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Central Pattana Plc.Property Development and Investmentp y p
Corporate Presentation: 2Q11 Performance Review
Disclaimer
The information contained in this presentation is for information purposes only and does not constitute an offer or invitation to sell or the solicitation of an offer or invitation to purchase or subscribe for share in Central Pattana Public Company Limited (“CPN” and shares in CPN “shares”) in any jurisdiction nor should it or any part of it form the basis of or be relied upon in any connection with any contract orCPN, shares ) in any jurisdiction nor should it or any part of it form the basis of, or be relied upon in any connection with, any contract or commitment whatsoever.
This presentation may include information which is forward-looking in nature. Forward-looking information involve known and unknown risks, uncertainties and other factors which may impact on the actual outcomes, including economic conditions in the markets in which CPN t d l hi t f CPN b i f t hi h ill th t l lt f hi t fCPN operates and general achievement of CPN business forecasts, which will cause the actual results, performance or achievements of CPN to differ, perhaps materially, from the results, performance or achievements expressed or implied in this presentation.
This presentation has been prepared by the CPN. The information in this presentation has not been independently verified. Norepresentation, warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information and opinions in this presentation. None of the CPN or any of its agents or advisers, or any of their respective affiliates, advisers or representatives, shall have any liability (in negligence or otherwise) for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection with this presentation.
This presentation is made, furnished and distributed for information purposes only. No part of this presentation shall be relied upon p , p p y p p pdirectly or indirectly for any investment decision-making or for any other purposes.
This presentation and all other information, materials or documents provided in connection therewith, shall not, either in whole or in part, be reproduced, redistributed or made available to any other person, save in strict compliance with all applicable laws.
2Note: All currency figures within this presentation are presented in Thai Baht unless otherwise stated.
Agenda
► Company Overview
► Operations
► Future Developments► Future Developments
► Financial Highlights
► Appendix
Company OverviewCompany Overview
Business Overview
“Excellence CG Scoring” honored the company’s CPN is the leading retail property developer and investor
Highlights Recent Achievements
g p ycorporate governance performance.
“ICSC Best of the Best Award - Design and Development – CentralWorld” honored and recognized the most outstanding shopping center
in Thailand with a 21% market share in Bangkok’s mall leaseable area.
CPN manages 16 shopping centers, 6 office towers, 2 hotels, and 2 residential properties in Thailand. recognized the most outstanding shopping center
design and development of CentralWorld.
“CNBC Best Mixed-Use Development Award”honored the unique and exceptional design and environment concerns of CentralWorld
, p p
CPN continuously achieves strong growth of shopping complex through green-field developments, acquisition & redevelopments and asset enhancement projects.
environment concerns of CentralWorld.
“A+ Credit Rating” was affirmed with stable outlook by TRIS Rating in August 2010.
CPN is a fully integrated retail developer with unparallel synergies with its major shareholders, Central Group and Thailand Equity Fund, and unmatched financing capability through its property fund.
CPN is the largest retail property developer on Stock Exchange of Thailand (SET) with a market capitalization of approx. USD 2.07 bn (1).
CPN is the property manager and largest shareholder p p y g g(28%) in Thailand’s largest REIT - CPN Retail Growth Leasehold Property Fund (CPNRF) with a market capitalization of approx. USD 661 mil (1).
5Source: SetSmart as of 30 June 2011.
Strong Development & Acquisition Pipelines
1980Established under “CentralPlaza Co., Ltd.” 2002
Opened
2009Opened “CentralFestival Pattaya Beach”, “CentralPlaza Chonburi” AND “CentralPlaza Khon Kaen”
2010opm
ent
2011 (NEW)Opened “CentralPlaza Chiangrai”,Open CentralPlaza Phitsanulok ,CentralPlaza Rama 9
1982 Opened “CentralPlaza Ladproa”
The first integrated shopping complex in Thailand
1995 Opened “CentralPlaza Pinklao” AND “Central Center Pattaya”
1997 Opened “CentralPlazaRatchada Rama 3”
Opened “CentralPlaza
Rama 2”2008
Opened “CentralPlazaChaengwattana”
Opened “Hilton Pattaya Beach Hotel”
-fie
ld D
evel
o
CentralPlaza Rama 9
1993
Opened “CentralPlaza Ramindra”
2012 (NEW)Open “CentralPlaza Suratthani”
2013 (NEW)Open “CentralFestival Chiangmai”
Gre
en-
1996
Acquired full equity stake in “CentralPlaza Chiangmai Airport”
2000 2002
2012 (Enhancement)
Complete “CentralPlazaUdonthani Phase 2”op
men
t
2000
Completed “CentralPlaza Chiangmai Airport Phase 2A”
2001
Acquired full equity stake in
2002
Acquired “CentralWorld”(Formerly World Trade Center) 2004
Completed
2006Completed “CentralWorld”
2009
Acquired “CentralPlaza Udon Thani”(formerly Charoensri Complex)
Udonthani Phase 2
n &
Rede
velo
q q y“CentralPlaza Bangna”
2003
Acquired “CentralPlaza Rattanathibet” (Formerly Siam Jusco Rattanathibet) AND completed
“CentralPlaza Chiangmai Airport Phase 2B”
Completed “The Offices at CentralWorld”
CPN current portfolio:16 Shopping Centers6 Office Towers
4 Projects Under DevelopmentAc
quis
ition
6
Leading Market Share of Mall Retail Space in BMA
CPN is the leading retail property developer and investor in Thailand with approximately 21% market share in Bangkok Metropolitan Area’s mall leaseable space.g p p
CPNCPN 21%
TheMall Gro pThe Mall Group9%
Future Park
Other46%
Rangsit4%
Siam Paragon4%
Seacon SquareFashion Island q7%Siam Future
6%
Fashion Island 3%
7Source : Company estimate as of 30 June 2011.
