MIRVAC gRoup AnnuAl RepoRt 2012 - Mirvac - Mirvac Group

More documents

Recommendations

Info

DIReCtoRs’ RepoRt Review of opeRAtions AnD Activities / continueD 02 mirvac group annual report 2012 2012 2011 $m $m profit attributable to the stapled securityholders of Mirvac 416.1 182.3 specific non-cash items Net gain on fair value of investment properties and owner-occupied hotel management lots and freehold hotels (148.7) (110.4) Net loss on fair value of investment properties under construction (“IPuC”) Net loss/(gain) on fair value of derivative financial instruments 15.8 58.6 and associated foreign exchange movements 82.0 (7.5) Security based payment expense Depreciation of owner-occupied investment properties, hotels and hotel 8.5 6.2 management lots (including hotel property, plant and equipment) 9.5 8.1 Straight-lining of lease revenue (15.9) (16.4) Amortisation of lease fitout incentives Net loss/(gain) on fair value of investment properties, derivatives and other 14.4 10.4 specific non-cash items included in share of net profit of associates and joint ventures Net loss on fair value of investment properties, derivatives and other 13.7 (11.0) specific non-cash items included in non-controlling interest (“NCI”) significant items — (0.4) Impairment of loans 6.0 — Provision for loss on inventories 25.0 295.8 Net (gain)/loss on sale of non-aligned assets (0.8) 0.2 Net gain on sale of hotel Management business and related assets (21.4) — Business combination transaction costs tax effect — 31.8 Tax effect of non-cash and significant adjustments (37.9) (89.2) operating profit (profit before specific non-cash items and significant items) 366.3 358.5 finAnciAl AnD opeRAtionAl highlights Key financial highlights for the year ended 30 June 2012 included: — profit attributable to the stapled securityholders of Mirvac of $416.1m, an increase of 128.0 per cent, which included a net gain on investment properties (including IPuC) of $132.9m, profit of $21.4m from the sale of the hotel Management business and, as previously announced in February 2012, a provision for loss on inventories of $25.0m in respect to Beachside Leighton, North Fremantle, wA; — operating profit after tax of $366.3m 1 , representing 10.7 cents per stapled security; — net tangible assets (“NTA”) per stapled security of $1.66 from $1.62 2 ; — operating cash flow of $317.0m; and — full year distribution of $287.0m, representing 8.40 cents per stapled security. Key operational highlights for the year ended 30 June 2012 included: — successfully delivered on the Group’s strategy to simplify its business with the sale of the hotel Management business, realising a profit of $21.4m 3 ; — established strategic relationships with K-ReIT Asia and AvIvA Investors via the sale of 50.0 per cent of 8 Chifley Square, Sydney NSw and hoxton Distribution Park, hoxton Park NSw respectively; — achieved 3.4 per cent like-for-like net operating income growth within the Investment Division’s portfolio; — maintained a high portfolio occupancy rate of 98.4 per cent 4 and a strong weighted average lease expiry of 7.4 years 4 within the Investment Division’s portfolio; — leased 147,646 square metres (10.4 per cent of net lettable area) within the Investment Division’s portfolio; — disposed of four non-core retail properties within the Investment Division’s portfolio, realising $132.0m in gross sale proceeds; — continued the strong focus on corporate responsibility and sustainability with the Investment Division’s portfolio achieving a National Australian Built environment Rating System (“NABeRS”) office energy rating of 4.3 Star average, six months ahead of the December 2012 target of 4.0 Stars, and 8 Chifley Square, Sydney NSw awarded a 6.0 Star Green Star office Design v2 rating; — Mirvac’s safety performance continued to improve with a lost time injury frequency rate of 7.3 for employees plus service providers, representing a 17.0 per cent improvement over the corresponding period for the year ended 30 June 2011. In addition, the number of workers’ compensation claims reduced by 20.5 per cent and the average cost per claim reduced by 34.7 per cent over the corresponding period for the year ended 30 June 2011; and — strong levels of exchanged pre-sales contracts at $907.7m 5 in residential projects and achieved 1,807 residential lot settlements. 1) excludes specific non-cash items, significant items and related taxation. 2) NTA per stapled security based on ordinary securities including employee Incentive Scheme (“eIS”) securities. 3) After costs. 4) By area, excluding assets under development. 5) Total exchanged pre-sales contracts as at 30 June 2012, adjusted for Mirvac’s share of joint ventures, associates and Mirvac’s managed funds.
