ARA ASSET MANAGEMENT LIMITED亚腾资产管理有限公司腾资产管 有限公司

RESULTS FOR THE QUARTER ENDED 30 SEPTEMBER 2013

1. YTD 3Q2013 Highlights

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Building on established platforms, reaching for new heightsYTD 3Q2013 – BUSINESS HIGHLIGHTS

Assets under Management as at 30 September 2013Assets under Management as at 30 September 2013

S$ 23.4 billion$

S$ 1.5 billion year‐on‐year                    7.0% year‐on‐year

Achieved on the back of :

• Improved asset performance driven by asset enhancement initiativesresulting in higher property valuations of the REIT portfolios underresulting in higher property valuations of the REIT portfolios undermanagement

• Acquisitions by REITs under management

• Deployment of committed capital of ARA Asia Dragon Fund II

• Inclusion of additional committed capital for ARA China Investment Partners

• Higher valuation of the property in the ARA Harmony Fund following its assetenhancement works

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ASSETS UNDER MANAGEMENTS$23.4 billion as at 30 September 2013S$b S$b

20.1

22.523.4

18 0

20.0

22.0

24.0

18 0

20.0

22.0

24.0REITs ‐Real Estate

Private RE Funds ‐ Real Estate

Private RE Funds ‐ Capital

S$b

11.712.9

16.9

12.0

14.0

16.0

18.0

12.0

14.0

16.0

18.0Real Estate Management Services

3.4

5.46.2

9.5

4 0

6.0

8.0

10.0

4 0

6.0

8.0

10.0

0.5

3.4

0.0

2.0

4.0

0.0

2.0

4.0

31 Dec 03 31 Dec 04 31 Dec 05 31 Dec 06 31 Dec 07 31 Dec 08 31 Dec 09 31 Dec 10 31 Dec 11 31 Dec 12 30 Sep 13

Notes:Assets Under Management(1) (S$ billion) 31 Dec 2012 30 Sep 2013 Change

REITs – Real Estate(2) 16.2 16.7 3.2%

Notes:(1)    Based on exchange rates as at 

30 September 2013(2)    Comprises gross property 

value of REITs managed by subsidiaries & associated companies

Private Real Estate Funds – Real Estate 4.7 5.2 10.7%

Private Real Estate Funds – Capital(3) 1.3 1.1 (16.4%)

Real Estate Management Services(4) 0 4 0 4

companies(3)    Excludes capital committed 

for projects pending completion

(4) Revenue base for real estate management services fee computation

4

Real Estate Management Services(4) 0.4 0.4 ‐

Total 22.5 23.4 3.6%

p

Forging partnerships ‐ Positioned for accelerated growthYTD 3Q2013 – BUSINESS HIGHLIGHTS

Strategic alliance with

The Straits Trading Company LimitedThe Straits Trading Company Limited

Start of an expanded long‐term partnership between The Straits T di C Li i d Ch K (H ldi ) Li i d dTrading Company Limited , Cheung Kong (Holdings) Limited and Mr. John Lim

Strengthened SponsorshipStrengthened Sponsorship• Expanded business network to bolster deal sourcing and origination

capabilities

AUM Growth• S$100 million seed capital for new development fund• S$830 million real estate portfolio to be managed on a separate account• S$830 million real estate portfolio to be managed on a separate account

basisCapital Support

$

5

• Co‐investment vehicle expected to support up to S$10 billion of new ARAprivate funds over time

2. Financials and Track Record

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Good set of results with growing quality of earningsYTD 3Q2013 – FINANCIAL HIGHLIGHTS

Financial Highlights YTD 3Q2013 YTD 3Q2012

Recurrent Management Fees (S$’000) 84 030 74 059 13%Recurrent Management Fees  (S$ 000) 84,030 74,059 13%

Net Profit (Exc Unrealized M‐T‐M gains/losses) (1)

(S$’000) 56,811 47,338 20%(Exc. Unrealized M‐T‐M gains/losses)