Strategic Shareholders
CPN is one of the flagship businesses of the Central Group (Chirathivat Family). As a strong and supportive shareholder, the Chirathivat family brings to CPN a wealth of retail‐related expertise through the family’s long record and successful leadership in Thailand’s dynamic and competitive landscape of y g p y p pshopping mall developments and department store / specialty stores operations.
Local funds27%
Chirathivat Family32%
Foreign funds61%
Individuals12%
32%
Others (Free float)Central Group totaling 59% ( )
41%totaling 59%
Central Group27%
8Source : Company estimate as of 16 August 2011.
Strategic Shareholder: Central GroupCPN’s strong synergy with the Central Group helps CPN to attract dynamic tenants, increase people traffic and command higher rents.
The Central Group and Chirathivat Familyp y
Centara HotelCentral Pattana Central Retail Central Marketing
100%59% 67% 100%
(CENTEL)(CPN) Corporation (CRC)g
Group (CMG)
Owner of Centara hotelOwner and developer of Owner of retail chains Owner of international retailOwner of Centara hotel, resorts, and convention
centers, and also franchisees of fast-food retail chains including
KFC, Mister Donut, Auntie's Anne Pepper
Owner and developer of Shopping Centers and Mix-
Used Complex
Owner of retail chains including
Central Department Stores, Robinson Department
Stores, ZEN Department Store, Power Buy, Super
Sports B2S Home-works
Owner of international retail franchisees for; - Cosmetics : Clarins, Elizabeth Aden, Payot...
- Apparel : G2000, U2, TOPSHOP, Dorothy Perkins, Enorgie Hush PuppiesAuntie s Anne, Pepper
Lunch, Beard papa’, Cold Stone, Chabuton,
Ootoya
Sports, B2S, Home works, Tops Supermarket, Office
Depot, etc.
Enorgie, Hush Puppies,Wrangler, Lee, FCUK, Energy, Miss Sixty...
- Others : Samsonite, Pentax, Guess watch, Casio....
9
Fully Integrated Business PlatformCPN is the only retail developer in Southeast Asia with a fully integrated business platform that will allow it to expand on a sustainable basis and achieve operational enhancements and success with its synergies with the Central Group of companies.
CPN ill thi i t t d b i l tf t d f th th h t Th il d i t i i k t h iCPN will use this integrated business platform to expand further throughout Thailand, maintaining market share in Bangkok while increasing market share in the Provincial area. CPN will also utilize this optimal business platform in its expansion into neighboring countries.
Central Group CPNRF – Property FundCPNLargest property fund in ThailandLeading retail developer propertyLargest and most popular retail Largest property fund in Thailand
Provide optimal funding source:
Unlock CPN’s asset value
Free up capital for businessexpansion
Leading retail developer, property manager and investor in Thailand with market share of 22% of Bangkok’s mall saleable area
Integrated development, leasing and property management teams have
Largest and most popular retail chains in Thailand
Guarantee space take-up with successful brands and store concepts
I l t ffip
Lower leverage and avoid dilution
Create fee base income
Improve CPN’s financial position:
property management teams have ensured continuous success for over 30 years
Strategic location
Optimal tenant mix
Increase people traffic
Most successful and most experienced retail company in Thailand
Attract tenants to locate in Tax benefit
Capital redeployment to projects with higher return
World class standard
Branded malls to ensure innovative designs and functionality to suit customer needs
CPN shopping centers
Allow CPN to achieve higher rental rates than others
10
Key Success Factors
“ Unrivalled Leading Player in the Retail Property Development Industry ”
Central’s Group Synergy
Business alliances and joint developers, building confidence among prospects
and attracting shoppers
y gy
Experienced & Hands-on
Management
High Revenue Generating
Capability at Sustainable
30-yeared experience in retail property development &
management
Recurring income from monthly rent with proven sustainable rental growth
Site selection, merchandizing mix and
Growth Rate
Focus on Retail Property
Prudent Financial
merchandizing mix, and retail business know-how’s
Development in Prime Locations
with Solid Operating
PerformanceDynamically
Management and
Financial Flexibility
High quality shopping centers: high occupancy & traffic flow and sustainable rental growth
Enhanced funding capability through REIT vehicle. Business growing at a low gearing
Dynamically Innovative &
DiversificationStep-up rental structure. Well diversified portfolio in 16 high traffic growth areas
11
Operational PerformanceOperational Performance
Property Locations Existing Projects:Shopping Centers: 16
World Format 1 (BMA)Plaza Format 13 (8 - BMA)
Thailand
Plaza Format 13 (8 BMA)(5 - Province)
Center Format 1 (Province)Festival Format 1 (Province)
Offices: 4 (BMA)
Future Projects
Existing Projects
Hotel: 2 (Province)
Pipeline Projects:Bangkok Metropolitan Area (BMA)
Shopping Centers:BMA
- Rama IX- Suan Lumpini (Pre-Cadet School)
Provinces
- Phitsanulok- Suratthani- Chiangmai
13
Leasable Area and Occupancy: Bangkok Retail
CPN manages sixteen (16) premium shopping centers – Nine (9) in Bangkok Metropolitan Area (BMA) and its vicinities and seven (7) in provincial areas. In 2Q11, occupancy of the BMA shopping centers stood at 93%.
