Cedar Woods Properties Limited Annual Report 2011

Plain-text annual report

Cedar Woods Properties Limited A.B.N. 47 009 259 081 2011 ANNUAL REPORT n e e r G e l a d s i r r a H k r a P d l a r e m E s l e r t s e K e h T i s g n d n a L e h T s m u g r e v i R e h T e n i l r e t a W e g a l l i V y r u b n a B s d n a l s I e h T y t t e J e h T d r o f g n i l r a C m l a e R i g n d n a L s m a i l l i W CONTENTS i CEDAR WOODS PROPERTIES LIMITED 2011 ANNUAL REPORT Cedar Woods’ Objective About Cedar Woods 2011 Highlights Report to Shareholders Overview of Projects Performance Record Corporate Directory 1 2 3-4 5-10 11-18 19 20 CEDAR WOODS PROPERTIES LIMITED 2011 ANNUAL REPORT ii CEDAR WOODS’ OBJECTIVE Our primary objective is to create value for our shareholders through growth in earnings. 1 CEDAR WOODS PROPERTIES LIMITED 2011 ANNUAL REPORT Cedar Woods’ projects are sensitively developed with consideration for environmental and community interests. In meeting our primary objective we seek to: • communicate the company’s progress to shareholders and the investment community; • satisfy customers’ expectations through excellence in property development; • align the interests of the company and its employees and provide employees with the opportunity of growth and development; • have our citizenship recognised by the communities in which we operate and be recognised as environmentally responsible; and • maintain the highest ethical standards. ABOUT CEDAR WOODS Cedar Woods Properties Limited is an Australian property Cedar Woods’ projects are sensitively developed with development company. The company was established in 1987 and consideration for environmental and community interests and has been listed on the Australian Securities Exchange since 1994, built to a high quality that is renowned in the marketplace. trading under the security code ‘CWP’. Its market capitalisation is approximately $250m. Through the rapid expansion of its build form development portfolio, Cedar Woods has earned a reputation of delivering high The company’s principal interests are in urban land subdivision quality apartments for both the owner-occupier and investor and built form development for residential, commercial and market. industrial purposes. Its portfolio of assets is located in Western Australia and Victoria. The board and management of Cedar Woods have extensive The company has a strong focus on shareholder value and its record in delivering quality developments to the market has produced a strong earnings stream, providing high returns to experience in the property industry, with particular expertise shareholders. in adding value to land holdings through the achievement of government and local authority approvals and the planning and design process. Cedar Woods has consistently generated proﬁ ts and dividends for shareholders, whilst achieving excellence in product delivery, as recognised by several national awards and many state awards, including the categories “Best Residential Estate” and “Environmental Excellence” and most recently, “Best High Density Development”. In the investor relations arena, the company is a past winner of three ARA Silver awards for its annual report. CEDAR WOODS PROPERTIES LIMITED 2011 ANNUAL REPORT 2 2011 HIGHLIGHTS 3 CEDAR WOODS PROPERTIES LIMITED 2011 ANNUAL REPORT In 2011 Cedar Woods delivered a record net proﬁ t and a 58% increase in earnings per share. • Record full year proﬁ t of $28m, up 63% • Earnings per share of 45.8 cents, up 58% • Full year dividend of 23 cents (fully franked), up 77%; full year payout ratio to remain at 50% of net proﬁ t • $130m in presales at projects completing in FY2012 • Forecasting approximately $34m NPAT for FY2012, up 21% • Signed major leasing deal with Woolworths at Williams Landing • Victorian State Government award contract for Williams Landing station and overpass • Completed major new acquisitions in WA and Victoria 2011 FINANCIAL RESULTS SUMMARY Year ended 30 June Revenue Net proﬁ t after tax Total assets Net bank debt Shareholders’ equity 2011 KEY PERFORMANCE INDICATORS Year ended 30 June Basic earnings per share Dividends per share – fully franked Total shareholder return (1 year) Net bank debt to equity – 30 June Interest cover Net asset backing per share – historical cost Shares on issue – end of year Stock market capitalisation at 30 June Share price at 30 June Return on equity Return on capital 2011 $’000 131,839 28,060 233,595 55,100 129,549 2011 45.8 23.0 71.0 42.5 9.1 2.10 61,818 247,272 4.00 21.7 22.5 2010 $’000 108,415 17,241 205,657 39,716 108,790 2010 29.0 13.0 81.0 36.5 6.4 1.80 60,565 148,383 2.45 15.8 18.0 Change + 21.6% + 62.7% + 13.6% + 38.7% + 19.1% Change + 57.9% + 76.9% (10.0)% + 6.0% + 2.7 + 16.7% + 2.0% + 66.6% + 63.3% + 5.9% + 4.5% ¢ ¢ % % x $ ’000 $’000 $ % % Reference should be made to the ﬁ nancial performance summary on page 19 of this annual report which tables the ﬁ nancial performance of the company over the last 5 ﬁ nancial years. CEDAR WOODS PROPERTIES LIMITED 2011 ANNUAL REPORT 4 REPORT TO SHAREHOLDERS 5 CEDAR WOODS PROPERTIES LIMITED 2011 ANNUAL REPORT In 2011, Cedar Woods delivered a record proﬁ t of $28 million. Net proﬁ t increased 63% and earnings per share increased 58%. Interest cover has risen to 9.1 times, up from 6.4 times in 2010. Cedar Woods continues to enjoy strong cash ﬂ ows from operations. The company has made various acquisitions throughout the year to boost its land bank with the purchase of the Bushmead, Piara Waters, and Baldivis properties in WA and the Camberwell property in Victoria. The company’s share price rose over the ﬁ nancial year, increasing 63% to $4.00 per share. The Board remains conﬁ dent that the market value-based Net Tangible Assets (NTA) per share is substantially above the current share price and historical book value per share. 2011 Annual Result The company achieved a net proﬁ t of $28 million ($17.2 million in 2010), equating to earnings per share of 46 cents (29 cents in 2010). Despite challenging market conditions in 2011 Cedar Woods achieved a record proﬁ t for the year. The robust result reﬂ ects the increased proﬁ tability of the company’s projects particularly in Melbourne and the strength and diversity of Cedar Woods’ property portfolio. Cedar Woods remains in a strong ﬁ nancial position with a $110 million debt facility in place until August 2013. The company remains modestly geared with net bank debt to equity at 30 June 2011 at 43%, well within the target range of 20% - 75%. REVENUE ($m) NPAT ($m) 10% pa 11% pa 140 105 70 35 0 30.0 22.5 15.0 7.5 0 90.0 81.9 107.1 108.4 131.8 18.6 20.6 9.3 17.2 28.0 2007 2008 2009 2010 2011 2007 2008 2009 2010 2011 EPS (cents) DIVIDEND PER SHARE (cents) 8% pa 8% pa 50.0 37.5 25.0 12.5 0 25.0 18.75 12.5 6.25 0 33.9 37.3 16.2 29.0 45.8 17.0 18.0 7.0 13.0 23.0 2007 2008 2009 2010 2011 2007 2008 2009 2010 2011 CEDAR WOODS PROPERTIES LIMITED 2011 ANNUAL REPORT 6 REPORT TO SHAREHOLDERS Capital Management and the 2011 Dividend In light of Cedar Woods’ strong ﬁ nancial result, and in accordance Projects In FY2011, your company received income from two new projects, with the company’s dividend policy, your board has declared a Harrisdale Green and Banbury Village, bringing the total projects fully franked ﬁ nal dividend of 12 cents per share. This brings the under development in Cedar Woods’ portfolio to eleven across full year payout to a record 23 cents per share (13 cents per share Western Australia and Victoria. in 2010), providing an attractive yield based on the current share price, and representing a 77% increase on last year’s full year dividend. The ﬁ nal dividend will be paid on 31 October 2011. At the company’s current Western Australian land estates, lots sold steadily and price levels were maintained. In the last quarter, the company acquired two adjacent parcels of land, The Dividend Reinvestment Plan (DRP) will be available for the totalling 68 hectares, in Baldivis in Perth’s southern growth ﬁ nal dividend and shares under the DRP and Bonus Share Plan corridor. The site is strategically located close to the Kwinana (BSP) will be offered at a 2.5% discount to the weighted average Freeway and has the potential to deliver an 800 lot, master- market price for the 10 days to 21 October 2011. planned residential estate. Development is anticipated to Economy and the Property Market While the Australian economy has rebounded since the lows of 2008-09, overall, the economy remains mixed – with parts of the economy sluggish and others expanding rapidly. National economic growth is expected to be approximately 3.25%1 for 2011, weaker than initially anticipated, but still robust on a historic basis. Unemployment remains at historically low levels (5.1%2 nationally) and forward-looking indicators continue to point to moderate employment growth while annual weekly wages have commence in approximately ﬁ ve years. As part of the company’s regional growth strategy, Cedar Woods announced it was successful in its bid as the preferred proponent to acquire 11.5 hectares of land from the WA State Government in South Hedland approximately 1,600km north of Perth. The project, which will include a mix of residential, affordable, key worker, social and indigenous housing, is expected to yield approximately 170 lots, depending on the lot sizes and planning outcomes. The company’s major residential