Recurrent Net Profit (2) (S$’000) 43,202 37,295 16%

Strong quality of earnings achieved on the back of:• Higher REIT management fees

• Higher portfolio management fees from Private Funds division due to contributions from the ARA Asia Dragon Fund II and ARA China Investment Partners

• Higher real estate management fees  from increased leasing activities for retail space in the newly revamped Suntec City

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(1) M-T-M refers to “Marked-to-Market”, adjusted for the effects of tax(2) Recurrent Net Profit refers to Net Profit excluding acquisition, divestment and performance fees, finance income and finance

costs, adjusted for the effects of tax

Solid business model delivers growing financial performanceFINANCIAL PERFORMANCE

YTD 3Q2013

YTD 3Q2012

Change (%)

Revenue

Management fees(1) (S$’000) 84,030 74,059 13%

Acquisition, divestment and performance fees(2) (S$’000) 2,910 6,709 (57%)

Finance income(3) (S$’000) 9,617 15,136 (36%)Finance income (S$ 000) 9,617 15,136 (36%)

Other income (S$’000) 71 666 (89%)

Total Revenue (S$’000) 96,628 96,570 0%

Operating Profit (Pre‐Tax) (S$’000) 59,255 62,276 (5%)

Share of Profit of Associates (S$’000) 3,007 3,265 (8%)

N t P fit (S$’000) 52 120 55 018 (5%)Net Profit (S$’000) 52,120 55,018 (5%)

Net Profit (Excluding unrealised M‐T‐M gains/losses) (4) (S$’000) 56,811 47,338 20%

Recurrent Net Profit(5) (S$’000) 43,202 37,295 16%

Notes:

Recurrent Net Profit (S$ 000) 43,202 37,295 16%

AUM (S$ billion) 23.4 21.9 7%

(1) Recurrent management fees from REITs, private real estate funds and real estate management services(2) Primarily REIT acquisition/divestment fees and project management and consultancy fees(3) Comprises mainly distribution income from financial assets and net gains on fair valuation/disposal of REIT units(4) M‐T‐M refers to “Marked‐to‐Market”, adjusted for the effects of tax (5) Recurrent Net Profit refers to Net Profit excluding acquisition, divestment and performance fees and finance income, adjusted for the effects of tax 8

BALANCE SHEETAsset‐light business model with robust balance sheet

Group Balance Sheet as at 30 September 2013

S$’000 S$’000Non‐current assets Non‐current liabilitiesPlant and equipment 1,464 Financial liabilities 153 Tenancy deposits 1,023  Deferred tax liabilities 81 Associates 3,612Associates 3,612 Financial assets 196,882

202,981  234 Current assets Current liabilitiesFi i l t 32 867 T d d th bl 20 786Financial assets 32,867  Trade and other payables 20,786Trade and other receivables 38,384  Financial liabilities 22,671 Cash and cash equivalents 40,126 Current tax payable 8,826

111,377 52,283

Total liabilities 52,517

Shareholders’ equity 261 841Shareholders  equity 261,841

Total assets 314,358 Total liabilities & shareholders’ equity 314,358

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REVENUE AND NET PROFIT TRACK RECORDStrong track record of revenue and net profit growth

S$m S$m

112.5

122.8

133.5

120

140S$m

Recurrent management feesAcquisition & performance feesOther income

63.8

68.2

72.7

70

80S$m

Net Profit

70 0

86.3

80

100

48.350

60

62.1

70.0

40

6034.0

36.7

30

40

27.631.3

20

40

13.4 13.5

10

20

0

FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012

0

FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012

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DIVIDENDSRewarding shareholders S cents

2 17 2.24 2.302.50

2.302.50

2.30

2.70

2.30

2.70

2.302.5

3.0

2.17

1.5

2.0

0 5

1.0

0.0

0.5

1H08 2H08 1H09 2H09 1H10 2H10 1H11 2H11 1H12 2H12 1H13

Sustainable dividend policy• 5.0 Singapore Cents per share annually, barring any unforeseen circumstances