Retail Properties in BMA
CPN Retail Develop- LandLeaseable
area (1)
No.of
Tenants
Occupancy Rate (2)
Closure for major renovation from Feb - Aug 2011.
Properties ment Ownership(sqm) 2Q11(1) 2Q11 1Q11 2Q10
1. Lardprao Greenfield Leasehold n/a n/a n/a n/a 87%
2. Ramindra Greenfield Leasehold 17,160 79 100% 100% 100%
3. Pinklao (3) Greenfield Leasehold 35,705 144 99% 99% 100%
4. Rama 3 (3) Greenfield Freehold 18,394 69 99% 100% 100%
5. Bangna Acquisition Freehold 53,216 284 99% 99% 99%
Under major renovation. Full opening is expected in Dec 11.
6. Rama 2 (3) Greenfield Leasehold 5,937 34 100% 100% 100%
7. Rattanathibet Acquisition Freehold 77,309 206 97% 97% 98%
8. CentralWorld Acquisition Leasehold 187,028 478 87% 86% n/a
9.Chaengwattana Greenfield Freehold 65,550 391 95% 95% 91%
CPN Portfolio in BMA 460,317(4) 1,685 93% 93% 95%
14Note 1: Excludes rental agreements < 1 year, such as kiosk, carts, ATMs and coin machines. Note 2: Percentage based on leaseable area. Note 3: Excludes areas transferred to CPNRF.Note 4: Includes Zen Department Store and under-renovating areas at CentralWorld.
Leasable Area and Occupancy: Provincial Retail
Seven (7) shopping centers are strategically located in high traffic growth areas in provinces. Occupancy rate in 2Q11 averaged 95%.
Retail Properties in Provincial Areas
CPN Retail Develop-
t
LandLeaseable
area (1)
No.of
Tenants
Occupancy Rate (2)
Properties ment Ownership(sqm) 2Q11 (1) 2Q11 1Q11 2Q10
1. Pattaya Center Greenfield Leasehold 15,226 127 92% 97% 97%
2. Chiangmai Acquisition Freehold 75,918 520 99% 100% 99%
3. Pattaya Festival Greenfield Freehold 57,150 304 95% 93% 90%
4. Udonthani Acquisition Freehold 49,076 181 97% 97% 98%
5. Chonburi Greenfield Freehold 39,240 291 95% 96% 90%
Opened in Mar 11.
6. Khonkaen Greenfield Freehold 50,123 353 89% 86% 91%
7. Chiangrai Greenfield Freehold 17,932 116 99% 90% n.a.
CPN Portfolio in Provinces 304,665 1,892 95% 95% 94%
Total CPN Portfolio for Retail Properties 764,982 (4) 3,577 94% 94% 95%
15Note 1: Excludes rental agreements < 1 year, such as kiosk, carts, ATMs and coin machines. Note 2: Percentage based on leaseable area. Note 3: Approximate figures.Note 4: Includes Zen Department Store and under-renovating areas at CentralWorld.
Leasable Area and Occupancy: Office
Office property is considered as non-core business, complementing shopping center business and adding value to the overall project. As of 2Q11, CPN owned four office towers located in BMA with an average occupancy rate of 83%.
OfficeDevelop- Land
Leaseable
area (1)
No.of
Tenants
Occupancy Rate (2)
Officement Ownership
(sqm) 2Q11 (1) 2Q11 1Q11 2Q10
1. Lardprao Greenfield Leasehold 16,275 41 60% 55% 38%
2. Bangna Acquisition Freehold 10,007 29 94% 98% 97%
Completed its major renovation in 1Q11.
3. CentralWorld Acquisition Leasehold 82,796 92 92% 91% 95%
4. Chaengwattana Greenfield Freehold 19,708 39 58% 57% 53%
Total 128,786 201 83% 82% 81%
Opened in Mar 09.
16Note 1: Excludes storage.Note 2: Percentage based on leaseable area.
Occupancy: Residential and Hotel
Residential property and hotel are non-core businesses. These businesses complement that of the shopping center and add value to the project.
