ESR FY2020 Results Presentation
Transcript of ESR FY2020 Results Presentation
ESR
FY2020 Results Presentation
26 March 2021
Disclaimer
1
The presentation may contain projections and forward-looking statements that reflect the Company’s current views with respectto future events and financial performance and are subject to certain risks, uncertainties and assumptions. In some cases,these forward-looking statements can be identified by the use of forward-looking terminology, including the terms “believe”,“continue”, “could”, “estimate”, “forecast”, “plan”, “prepare”, “project”, “anticipate”, “expect”, “intend”, “may”, “will” or “should” or,in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives,goals, future events or intentions. These forward-looking statements include all matters that are not historical facts. By theirnature, forward-looking statements involve known and unknown risk and uncertainty because they relate to future events andcircumstances. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties, andactual results may differ materially from those in the forward-looking statements as a result of various factors and assumptions,many of which are beyond the Company’s control. Prospective investors are cautioned not to rely on such forward-lookingstatements. Neither the Company nor any of its affiliates, advisors, representatives or underwriters has any obligation to, nor doany of them undertake to, revise or update the forward-looking statements contained in this presentation to reflect future eventsor circumstances, except where they would be required to do so under applicable law.
This presentation material includes measures of financial performance which are not a measure of financial performance underInternational Financial Reporting Standards (“IFRS”), such as Adjusted EBITDA and Adjusted Net Profit. These measures arepresented because the Company believes they are useful measures to determine the Company's financial condition andhistorical ability to provide investment returns. Adjusted EBITDA and Adjusted Net Profit and any other measures of financialperformance in this presentation material should not be considered as an alternative to cash flows from operating activities, ameasure of liquidity or an alternative to net profit or indicators of the Company's operating performance on any other measureof performance derived in accordance with IFRS. Because Adjusted EBITDA and Adjusted Net Profit are not IFRS measures,Adjusted EBITDA and Adjusted Net Profit may not be comparable to similarly titled measures presented by other companies.
Data or information compiled by JLL has been reproduced in this presentation. While the ESR has taken reasonable care toensure that any data compiled by JLL and used in this presentation has been accurately reproduced, such data has not beenindependently verified by the ESR, and JLL does not accept any liability in negligence or otherwise for any loss or damagesuffered by any party resulting from reliance on the information herein contained.
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Contents
• FY2020 Key Highlights
• FY2020 Financial Highlights
• Industry Update
• New Growth Area: Data Centres
• FY2020 Operations Overview
• FY2020 Financial Overview
• Outlook
• Appendix
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FY2020 Key Highlights
ESR’s record achievements in FY2020:
▪ AUM grew by 35.3% to an all-time high of US$30 billion
▪ Record capital raising with seven new funds raising US$3.5 billion
▪ Record leasing of over 2.3 million sqm
▪ Record new completions of US$3.4 billion and record new development starts of US$3.2 billion
▪ PATMI up 16.8% to a record high of US$286 million
▪ Strong balance sheet with US$1.5 billion in cash and net debt/total assets of 23.2%
• Healthy portfolio occupancy of 90%
• Commenced US$3.2 billion worth of projects and Work In Progress grew 21% y-o-y to US$4.7 billion
• Completed US$3.4 billion of developments
• Robust cash position of US$1.5 billion and balance sheet strength
• Well-diversified debt profile with improved gearing ratio of 23.2%
• Recycled close to US$1 billion of capital from assets on balance sheet to ESR managed funds
• Weighted average interest cost was 4.6% as of 31 Dec 2020
• ESR Cayman became a constituent of MSCI Hong Kong, Hang Seng Composite Index and joined the Stock Connect
• Successfully raised US$650 million with listing of ESR Kendall Square REIT on KRX KOSPI in Dec 2020
• Launched Five-year ESG Roadmap aligned with the UN Sustainable Development Goals in Nov 2020
• Named ‘Sector Leader in Asia’ in GRESB 2020 rankings
• MIPIM Asia Awards 2020, Best Infrastructure, Community & Civic Building (Gold Award)- ESR Amagasaki DC
Capital Management Quality Portfolio Capital Markets ESG Roadmap
4
FY2020 Financial Highlights
Total Segmental
EBITDA
US$663m US$286m US$260m
Total
PATMICore
PATMI1
▪ Strong operating performance continues through COVID-19 through key business segments
▪ Further cemented market leading position and achieved AUM of US$30 billion well-ahead of end-2021 target
▪ Disciplined capital management with strong cash position, diversified and lower cost funding and improved gearing ratio
▪ Well-positioned to capture future acquisition and investment opportunities
Total
AUM
US$29.9b 23.2%
Net Debt/Total Assets Cash
+4.7%
+35.3%
+16.8% +14.7%
Note:(1) Excludes fair value on completed investment properties, pre-IPO ESOP expenses and tax effects of adjustments
-3.4pp
US$1.5b
+71.4%
Kunshan Friend Park I, China
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Section 1 Industry Update
E-commerce adoption continues to grow
post COVID-19
Paradigm Shift in Capital Flows For Region and Sector
Superior Risk / Reward Proposition of Logistics to Drive Cap Rate Compression and Capital Value Growth
ESR has and will continue to uniquely leverage the largest secular trends to further solidify its market leading position in Asia Pacific
APAC Logistics – Largest Secular Growth Opportunity In Asia
6
Manufacturers and Retailers Adapting Supply Chains to
COVID-19 Challenges
Post COVID-19, APAC Logistics Market Growth Continues To Be Underpinned By E-commerce Across The Region
Japan3
South Korea2
Australia6
Source: Euromonitor
35.8% 38.2% 39.4%
2020 2024EbeforeCOVID
2024Eafter
COVID
India4
6.5%8.5%
11.2%
2020 2024EbeforeCOVID
2024Eafter
COVID
10.4%11.6%
12.7%
2020 2024EbeforeCOVID
2024Eafter
COVID
5 Singapore
15.6% 14.5%17.5%
2020 2024EbeforeCOVID
2024Eafter
COVID
12.5%14.0% 15.0%
2020 2024EbeforeCOVID
2024Eafter
COVID
Increasing e-commerce penetration will continue to support long-term demand for modern logistics facilities
E-commerce penetration across Asia
7
The PRC1
27.3%
40.4% 40.4%
2020 2024EbeforeCOVID
2024Eafter
COVID
7 Indonesia
19.9%
33.5%
2020 2024E
Average spending per order on the platform (RMB)
E-Commerce Accelerated During COVID-19 And It Is Here To Stay
8
Average spending per order continued toIncrease(2)
Higher frequency for e-commerce platformover the past 12 months(1)
Chinese fresh food online retailing isexpanding at a CAGR of 49% over 2014-19
Low online retail penetration in Chinese freshfood relative to other categories
Shopping frequency for e-commerce platforms per year
China - food retail sales by distribution channelOnline penetration by categories (2019)
20
31
32
25
43
46
84
30
34
34
44
49
51
95
0 20 40 60 80 100
Mogujie
Vipshop
Xiaohongshu
Tmall Global/ Kaola
JD
Pinduoduo
Taobao/ Tmall
2019 2020
177
249
270
316
317
362
425
177
221
257
353
375
406
571
0 100 200 300 400 500 600
Pinduoduo
Mogujie
Xiaohongshu
Vipshop
Tmall Global/ Kaola
Taobao/ Tmall
JD
2019 2020
72%
46%
46%
39%
34%
30%
26%
22%
20%
11%
6%
0% 10% 20% 30% 40% 50% 60% 70% 80%
Toys and games
Consumer Electronics
Small Appliances
Major Appliances
Apparel & Footwear
Beauty a& Personal…
Consumer Health
Tissue and Hygiene
Home Care
Packaged Food
Fresh Food
35 35 36 36 36 36
62 61 60 59 57 56
1 2 3 4 5 6
0%
20%
40%
60%
80%
100%
2014 2015 2016 2017 2018 2019
Hyper/ Supermarket Traditional grocery retailers Online retailing Others
Source: Euromonitor Source: Euromonitor
Source: Euromonitor Source: Euromonitor
Notes:(1) 2019 does not include Tmall Global(2) All respondents who purchased on the platform at least once every 2-3 months
“We believe that the focus of the government on infrastructure, on encouraging manufacturing, the trend of localization in supply chains after the covid-19 crisis—all of these will create opportunities for us in the medium- to long-term. We are bullish about these prospects.”
