Market Tech Holdings Limited Interim Results 3 December 2015

Transcription

1 Market Tech Holdings Limited 2016 Interim Results 3 December 2015

2 2 Agenda 1 Introduction 2 H1 Financial Review Real Estate Portfolio Developments Digital Assets Summary Highlights Appendix

3 Introduction

4 4 Financial Highlights Revenue 62.2m, 13.8m from Property and 48.4m from Digital Assets Adjusted EBITDA 10.6m, 6.7m from Property and 3.9m from Digital Assets PBT of 10.1m, resulting in basic EPS from continuing operations of 1.81p per share Total property portfolio valuation of 866.7m (1), representing a 15.0% uplift since Mar-15 LfL property valuation uplift of 41.9m, representing 5.6% growth since Mar-15 Group NAV 770.1m, representing 164.4p per share, an uplift of 11.0% since Mar-15 EPRA Adjusted NAV (2) 727.8m, representing 155.4p per share, an uplift of 10.4% since Mar-15 Cash and cash equivalents of 175.3m (1) Group portfolio Red Book valuation (30 Sep 2015), including 6.9m of investment property classified as PP&E (2) Property and Other segment excluding Digital segment, adjusted for deferred and financial derivative fair value movement

5 5 Operational Highlights Passing rent 28.3m, an increase of 6.8% from Mar-15 Average rent per sqft of 66.2 Average occupancy of 91.8% Two property acquisitions totalling 75.1m (1) with a further property acquired post period end for 5.2m (1) Additional planning approval on Hawley Wharf for an additional 36,300 sqft of commercial and residential use, including 24 apartments Hawley Wharf School timing on track to be delivered Sept-16 Detailed planning application submitted for the enhancement of Camden Lock Market First phase of the Interchange co-working space launched with 250 desks going live post the period end Acquisition of 75% of Glispa for 22m and Stucco Media for $26m (1) Including stamp duty and excluding transaction costs

6 Gross proceeds 6 Milestones: > 400m New Capital Raised and > 200m of Acquisitions in last 12 months 112.5m (1) Convertible Bond for additional acquisitions Acquisition of Glispa for 22m (75%) Acquisition of Stucco Media for $26m Equity raise of 201m (1) Dec 14 Mar Mar Mar Apr Apr Jun Jul Oct IPO of Market Tech with 100m (1) primary capital at 750m pre-money valuation Property acquisitions of Camden Wharf and Interchange for 99m Property acquisition of Utopia Village for 44m Property acquisition of Hawley Crescent for 31m Property acquisition of 49 Chalk Farm Road for 5m (1) Gross proceeds

7 7 Unique London Estate with 14 Acres in Camden Town Including the Iconic Markets and over 28 million (1) Visitors per Year Hampstead Belsize Park Primrose Hill Hill Kings Cross Regents Park Park (1) Source: TFL data based on 2013 figures for annual entry and exit for Camden Town and Chalk Farm Road Tube stations.

8 8 Combining Offline & Online Ecosystem to Drive Income & Growth Customers Selected Tenants Offline Traffic Real Estate Rent Developments ( m) Yielding properties incl. the Camden Markets with significant reversionary rent potential Offline Retail & Leisure Co-working > 5 acres development property Passing Rent Uplift Market Uplift Rent Uplift Rent Sep-15 Rent & Vacant Developments Hawley Wharf Space (1) (2) Residentials (3) = Online Market Places Marketing & CRM Payment Processing Online Traffic Digital Assets Digital Income Distribution 48m Customers Independent Retailers Customers Multi-national 10m H1 16 (Sep-15) FY 15 (Mar-15) (1) Including Co-working (2) Management expectation for rent from Hawley Wharf (excluding residential), Union Street & Camden Lock Market post completion of development (3) Management expectation

9 H Financial Review

10 10 KPI Summary Property HY 2016 (Sep 2015) FY 2015 (Mar 2015) Change Rent Roll (passing rent) ( m) % Rent per sq. ft. ( ) 66.2 NLA available ( 000 sqft) 466 Occupancy 91.8% Property Valuation ( m) (1) % EPRA NAV (pence per share) % LTV 14.3% 27.9% (48.7)% Digital Digital Revenue ( m) n/a Digital EBITDA ( m) n/a (1) Group portfolio Red Book valuation (30 Sep-15), including 6.9m of investment property classified as PP&E

11 11 Financial Performance 000s (unless otherwise stated) HY2016 Group FY2015 Group Gross Rental Income 13,811 20,071 Digital Income 48,404 10,010 Gross Profit 27,778 24,100 Adjusted EBITDA (1) 10,586 12,018 (1) Adjusted EBITDA is defined as Earnings Before Interest, Taxes, Depreciation, Amortisation and adjusted for fair value investment property movements, share based payment charges, exceptional items and foreign currency exchange gain/(loss)