ResidentialLeaseable area (1)
(sqm)
Occupancy Rate (2)
2Q11 1Q11 2Q10
Residential
(sqm) 2Q11 1Q11 2Q10
1. Bangna 1,907 42% 42% 58%
2. Langsuan 4,466 69% 70% 76%
T t l
50-unit furnished apartment.
Strata title. Asset for sales.
Total 6,373 61% 62% 71%
No. of Occupancy Rate %
Hotel
Hotel Available
Room 2Q11 1Q11 2Q10
Centara Udonthani n.a. n.a. 84% 64% Managed by Central Plaza Hotel Plc.
Hilton Pattaya 302 62% 62% n/a
Total 302 62% 72% 64%
Managed by Hilton Hotel Corporation
17Note 1: Includes retail space. Excludes storage.Note 2: Percentage based on leaseable area.
Operation Performance: CPNRF
In 2Q11, CPN Retail Growth Leasehold Property Fund (“CPNRF”) owns three shopping centers and two office towers. CPNRF is managed by SCB Asset Management, Fund Manager. Its properties are managed by CPN, Property Manager.
CPNRF Retail
PropertiesDevelop-
ment
Land
Ownership
Leaseable
area (1)
(sqm)
No.of
Tenants
2Q11 (1)
Occupancy Rate (2)
2Q11 1Q11 2Q10
1. Rama 2 Greenfield Leasehold 93,489 316 99% 99% 99%
2. Rama 3 Greenfield Freehold 40,071 229 96% 95% 94%
3. Pinklao Greenfield Leasehold 24,007 115 95% 95% 96%,
CPNRF Retail Properties 157,567 660 98% 98% 97%
CPNRF Office Develop LandLeaseable No.of Occupancy Rate (2)
CPNRF Office
PropertiesDevelop-
ment
Land
Ownershiparea (1)
(sqm)
Tenants
1Q11 (1) 2Q11 1Q11 2Q10
Pinklao Tower A & B
Greenfield Leasehold 33,760 102 96% 94% 96%
CPNRF Portfolio 191,327 762 97% 97% 97%
18Note 1: Includes rental agreements < 1 year such as kiosk, carts, ATMs and coin machines and CPN acts as the property manager.Note 2: Percentage based on leaseable area.
Effective Rental Rate (1)
1 212
1,300
(Bt/sm/mth)
Rental Rate of matured mallsDeclined effective rental rate from lower rental rates of newly opened malls in provinces
1,114
1,212
1,000
1,100
1,200
Same Store Rental +6.7% YoY
(Bt./sqm/mth)
900
2Q10 2Q11Excludes CentralWorld, CentralPlaza
Lardprao, and new projects (2)1,164 1,220
1,274 1,254 1,225
1 092
1,165 1,200
1,400
1,200
(Bt/sm/mth)
Rental Rate of new malls1,040 1,092
1,000
1,065
1,108
1,000
1,100
600
800
2005 2006 2007 2008 2009 2010 2Q10 2Q11900
2Q10 2Q11Excludes CentralWorld,CentralPlaza Lardprao, and
CentralPlaza ChiangraiAll projects The five new malls
(opened during 2008 – 2009) (2)
2005 2006 2007 2008 2009 2010 2Q10 2Q11
19Note 1 : The figures are effective rental rates for retail tenants (occupied space < 1,000 sqm) and net of special rental discounts.Note 2 : Newly opened projects - CentralPlaza Chaengwattana, CentralFestival Pattaya Beach, CentralPlaza Udonthani, CentralPlaza Chonburi, and
CentralPlaza Khonkaen.Source: Company estimate as of 30 June 2011.
Rental Contract Type
Fixed rent51%
% of Sales24%
• Increase rental rate
(up to 3 years)Monthly basis collection
• Tenants: food centers, cineplex and international brands such as
(up to 3 years)Monthly basis collection
approx 5% p.a. • Approx. 1/3 of rental contract expired every year
“McDonalds”, “KFC”• Range of percentage: 10% ‐ 30% of sales• With minimum guarantees
Long‐term leaseLong term lease25%
(up to 20 years)Up‐front collection
• Up‐front payment – realize throughout lease contract period on straight‐line basis Note:
On top of space rental fee, service & utility fees are collected on a monthly basis
20Note1: Percentage based on occupied area. Excludes leaseable area of CentralPlaza Lardprao. Source: Company estimate as of 3o June 2011.
Future DevelopmentsFuture Developments
Secured Future Locations
CentralFestival ChiangmaiCentralFestival ChiangmaiNLA: 46,500 sqmOpening in 2013
CentralPlaza PhitsanulokNLA: 23,200 sqm
CentralPlaza Rama IX
Opening in Oct 2011
CentralPlaza Rama IXNLA: 89,600 sqmOpening in Dec 2011
CentralPlaza SuratthaniNLA: 31,600 sqmOpening in June 2012Opening in June 2012
+ 3 secured land plots
22As of 30 June 2011.