cApitAl MAnAgeMent AnD funDing For the year ended 30 June 2012, the Group maintained its strong capital and liquidity position. on 22 May 2012, the Group completed the sale of the hotel Management business with the proceeds received (totalling $293.2m) used to repay debt, which reduced gearing to 22.7 per cent 1 . This is comfortably within the Group’s targeted range of 20.0 to 25.0 per cent. other key highlights for the Group included: — no debt maturities in the year ending 30 June 2013; — $530.0m of debt facilities maturing in January 2014, of which only $237.9m is actually drawn; — high levels of liquidity with $804.4m 2 in cash and undrawn committed debt facilities on hand; — repayment of $140.0m debt facility which was scheduled to mature in January 2013; — weighted average debt maturity of 3.5 years; — average borrowing costs increased slightly to 7.6 per cent per annum including margins and line fees; — maintained the BBB credit rating from Standard & Poor’s; and — continued to comfortably meet all debt covenants. outlook The volatility created by the european debt crisis dominated international capital markets for most of the 2012 financial year, resulting in funding costs remaining elevated and reduced appetite for lending from european based lenders. There will be limited impact of these events on the Group’s borrowing costs for the next six to 12 months, allowing time for conditions to stabilise before any refinancing is required. The Group remains focused on managing its capital position prudently by monitoring and accessing diversified sources of capital, including both domestic and international markets. This ensures Mirvac can continue to meet its strategic objectives without increasing its overall risk profile. opeRAtionAl highlights AnD DivisionAl stRAtegy investment Division At 30 June 2012, the Investment Division had invested capital of $6,002.7m 3 , with investments in 66 direct property assets, covering the office, retail and industrial sectors, as well as investments in other funds managed by Mirvac. The asset allocation for MPT invested capital was as follows: — office: 57.6 per cent; — retail: 27.2 per cent; and — other: 15.2 per cent 4 . For the year ended 30 June 2012, the Investment Division’s statutory profit before tax was $495.5m and operating profit before tax was $403.7m. Key highlights for MPT for the year ended 30 June 2012 included: — achieved 3.4 per cent like-for-like net operating income growth; — occupancy remained high at 98.4 per cent 5 ; — 29 properties (43.9 per cent 6 ) of the Trust’s assets were independently valued resulting in a $163.4m or 3.0 per cent increase over the previous book value for the 12 months ended 30 June 2011; mirvac group annual report 2012 — disposed of four non-core retail assets realising $132.0m in gross sale proceeds (2.6 per cent premium to book value); — established strategic relationships with K-ReIT Asia and AvIvA Investors via the sale of 50.0 per cent of 8 Chifley Square, Sydney NSw and hoxton Distribution Park, hoxton Park NSw respectively; — completed 325 leasing deals over 147,646 square metres of net lettable area (10.4 per cent of the portfolio), with significant office leasing commitments at: — 10-20 Bond Street, Sydney NSw (99.3 per cent 7 of net lettable area secured); and — 8 Chifley Square, Sydney NSw (42.0 per cent of net lettable area secured with the asset’s first lease to Corrs Chambers westgarth); — progressed with Development Approvals for: — the development of the old Treasury Building, Perth wA, which incorporates 30,000 square metres of prime office space that is 100.0 per cent pre-leased to the wA Government for 25 years; and — the Stage 2 Development Application at 190-200 George Street, Sydney NSw which incorporates 38,500 square metres of net lettable area over 32 office levels, and includes 63 basement car spaces; — the Development Division completed construction on the final industrial building at Nexus Industry Park, Prestons NSw in october 2011, which is now 100.0 per cent leased to hPM Legrand Australia and held within MPT’s investment portfolio; — received authority approvals for expansions at Kawana Shopping Centre, Buddina qLD, Stanhope village, Stanhope Gardens NSw and orion Springfield, Springfield qLD; and — Broadway Shopping Centre, Sydney NSw was ranked second nationally in the Big Guns for MAT of $9,833 per square metre 8 . The Group’s focus on corporate responsibility and sustainability delivered results within the Trust’s portfolio, with key achievements