12 12 Financial Performance Balance Sheet m (unless otherwise stated) HY2016 Group FY2015 Group % Movement Investment & Development Property 867 (1) % Net Debt (123) (210) (41%) Other Assets & Liabilities % Net Assets % EPRA Adjusted NAV % EPRA Adjusted NAV (pence per share) % (1) Includes 6.9m of investment property classified as PP&E

13 13 Capital Structure and Capex Requirement for Development Capex for Development ( m) Debt and Equity Structure m Sep-15 Loan to value (Net debt) 14.3% 93 Loans FY16E FY17E FY18E Sub-Total Convertible Bond 113 Net Equity Fundraise Proceeds 197 FY16E ( m) FY17E ( m) FY18E ( m) Sub-Total ( m) Stables Market Hawley Wharf (1) Union Street Market (2) Camden Lock Market (2) Robust Capital Structure for Growth Gross equity raising of 301m incl. IPO to fund development and further acquisitions Issuance of 112.5m convertible to accelerate value creation and fund both digital acquisition of Glispa (75%) and purchase of The Interchange building and Camden Wharf Existing Nomura 185.3m debt expiring 2017 Total (1) Total dev. costs 191m (2) No planning permission granted

14 14 NAV Bridge 102m 1m 770m (46)m 724m 4m 728m 75m 20m 197m 555m 16m Group FY2015 Net Assets Investment property FV movement Investment property asset acquisitions Investment property additions Placing net of property acquisition + additions Other Group 2016 HY Net Assets Less: Digital Net assets Property and Other Net Assets 2016 HY Deferred tax & financial derivatives EPRA Net Assets 2016 HY

15 Real Estate Portfolio

16 16 Assembly of Key Strategic Assets # Asset (1) Red Book NLA (sqft) Passing Rent Market Rent Directors GDV Occ. Locations 1 Stables Market 239.6m 182k (3) 14.2m 17.2m 97% Markets 2 3 Camden Lock Market 102.8m 48k 4.9m 6.0m 247.3m 94% Union Street Market 29.5m 7k 2.0m 2.0m 66.9m 98% Office/Retail/ Residential Development 4 10 Jamestown Road 26.3m 28k 1.4m 1.5m 100% 5 Camden Wharf 48.3m 49k 1.6m 2.5m 87% 6 31 Kentish Town Road 10.3m 10k 0.3m 0.3m 100% Camden High St. 11.1m 4k 0.5m 0.5m 100% The Interchange 55.3m 65k 1.9m 2.9m 100% Utopia Village 43.0m 47k 0.7m 2.4m 49% 1-11 Hawley Crescent 28.0m 25k 0.9m 1.1m 100% Diversified Mix of Asset Types Pre-Development 5% Post-Development (2) 3% 11 Hawley Wharf 272.5m 956.3m 866.7m (4) 466k 28.3m 36.5m 1,270.5m 92% 38% 466k sq. ft. 20% 32% 999k sq. ft. 20% 18% (1) Excluding 5m acquisition of 49 Chalk Farm Road (2) Hawley Wharf development, excluding 36k sq. ft. additional planning granted (3) Excludes Co-Working with NLA of 43k (launched post period end) (4) Group portfolio Red Book valuation (30 Sept 2015), including 6.9m of investment property classified as PP&E 37% Residential Leisure/Ent Office Retail Workshops 26%

17 17 Asset Management Key Initiatives Current Passing Rent vs. Market Rent 1 Capture significant reversionary rent potential m 2 Active repositioning of assets and redevelopment of vacant spaces 3 Deliver digital services to tenants Current Passing Passing Rent ERV Market Rent 4 Future growth through strategic acquisitions The active asset management strategy is further strengthened by two key hires to focus on pre-letting as well as the overall retail strategy

18 18 Relative Low Rent Levels and High Yields Provide Significant Upside Potential Office rent per sqft ( ) Retail rent per sqft ( ) (1) 1, (2) Westend Kings Cross Shoreditch City MKT Covent Garden Carnaby Street Marleybone Borough High Street MKT Office Yield (%) Retail Yield (%) (4) MKT Kings Cross Shoreditch City Westend MKT (3) Borough High Street Marleybone Covent Garden Carnaby Street (Source: CBRE View Q (1) Zone A rent (2) Average rent /sqft ranges from dependant on zone (3) All Market assets (Stables Market, Union Street Market and Camden Lock Market) (4) All non market assets

19 Quantity % of total lease value ( ) 2016 Interim Results 19 Non Market Lease Rent Review Profile Rent Review Schedule % 90.0% 80.0% 70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% Quantity % of total lease value ( ) SM SM SM (2) SM (2) CW (2) SM (2) CW JR (3) CL CL (3) CL IB JR (3) KTR KTR JR (6) HC (2) CW CW (3) CW IB UT HC (2) SM - Stables Market, CL - Camden Lock Market, KTR - Kentish Town Road, CW - Camden Wharf, IB - Interchange, JR - Jamestown Road, UT - Utopia Village, HC - Hawley Crescent