CentralPlaza Phitsanulok
Project Highlights
Investment Cost (1) 1,400 MB
Program
Shopping Center (N.L.A.) 23,200 sqm (2)
Parking (G.A) 1,000 cars
Joint- Developer Robinson Department Store (3)
Location
Construction Progress
104 rais, Phitsanulok ProvinceCentral of Thailand
48% of construction
Opening (tentative) October 2011
23Note1: Includes land and construction cost of shopping center and parking building. Excludes those of Robinson Department Store.Note2: Excludes CRC’s area (Robinson Department Store).Note3: Area will be developed and owned by the joint developer. However the store will be magnet to draw traffic into CPN’s plaza area.
CentralPlaza Rama IX
Project Highlights
Investment Cost (1) 5,100 MB,
Program
Shopping Center (N.L.A.) 89,600 sqm (2)
Office Building 16,400 sqm
Parking (G.A) 2,500 cars
Location 5 km from Bangkok CBD Area
Construction Progress 54% of construction
O i (t t ti ) D b 2011Opening (tentative) December 2011
24Note1: Includes land and construction cost of shopping center and parking building.Note2: Includes Robinson Department Store - an anchor tenant.
CentralPlaza Suratthani
Project Highlights
Investment Cost (1) 2,000 MB
Program
Shopping Center (N.L.A.) 31,600 sqm (2)
Parking (G.A) 1,400 cars
Location 52 rais, Suratthani ProvinceSouth of Thailand
Opening (tentative) June 2012
25Note1: Includes land and construction cost of shopping center and parking building. Excludes those of department store.Note2: Excludes department store area under CRC.Note3: Area will be developed and owned by the joint developer. However the store will be magnet to draw traffic into CPN’s plaza area.
CentralFestival Chiangmai
Project Highlights
Investment Cost (1) 3,300 MB
Program
Shopping Center (N.L.A.) 46,500 sqm (2)
Parking (G.A) 1,600 cars
Joint- Developer Central Department Store (3)
Location 70 rais, Chiangmai ProvinceNorth of Thailand
Opening (tentative) 2013p g ( )
26Note1: Includes land and construction cost of shopping center and parking building. Excludes those of Central Department Store.Note2: Excludes CRC’s area (Central Department Store).Note3: Area will be developed and owned by the joint developer. However the store will be magnet to draw traffic into CPN’s plaza area.
Asset Enhancement ProjectsAsset Enhancement Projects
CentralPlaza Lardprao
Investment Cost (1) 2,100 MB
ProgramShopping Center Total face life with new design & conceptg p
New tenants, including Uniqlo, XXI Forever, TOPSHOP, i-Studio, etcAdditional parking (over 300 parking spaces)
Office Tower Face lift with new interior design
L ti B k kLocation Bangkok
Construction Period 1Q11 – 3Q11
Completion Completed
Impact • Increased merchandize with more leading brandsImpact Increased merchandize with more leading brands• Increased traffic flow and rental income
Post-renovationBefore renovation After renovation
28As of 30 June 2011 .Note 1: Includes those of shopping center and office.
CentralPlaza Udonthani and Centara Udonthani
Investment Cost (1) 2,400 MB
ProgramShopping Center New retail space (NLA) of 17,700 sqmp ( ) q
New anchors, including TOPS, PowerBuy, and SuperSportNew parking building (5 floors with over 700 parking spaces)
Hotel Face lift with new interior design
L ti N th t f Th il dLocation Northeast of Thailand
Construction Period 2Q11 – 1Q12
Impact • Increased leasable area with more leading brands• Increased traffic flow and rental income
New space
Post-renovation
p
After completion
29As of 30 June 2011 .Note 1: Includes those of shopping center and hotel.
CentralPlaza Bangna
Investment Cost (1) 1,000 MB
ProgramShopping Center New retail space (NLA) of 10,500 sqmp ( ) q
New parking building (3 floors with over 385 parking spaces)Improved façade and skylightRe-merchandizing mix
Location BangkokLocation Bangkok
Construction Period 2Q11 – 4Q12
Impact • Increased leasable area with a wider range of merchandizing and more leading brands .
• Increased traffic flow and rental income• Increased traffic flow and rental income
Post-renovationAfter completion
30As of 30 June 2011 .
Future Leaseable Area & Occupancy Rate
100%1 800 000
Retail NLA & Occupancy(sqm)
80%
100%
1,400,000
1,600,000
1,800,000
Under study projects
Under developing
60% 1,000,000
1,200,000
Under developing projects
Exisitng projects
% Occupancy (RHS)
40% 600,000
800,000
2006
2007
2008
2009
2010
011F
012F
013F
014F
015F
(RHS)
2 2 2 2 2
Assets under management 2006 2007 2008 2009 2010 2011F 2012F 2013F 2014F 2015F No.of project 10 10 11 15 15 18 21 24 27 29 Retail space (NLA in sqm) 684,587 697,038 761,111 967,430 964,612 1,100,412 1,222,612 1,291,092 1,425,092 1,485,092 Office space (NLA in sqm) 145,700 144,791 144,791 164,253 163,991 162,823 178,620 178,620 178,620 178,620 Hotel (rooms) 255 557 557 557 557 557 557 Residential (units) 62 62 62 62 62 62 62 62 62 62
31Source: Company estimate as at 30 June 2011. Includes leaseable area of CentralPlaza Rama 2, CentralPlaza Rama 3, and CentralPlaza Pinklao which were partially transferred to CPNRF, but still under CPN’s management.
