% 54% 57% 57% 28% 11% By Units By GSV By GSV (RM mn) By Units By GSV By (RM GSV mn) Residential DSLH Bungalow / Townhouse Semi - D Condo / Apartment <RM400k RM400k - 800k RM800k - RM1.2mn >RM1.2mn Commercial Note: Future/forecast launches for residential and commercial launches only
31 5 Megatrends & Market Outlook
Emerging Megatrends to Benefit Sime Darby Property 32 Expected completion of Damansara- Shah Alam Elevated Highway (DASH) by October 2019 Will increase the value of all projects along the Guthrie Corridor Upgrading the first phase of the Sungai Buloh - Serdang - Putrajaya (SSP) line is expected to be operational by July 2021 and be fully operational a year later Affordable Housing severe shortage of houses below RM250k 1 mil affordable houses to be built within two terms of administration Tax incentives will be given to companies to use cost saving technologies such as IBS Senior Citizens Provide subsidies and incentives to encourage the construction of retirement villages Connectivity Post GE14 focus Malaysia Population 33.8 million by 2020 (2017: 32 mil) estimated population within Greater Klang Valley (fastest growing area) Approximately 70% of Malaysia population live in urban areas as of 2018 and forecasted to increase to 80.1% in 2025. Senior population expected to increase to ~800 mn by 2025 and double to 1.6 bn by 2050 Digitalisation & Industrialisation 21% growth of E-Commerce in Malaysia by 2020, double from 2016 Non-traditional competitors are shifting value pools rapidly by leveraging tech based platforms to build end-to-end ecosystems Opportunity to leverage on: Industry 4.0 Smart Factories E-commerce warehousing & logistics Digital free trade zones Rise in Small Medium Enterprises (SMEs) Source: PwC, CBRE, Juwai, MDEC, MITI and DOSM
Jan-15 Mar-15 May-15 Jul-15 Sep-15 Nov-15 Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17 May-17 Jul-17 Sep-17 Nov-17 Jan-18 Mar-18 Jan-15 Mar-15 May-15 Jul-15 Sep-15 Nov-15 Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Feb-17 May-17 Jul-17 Sep-17 Nov-17 Feb-18 Apr-18 Q2 2018F Q4 2018F Q2 2019F Malaysia: Economic and financial stability expected to remain intact 33 Q1 2018 GDP grew by 5.4%, slightly below consensus of 5.5%. GDP is expected to hover between 5.0 5.5% over the next 1.5 years, with domestic demand being the key driver of growth. % 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 GDP (Year-on-Year) 5.4 5.0-5.5% Following the hike of 0.25% in Feb 18, OPR in coming months is expected to be maintained at 3.25%, consistent with the policy stance to ensure that the domestic economy continues on a steady growth path. % 3.50 3.40 3.30 3.20 3.10 3.00 2.90 2.80 2.70 Overnight Policy Rate (OPR) 3.25 3.25 3.40% Historical Forecasts Historical Forecasts Consumer sentiment has been on an uptrend at 91.0, highest since Q1 2015. Consumer sentiment is expected to be boosted in the near term from the removal of GST. Loan approval rates have been stable at 41%, slightly below the 3 year average of 43%. Approval rates are expected to hover around the current levels. 100.0 90.0 80.0 70.0 60.0 50.0 40.0 30.0 20.0 10.0 0.0 Q1 2015 Q2 2015 Q3 2015 Consumer Sentiment Index Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 91.0 Q4 2017 Q1 2018 RM mil' 25,000 20,000 15,000 10,000 5,000 0 Loans Applied & Loans Approved for Residential Property Purchase Loan Approval Rate (RHS) Loans Approved Loans Applied 41 % 60 50 40 30 20 10 0 Source: Bloomberg and Bank Negara Malaysia
Cautionary Note 34 This presentation does not constitute and is not an offer to sell or the solicitation of an offer to buy securities of any company referred to in this presentation in the United States or elsewhere. The companies referred to herein have not registered and do not intend to register any securities under the US Securities Act of 1933, as amended (the Securities Act ), and any securities may not be offered or sold in the United States absent registration under the Securities Act or an exemption from registration under the Securities Act. By attending the presentation you will be deemed to represent, warrant and agree that to the extent that you purchase any securities in any of the companies referred to in the presentation, you either (i) are a "qualified institutional buyer" within the meaning of Rule 144A under the Securities Act, or (ii) you will do so in an "offshore transaction" within the meaning of Regulation S under the Securities Act. This presentation may contain forward-looking statements by Sime Darby Property Berhad that reflect management s current expectations, beliefs, intentions or strategies regarding the future and assumptions in light of currently available information. These statements are based on various assumptions and made subject to a number of risks, uncertainties and contingencies. Actual results, performance or achievements may differ materially and significantly from those discussed in the forward-looking statements. Such statements are not and should not be construed as a representation, warranty or undertaking as to the future performance or achievements of Sime Darby Property Berhad and Sime Darby Property Berhad assumes no obligation or responsibility to update any such statements. No representation or warranty (either express or implied) is given by or on behalf of Sime Darby Property Berhad or its related corporations (including without limitation, their respective shareholders, directors, officers, employees, agents, partners, associates and advisers) (collectively, the "Parties") as to the quality, accuracy, reliability or completeness of the information contained in this presentation (collectively, the "Information"), or that reasonable care has been taken in compiling or preparing the Information. None of the Parties shall be liable or responsible for any budget, forecast or forward-looking statements or other projections of any nature or any opinion which may have been expressed or otherwise contained or referred to in the Information.