projects in Victoria performed well, experiencing strong pre-sales and signiﬁ cant levels of enquiries. At Cedar Woods’ ﬂ agship Williams Landing continued to rise, making property more affordable. The Reserve development in Melbourne’s west, the company recorded more Bank of Australia has kept interest rates unchanged at 4.75% since late 2010 providing stability for ﬁ rst home buyers. The Western Australian economy has continued to outperform the national economy over the past ﬁ nancial year, with economic growth for 2011 expected to be 4.0%, and forecast to grow to 4.75%3 in 2012. Despite a strong economy, property prices softened in the second half of the year. Strong in-bound migration supported by the resources boom, coupled with low than 200 settlements in the year and pre-sold all 51 sites in the new builders’ display village. The company also signed a major 20 year leasing agreement with national retailer Woolworths for three stores which will underpin the development of the project’s town centre. In August 2011 the Victorian State Government announced that the contract to build the railway station and Palmers Road overpass had been awarded. The work will start soon and is unemployment, provides the underlying fundamentals to support expected to be completed in 2012, providing a major boost for the growing demand for residential property in the future. town centre development. Following a period of strong growth in the residential property market in Victoria, demand has moderated with property prices remaining steady in the second half of the year. Forecast population growth, low unemployment and a shortage of During the year, several stages at Banbury Village in Footscray and Carlingford at Lalor were completed and settled and early planning approval has been granted for the Realm at Camberwell project with the tender for construction of 78 premium dwellings dwellings provides the platform for increased demand in the completed. medium term. 1 Reserve Bank of Australia – August Minutes 2 Seasonally adjusted ﬁ gure July 2011 3 Based on WA Treasury ﬁ gures 7 CEDAR WOODS PROPERTIES LIMITED 2011 ANNUAL REPORT Details of progress at the projects commences on page 11. Cedar Woods acquired signiﬁ cant new projects in Western Australia and Victoria. Corporate Objectives and Strategy Cedar Woods’ Corporate Plan guides management’s activities and provides a ﬁ ve year outlook for the company, projecting earnings growth and other key performance indicators. Cedar Woods’ primary objective is to create value for shareholders through earnings growth and it has consistently delivered 10% per annum growth in earnings per share. This puts the company in the top half of all listed industrial companies based on ﬁ nancial performance. This year, earnings growth has been much higher than the company’s target of 10% per annum. However, the board considers that this remains an appropriate The company’s strategies, as set out in the Corporate Plan are: • Ongoing development of existing projects Cedar Woods’ core competency is in property development and the company continues to achieve industry-leading design, delivery and marketing of projects to maximise returns. • Diversiﬁ cation of the property portfolio The company utilises options and similar agreements as a way of securing new projects whilst progressing necessary approvals. This is part of a strategy to diversify and grow the portfolio. target and is committed to achieving the company’s primary • Identiﬁ cation and acquisition of new projects objective. The Corporate Plan sets out a number of key action items and strategies focused on achieving delivery of earnings growth and addressing key risk factors. These key actions form performance targets for senior executives, sales managers and other employees. In addition, twice each year our Audit and Risk Management Committee assesses risk factors that may affect the company including speciﬁ c risks affecting individual projects and more general risks affecting our business sector. In the last year the company bolstered its land bank by completing key acquisitions in Western Australia and Victoria. Towards the end of the ﬁ nancial year the company made two strategic acquisitions in Baldivis in Perth’s south western growth corridor. This land will consolidate Cedar Woods’ position in the area and maintain our presence after The Rivergums and Emerald Park developments are completed, contributing to earnings growth over the medium term. The focus of future acquisitions remains on medium to long term prospects that provide the potential to add greater value through rezoning and approvals rather than projects purchased for immediate development and the