20 20 Example Historic Stables Market Rent Levels Stables Market Use Passing rent (Sept 15) ( m) Available NLA (sqft) Average rent/sqft (occupied) Occupancy (Sept 15) Market - Food k % Market - Retail k % Retail 0.4 9k % Leisure k % Office 0.2 5k % Other 0.1 2k % > Within Market-Food rent/sqft ranges in the various zones from 146.5/sqft to 354.1/sqft > Within Market-Retail average rents/sqft ranges from 50.6sqft to 190.8/sqft Stables Market Total k % > Active asset management and zoning/mix of food and retail allows optimization of rents across the market

21 21 Interchange Space as a Service Bolstering Value Through Co-working Successful launch of Interchange, London s newest Co-working space for creative SME s, and tech companies in the heart of Camden Phased build out of 43k sqft NLA across three buildings above Stables Market c.1,000 desks including hotdesks and private offices Triangle building opened in Oct with 250 desks now live All three buildings (Triangle & Atrium A+B) expected to complete by end of Q1-16

22 Developments

23 23 Developments and Redevelopments Hawley Wharf Camden Lock (2) Union Street Market (2) Total Commercial Commercial Other Total Total Director GDV 956m 681m 249m 26m 247m 67m Current GAV Dev. uplift 145m 38m NLA 398k sq. ft. 229k sq. ft. 169k sq. ft. n.a. 85k sq. ft. 12k sq. ft. (1) Rent 40.6m 13.1m 4.7m Planned Timing Description/ Initiatives 5 acre canalside mixed use development Restaurants, artisan workshops, cinema and work space Private & affordable residential flats Advertising, branding, events Reorganise to encourage greater customer flow Enlarged market area combined with boutique hotel Total dev. costs 191m 30-35m 15-20m (1) Remaining costs (3) 177.5m Note: Management Estimates (1) Excluding the hotel scheme (2) No planning scheme granted (3) Including actual spend to date for FY16

24 Digital Assets

25 25 Create additional value for Market Tech around retail innovation, mobile and marketing technology services Existing digital portfolio and how it contributes to Market Tech s value Mobile technology & advertising marketplace Distribution & e-commerce technology > Providing online services to Camden market retailers > Generating strong financials 48m H1 Income > Portfolio of leading companies in their fields with international reach (Offices in London, Berlin & Tel Aviv) > Technological assets built (ecommerce, Marketplace, CRM software) and scalable Online marketplace & traffic driver Future strategic acquisitions & partnerships > Strong growth potential through product optimisation and geographical expansion > Implement unified data layer to drive on- and offsite optimisation

26 26 Create value for retailers beyond providing the physical space through offline and online technology Value from Offline Technology Strategy Value from Online Technology Strategy > Roll out unified EPOS system across retailers, reducing their overheads and enabling large-scale data collection > Implement standardised payment system in stores, leveraging newest technologies such as mobile payments > Collection of exhaustive behavioural, personal, device and movement data of each shopper through free WiFi service > Investigate installation of Beacon technology to give shoppers a more personalised experience while at Camden Market > Development of camdenmarket.com as unified online storefront for all Camden Market retailers > Drive traffic to camdenmarket.com through ads on free WiFi service and through reach of Market Tech s portfolio companies > Support individual retailers with their online marketing and CRM efforts > Partner with strong online affiliates to build brand for camdenmarket.com

27 27 Offline Analytics > Offline Visitor Analytics live in Camden Market > Closing the customer journey loop > Visitor entry / exit insights > Footfall flow insights > Allow more efficient asset management and traffic flow

28 Summary

29 29 Summary Strong portfolio NAV per share growth, up 11% since Mar-15 Significant reversionary rent potential uplift of 29% to market rent Hawley Wharf development on track Strong growth in Digital Assets Robust capital structure to deliver on strategy

30 Appendix

31 31 Developments Value Bridge Hawley Wharf Camden Lock Market & Union Street Market A B 322m 956m 312m 1286m 362m 634m 272m Red Book Fair Value Associated Costs & Fees Red Book GDV Director est. Upside to GDV Director Value Estimate Further uplift through Redevelopment Total GDV Key Sources of Upside vs Appraisal Value A > Reversal of site acquisition costs - Going concern valuation > Reversal of developer profit - No use of 3rd party developer > Removal of finance costs - Capex fully equity funded > Reduction of sales agents and marketing & letting fees - Use of existing in-house teams B Hawley Wharf > Management assumptions comparable with existing Stables Market: - Higher average rents per sq. ft. 167 per sq. ft. - Higher average residential sales values 1,466 per sq. ft. - Initiatives: Branding, Advertising, Events etc. 3.7m of income - Lower operating costs 3.1m Source: Management information

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