Capital ExpenditureMajor capital expenditure will be used to develop new projects. Financing plan for future expansion includes: cash flow from operation, bond issuance and/or project finance, and property fund vehicle.
(Unit: MB)
Under‐construction Projects 2010 2011 2012 2013 2014 2015
CentralPlaza Chaengwattana 110 160 ‐ ‐ ‐ ‐ CentralFestival Pattaya Beach 100 100 ‐ ‐ ‐ ‐ Hilton Pattaya Hotel 1,250 400 ‐ ‐ ‐ ‐CentralPlaza Chonburi 180 110 ‐ ‐ ‐ ‐ CentralPlaza Chonburi 180 110 ‐ ‐ ‐ ‐ CentralPlaza Khonkaen 460 450 ‐ ‐ ‐ ‐ CentralPlaza Chiangrai 710 710 280 ‐ ‐ ‐ CentralPlaza Pitsanulok 160 770 340 ‐ ‐ ‐ CentralPlaza Rama 9 780 1,400 1,260 ‐ ‐ ‐ CentralPlaza Suratthani 450 580 470 300 ‐ ‐ CentralFestival Chiangmai 0 500 1,000 900 300 ‐
Enhancement projects
CentralWorld 820 1,980 ‐ ‐ ‐ ‐C t lPl L d 510 1 030 500 CentralPlaza Lardprao 510 1,030 500 ‐ ‐ ‐ CentralPlaza Pinklao 200 ‐ ‐ ‐ ‐ ‐ CentralPlaza Udonthani – Phase 2 50 540 1,000 620 ‐ ‐ CentralPlaza Bangna – Phase 2 0 500 500 ‐ ‐ ‐ Existing projects 500 500 500 1,000 1,000 1,000 g p j , , ,
Potential projects
New Projects (1) 300 2,100 4,600 7,700 9,200 9,400
Total CAPEX 6,580 11,830 10,450 10,520 10,500 10,400
32Source: Company estimate as of 30 June 2011. Note 1: Tentative development projects.
Financial PerformanceFinancial Performance
Financial Summary
14,000
(Bt.mil)
8,282 9,271
11,755 11,388
8 000
10,000
12,000
6-mth closure
Closure of CentralPlaza Lardprao
2,486 3,119 2,939
2,404 2,991 3,112
2,438 4,000
6,000
8,000 of CentralWorld
368 768 505 1,569 2,158 2,292 1,549 162 612 365
0
2,000
2007 2008 2009 2010 2Q10 1Q11 2Q11
Total revenues Operating profit Net profit/1
% YoY Growth 2007 2008 2009 2010 2Q11 QoQ 2Q11 YoY
Total revenues /1 (12%) 12% 27% (3%) (6%) 18% Total revenues ( ) ( ) ( )Operating profit 8% 24% 4% (22%) (34%) 37% Net profit 7% 38% 6% (32%) (40%) 126%
Same store revenue growth 14% 11% 5% 0% (2%) 8%
34Excludes non-recurring itemsNote1: Total Revenue includes rental & service, hotel operation, food & beverage, and other incomes.
Excludes interest income and share of profit from investment..
Revenues Breakdown
6 0577,000
(Bt.mil)
+18% YoY
Retail & office +15% YoY, despite the closure of CentralPlaza Lardprao. This was mainly from:
5,614 6,057
3,119 2 9384,000
5,000
6,000 -6% QoQwas mainly from:
• The increases in rental rate at most of properties
• The opening of CentralPlaza Chiangrai in 2,486
2,938
1,000
2,000
3,000
1H10 2H11 2Q10 1Q11 2Q11
p g gMarch 2011
• The closure of CentralWorld in 2Q10, due to the difficulty of access during political demonstration1H10 2H11 2Q10 1Q11 2Q11
Other income Hotel F&B Office Retail/1
2Q11 Revenue breakdown
demonstration
Hotel revenues +212% YoY, due to the opening of Hilton Pattaya Hotel in November
Office6%
F&B5%
2010.
F&B Sales +15% YoY from
• Higher sales of most food centersRetail79%
Hotel4%
Other income6%
/1
• Higher sales of most food centers
• The opening of new food center at the newly opened CentralPlaza Chiangrai
35Excludes non-recurring income.Note1: Includes revenues from residential projects and water & amusement park, and property management fees from CPNRF.