company continues to assess many opportunities. CEDAR WOODS PROPERTIES LIMITED 2011 ANNUAL REPORT 8 REPORT TO SHAREHOLDERS • Using joint ventures, syndicates and co-development arrangements to leverage the company’s skill base Cedar Woods utilises joint ventures, syndicates and co- development arrangements to diversify the company’s revenue streams and efﬁ ciently manage its capital. This year, the company has conditionally agreed to a joint venture with local investors in Geraldton for a luxury apartment development. The company completed the sale of units in its joint venture at the Mandurah Country Club and has progressed its syndicate company, Cedar Woods Wellard Sustainability Reporting Our environmental and community development report and an overview of research and innovation is available as a separate web-based Sustainability Report. The Report is available on our website, www.cedarwoods.com.au People Our management team continues to grow to support the growth Limited, which generates ongoing revenue. The company in the business. has also established important co-developments with state government entities which will contribute to earnings over the medium term. The ﬁ rst of these at Harrisdale Green enabled the company to earn management fees from this project in the second half. In accordance with recommendations of the ASX Corporate Governance Council, this year the company introduced a diversity policy to reﬂ ect Cedar Woods’ commitment to an inclusive workplace that embraces and promotes diversity. The Policy sets out a framework for the company’s new and existing diversity- • Retaining ownership of income producing assets related initiatives, strategies and programs. The company has a portfolio of income producing assets The company has continued to actively support a range of that provide a recurring income stream. This portfolio will be industry groups including the Property Education Foundation of expanded with commercial and retail property assets that the WA which focuses on improving property professionals’ skills. In company will develop at Williams Landing and at other estates 2011, Cedar Woods participated in promotional activities with the where sites are designated for commercial or retail use. Foundation to help attract graduates to the development industry. 9 CEDAR WOODS PROPERTIES LIMITED 2011 ANNUAL REPORT Cedar Woods enters 2012 in a strong ﬁ nancial position with a diverse portfolio in major growth regions. Board Matters The board is conscious of its duty to ensure the company meets its performance objectives. During the year the board and its committees reviewed their respective charters and performance to ensure they were properly discharging their responsibilities. Further details of the Cedar Woods’ corporate governance framework are available on the company’s website and in the Corporate Governance Statement in the 2011 Financial Report. Takeover Approach In March, Cedar Woods announced it had received a conditional and indicative approach under which a third party proposed the acquisition of 100% of issued ordinary shares in the company. New projects to be launched in FY2012 will add to the earnings growth from the existing portfolio. With ample funding and approvals in place, your board remains positive about the company’s outlook and it is well positioned to achieve earnings per share growth in excess of our target of 10% per annum going forward. In 2011, we have actively engaged with the investment and broking community to raise Cedar Woods’ proﬁ le and build awareness of the strength of the company’s portfolio. The board remains conﬁ dent that the market value-based Net Tangible Assets (NTA) per share is substantially above the current share price and historical book value per share. We look forward to further building on the strength and diversity of our portfolio of projects and our land bank in the year ahead. The takeover proposal was made on a conﬁ dential basis and was We would like to thank our fellow directors, the management subject to a number of conditions, including due diligence and team and staff for their dedication and hard work in FY2011. We a majority board recommendation. The board actively sought to also thank our shareholders for their ongoing support of Cedar negotiate modiﬁ cations to the terms of these conditions in the Woods in FY2011 and in the year ahead. best interests of shareholders, but ultimately a number remained incapable of being satisﬁ ed and consequently the approach was withdrawn. The board continues to work to maximise returns to shareholders. Outlook Despite softer business and consumer conﬁ dence in 2011, the underlying fundamentals of the economy and