THANK YOU 35
7 Appendices 36
Our History 1972 1984 1995 1997 Negara Properties, the subsidiary of Golden Hope Plantations launched its first township Taman Melawati (880 acres) Sime UEP was established through the acquisition of a large stake in United Estates Projects Bhd, the developer of Subang Jaya township (2,241 acres) Guthrie Property Development Holding Bhd, a subsidiary of Kumpulan Guthrie Berhad launched its first township Bukit Jelutong (2,205 acres) Launched and transformed Nilai Impian 1 (1,263 acres) into a comprehensive township at the Pajam Nilai interchange along the North- South Expressway Taman Melawati Subang Jaya 37 2005 2007 2012 2013 2016 2017 Completion of the Guthrie Corridor Expressway (25 km) which connect Shah Alam to Rawang Sime Darby Property Division was established following the historical merger of Kumpulan Sime Darby Bhd, Kumpulan Guthrie Bhd and Golden Hope Plantations Bhd Sime Darby Property, SP Setia and EPF acquired the iconic Battersea Power Station for GBP400mn (42 acres) Signed concession agreements with government of Malaysia and four higher learning institutions to develop Pagoh Education Hub City of Elmina was launched (5,000 acres) Started the developments of Denai Alam, Bukit Subang and Elmina East Launched Bandar Bukit Raja 2 (~1,400 acres) and Serenia City (2,370 acres) Listing of Sime Darby Property on to Bursa Securities Malaysia on 30 November 2017 Bukit Jelutong City of Elmina
Strong Board Governance and Management 38 11 9 6 3 Total Board Members Non-Executive Directors Independent Directors Women Directors Non-Independent Non-Executive Chairman Tan Sri Abdul Wahid Omar Sime Darby Property Board R i s k M a n a g e m e n t C o m m i t t e e G o v e r n a n c e & A u d i t C o m m i t t e e T e n d e r C o m m i t t e e N o m i n a t i o n & R e m u n e r a t i o n C o m m i t t e e Accountable for holistic risk management framework and efficacy of internal controls Ensure effective corporate governance Oversee the process of awarding material contracts Responsible for all matters relating to the nomination of new Directors and assessment of Group Managing Director and his direct reports Operational excellence and value creation Efficient employment of company resources to deliver value to shareholders Group Managing Director Dato Sri Amrin Awaluddin Management Team Develop long-term strategies for sustainable growth Adhere to the highest standards on Environmental, Social and Governance (ESG) practices
Highly-Qualified Board of Directors 39 Board members have held prominent positions and directorships in public listed companies involving the property sector as well as the banking and finance sectors and in governmental, regulatory and professional bodies Tan Sri Abdul Wahid Omar Non-Independent Non- Executive Chairman Dato' Sri Amrin Awaluddin Group Managing Director Dato' Rohana Tan Sri Mahmood Senior Independent Non-Executive Director Datuk Tong Poh Keow Executive Director Tengku Datuk Seri Ahmad Shah Alhaj ibni Almarhum Sultan Salahuddin Abdul Azjz Shah Alhaj Independent Non- Executive Director Dato' Johan Ariffin Independent Non- Executive Director Dato' Jaganath Derek Steven Sabapathy Independent Non- Executive Director Datuk Dr Mohd Daud Bakar Non-Independent Non-Executive Director Dato' Seri Ahmad Johan Mohammad Raslan Independent Non- Executive Director Datin Norazah Mohamed Razali Independent Non- Executive Director Rizal Rickman Ramli Non-Independent Non- Executive Director
Strong Management Team 40 Strong management team with relevant experience and a proven track record in the real estate industry Dato' Sri Amrin Awaluddin Group Managing Director Datuk Tong Poh Keow Chief Financial Officer Fairuz Radi Chief Transformation Officer & Head, Group Managing Director s Office Dato Wan Hashimi Albakri Chief Operating Officer Township Development Quek Cham Hong Chief Operating Officer Integrated Gerard Yuen Yun Wei Chief Marketing & Sales Officer Choo Suit Mae Group General Counsel Azlina Hamzah Chief People Officer Tang Ai Leen Chief Risk and Compliance Officer Aravindan Devapalan Nair Chief Corporate Assurance Officer