—— T.V. Narendran, CEO and MD at Tata Steel Ltd., April 27, 2020
“Think of it as “just in time plus.” The “plus” stands for “just in case,” meaning more sophisticated risk management. The COVID-19 pandemic revealed vulnerabilities in the long, complicated supply chains of many companies. When a single country or even a single factory went dark, the lack of critical components shut down production. Never again, executives vowed. So the great rebalancing began. As much as a quarter of global goods exports, or $4.5 trillion, could shift by 2025.”
—— McKinsey & Co, January, 2021
“There’s a diversification in supply chains going on for security reasons, after recent events disrupted the supply chain…The move from the just in time to just in case supply chain model is taking root and people look at Vietnam as one of the options.”
—— Frederick Burke, partner at law firm Baker McKenzie, July 28, 2020
Manufacturers Are Shifting From “Just In Time Inventory” To “Just In Case Inventory”
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“The downward trend in inventory-to-sales ratios since the early 1990s could reverse as manufacturers, wholesalers and retailers store materials and products closer to manufacturing centers and consumers…The COVID-19 crisis has underscored the fragility of just-in-time (JIT) production networks... These JIT systems are now susceptible to closed manufacturing facilities, ports and borders due to the COVID-19 crisis. A March survey by the Institute for Supply Management found that nearly 75% of business respondents have experienced supply chain disruptions and more than 80% believe they will in the future. As a result, many businesses are planning major restructuring of their supply chain processes.”
—— CBRE, May 14, 2020
“As the situation began to unfold, we built inventory in both raw materials and finished goods to mitigate risk and to help us to continue meeting demand… This proactive approach coupled with our experienced and dedicated team, has enabled us to consistently deliver strong customer service levels.”
—— Michele G. Buck, President and CEO, The Hershey Co., April, 23, 2020
Investors will continue to cycle out of retail and into logistics given the transformative impact of e-commerce
Source: Real Capital Analytics
c.25% of investment volume
% of global investment
As investors have shifted focus in favour of logistics, investments in logistics sector have surpassed retail
Capital Allocation Increasingly Skewed Towards Funds Focused On Logistics Due To E-commerce
10
0
10
20
30
Retail Industrial
Logistics deal activity in 2020 continued to surpass retail, evidencing investors’ unwavering interest in the sector
21.3%
11.7%
Q1 2008
Q12010
Q1 2012
Q1 2014
Q1 2016
Q1 2018
Q4 2020
Q1 2020
Total cross-border investment transaction breakdown by region
Capital flows are already starting to pivot towards APAC, but APAC still remains under-penetrated
Superior growth prospects coupled with strong demographic and urbanisation trends are fuelling demand for APAC
Expected change by capital allocators in funds flow into Asian markets over the next five years
13%18% 19%
27%
60% 51%57%
52%
27%31%
24% 21%
2017 2018 2019 2020
APAC EMEA Americas
6.4
6.2
5.9
0 1 2 3 4 5 6 7 8 9
APAC
Americas
Europe
Large decline
Stay the same
Large increase
Source: Real Capital Analytics Source: PwC, Emerging Trends in Real Estate, 2021
Global Funds Are Under Allocated To APAC With Over 75% Investors Indicating Plans To Boost Allocation To The Region
11
Ca
pita
l O
rig
in
Hong Kong
(22.8%)(37.6%)
(14.5%)
57.5%
Office Hotel Retail Logistics
“New Economy” Real Estate Has Significantly Outperformed “Old Economy” In Public Markets
LTM share price performance (%)(1)
12
Europe
(22.7%)
(46.6%)
(19.9%)
15.7%
Office Retail Hotel Logistics
US
(24.5%)
(48.0%)
(32.7%)
18.9%9.1%
Office Retail Hotel DataCenter
Logistics
(13.1%) (12.6%)(18.6%)
22.9%15.3%
Office Retail Hotel DataCenter
Logistics
Singapore Australia
0.7%
12.8%
52.8%
Office Retail Logistics
Notes:(1) Market data as of December 31, 2020, each sector performance based on market cap weighted share price performance(2) Excluding Jinmao Hotel due to privatisation
Japan
(16.4%)(11.1%)
(23.5%)
20.6%
Office Retail Hotel Logistics
365
350 333 310300 255 225 180 175 188
130
Singapore Osaka Tokyo Guangzhou Seoul Sydney Melbourne Shanghai Beijing US average London
(Basis points)
2.9%
1.7%
1.3% 1.2% 1.2% 1.2%
0.4%0.2%
0.0%
(0.4%)
Singapore Beijing Tokyo Seoul Shanghai Hong Kong Sydney Melbourne London US average
APAC offers more attractive valuation premium spreads compared to more mature markets in the US and UK
Cap rate tightening and differential shrinking will drive higher logistics asset values, generating outsized returns for the asset class
Potential for meaningful cap rate compression in the APAC logistics real estate sector
Key logistics hubs in APAC offer more attractive premia
Spreads between logistics & office cap rates1
Logistics gross rental yields over costs of debt2
Risk/Reward For Logistics Will Continue To Transform Capital Values
Notes:(1) As of 2Q2020(2) As of 2019. Debt costs are based on investment grade borrowers, core stabilized assets fixed pricing on typical market maturi ties. In the calculation of the market yield, the transaction costs of purchasing or leasing of space are
not included. The market yield therefore reflects the returns to investment before transaction costs, assuming full occupancy and that the current income being paid is the market effective rent
Source: Real Capital Analytics, NCREIF, JLL
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RW NankoNaka DC, Japan
14
Section 2 New Growth Area: Data Centres
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Data Centers – A Growing Asset ClassMarket drivers for data centres further accelerated by COVID-19
Growing need for data creation and
storage
• Increasing computing and storage needs
• From video, online retail, gaming and corporate data processing
Internet of Things• Rising needs for data storage & processing
• Stakeholders install +40bn IoT devices globally through 2023
Adoption of cloudservices by
businesses andconsumers
• Introduction of 5G mobile network infrastructure results in faster and denser stream of mobile data
• Increasing artificial intelligence utilization
Data protection acts
• Corporates continue outsourcing data center needs
• Drive cost efficiencies and outsource to specialists
• Increasing compliance and regulatory requirements on data security
Demand accelerated by
COVID-19
• Increased short-term demand from telecommuting, online education and increased e-commerce consumption
• Expected sharp increase for demand for processing and storage of information
41.0%2019-2023E mobile data traffic CAGR in APAC
APAC data traffic expected to grow exponentially due to demographic tailwinds
50.7% of global millennials live in APAC(1)
Overall market size of carrier-neutral data centers (MW(2))
Rapid growth in APAC data center market
APAC Is Leading The Growth In Data Centers
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Public cloud service market size (US$billion)
c.34%of global hyperscale data centers expected to be located in Asia-Pacific by 2021E(2)