the property market remain solid, particularly in Western Australia and Victoria where the company’s portfolio is located. With strong levels of inbound migration and low levels of unemployment, the medium-to-long term prospects of Australia’s residential property sector are positive. The Western Australian economy is forecast to grow at 4.5% with unemployment at 4.5%, below the national average of 5.1%. Victoria’s economy is expected to grow steadily in 2012 at a forecast 3% with population growth of 1.5%.4 Cedar Woods enters 2012 in a strong ﬁ nancial position with a diverse portfolio in major growth regions in Western Australia and Victoria. The company has $130 million of pre-sales in place due for settlement in 2012, underpinning the $34m net proﬁ t forecast. 4 Based on 2011-12 Victorian Budget Figures William Hames CHAIRMAN Paul Sadleir MANAGING DIRECTOR September 2011 CEDAR WOODS PROPERTIES LIMITED 2011 ANNUAL REPORT 10 OVERVIEW OF PROJECTS Bushmead Purchased in July 2010, 273 ha, project life of 12 years. The former Bushmead Riﬂ e Range site was sold by the Department of Defence on behalf of the Commonwealth of Australia. The land is located 16 kilometres north east of the Perth CBD within the suburb of Hazelmere and adjacent to Cedar Woods’ Helena Valley Private Estate. Given its proximity to the Perth CBD, Perth airport, Midland regional centre and strong connectivity via regional road networks, the site is in a prime location for future redevelopment. The site is a long term project for the company and expected to yield between 600 and 900 residential lots, depending on lot sizes and planning outcomes. RECENT ACHIEVEMENTS AND STATUS The company is now progressing the planning on the site and rezoning applications. Carine Development agreement signed 2010, 8ha, project life of 3 years. The planned redevelopment of a former TAFE site in Perth’s middle northern suburb of Carine is the company’s ﬁ rst project to be conducted in cooperation with the Western Australian State government (LandCorp). Cedar Woods and the St Ives Group were selected through a highly competitive tender process as the preferred project partners. The redevelopment will include residential aged care, a retirement village, mixed use development and residential townhouses and apartments. The St Ives Group is one of the state’s leading providers of aged care and retirement housing. RECENT ACHIEVEMENTS AND STATUS The demolition of existing improvements, rezoning and masterplanning has commenced and these processes are expected to be completed in FY2012. Emerald Park, Wellard Syndicate established in 2006, 47ha, remaining project life of 5 years. Cedar Woods Wellard Limited, an investment syndicate managed by the company, owns this exciting residential estate to ultimately comprise over 600 homesites, a school site and sports ground. Its location in Perth’s southern suburbs, some 33km from the CBD, adjacent to the Kwinana Freeway and close to the Perth - Mandurah rail line, brings convenient accessibility beneﬁ ts to residents. RECENT ACHIEVEMENTS AND STATUS The ﬁ rst two stages have now been completed and the estate is now entering a mature phase. The initial stages incorporate a display village and signiﬁ cant areas of parkland, providing a springboard for future stage releases. 11 Western Australia Land Development Harrisdale Green Development agreement signed 2010, 30ha, project life of 5-7 years. Following on from Carine, Cedar Woods was awarded its second joint venture land development with the Western Australian State Government, in this case to be conducted with the Department of Housing. The Harrisdale Green project is located within Perth’s south-eastern urban corridor and will comprise 540 homes and 40 mixed use units. Won as a result of a tender, it was the company’s focus on affordability and sustainability that set it apart from its competitors. The Kestrels, Tapping Purchased in 2003, 50ha, remaining project life of 1 year. As the name suggests, The Kestrels residential estate in Perth’s northern suburbs has focused on maintaining habitat and attracting prominent local bird species by maximising parkland and tree planting, and undertaking other revegetation initiatives. The Kestrels is another Housing Industry Association (WA) GreenSmart estate and won the 2006 City of Wanneroo Environmental Excellence Award. The estate will ultimately comprise over 520 dwellings. RECENT ACHIEVEMENTS AND STATUS RECENT ACHIEVEMENTS AND STATUS The ﬁ rst stage was released and developed in FY2011 with all but a few lots now sold. The second stage is now under construction. The Kestrels has continued to be very popular with buyers. The ﬁ nal lots have now been released, bringing to a close the company’s development. Mangles Bay Development Agreement, 80ha, project life of 15 years. In April 2010, LandCorp appointed Cedar Woods as its development partner for the Mangles Bay Marina Based Tourist Precinct. The project area is nearly 80ha of beachfront land which is expected to include a 400- 500 pen marina, waterfront commercial and up to 800 dwellings across a range of types from apartments to traditional residential lots. Environmental and planning approvals are being sought to allow the project to proceed. RECENT ACHIEVEMENTS AND STATUS The company is progressing the environmental approvals on the site and rezoning applications. 