Costs Breakdown
5,000
(Bt.mil)
+12% YoY
Cost of retail & office +10% YoY from:
• The opening of CentralPlaza Chiangrai
3,436 3,729
3,000
4,000
+3% QoQ • Utilities of CentralWorld which was closed in 2Q10
Cost of hotel business +222% YoY, due to
1,689 1,837 1,892
1,000
2,000
1H10 2H11 2Q10 1Q11 2Q11
Cost of hotel business +222% YoY, due to the opening of Hilton Pattaya Hotel. The increase in costs was in line with the growth of revenues
1H10 2H11 2Q10 1Q11 2Q11
Other income Hotel F&B Office Retail
2Q11 Cost breakdown
F&B Costs +16% YoY from
• Higher F&B sales
Th i f f d t t th
Office7%
F&B7%
• The opening of new food center at the newly opened CentralPlaza Chiangrai
Retail83%
7%
Hotel3%
Other income0%
36Note1: Excludes non-recurring items.
SG&A Expenses Breakdown
1,074 1,200
(Bt.mil)
+26% YoY
Personnel expenses +15% YoY from:
• The openings of Hilton Pattaya Hotel and C t lPl Chi i
902
439 521 553
600
800
1,000 +6% QoQCentralPlaza Chiangrai
• Increased number of employee to support business expansion
0
200
400
1H10 2H11 2Q10 1Q11 2Q11
Advertising & promotion ‐2% YoY, due to the effective cost management to top‐line driven basis
2Q11 SG&A breakdown
1H10 2H11 2Q10 1Q11 2Q11
Others Depreciation Advertising & promotion Personnel Depreciations +311% YoY from
• The openings of Hilton Pattaya Hotel and CentralPlaza Chiangrai
Personnel45%
Advertising & promotion
17%
Depreciation15%
Others23%
37Note1: Excludes non-recurring items.
Debt Analysis
Outstanding Borrowings Bt 21,223 mil
Long‐term loan32%
Fixed
Fixed vs. Floating Interest Rate Mix
32% Short‐term bond24%
91%
Long‐term bond34%
Short‐term loan10% Floating
9%
Financing Cost
34%
5 6%
7%1,400
(Bt.mil)
621 581 543
745 688
5.6% 5.5% 5.2%
4.7% 4.4% 4.3% 4.3%
3%
4%
5%
6%
600
800
1,000
1,200
178 205
0%
1%
2%
0
200
400
2006 2007 2008 2009 2010 1Q11 2Q11
Interest expenses Weighted average cost of debt (RHS)/1
38Note 1 : Weighted average interest rate was derived from interest expenses including interest capitalization for projects under development.
Interest expenses Weighted average cost of debt (RHS)
Capital Structure
CPN’s net D/E stood at one time, against its debt covenant of 1.75 times.
(Times)(Bt.mil)
16,445 16,669
19,085 19,849
21,223
13 63915,173
19,008 18,918 19,527 19,346
1.04 1.00
1.20
1.40
16,000
20,000
24,000
12,045
13,639
0.59
0.84 0.74
0.92 0.97
0.40
0.60
0.80
8,000
12,000
3,983 3,677 2,541
1,632 873 1,032
‐
0.20
0
4,000
2007 2008 2009 2010 1Q11 2Q11
Cash & current investment Interest bearing debts Equity Net D/E
39
Share Price Performance and Dividend
16,000
18,00035.0
('000 shares)(Bt/share)
6,000
8,000
10,000
12,000
14,000
20.0
25.0
30.0
0
2,000
4,000
10.0
15.0
Jan‐10 May‐10 Oct‐10 Feb‐11 Jun‐11
V l (RHS) Cl
Par Value (Bt) 1.00 2010 2009 2008 2007 2006
Dividend policy is 40% of normal net profit.Share overview
Volume (RHS) Close
Stock Price (Bt)
Consensus FY11 core EPS (Bt/share)
P/E /1 (Times)
P/BV /1 (Times)
29.25
1.10
26.6
3.3
Par Value (Bt)
Dividend (Bt/share)
Dividend Paid (Bt mil)
Dividend Payout Ratio
1.00
0.25
545
48%
1.00
0.58
1,264
25%/1
1.00
0.33
719
33%
1.00
0.33
719
40%
1.00
0.31
675
40%Market Capitalization (Bt mil)
Share Capital (mil.shares)
63,730
2,179
Dividend Payout Ratio 48% 25%/1 33% 40% 40%
Remarks: Dividend policy is paid annually not less than 40% of net profit (unless there is a compelling reason against this).
Note 1: Dividend payout ratio of 25% in 2009 was derived from 40% of normal net profit and 14% of gain from transferring assets into CPNRF.