• Interim dividend – 2.3 Singapore Cents per share

• Final dividend – 2.7 Singapore Cents per share

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DIVIDENDSGrowing total dividends over time

33 538.4

40.5

3540 45 S$m

25.727.9

33.5

25 30 35 

10 15 20 

‐5 

FY2008 FY2009 FY2010 FY2011 FY2012

Dividend growth over time

1‐for‐5 bonus issue

1‐for‐10 bonus issue

1‐for‐10 bonus issue

Dividend growth over time• Issued bonus shares while maintaining the constant dividend of 5.0 Singapore Cents 

per share

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• Record total dividends paid for FY2012 of S$40.5 million

3. Business model

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FUNDS & SERVICESDiversified funds management platforms  and complementary real estate management servicesea estate a age e t se ces

Listing Venue SGX‐ST & SEHK SGX‐ST SEHK Bursa SGX‐ST SEHK

REITs

Listing Year 2003 2004 2005 2006 2009 2011

Focus Suburban retail properties in Hong Kong

Prime office & retail properties in Singapore

Office & industrial/ office properties in 

Hong Kong

Commercial properties in Malaysia

Logistics properties in the Asia Pacific 

region

Commercial properties in the 

PRC

Property Value(1) HK$22 188m S$7 936m HK$8 434m RM1 277m S$1 028m RMB 36 738m

Private Real Estate Funds

Property Value( ) HK$22,188m S$7,936m HK$8,434m RM1,277m S$1,028m RMB 36,738m

ARA Harmony FundADF

ARA Asia Dragon Fund

ADF IIARA Asia

Dragon Fund II

CIPARA China

Investment PartnersDescription Flagship strategic and 

opportunistic private real estate fund 

investing in Singapore, Hong Kong, China, Malaysia and other

2nd strategic and opportunistic private 

real estate fund investing in Singapore, Hong Kong, China, Malaysia and other

Single‐asset private real estate fund which owns the Suntec Singapore Int’l Convention & Exhibition Centre

Core‐plus private real estate fund investing in high quality 

office and  commercial properties in key cities in China, 

including Hong Kong

Strategic alliance with Australian specialist real 

estate investment manager, APN Property Group(3) for private funds investingMalaysia and other 

emerging economies in Asia

Malaysia and other emerging economies in 

Asia

funds investing primarily in Australian 

real estate

Fund Size US$1.1b (Committed Capital)

US$441m(Committed Capital)

S$630m (Gross Asset Value)

US$830m(2)

(Committed Capital)

Real Estate Mgmt Svcs

Description Property management Operations sales and marketing services provider & consultant for

(1) Property values as of last publicly‐announced valuation(2) Including additional  capital commitments of US$330 million in July 2013(3) ARA currently holds a 14% interest in APN Property Group 14

Description Property managementservices provider

Operations, sales and marketing services provider & consultant for convention, exhibition, meeting and event facilities

BUSINESS SEGMENTSDelivering value to shareholders

ARA ASSET MANAGEMENT LIMITED

REIT Private Real EstateBusiness Real Estate Corporate FinanceREITs Private Real Estate Funds

Revenue ‐Recurrent( )

Segments

Portfolio Management Fees

Base Fees(Gross Property Value)

Property Management Fees

Real Estate Management Services

Corporate Finance Advisory Services

(Primary Basis) (Committed Capital / Gross Property Value)

Performance / Variable Fees

(Property Gross Revenue)

Convention & Exhibition Service Fees

Performance Fees

Variable Fees(Net Property Income)

Acquisition / 

Exhibition Service Fees(Gross Revenue)

Advisory FeesRevenue ‐ Consultancy Fees(IRR above Hurdle)

Return on Seed Capital

q /Divestment Fees(Gross Property Value)

y(Purchase Value)One‐off

(Primary Basis)

y(Project Value)

Return on Seed Capital

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3. Strategy

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ARA GROUP INVESTMENT OFFICEDriving the Group’s expansion