12 OVERVIEW OF PROJECTS North Baldivis Purchased in 2011, 68 ha, project life 10 years. The land abuts the Kwinana Freeway and Mundijong Road which affords excellent exposure. Whilst the land is currently zoned Rural under the local planning scheme and Urban Deferred under the Metropolitan Region Scheme, the planned connection to waste and water services by the Water Corporation in 2015 will see the land rezoned as Urban. The project will yield some 800 lots and is a neat strategic ﬁ t with the expected completion of Cedar Woods’ estates at Baldivis (The Rivergums) and Wellard (Emerald Park). RECENT ACHIEVEMENTS AND STATUS The company is now progressing the planning on the site and rezoning applications. Piara Waters Purchased in 2005 and 2010, 30ha, project life of 5 years. The company’s landholding in Piara Waters has the potential to yield 280 residential lots, including 3 unit sites. Located in Perth’s south-eastern corridor, the company’s two sites on Nicholson Rd, form part of a larger new urban precinct which includes new retail commercial centres and schools. This new urban area is close to the Armadale Regional Centre and with the extension of the nearby Tonkin Highway, beneﬁ ts from good access to surrounding employment centres. RECENT ACHIEVEMENTS AND STATUS Development of the ﬁ rst site is expected to commence in FY2012 with the ﬁ rst lots available for settlement in FY2013. Mariners Cove, Mandurah Purchased in 1993, 196ha, remaining project life of 7 years. A unique waterfront development close to the Mandurah town centre, comprising a mix of canal lots, The Landings waterfront townhouses, parkland lots and estuary view lots, Mariners Cove boasts a spectacular 93 hectare wildlife reserve complete with raised board walks, bird hides and an interpretive centre. The reserve protects the Creery Wetlands, an internationally recognised waterbird habitat that is home to migratory birds from around the world. Mariners Cove won the State and National Urban Development Institute of Australia Environmental Excellence Awards in 2002 and 2003, respectively. It has also won the State and National UDIA awards for Best Residential Development (250 or more lots) in 2004 and 2005 respectively. RECENT ACHIEVEMENTS AND STATUS Marketing continues on the remaining canal lots in stage 5CA and the last few remaining waterfront townhouses at The Landings. 13 South Hedland Contracted in 2011, 11ha, project life of 3 years. Located within the booming Pilbara region, Cedar Woods was announced as the successful partner in July 2010, and has partnered with Foundation Housing, IBN Corporation and Gumala Aboriginal Corporation to provide a balanced mix of residential, affordable, key worker, social and indigenous housing options to the region. RECENT ACHIEVEMENTS AND STATUS Development planning has commenced with approvals expected to be provided by the Town of Port Hedland in 2012. The Rivergums, Baldivis Purchased in 2001, 139ha, remaining project life of 8 years. Located in Perth’s southern suburbs and only minutes from the Perth - Mandurah rail line and the Rockingham beaches, The Rivergums residential estate will ultimately provide around 1200 dwellings plus primary and secondary schools. The estate boasts a network of lakes, wetlands, and beautifully landscaped parks. Environmental initiatives included restoration of a degraded wetland, conservation of the local frog population and the revegetation of the adjoining Tramway reserve. The Rivergums was also one of the ﬁ rst Housing Industry Association (WA) ‘GreenSmart’ developments, promoting efﬁ cient energy and water use. RECENT ACHIEVEMENTS AND STATUS With most of the lots in previous stages now sold, the company is developing the prime land that surrounds the central lake and the land to the north of the estate which will offer views across signiﬁ cant public open space. The ﬁ rst stage of this premium land is now under construction and the ﬁ rst lots will be titled midway through FY2012. The State has commenced construction on the