40Source: Factset as of 30 June 2011Note 1: Based on analyst’s consensus FY11 core EPS
AppendixAppendix
Details of Borrowings
Tenor Coupon / Repayment Maturity Outstanding (Bt mil)(years) Interest Rate (pa.) Type Date as at June 30, 2011
Short‐term Promissory Note up to 3 2.60% Bullet ‐‐ 0
Borrowing Type
Promissory Note up to 3 2.60% Bullet 0 Long‐term Term Loan 3.5 3.14% Bullet Jun 2014 1,500 Term Loan 3.8 3.19% Bullet Sep 2014 900 Term Loan 3.9 3.84% Bullet Jan 2015 500 Unsecured Bond 5.0 4.25% Bullet May 2012 3,000 % y ,Unsecured Bond 3.0 4.80% Bullet Aug 2011 1,500 Unsecured Bond 4.0 4.50% Bullet Apr 2013 2,000 Unsecured Bond 5.0 4.75% Bullet Apr 2014 1,000 Unsecured Bond 4.0 4.50% Bullet May 2013 1,200 Unsecured Bond 3.0 4.00% Bullet May 2012 1,000
Unsecured Bond 2.0 3 month fixed deposit
rate + 1.15%Bullet May 2012 500
Unsecured Bond 5.0 3.95% Bullet May 2015 500 Unsecured Bond 5.0 3.96% Bullet Feb 2016 500 Unsecured Bond 5.0 3.95% Bullet Apr 2016 1,000 Thai Business Fund 5 (Property Fund) 15.0 MLR‐1.25% Amortising Feb 2018 530 Thai Business Fund 5 (Property Fund) 15.0 6.00% Amortising Feb 2018 125 Project Finance (grace period of 2 years) 7.0 MLR‐2.00% Amortising Sep 2015 1,425 Project Finance (grace period of 2 years) 7.0 MLR‐2.00% Amortising Jan 2016 868 Project Finance (grace period of 2 years) 7.0 4.25% Amortising Jan 2016 1,000 P j Fi ( i d f 2 ) 7 0 MLR 2 00% A i i M 2016 1 275Project Finance (grace period of 2 years) 7.0 MLR‐2.00% Amortising Mar 2016 1,275 Project Finance (grace period of 2 years) 7.0 MLR‐1.75% Amortising Nov 2016 900
Total Borrowings 21,223 Less Cash and Current Investments 1,032
Net Borrowings 20,191
42Source: Company data as of 31 March 2011.
Net Borrowings 20,191
Balance Sheet
Dec 2010
(Restated)Financial position (MB) Jun 2011 % Change
Current assets
Cash and current investments 1,632 1,032 (37%) Other current assets 2,133 2,216 4%
Total current assets 3,765 3,248 (14%) Non‐current assets
Investment properties 29,955 32,822 10% Leasehold rights 13,549 13,319 (2%) Property & equipment (PP&E) 2,354 2,238 (5%)Property & equipment (PP& ) ,354 , 38 (5%) Other non‐current assets 4,213 4,599 9%
Total Non current assets 50,071 52,977 6% Total assets 53,836 56,225 4%
Current liabilities 10 153 13 213 30%Current liabilities 10,153 13,213 30% Non‐current liabilites 24,765 23,666 (4%) Total liabilities 34,918 36,879 6%
Total equities 18,918 19,346 2%
43
Income Statement
2Q10 1Q11 2Q11 % YoY % QoQ
(Restated) Change ChangeConsolidated earnings (MB)
Revenues from rental and service 2,165 2,623 2,497 15% (5%) Retail 2,024 2,431 2,308 14% (5%) Office 133 186 182 36% (2%) Other supportive businesses 8 5 7 (9%) 30% Hotel operations 34 131 107 212% (18%) Food & beverage sales 142 142 163 15% 15% Other income 145 223 171 18% (23%) Total revenues 2,486 3,119 2,939 18% (6%) , , , ( )
Costs of rental and service 1,557 1,661 1,709 10% 3% Retail 1,424 1,532 1,572 10% 3% Office 126 124 130 3% 5%
Other supportive businesses 7 5 7 4% 48% Other supportive businesses 7 5 7 4% 48% Hotel operations 14 52 45 222% (13%) Food & beverage sales 119 123 138 16% 12% Total costs 1,690 1,837 1,893 12% 3%
O ti fit (407) 768 505 224% (34%) Operating profit (407) 768 505 224% (34%)
Net profit (613) 612 365 160% (40%)
Net profit excluding non‐recurring items 162 612 365 126% (40%)
EPS (Bt) excluding non‐recurring items 0.07 0.28 0.17 126% (40%)
44
The fire incidents and the renovation of CentralWorld
The fire incidents at CentralWorld Project on May 19, 2010 caused damages (1) to CentralWorld Project
as follows:
M f Z D S ( l l )• Most of Zen Department Store (a long‐term lessee)• Parts of CentralWorld Shopping Complex
CentralWorld Project is protected by Industrial All Risks, Business Interruption, and Terrorism insurances.
D l d &
Re‐construction and re‐opening schedule:
insurances.
• CentralWorld Shopping Complex – Now open
Hotel
Developed & owned by Central Hotel (CENTEL)
Owned by CPN – not damaged
Owned by CPN
• Isetan Department Store – Now open
• Zen Department Store
> 14 month reconstruction Owned by CPN –partially damaged
& Now open
> 14‐month reconstruction
> Will resume operation in November 2011 (tentative)
Owned by CPN & leased out to ZEN Department Store – under
re‐construction
46Source: Company preliminary investigation.Note 1: Insurers and relevant independent experts are investigating and assessing the actual damage.