Capital Raising

ARA Group

l S i

Investment Office

dDeal Sourcing & Origination

Product Development

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2013 STRATEGY IMPLEMENTATIONPoised for the next phase of growth

Build Relationships

Joint Ventures / Alliances

Build

New MarketsNew Capital SRelationships

Develop Products

Investor Driven

Operating  PartnersMergers & Acquisitions

Build Teams and Expertise

SourcesSame Focus (Fund Management)

Pan‐Asia Capabilities

q g )

18

Established regional networkExpanding regional footprint across Asia

DalianBeijing

• Established

Shenyang

GuangzhouHong Kong

NanjingShanghai

Establishedregional networkspanning 13 citiesin the Asia‐Pacific,i l di 6 iti

Kuala Lumpur

including 6 citiesin the ChinaMainland

• Network extendsIpoh

Singapore

Kuala Lumpur

Malaccaacross Singapore,Hong Kong, China,Malaysia andAustralia

Klang

p

Australia• Staff strength of

approximately1,097(1) as at 30

Melbourne

September 2013

Melbourne

Notes:(1) Inclusive of real estate management services business division and employees in joint‐venture entities of the Group and various funds under management

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MANAGEMENT TEAMExperienced team with a proven track record

Group CEOJohn LimGroup CEOJohn Lim

CEO  Property ManagementCEO 

CIOCorporate Divisions

Finance & ComplianceCheryl Seow

Senior Director Group

Private MarketNg Beng Tiong

ADF INg Beng Tiong

CEO

Property Management Services

APM SingaporeAnthony Yip

Public MarketJohn Lim

Suntec REITYeo See Kiat

CEO

CIO Moses Song

ARA FinancialLow Poh Choo

Senior Director, Group Finance

Corporate OfficeNg Beng Tiong

Director

CEO

ADF IIPaul YiCEO

Deputy Chairman

APM ChinaMun Hon Pheng

CEO, China

CEO

Fortune REITAnthony Ang

CEO

Senior Director

Group Business DevPrivate & Public Mkt

Mark ChuDirector

Group Risk Mgmt & IATang Boon KangSenior Manager

ARA Harmony FundSiew Siew HoonFund Director

APM MalaysiaChan Lai Hing

General Manager

Prosperity REITMavis Wong

CEO

Cache Logistics Trust

China DeskMun Hon Pheng

Head

Group HR & Corp DevPauline Lim

Senior Manager

Group Office AdminSerene Yeo

CIPDerek Lai

Senior Portfolio Manager

China RMB FundsMark Chu

Suntec SingaporeArun Madhok

CEO

Suntec InternationalArun Madhok

Cache Logistics TrustDaniel Cerf

CEO

AmFIRST REITZuhairy bin Md. Isa

Australia DeskLow Poh Choo

Head

Japan / Korea / India / Serene Yeo

Senior ManagerDirectorArun Madhok

CEOy

Acting CEO

Hui Xian REITTom Cheung

CEO

GCC Desk

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DISCLAIMER

These slides may contain forward‐looking statements that involve risks and uncertainties. Actual future performance, outcomes andresults may differ materially from those expressed in forward‐looking statements as a result of a number of uncertainties, risks andresults may differ materially from those expressed in forward looking statements as a result of a number of uncertainties, risks andassumptions. Representative examples of these factors include but are not limited to general market and economic conditions,interest rate trends, competition from other real estate investors, changes in operating expenses including employee wages andbenefits, changes in government policies, and the continued availability of financing in the amounts and terms necessary to supportfuture business. You are cautioned not to place undue reliance on the forward‐looking statements in these slides, which are based onthe current view of management on future events. Information from external sources in these slides has not been independentlyg p yverified by us nor have the external sources quoted consented to the inclusion of the information.

ContactCheryl SeowSenior Director, Group Financecherylseow@ara.com.hk

Global Headquarters:6 Temasek BoulevardSuntec Tower Four, #16‐02Singapore 038986

Tel:  (65) 6835 9232Fax: (65) 6835 9672

Website: www.ara‐asia.com

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