Baldivis Senior High School, located to the east of the lakefront lots, due to take enrolments for the 2013 school year. Western Australia Land Development 14 OVERVIEW OF PROJECTS Essence, Harrisdale Located within the Harrisdale Green project within Perth’s south- The Jetty, Palm Beach Rockingham Purchased in 2006, 0.2ha, project completed. The company eastern urban corridor, Essence comprises 28 homes in total; 14 has recently completed this 4 storey beachfront development, three bedroom, two storey townhouses, 8 three bedroom, single opposite the refurbished landmark Palm Beach jetty in level villas, and 6 two bedroom apartments. Rockingham. The Jetty comprises 15 luxury three bedroom, two Situated adjacent to the central parkland of Harrisdale Green, the development is designed by Zuideveld Marchant Hur Architects. bathroom apartments, all with spectacular ocean views and the very best quality ﬁ t-out. A ground ﬂ oor beachfront café is also planned. RECENT ACHIEVEMENTS AND STATUS Sales and marketing recently commenced with the project launch in August 2011. RECENT ACHIEVEMENTS AND STATUS All but one of the apartments have been sold. 15 Western Australia Built Form Sutton Heritage Site, Mandurah Purchased in 1990, 2.24ha, remaining project life of 4 years. Part Waterline Apartments, Mandurah Purchased in 2005, 0.45ha, remaining project life of 3 years. of the company’s award winning Port Mandurah canal estate, The Waterline Apartments occupy a prime beachfront location, the historic Sutton farm site is the last remaining development directly opposite Doddi’s Beach in Halls Head, Mandurah. Stage site. The heritage farm buildings have been restored with the 1 of this beachside development comprises 15 two and three cooperation of the Heritage Council of Western Australia and will be retained as part of the redevelopment in a parkland setting, bedroom luxury ocean view apartments and 3 luxury penthouses. Retail space on the ground ﬂ oor now incorporates a popular together with a heritage listed norfolk pine tree, which is a local ‘Dome’ cafe. The balance of the site will comprise a medium landmark. density development for which planning is underway. RECENT ACHIEVEMENTS AND STATUS RECENT ACHIEVEMENTS AND STATUS Planning and design is well advanced and the necessary Construction of the Stage 1 ocean front apartments and approvals are expected in 2012. commercial tenancy was completed in 2008 and the remaining few apartments are currently being marketed. The company is now reﬁ ning development options for Stage 2. 16 OVERVIEW OF PROJECTS Banbury Village, Footscray Purchased in 2006, 9ha, remaining project life of 4 years. Banbury Carlingford, Lalor Purchased in 2006, 56ha, remaining project life of 4 years. An inﬁ ll Village is a substantial urban renewal project comprising over project in Melbourne’s northern suburb of Lalor, Carlingford is 430 new home sites, townhouses and apartments. The project the ﬁ rst residential estate launched in the area in over a decade. is a premium housing development for the inner west suburb of Ultimately comprising 600 housing lots, its location boasts Footscray, some 6km from the Melbourne CBD. Banbury Village not only looks to the future with energy efﬁ cient homes but excellent transport links to Melbourne’s CBD and is within easy reach of shopping, schools and the train network. also embraces the past through the adaptive re-use of heritage buildings on site. RECENT ACHIEVEMENTS AND STATUS RECENT ACHIEVEMENTS AND STATUS The ﬁ rst six stages have now been completed and sold. Substantial pre-sales have been achieved in the two subsequent The ﬁ rst six stages have been constructed and all homes have stages as interest remains strong from buyers in the local area. been sold. Work is now underway on the exciting ‘Heritage Apartments’ which comprise fully renovated existing heritage listed buildings, most of which are pre-sold. 17 Victoria Land Development Built Form Realm, Camberwell Purchased in 2010, 2.55ha, remaining project life of 3 years. Williams Landing Purchased in 1997, 275 ha (220ha developable), remaining An inﬁ ll project in one of Melbourne’s prestigious eastern suburbs project life of 13 years. A premium masterplanned community that will accommodate 78 premium homes, the site is rezoned development is being delivered on the former RAAF Williams and now has a development approval. A mix of product has been Laverton airﬁ eld, comprising four neighbourhoods with 2,500 designed for the site including terraces and detached, large family homes. dwellings and a future major town centre. Signiﬁ cant State Government infrastructure delivery for the site including a new RECENT ACHIEVEMENTS AND