including: — 8 Chifley Square, Sydney NSw awarded a 6.0 Star Green Star office Design v2 rating; — a NABeRS office energy rating of 4.3 Star average, six months ahead of the December 2012 target of 4.0 stars; — 275 Kent Street, Sydney NSw achieved a 4.5 Star NABeRS energy rating for the first time since construction as a result of management efficiencies within the building; — 23 Furzer Street, Phillip ACT achieved 5.5 Star NABeRS energy rating with the building contractually designed to only achieve a 4.5 Star rating; and — 340 Adelaide Street, Brisbane qLD achieved a NABeRS energy rating of 5.0 Stars, a significant improvement on the prior rating of 1.5 Stars. The Trust’s earnings continue to be secure with a strong weighted average lease expiry profile of 7.4 years 9 , 72.7 per cent of Fy13 rent reviews being fixed or linked to the Consumer Price Index (“CPI”), and 72.2 per cent of revenue derived from multinational, Australian Securities exchange (“ASX”) listed and government tenants. 1) Net debt (at foreign exchange hedged rate) excluding leases/(total tangible assets – cash). 2) Total liquidity includes total available liquidity of $721.1m and cash on hand of $77.3m. 3) By book value, includes assets under development. 4) Includes industrial assets, assets under development, indirect property investments, car park assets and a hotel. 5) By area, excluding assets under development. 6) By total number of investment properties. 7) Incorporates heads of Agreement and executed leases as at 30 June 2012. 8) The national magazine, Shopping Centre News, publish an annual awards for Big Guns shopping centres. Big Guns are defined as those centres with a gross lettable area in excess of 45,000 square metres, and typically contain a department store/s, discount department store/s, supermarket/s and specialties. Moving Annual Turnover (“MAT”) is the total retail sales for the past 12 months including GST. 9) By area, excluding assets under development. 03
Page 1 and 2: y mirvac MIRVAC gRoup AnnuAl RepoRt
Page 3: DIReCtoRs’ RepoRt The Directors o
Page 7 and 8: opeRAtionAl highlights AnD Division
Page 9 and 10: enviRonMentAl RegulAtions / continu
Page 11 and 12: ReMuneRAtion RepoRt / continueD The
Page 13 and 14: 2 AlignMent of ReMuneRAtion stRAteg
Page 15 and 16: 4 ReMuneRAtion coMponents AnD outco
Page 21 and 22: Operating earnings ($m) 4 ReMuneRAt
Page 23 and 24: 6 seRvice AgReeMents foR elt MeMbeR
Page 25 and 26: 8 ADDitionAl infoRMAtion / continue
Page 27 and 28: 8 ADDitionAl infoRMAtion / continue
Page 29 and 30: AuDItoR’s InDepenDenCe DeClARAtIo
Page 31 and 32: 3 pRinciple 2: stRuctuRe the boARD
Page 33 and 34: 3 pRinciple 2: stRuctuRe the boARD
Page 35 and 36: 4 pRinciple 3: pRoMote ethicAl AnD
Page 37 and 38: 8 pRinciple 7: Recognise AnD MAnAge
Page 39 and 40: 9 pRinciple 8: ReMuneRAte fAiRly An
Page 41 and 42: fInAnCIAl stAteMents 40 Consolidate
Page 43 and 44: ConsolIDAteD stAteMent of CoMpReHen
Page 45 and 46: ConsolIDAteD stAteMent of CHAnges I
Page 47 and 48: notes to tHe ConsolIDAteD fInAnCIAl
Page 49 and 50: 1 suMMARy of significAnt Accounting
Page 55 and 56:
1 suMMARy of significAnt Accounting
Page 57 and 58:
1 suMMARy of significAnt Accounting
Page 59 and 60:
2 cRiticAl Accounting JuDgeMents An
Page 61 and 62:
3 segMentAl infoRMAtion / continueD
Page 63 and 64:
3 segMentAl infoRMAtion / continueD
Page 65 and 66:
5 eXpenses / continueD 2012 2011 pr
Page 67 and 68:
6 incoMe tAX / continueD mirvac gro
Page 69 and 70:
8 ReceivAbles / continueD d) credit
Page 71 and 72:
13 Assets clAssifieD As helD foR sA
Page 73 and 74:
16 investMent pRopeRties / continue
Page 75 and 76:
17 pRopeRty, plAnt AnD equipMent /
Page 77 and 78:
20 boRRowings mirvac group annual r
Page 79 and 80:
22 pRovisions mirvac group annual r
Page 81 and 82:
25 ReseRves / continueD mirvac grou
Page 83 and 84:
29 contRolleD entities AnD DeeD of
Page 85 and 86:
Page 87 and 88:
Page 89 and 90:
30 investMents in AssociAtes / cont
Page 91 and 92:
31 investMents in Joint ventuRes /
Page 93 and 94:
31 investMents in Joint ventuRes /
Page 95 and 96:
34 KMp / continueD mirvac group ann
Page 97 and 98:
34 KMp / continueD Balance Interest
Page 99 and 100:
35 eMployee benefits / continueD e)
Page 101 and 102:
37 finAnciAl RisK MAnAgeMent / cont
Page 103 and 104:
Page 105 and 106:
Page 107 and 108:
40 events occuRRing AfteR the enD o
Page 109 and 110:
InDepenDent AuDItoR’s RepoRt to t
Page 111 and 112:
seCuRItyHolDeR InfoRMAtIon The info
Page 113 and 114:
glossARy of ACRonyMs AAS Australian
show all

MIRVAC gRoup AnnuAl RepoRt 2012 - Mirvac - Mirvac Group

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?