18.6
61.1
2019 2023E
8,189
13,279
2019 2023E
CAGR: 12.8%
Notes:(1) Population aged 23-38(2) Includes all carrier-neutral data centers, including retail, wholesale, and hyperscale data centers; market size is calculated by total capacity, which is the maximum capacity as designed(3) Including China, India and Southeast Asia(4) The percentages represent the 2019-2023E CAGR of the market size of carrier-neutral data centers (in terms of MW) across operating models and regions; market size is calculated by total
capacity, which is the maximum capacity as designed
Rapid growth in APAC emerging markets(3)’ public cloud service market
CAGR: 34.6%
2019-2023E CAGR in data center capacity(4)
APAC EMs(3) outgrows all other regions in data center capacity
30%
16%
13%
27%
12%
6%
18%
5%
3%
10%
5%
2%
Hyperscale Wholesale Retail
APAC Emerging Markets LATAM
EMEA North America
APAC Is World’s Second Largest DC RegionESR has a competitive advantage in APAC given our leading presence across seven markets
Denotes ESR’s pipeline projects
Asia Pacific to grow to a power capacity of 9,800 MW by 2025
APAC data centre spending to surpass US$35b by 2024 to account for >35% of global market
Source: Synergy Research Dec 2020 17
A Natural Progression From Logistics To Digital Infrastructure
ESR’s role as Property Company to deliver core
and shell
Similar Product Type: Modern Logistics Facility & Data Centre✓ Require large amounts of space near population hubs with easy access to
power and infrastructure✓ Sustained growth driven by changing habits and increased online activity
Work closely with hyperscale cloud
and colocation Operator Company with dedicated experience in operating data centres
ESR’s Distinct Advantages
▪ Hyper-local presence provides unparalleled access
to unique un-brokered land/ zoning / power
approvals / development expertise.
▪ Ability to speculatively acquire and create landbank
thereby reducing “ready-for-service” timelines
▪ Identify assets from our existing portfolio of
warehouses for redevelopment or repurpose
▪ Flexibility to allocate land to warehousing and data
centres in land parcel acquisitions
+
18
Leverage on expertise of similar product type
“Go-to” provider for e-commerce and 3PL
companies
Increasing requirement by e-commerce tenants for
data space and by capital partners for exposure to
the asset class
Repeat business and multiple-fund
investments from capital partners
◼ Major landlord of leading e-commerce companies in China
◼ Major provider of warehouse facilities for offline retailers
Landlord of E-Commerce Companies & Retailers
◼ Strategic alliance with major 3PLs and reputable logistics service providers
Collaborations with 3PLs / Logistic Operators
◼ Developing build-to-suit modern facilities for leading global e-commerce companies and manufacturers
Build-to-Suit Logistics Solutions Provider &
Reliable Landlord
◼ Synergistic alignment between operating network and capital providers’ investment mandates to attract repeat investors
Blue chip Institutional Capital Providers
The ESR Advantage: Extension Of Customer Relationships
Strong network effectwith APAC focused
tenants
Leverage ESR’s Synergistic Network of Blue-Chip Capital Partners and Customers
19
Chibakita Distribution Center, Japan
20
Section 3 FY2020Operations
Overview
21
#1 APAC Focused Logistics Real Estate Platform With Top Positions In Its Respective Markets◼ ESR has over 20.1 million sqm GFA in operation and under development1 and a further c7.2 million
sqm GFA of development pipeline with MOUs2 signed across top tier markets with a high quality tenant base
China1
South Korea
Singapore5
Australia
Japan3
India4
6
2
Notes:(1) Consisting of approximately 11.8 million sqm of GFA of completed properties, approximately 4.6
million sqm of GFA of properties under construction and approximately 3.7 million sqm of GFA to be built on land held for future development as of 31 December 2020
(2) MOUs as of January 2021(3) As of 31 December 2020(4) In terms of proportion of total area occupied in China in comparison to only GLP as of September
2017 when GLP was privatised(5) In Greater Shanghai, Greater Beijing and Greater Guangzhou from 2020 to 2021
(6) As of 4Q 2019, in Greater Shanghai, Greater Beijing and Greater Guangzhou as measured by GFA (7) By GFA from 2019 to 2020(8) Development pipeline including MOU as of 30 January 2021(9) In terms of number of assets(10) Including 57 properties in ESR REIT and 18 properties in Sabana REIT as of 31 December 2020(11) 17% stake in Centuria as of 31 December 2020
3. Japan Platform
#1 development pipeline in
the Greater Tokyo and Greater Osaka regions7
US$1.7 billion of
development starts in FY2020
6. Australia Platform
2. South Korea Platform
#1 largest owner of logistics
stock7
#1 development pipeline in
the Seoul Metropolitan Area7
1st publicly listed institutional
quality logistics asset focused REIT in Korea
5. Singapore Platform
#1 non-Temasek affiliated
industrial REIT platform9 of 75 properties10
1. China Platform
#1 e-commerce landlord4
#1 development pipelines5
#2 largest portfolio of logistic
properties6
4. India Platform
Quickly emerged as one of the leading logistics developers in India
Established US$750 million JV with GIC to be seeded with a ~2.2 million sq ft build-to-core asset
2 million sqm GFA in development pipeline8
22.1
29.9
FY2019 FY2020
AUM
(US$ billion)
3
US$3.4 billion of AUM with
a development pipeline of US$694 million
Largest shareholder of
Centuria11 (AUM: A$10.2 billion)
Indonesia7
22
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Strategic Achievements In 2020Strengthening presence in our core markets with strong fundraising efforts through the year
US$500m JV with GIC for development fund in China
Plans to build 76.84-acre logistics park in Sohna, New Delhi
Plans to develop JPY27b ESR Yatomi KisosakiDC
Issued S$225m 5.1% five-year notes
Launched A$1b ESR Australia Logistics Partnership (EALP)
Drawdown of US$250m three-year unsecured senior term loan at Libor +3%
Plans to develop modern logistics facility, ESR UkishimaDistribution Centre in Greater Tokyo Bay Area
Launched US$1b South Korea development JV (ESR-KS II) with APG and CPPIB
Launched A$1b develop-to-hold ESR Australia Development Partnership (EADP)
Acquisition of 3 prime properties in Jiangsu, East China
Completion of acquisition of PGGM's real estate portfolio for RMB1.7b in JV with Manulife
Purchase of 79ha site in Southeast Melbourne to be held in EADP
Acquired US$368m ESR Kuki DC from RJLF II in JV with AXA
Plans to develop a 36-acre industrial & logistics park in Chennai
Issued US$350m 1.50% convertible bond due 2025
Signed new full building 81,391 sqm lease with Nakano Shokai at ESR Toda DC, Tokyo
EADP acquired 18ha infill site in QLD, Australia
Secured JPY15b 3-year unsecured senior term loan at JPY TIBOR +2%
ESR named a Sector Leader in Asia by GRESB
ESR (Stock Code: 1821) included as a constituent of MSCI Hong Kong Index from 30 Nov
GIC and ESR established US$750m JV to develop and acquire assets in India
Listing of ESR Kendall Square REIT (Stock Code: 365550.KS) on KOSPI
Commenced construction on Phase 1 of ESR Higashi Ogishima DC which will house the world’s first cargo drone logistics facility