STATUS The ﬁ rst sales release is currently under way and construction is expected to commence in 2012, subject to satisfactory presales being achieved. freeway interchange and rail station is underway and is due for completion late 2012. The new town centre will integrate directly with these transit facilities to create a showcase transit-oriented development. RECENT ACHIEVEMENTS AND STATUS With zoning and masterplan approvals in place and the ﬁ rst eight residential stages completed, the company is moving forward with construction of further stages. The company is also progressing with the detailed planning of the town centre component of the project, having signed lease agreements with the Woolworths group for a trio of stores at Williams Landing. 18 2011 2010 2009 2008 2007 PERFORMANCE RECORD All ﬁ gures in $’000 except where stated FINANCIAL YEAR FINANCIAL PERFORMANCE Revenue from ordinary activities Earnings before interest and tax Finance costs Operating proﬁ t before tax Income tax expense Net proﬁ t after tax Realised reserve 131,839 41,455 1,215 40,240 12,180 28,060 23 108,415 26,771 2,036 24,735 7,494 17,241 26 Net proﬁ t after tax plus realised reserve 28,083 17,267 FINANCIAL POSITION Total assets Total liabilities Shareholders’ equity Number of shares on issue - end of year (‘000) KEY PERFORMANCE MEASURES Earnings per share (cents) Dividend per share fully franked (cents) EBIT margin (%) Interest cover (times) Return on equity (%) Investment in inventory during year Net tangible assets backing per share ($) Net bank debt Net bank debt to equity (%) Share price - end of year ($) Stock market capitalisation at 30 June Number of employees at 30 June 233,595 104,046 129,549 61,818 45.8 23.0 31.4% 9.1 21.7% 102,348 2.10 55,100 42.5% 4.00 205,657 96,867 108,790 60,565 29.0 13.0 24.7% 6.4 15.8% 56,338 1.80 39,716 36.5% 2.45 247,272 148,383 41 35 107,076 16,567 3,047 13,520 4,257 9,263 83 9,346 162,720 69,442 93,278 58,163 16.2 7.0 15.5% 2.2 9.9% 45,312 1.60 47,913 51.4% 1.42 82,592 30 81,941 31,245 2,230 29,015 8,458 20,557 179 20,736 185,019 101,073 83,946 55,138 37.3 18.0 38.1% 4.2 24.5% 46,002 1.52 80,633 96.1% 2.75 90,008 31,304 4,515 26,789 8,236 18,553 271 18,824 155,561 83,918 71,643 54,824 33.9 17.0 34.8% 5.8 25.9% 73,799 1.31 63,735 89.0% 5.22 151,630 286,181 33 26 RETURNS TO SHAREHOLDERS OVER 1, 3 & 5 YEARS 1 Year 3 Year 5 Year Earnings growth % Share price growth % Dividend growth % (paid dividend) Total shareholder return % SHAREHOLDER DISCOUNT SCHEME 58 63 58 71 7 13 2 17 9 (2) 5 2 The company operates a shareholder discount scheme which entitles shareholders to a 5% discount off the listed purchase price of any residential lot at a number of the company’s developments. A summary of the main terms and conditions follows: • shareholders must hold a minimum number of 5,000 shares for at least 12 months before purchasing a lot to qualify for the discount; • • there is no limit to the number of lots which a shareholder may purchase under the scheme, subject to any statutory restrictions; and the shareholder discount scheme does not apply to combined house and land packages or apartments. The above is a summary of the main conditions and shareholders should apply to the company or visit the website for the full terms and conditions. 19 CEDAR WOODS PROPERTIES LIMITED 2011 ANNUAL REPORT CORPORATE DIRECTORY A.B.N. 47 009 259 081 DIRECTORS William George Hames, BArch (Hons) MCU (Harvard) LFRAIA, MPIA, FAPI (Econ) – Chairman Robert Stanley Brown, MAICD, AIFS – Deputy Chairman Ronald Packer, BCom (UWA), AAPI, FAICD, Solicitor Supreme Court of England & Wales Paul Stephen Sadleir, BE, MBA, AAPI, FAICD, FRICS – Managing Director Timothy Robert Brown, BA, LLB, M.Fin, Post Grad Dip (Phil) (Alternate for R S Brown) COMPANY SECRETARY Paul Samuel Freedman, BSc, CA, GAICD REGISTERED OFFICE AND PRINCIPAL PLACE OF BUSINESS Ground Floor, 50 Colin Street, WEST PERTH WA 6005 Postal address : P.O. Box 788, WEST PERTH WA 6872 Phone: (08) 9480 1500 Fax: (08) 9480 1599 Email: email@cedarwoods.com.au Website: www.cedarwoods.com.au SHARE REGISTRY Computershare Investor Services Pty Ltd Level 2, Reserve Bank Building 45 St George’s Terrace, PERTH WA 6000 AUDITOR PricewaterhouseCoopers QV1 250 St George’s Terrace, PERTH WA 6000 SECURITIES EXCHANGE LISTING Cedar Woods Properties Limited shares are listed on the Australian Securities Exchange Limited. ASX Code : CWP ANNUAL GENERAL MEETING Venue : Kings Park Function Centre, Fraser Avenue, WEST PERTH WA 6005 Time : 11.00am Date : Friday, 4 November 2011 CEDAR WOODS PROPERTIES LIMITED 2011 ANNUAL REPORT 20 cedarwoods.com.au

Continue reading text version or see original annual report in PDF format above