Investment Thesis for the New Company 41 We are in execution mode to fundamentally transform Sime Darby Property 1 2 Largest developable land bank in Malaysia City of Elmina, Selangor Bandar Bukit Raja, Klang Strategic locations with full spectrum of products Transit Oriented / Adjacent Developments 20,695 acres with remaining estimated GDV of RM96bn Additional 20,599 acres of lands under Options Agreements with Sime Darby Plantation Berhad and Sime Darby Berhad All freehold developments except for developments in Bandar Universiti Pagoh and ALYA Offering a wide range of products, especially in the affordable-to-medium range of properties Located in growth areas with robust economic activities and superior accessibility to major road systems and railways Well positioned along the Guthrie Corridor Expressway (GCE) and West Coast Expressway 3 Recognised brand with established track record Taman Melawati Subang Jaya Since 1972 Since 1976 Good track record of over 40 years in property development Received awards over the years for excellence and distinctions Putra Brand Awards 2017 Gold Award in Property Category (7 consecutive years) StarProperty.my Awards 2017 Top Ranked Developers of the Year
Land Bank Status as at 31 March 2018 ~12k acres of remaining developable land bank with a remaining GDV of RM81.5bn 42 Township/Development Name Total Area (Acres) Remaining Developable Area Remaining GDV (RM bn) (Acres) Niche / Integrated ALYA, Kuala Lumpur 62 50.5 6.6 Chemara Hills, Seremban 44 3.0 0.1 USJ Heights, Subang Jaya 375 17.0 0.2 SJ 7, Subang Jaya 40 34.6 5.2 SJCC, Subang Jaya 30 28.1 3.8 KL East 160 55.0 2.0 Township City of Elmina: Elmina West, Shah Alam 2,661 2,561.0 15.1 City of Elmina: Elmina East, Shah Alam 1,089 583.2 3.6 City of Elmina: Denai Alam & Bukit Subang 1,250 147.0 0.7 Bandar Bukit Raja 2 & 3, Klang 2,820 2,665.0 12.1 Bandar Bukit Raja 1, Klang 1,513 160.6 1.8 Serenia City, Dengkil, Sepang 2,370 1,462.0 7.6 Putra Heights, Subang Jaya 1,796 80.3 3.8 Ara Damansara, Petaling Jaya 693 62.1 5.8 Bukit Jelutong, Shah Alam 2,205 159.6 1.6 Saujana Impian, Kajang 600 4.1 0.01 Taman Melawati, Ulu Klang 880 2.3 0.7 Nilai Impian 2, Nilai 546 426.0 3.2 Nilai Impian 1, Nilai 1,263 184.0 1.0 Bandar Ainsdale, Seremban 562 174.6 1.3 Planters' Haven, Nilai 250 83.6 0 Bandar Universiti Pagoh, Muar 4,099 3,297.0 5.1 Taman Pasir Putih, Pasir Gudang 356 24.6 0.2 TOTAL 25,664 12,265 81.5 Future Development 8,430 14.4 1 Note: 1. This GDV figure is preliminary and currently only available for 3 future developments
Healthy Launches of Various Product Lines 2015-2017 43
Recent and Upcoming Property Launches 44 Recent Launches Upcoming Launches (July Dec 2018) Landed Serenia Amani, Serenia City (2-storey house) No. of Units : 302 Average Price : RM575,302 Sales Value : RM173.7mn Orkid, Nilai Impian (2-storey house) No. of Units : 132 Average Price : RM512,426 Sales Value : RM67.7mn Elmina West (2-storey house) No. of Units Est. Sales Value Bandar Bukit Raja (2-storey house) No. of Units Est. Sales Value : 211 units : RM142.6mn : 126 units : RM88.9mn Highrise Cantara, Ara Damansara (Serviced Apartment) No. of Units : 888 Average Price : RM784,703 Sales Value : RM696.8mn KL East (Serviced Apartment) No. of Units Est. Sales Value : 254 units : RM167.4mn Lot 15, SJCC (Serviced Apartment) No. of Units : 361 Average Price : RM768,159 Sales Value : RM277.3mn Putra Heights (Condominium) No. of Units Est. Sales Value : 72 units : RM81.1mn ffordable Harmoni 1, Putra Heights (Apartment) No. of Units : 1,700 Average Price : RM228,824 Sales Value : RM389.0mn Harmoni 1, Elmina West (Apartment) No. of Units Est. Sales Value : 562 units : RM131.0mn