20212020
US$26.5bJun 2020
AUM
US$22.1bDec 2019
AUM
US$29.9bDec 2020
AUM
Launched Five-year ESG Roadmap, reaffirming ESR’s commitment to best practices in ESG
Completion of ESR Amagasaki DC, APAC’s largest logistics warehousing project
23
Investment
Fund Management
Development
▪ High portfolio occupancy of 90%1
▪ Well-staggered WALE of 4.2 years2 by leased area
▪ Record leasing with 2.3 million sqm of space leased across portfolio
on the back of demand from e-commerce related customers
▪ Achieved 4% rental reversion on renewed leases1
▪ Total AUM rose 35% y-o-y to US$29.9 billion3
▪ Fund AUM grew 41% y-o-y to US$27.1 billion3
▪ Fund management fees increased 14% y-o-y to US$189 million
▪ Commenced US$3.2 billion worth of developments in FY2020 and
Work In Progress grew 21% y-o-y to US$4.7 billion
▪ Achieved US$3.4 billion of development completions
▪ Robust landbank of over 3.7 million sqm across portfolio
▪ Close to US$1 billion of capital recycled from assets on balance sheet
to ESR managed funds
Notes:(1) Based on stabilised assets on balance sheet as at 31 December 2020(2) Based on assets on balance sheet and portfolio assets in funds and investment vehicles by leased area as at 31 December 2020(3) As at 31 December 2020
Strong Operational Performance Testament To Resilience and Strength of Portfolio Fundamentals
24
Record Leasing Of 2.3 million sqm Across PortfolioTop five leases by area
Tenant
Coupang Amazon Nitori Market Kurly Nakano Shokai
Market KoreaJapan, China
and IndiaJapan Korea Japan
Area leased in
FY2020
(‘000 sqm)
235 149 120 87 82
Lease term
(years)2 – 5 5 – 20 2 – 6 10 10
Robust demand for logistics space across platform from quality creditworthy tenant base
E-commerce & 3PL
RetailE-commerce
& 3PLE-commerce
& 3PLE-commerce
& 3PL
Market Cap: US$79b1 Market Cap: US$1.6t1 Market Cap: US$22b1 Market Cap: US$1b1
Note:(1) As of 24 March 2021
China32%
South Korea16%
Japan25%
Singapore8%
Australia17%
India/Others2%
25
GFA By Region1AUM By Region1
As of 31 December 2020Notes:(1) GFA includes completed properties, properties under construction and GFA on land held for future development. AUM includes portfolio assets owned directly by ESR and portfolio assets held in
the funds and investment vehicles(2) Revenue excludes contribution from construction income
Revenue Contribution By Region1,2
Strategically Diversified In 7 Key APAC MarketsResilient to market changes and disruptions
China23%
South Korea26%
Japan 26%
Singapore10%
Australia11%
India/Others4%
China42%
South Korea17%
Japan18%
Singapore9%
Australia7%
India/Others7%
26
Key Project Achievements In Japan
ESR AMAGASAKI DISTRIBUTION CENTRE ESR HIGASHI OGISHIMA DISTRIBUTION CENTRE - I
▪ Recipient of “Gold Award – Best Infrastructure, Community & Civic Building” at the MIPIM Asia Awards 2020
▪ Largest domestic consumption logistics warehousing project (GFA: 388,570 sqm) in Japan as well as in APAC1 – completed in July 2020
▪ Boasts a suite of human-centric features including a child day-care centre (BARNKLÜBB), a private lounge (KLÜBB Lounge) and communal amenities
BARNKLÜBB KLÜBB Lounge
▪ Commenced construction with expected completed in March 2023
▪ Set to be one of Japan’s tallest distribution centreswith a double-ramped, high-throughput facility (GFA: 365,385 sqm)
▪ Human centric features including a child day-care centre (BARNKLÜBB), a private lounge (KLÜBB Lounge), as well as other lifestyle amenities
▪ Ground-breaking collaboration with VRCO to design and demonstrate the world’s first cargo drone logistics facility – use of electric vertical take-off and landing (eVTOL) airframes to revolutionisethe movement of commercial cargo from ESR distribution facilities of the future
Note:(1) The largest single-phase, single-asset logistics warehousing project in terms of GFA, as of July 2020. Sources: CBRE data and ESR research
27
Strengthening Our Leadership Position In KoreaSuccessfully listed ESR Kendall Square REIT and launched US$1 billion development fund in 2020
▪ Raised ~US$650 million through pre-IPO investments and
global offering in December 2020
▪ Portfolio is seeded by assets sold down from two of ESR’s
private real estate funds, while the injection of the committed
dropdown asset, Anseong Logistics Park, is expected to be
completed by June 2021
▪ Continues to see strong investor appetite with unit price up
19% year-to-date1
▪ Further cements ESR Kendall Square as the dominant
logistics real estate platform in Korea with over US$7.7
billion of AUM
▪ JV with longstanding capital partners APG and CPP
Investments
▪ ESR KS-II marks APG’s fourth development collaboration,
and CPPIB’ third joint venture with ESR
▪ Fund will be seeded with a prime land site in Incheon City
which will be developed into a modern, large-scale multi-
tenant facility with a GFA of >150,000 sqm
Note:(1) As at 24 March 2021
ESR-KS II
US$1 billion development JV with APG and CPP Investments
28
Key Project Achievements In China
XIEXIN JURONG AND XIEXIN XUZHOU
▪ Prime properties in East China’s Jiangsu province, strategically located in prominent hubs of the country’s last mile logistics networks
▪ Acquired 100% stake in June 2020
ESR SHANGHAI YURUN – I AND II
▪ Phase I is to be developed into a high standard warehouse logistics facility which includes cold storage (Planned GFA: >340,000 sqm)
▪ Construction of Phase I commenced in 2019 and is expected to be completed in 2022
▪ Construction of Phase II commenced in end 2020
Xiexin Jurong Xiexin Xuzhou
Occupancy 100% 100%
GFA 165,292 sqm 36,551
Status Stabilised Construction in
progress
Leased
Tenant
Fully leased to
JD.com
Fully pre-leased
to SF Express
ESR Chakan 1 Industrial & Logistics
Park, India
29
Section 4 FY2020Financial & Operational
Overview
357
388
FY2019 FY2020
359 366
FY2019 FY2020
278
315
245
286
FY2019 FY2020
Profit AfterTax
PATMI
30
FY2020 Financials Key Highlights
Note:(1) Adjusted EBITDA is calculated as profit before tax, adding back depreciation and amortization, exchange loss/(gain), finance costs, equity-settled share option, the listing expenses, and
eliminating the effect of interest income, and fair value gains on completed investment properties and investment properties under construction
(US$ million)
Revenue
(US$ million)
Adjusted EBITDA1
(US$ million)
Profit After Tax / PATMI
+8.7% +2.0%
▪ Delivered strong earnings across key business segments
▪ Well-diversified contributions from ESR’s six markets
PAT:+13.0%
PATMI:+16.8%
26.6%28.6%
23.2%
31 Dec 2019 30 Jun 2020 31 Dec 2020
3,251 3,189
3,805
2,5712,855
3,295
884 947
1,515
FY2019 1H 2020 FY2020
Total equity Total debt and other borrowings Cash and bank balances
31
(%)
1,780
Net debt
1,687
Well-Equipped With Strong Balance SheetProactive and disciplined debt management
(US$ million)
Net Debt
Net Debt / Total Assets
1,908
Weighted average interest cost was 4.6% as at 31 December 2020
51.9%
59.8%
46.8%
FY2019 1H 2020 FY2020
85
44
85
4
3
5 18
-
-
38
-
38
29
60
2
1
231
FY2019 1H 2020 FY2020
Interest expense on bank loans Interest expense on other borrowings
Interest expense on Hana Interest expense on RCPS
Interest expense on bonds Interest epxenses on convertible bonds
Interest accretion on convertible bonds Interest expense on lease liabilities
(US$ million)
Finance Costs
156
Redeemed or repaid
77
184
Net Debt / Equity Weighted Average Interest Cost
(%)
5.0% 5.0%4.6%
31 Dec 2019 30 Jun 2020 31 Dec 2020
(%)
32
Capital Recycling Initiatives In FY2020Close to US$1 billion of capital recycled from assets on balance sheet to ESR managed funds – double annual target of US$400 to US$500 million
Received net cash recycled back of approx. US$0.7 billionDisciplined strategy to enhance financial flexibility to seize potential opportunities
71-91 Whiteside Rd, Clayton, Victoria
ESR Higashi Ogishima Distribution Centre, Japan
Note:(1) Cash recycled back (net of cash deconsolidated) are as follows:
- US$105 million from the divestment of China assets- US$179 million from the divestment of Australia assets to EALP - US$7 million from the divestment of Australia assets to EADP- US$84 million received on the divestment of RW Kawajima DC - US$275 million from the divestment of Higashi Ogishima Site A
Transactions from Balance Sheet to ESR Managed
Funds in FY2020
Gross Divestment
Value
Divestment of six on-balance assets in China to ESR-
GIC JVUS$103 million
Divestment of 20 assets in Australia as part of the
Propertylink acquisition and a land parcel seeded into
ESR Australia Logistics Partnership (EALP)
US$514 million
Divestment of 2 assets in Australia into ESR Australia
Development Partnership (EADP)US$35 million
Divestment of RW Kawajima DC into private REIT US$86 million
Divestment of Higashi Ogishima Site A into
RJLF IIIUS$255 million
Total US$993 million
33Notes:(1) Based on allocated share of profits from FVTPL funds and JV funds to each of Investment and Development segments(2) FY2019 Segmental result: Investment: 40.5%, Fund Management: 20.8%, Development: 38.7%
Income
Investment Fund Management Development
– Base / Asset management fees
– Development fees
– Acquisition fees
– Leasing fees
– Promote fees
– Completed B/S properties
➢ Rental income + revaluation gains
– Fund co-investments(1)
➢ Pro rata earnings
– Listed securities
➢ Dividend income
– Solar energy income
– B/S development profits
➢ Revaluation gains on U/C properties + disposal gain on sale
– Funds’ development profits(1)
– Construction income
– Direct costs for rental and solar energy income
– Allocated administrative expense– Allocated administrative expenses
– Construction costs
– Allocated administrative expenses
✓ Rental growth and high occupancy
✓ Cap rate compression
✓ High dividend payout from listed securities
✓ Strong Fund AUM growth
✓ Significant development pipeline in funds
✓ Promote Fee opportunity
✓ Significant development pipeline (B/S, funds)
✓ Track record of strong development profit margins
✓ Asset recycling from B/S or development funds into core funds / REITs
A B C
Expenses
Key Drivers Of Our Three Pillars Of Business
Key drivers
US$226 million US$148 million US$289 million
Total Segmental Result: US$588 million
US$75 million corporate and other unallocated costs
Combined segmental EBITDA: US$663 million
34.1%
% contribution
22.3%
% contribution
43.6%
% contribution
D
FY2020Segmental
result2
6%2%
6%
2% 2% 1%
11%13%
11%
11%
8%
27%
2021 2022 2023 2024 2025 2026 andbeyond
Assets held on Balance Sheet Assets held in Funds
34
A Investment SegmentHealthy broad-based demand with strong occupancy maintained
Portfolio Lease Expiry Profile By Area1
▪ Decline in investment segment results due to reduced portfolio on balance sheet, following full sell-down of Propertylink assets to EALP in FY2020
▪ Well-staggered WALE of 4.2 years2 by leased area and 3.5 years2 by income
▪ Maintained high occupancy of 90%3 across portfolio
▪ Achieved positive rental reversion of 4% on renewed leases3
Notes:(1) As at 31 December 2020(2) Based on assets on balance sheet and portfolio assets held in the funds and investment vehicles (3) Based on assets on balance sheet and stabilised assets
As at 31 Dec 2020 Assets held
on Balance
Sheet
Assets held
in FundsPortfolio
WALE (by leased area) 2.2 years 4.6 years 4.2 years
WALE (by income) 2.1 years 3.7 years 3.5 years
17%15%
17%
13%10%
28%
256
226
FY2019 FY2020
(US$ million)
Investment Segmental Result
Cold Chain5%
Manufacturing10%
Retail12%
Others9%
1.5%
1.5%
1.6%
2.1%
2.3%
3.2%
3.6%
5.8%
8.4%
9.8%
Askul Corporation
Market Kurly
The State of Queensland
Cainiao
Mitsubishi Fuso Trucks and Buses
Amazon
Zeny
SoftBank Group Corp
Coupang
JD.com
35
A Investment SegmentStrong demand from digital economy supports leasing growth
Lease Profile By End User Industry
64% E-commerce and 3PL companies
Lease Profile
by Income1
▪ Leasing transactions remains strong across portfolio with 2.3 million sqm of space2 leased across portfolio
▪ Leasing demand largely driven by e-commerce and 3PLs
Notes:(1) Based on income for FY2020(2) Based on assets on balance sheet and portfolio assets held in the funds and investment vehicles
Portfolio Top 10 Tenants By Income1,2
(%)
E-commerce related
>Two-thirds of Top 10 Tenants
are e-commerce related
2.7 2.9 2.8 2.8
6.36.7 6.8
9.8
11.2
12.4
16.9
17.3
30 Jun 2019 31 Dec 2019 30 Jun 2020 31 Dec 2020
Balance Sheet Core Funds Development Funds
36
B Fund Management SegmentFund AUM rose 41% y-o-y to US$27.1 billion
(US$ billion)
Evolution in Total Assets Under Management (Jun 2019 to Dec 2020)
Accelerating growth of fund management business demonstrates strong investor confidence
29.9
22.1
20.2
Fund AUM
26.5
167
189
FY2019 FY2020
132
148
FY2019 FY2020
37
(US$ million)
B Fund Management SegmentStrong fundraising support with US$3.7b of committed but uncalled capital
Fund Income
Strong recurring income base from fees collected from blue chip investors
Fund Income FY2019 FY2020
% of Fund AUM 0.9%1 0.7%
% of Adjusted Fund AUM2 1.2% 1.0%
% of invested capital 3.4% 2.8%
Capital Raised (US$ billion) FY2019 FY2020
Equity committed 6.5 10.2
Undrawn capital 1.8 3.7
Capital raised 1.3 3.5
(US$ million)
Fund Management Segmental Result
Notes:(1) The figure has been updated to align to prior years’ and current comparative purposes.(2) Excludes uncalled capital.
7.7 7.9
Dec 19 Dec 20
4.6
7.7
Dec 19 Dec 20
4.8
6.7
Dec 19 Dec 20
1.5
3.4
Dec 19 Dec 20
38
New LPs in FY2020
China
Japan
New LPs in FY2020
South Korea
New LP in FY2020
Australia
India
AUM (US$ billion)
Singapore (2 Listed REITs)
AUM (US$ billion)
AUM (US$ billion)
AUM (US$ billion)
AUM (US$ billion)
AUM (US$ billion)
Listed in Dec 2020
*AUM details as of 31 December 2020
Strong Network of Blue Chip Institutional
Capital Providers
CPPIB APG
Ping An CPIC
NCI GIC
AXA Manulife
PGGM Allianz
ESR’s Capital Raising By MarketContinuous platform expansion underpinned by strong fundraising
B
New capital committed in FY2020
Uncalled capital to be deployed
US$3.5b
US$3.7b
0.5
1.2
Dec 19 Dec 20
3.0 3.0
Dec 19 Dec 20
New LP in FY2020
39
Notes:(1) The commitment represents the aggregate capital commitments to the fund or investment vehicle, as applicable, including capital commitments by third-party investors and the general partner or investment manager. Foreign
currency commitments have been converted into U.S. dollars based on: (i) the foreign exchange rate at the date of purchase for each investment; and (ii) the exchange rate that prevailed on 31 December 2020, in the case of uncalled commitments.
Investment Vehicles Under ManagementContinue to attract best-in-class capital partners across multiple-fund investments
B
Inception Date CategoryFund AUM
Capital
Commitments1
Uncalled
Capital Interest Held
By ESR (%)
GFA
(US$ million) (US$ million) (US$ million) ('000 sqm)
Ch
ina
e-Shang Star Cayman Limited May-14 Development 1,999 863 113 25.6 2,250
RCLF I Jul-12 Development 793 440 - 2.3 1,009
China Invesco Core Fund Oct-17 Core 350 190 - 16.3 371
NCI Core Fund Jan-19 Core 300 159 - 10.0 325
GIC Dec-19 Development 821 500 308 51.0 902
Manulife Mar-20 Core 276 265 0 1.5 270
So
uth
Ko
rea
South Korea Development Fund I Nov-15 Development 2,981 1,150 288 20.0 2,199
South Korea Core Fund Jul-18 Core/Core Plus 992 500 118 10.0 377
South Korea Development Fund JV 2 Jun-20 Development 2,346 1,000 902 20.0 150
AMC Projects - Core 289 NA NA NA 186
ESR Kendall Square REIT Dec-20 REIT 1,125 NA NA 9.9 589
Jap
an
RJLF II Apr-18 Development 1,566 588 86 0.0 587
ESR Japan Core Fund Dec-18 Core 1,057 408 - 17.0 414
RJLF III Jun-19 Development 1,555 724 344 20.0 617
Other investment vehicles Various Development 3,247 1,352 366 Various 1,055
Sin
gap
ore ESR-REIT 2006 REIT 2,342 NA NA 9.7 1,403
Sabana REIT 2010 REIT 632 NA NA 20.9 383
Au
str
ali
a
50 Ann PEP May-17 Core Plus 151 68 0 25.0 26
POP III Feb-19 Core Plus 99 45 0 11.2 20
PACT Dec-17 Core Plus 248 59 0 15.0 19
EALT Nov-19 Core Plus 143 73 0 20.0 94
EOP IV Dec-19 Core Plus 114 49 0 11.2 22
EALP Jun-20 Core Plus 942 456 54 20.0 655
EADP Jul-20 Development 1,674 759 702 60.0 405
Ind
ia ESR India Logistics Fund Nov-18 Development 403 244 85 50.0 694
ESR Mumbai 3 Dec-20 Development 667 300 300
TOTAL OF ALL FUNDS 27,113 10,191 3,665 15,023
40
C Development SegmentIncreased development workbook boosted by strong demand across portfolio
Estimated Total Cost (US$ billion)
Work In Progress
Work In Progress (Estimated Total Cost) (US$ billion) FY2019 FY2020
WIP End Value as at December 3.2 3.9
Development Completions 1.2 2.2
Development Starts 2.0 3.2
FX and other (0.1) (0.2)
WIP End Value as at December 2020 3.9 4.7
No. of WIP developments (as at year end) 42 42
▪ Strong growth in WIP to US$4.7 billion in FY2020 on the back of strong demand particularly e-commerce related customers
▪ Current developments are higher-value projects with increased scale and higher quality
Project rendering of the 153,092 sqm four-storey ESR Yatomi Kisosaki Distribution Centre, which is set to be the largest modern logistics facility in Greater Nagoya
3.9
4.7
FY2019 FY2020
42 42
No. of WIP developments
0.1 0.2
1.8
3.2
FY2019 FY2020
Assets held on Balance Sheet Assets held in Funds & Investment Vehicles
0.20.4
1.8
2.8
FY2019 FY2020
41
C Development SegmentContinue to leverage third party capital for development starts
Estimated Total Cost (US$ billion)
Development Starts
GFA (million sqm) FY2019 FY2020
Assets held on Balance
Sheet
16% 28%
Assets held in Funds &
Investment Vehicles
84% 72%
2.0
3.2
3.4
1.9
GFA (million sqm) FY2019 FY2020
Assets held on Balance
Sheet
16% 15%
Assets held in Funds &
Investment Vehicles
84% 85%
Completion Fair Value (US$ billion)
Development Completions
ESR Amagasaki DC, Japan
ESR Hongmei II, China
6.3
3.0
1.9
1.4
3.9
2.2
1.2
0.5
2.1
0.7
0.6
0.8
1.0
0.3
0.1
0.5
2.1
0.9
0.8
0.5
DevelopmentPipeline
MOU UnderDevelopment
Land
China
Japan
South Korea
Australia
India
42
C Development SegmentStrong landbank for sustainable and recurring development profits
Development Pipeline
(US$ million)
Note:(1) MOUs as of January 2021
GFA (million sqm)
245
289
FY2019 FY2020
Development Segmental ResultLand Bank
GFA (million sqm)
GFA (million sqm) FY2019 FY2020
Land held on Balance Sheet 49% 36%
Land held in Funds &
Investment Vehicles
51% 64%
1.6
1.3
1.72.4
FY2019 FY2020
Land held onBalance Sheet
Land held in Funds& Investment Vehicles
Estimated Total Cost
US$2.4 bil US$3.2 bil
3.33.7
15.5
7.2
4.6
3.7
GFA (million sqm) FY2019 FY2020
MOU1 43% 46%
Under Development 33% 30%
Land 24% 24%
1
43
Summary Of FY2020 Financial Performance
US$ million FY2019 FY2020 Variance
Revenue 357 388 8.7%
Investment 121 107 (11.5%)
Fund Management 167 189 13.5%
Development 69 92 31.9%
Segmental Results (EBITDA) 633 663 4.7%
Investment 256 226 (11.8%)
Fund Management 132 148 12.0%
Development 245 289 18.1%
Corporate and other unallocated expenses (75) (75) (0.9%)
Total EBITDA 549 571 4.0%
PATMI 245 286 16.8%
Core PATMI
(ex. revaluation from completed properties)227 260 14.7%
▪ Revenue increased by 8.7% y-o-y to US$388 million mainly due to higher fees from fund management segment. The increase was offset by lower income from investment segment following full sell-down of Propertylink assets to EALP
▪ Increase in segmental results (EBITDA) driven by increase in fee income, as well as gains realisedthrough investment properties and properties under development
▪ Growth in Core PATMI continues to be supported by strong recurring income such as fees collected from fund management
44
Summary Of FY2020 Balance Sheet
US$ million FY2019 FY2020 Variance
Total Assets 6,352 7,687 21.0%
Cash 884 1,515 71.4%
Total debt and other borrowings 2,571 3,295 28.2%
Net Debt 1,687 1,780 5.5%
Net Debt / Total Assets 26.6% 23.2% (3.4pp)
▪ Robust cash position of US$1.5 billion as at December 2020, an increase of 71.4% from Dec 2019
▪ Total debt and borrowings were higher in FY2020 to fund the Group’ investments and ongoing developments
▪ Improved gearing ratio of 23.2%, allowing substantial headroom to capture future acquisition and investment opportunities
45
Disciplined Capital ManagementWell-managed debt maturity profile of 3 years
22%
35%38%
5%
Within one year In the second year In the third to fifthyear, inclusive
Beyond five years
▪ Well-spread debt maturity profile of 3 years with diversified funding sources
▪ Continued interest cost management with weighted interest cost of 4.6% as at 31 Dec. 2020 (vs. 5% as at end June 2020)
- Feb 2020: Issued S$225 million five-year notes at 5.1%
- Mar 2020: Drawdown of US$250 million three-year unsecured senior term loan at Libor +3%
- Sep 2020: Issued US$350 million five-year convertible bonds at 1.5%
- Nov 2020: Drawdown of JPY15 billion unsecured senior term loan at TIBOR +2%
- Feb 2021: Issued S$200 million perpetual step-up subordinated securities at 5.65%
Debt Maturity Profile
(US$ million)
734
1,1491,248
164
USD51%
RMB15%
JPY16%
SGD16%
AUD2%
Debt Currency Profile
As at 31 December 2020
74-84 Main Road, Clayton, Victoria,
Australia
46
Section 6 Outlook
47
Going Forward
Well-positioned to participate in M&A and partnership opportunities across the Asia Pacific region
Deepen Penetration In Existing Markets
Expansion Into Southeast Asia
Growth Of Data Centre Business
Strengthen Fund Management Efforts
▪ Largest APAC focused logistics real estate platform
▪ Healthy development pipeline going forward, strong landbank and an active capital recycling model
▪ Integrated development platform to meet tenants’ growing demand
▪ Growth of SEA’s digital economy surpassed its 2025 forecast in 2020 alone to 310 million digital consumers1
▪ SEA’s e-commerce GMV up 23% from 2018 to 2020 –faster than China’s GMV CAGR growth1
▪ Actively exploring opportunities in key markets and growth locations
▪ Continued strong demand from best-in-class institutional investors
▪ Agile and strategic in sourcing capital
▪ Launch of discretionary capital vehicles including public-listed REITs
Acceleration in e-commerce and digital economy driving structural changes to consumption patterns
1 2 3 4
Note:(1) Facebook/Bain & Company, Digital Consumers of Tomorrow, Here Today, A SYNC Southeast Asia Report, August 2020
▪ Strong growth prospects and vibrant demand for data centres across APAC
▪ Broadens ESR long-term relationships with customers, tenants and capital partners
▪ A natural progression for ESR to leverage its own strengths, expertise and leading presence in APAC
48
Sustainability Supports Operational ResilienceESG Framework provides strong process of materiality assessment
2020 GRESB (Global Real Estate Sustainability Benchmark) Rankings
South Korea Ranked first in the following category: Overall GRESB score within Industrial/Asia
Ranked first in the following category: Distribution Warehouse within Industrial/Eastern Asia
JapanRanked first in the following category: Development score within Industrial/Asia
Ranked second in the following category: Developer, East Asia
We believe the following key focus areas are impactful to our business and we have made headway with mapping and identifying baseline data for the most critical areas.
As we strive to create a positive and supportive environment for
our employees, customers, suppliers and communities, the
idea of “human centricity” is integral to our business. Basic
human needs are universal, and meeting those needs today
while ensuring they can be met in the future is the cornerstone of sustainable development.
Focus Areas include: • Safety, Health & Wellbeing • Diversity & Inclusion • Community Investment • Talent Attraction, Retention &
Training • Stakeholder Engagement
Human Centric Property Portfolio
We aim to develop and manage modern, state-of-the-art logistics
facilities for the new economy. We see ourselves playing a clear role in modern-day commerce, driving the region beyond doing less harm and
seizing opportunities to create a positive impact – doing good for the
planet, people and business.
Focus areas include: • Climate Change Resilience • Sustainable & Efficient Operations • Biodiversity & Habitat Protection • Human-Centric Design, Flexible &
Adaptable Properties, Strategic Locations
• Sustainable Building
We embrace “long-termism” and believe a culture and practice of strong year-on-year corporate
performance cements the foundation for sustained and
balanced growth, resulting in stable and dependable returns.
Focus areas include: • Financial Results • Responsible Investing/Financing • Corporate Governance • Risk Management • Disclosure & Reporting • Investor Relations
Corporate Performance
Goyang Logistic Park, Korea
49
The End
ESR Chakan 1 Industrial & Logistics
Park, India
50
Section 5 Appendix
51
Year ended 31 December
US$ million 2019 2020
Revenue 357 388
Cost of sales (81) (103)
Gross profit 276 285
Other income and gains, net 370 370
Administrative expenses (199) (202)
Finance costs (180) (147)
Share of profits and losses of joint ventures, net 93 105
Profit before tax 360 411
Income tax expense (82) (96)
Profit for the year 278 315
Attributable to:
Owners of the parent 245 286
Non-controlling interests 33 28
278 315
Statements Of Profit Or Loss
52
As at 31 December
US$ million 2019 2020
Non-current assets
Property, plant and equipment 31 32
Right-of-use assets 12 12
Investments in joint ventures 698 1,082
Financial assets at fair value through profit or loss 589 679
Financial assets at fair value through other comprehensive income 543 878
Investment properties 2,786 2,664
Goodwill and other intangibles 433 427
Other non-current assets 64 87
Total non-current assets 5,156 5,861
Current assets
Trade receivables 89 95
Prepayments, other receivables and other assets 129 209
Cash and bank balances 884 1,515
Assets held for sale 94 7
Total current assets 1,196 1,826
Current liabilities
Bank loans and other borrowings 232 734
Lease liabilities 6 7
Trade payables, accruals and other payables 230 244
Liabilities held for sale 21 -
Total current liabilities 489 985
Net current assets 707 841
Total assets less current liabilities 5,863 6,702
Statements Of Financial Position
53
As at 31 December
US$ million 2019 2020
Non-current liabilities
Deferred tax liabilities 211 281
Bank loans and other borrowings 2,339 2,562
Lease liabilities 17 7
Other non-current liabilities 45 47
Total non-current liabilities 2,612 2,897
Net assets 3,251 3,805
Equity
Equity attributable to owners of the parent
Issued capital 3 3
Perpetual capital securities 97 -
Equity components of convertible bond - 48
Other reserves 2,926 3,545
Non-controlling interests 225 209
Total equity 3,251 3,805
Statements Of Financial Position (Cont’d)
54
5-Y
EA
R E
SG
TA
RG
ET
SE
SG
ST
RA
TE
GY
Five-year ESG RoadmapPursuit towards excellence in sustainability
Consistent Reporting
with Transparency
Develop and Embed
Systems and
Processes for the
Long-term
Increase Engagement
with the people that
Matter Most
Foster A Culture of
Active Learning
Plan and Adapt for
Change
Plan to progress in our
reporting each year,
with honesty and
transparency.
We will look to produce
a GRI adopted ESG
report by 2022, improve
our GRESB score and
participate at a
corporate level and
become a signatory of
the Principles of
Responsible Investment
(PRI) by 2024.
Integrate ESG
considerations into
all stages of the
business cycle which
include establishing
data management
systems, streamlining
ESG data collection
processes and
developing policies
while setting annual
performance targets
and reviews.
Implement engagement
programmes to promote
health & well-being to
provide all our
stakeholders with a
positive and supportive
environment.
We will measure our
impact with the hopes of
creating a culture of
community service and
promote harmony with
the community.
Encourage employees
to progress on
continuous learning with
annual ESG training for
all employees.
This will pave the way
for streamlined systems
and efficient processes,
creating a more resilient
workforce for the future.
Conduct regular ESG
risk assessments in
building safety, energy
efficiency, indoor
environmental quality
and waste and water
management.
In Australia, we use a
climate risk model to
inform our buy or sell
decisions and for the
rest of the region, we
are embarking on a
climate impact study to
shape the Group’s
approach to climate
adaptation.
Human Centric
Safe working environment targeting Zero Workplace Fatalities
Gender ratio of 40/60 women/men(from base year 2019)
Development of community engagement/foundation programme
50% increase in solar power generation (from base year 2019)
Sustainable building certification for 50% of ESR’s portfolio
20% reduction in energy consumption across the Group (from base year 2019)
Achieve a 3 Star GRESB rating average
Maintain a culture of strong corporate performance
US$15 million in Social Investment Programme to our local community foundation by 2030
Property Portfolio Corporate Performance