Waypoint REIT

Annual Report 
2020

Waypoint REIT is Australia’s largest listed 
REIT owning solely fuel and convenience 
retail properties with a high-quality 
network across all Australian states  
and mainland territories. 

Waypoint REIT’s objective is to maximise 
the long-term income and capital returns 
from its ownership of the portfolio for the 
benefit of all securityholders.

Investment Proposition 

Financial Highlights 

Chair and Chief Executive Officer’s Report 

Board of Directors 

Executive Leadership Team 

Portfolio Overview 

01

02

03

06

07

08

Sustainability Report 

Financial Report 

Additional Information 

Disclosures 

Glossary 

Corporate Directory 

12

19

80

82

83

85

About this report 
This Annual Report is a summary of Waypoint REIT’s activities and financial position 
as at 31 December 2020. In this report, references to ‘Waypoint REIT’, ‘Group’, 
‘Company’, ‘we’, ‘us’ and ‘our’ refer to Waypoint REIT unless otherwise stated. 
References in this report to a ‘year’, ‘2020’ and ‘FY20’ refer to the financial year 
ended 31 December 2020 unless otherwise stated. All dollar figures are expressed 
in Australian dollars (AUD) unless otherwise stated. More information, particularly 
latest Company announcements, can be found on Waypoint REIT’s website. 

Waypoint REIT is committed to reducing the environmental footprint associated 
with the production of the Annual Report, and printed copies are only posted to 
securityholders who have elected to receive a printed copy. 

Liberty Albany WA

Cover image: Shell Coles Express Laverton North VIC

The following symbols are used in this report to cross-refer to more information  
on a topic:

   References additional information within this Annual Report 

   References additional information available on Waypoint REIT website

Corporate Governance Statement
Waypoint REIT’s Corporate Governance Statement can be viewed on our website 
at 

 www.waypointreit.com.au

Waypoint REIT Limited – ACN 612 986 517

Investment Proposition

Secure rental income with embedded growth, underpinned by long-term 
leases to top-tier tenants

Essential economic infrastructure
• Sites leased to fuel and convenience 
operators focused on everyday needs

• Fuel and convenience tenants continued  

to operate throughout COVID-19 lockdowns 
(99.9% of rent collected in 2020)

World-class operators
• Viva Energy Australia supplies 24% of 

Australia’s downstream petroleum market

• Sites operated by one of Australia’s leading 

retailers, Coles Group (Coles Express)

Irreplicable network
• 470 Fuel and convenience sites acquired/built 

over 100+ years

• Aligned with population density and 

concentrated in metro locations along 
Australia’s eastern seaboard

• 2.2 million sqm of land; underlying land value 
estimated at ~50% of overall carrying value

Predictable income and growth
• 99.9% occupancy, 10.8-year weighted average 
lease expiry, predominantly Triple Net leases 
(91% by income)

• Strong organic rental growth underpinned  
by 2.9%1 weighted average rent review  
(3% for fuel tenants)

• Further growth potential via acquisitions  

and development fund-throughs

Low-cost operating structure
• $2.9 billion portfolio managed by eight  

(FTE basis)

• One of the lowest management expense ratios 

in the ASX REIT 200

Conservative capital structure
• Target gearing range of 30-40%
• Investment grade credit rating (Moody’s Baa1)2

• Diversified debt sources and tenor

1. CPI assumed at 1.0%. 

2.  Credit rating must not be used, and Waypoint REIT does not intend to authorise its use, in the support of, 

or in relation to, the marketing of its securities to retail investors in Australia or internationally.

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01

Waypoint REIT Limited – Annual Report 2020 
 
 
 
 
 
 
 
 
 
Financial Highlights

$279.9m

15.15cps

$2.49

Statutory net profit
Up 41.6% year on year

Distribution EPS3
Up 4.25% year on year4

NTA per security
Up 8.7% year on year

30bps

29.4%

4.3 years

Management expense ratio
Remains one of the lowest  
in S&P/ASX 200 REIT Index

Gearing
Just below bottom of revised 
target gearing range of 30-40%

Weighted average debt maturity
Up from 2.9 years in December 2019

Distributable EPS growth

FY20 continues Waypoint REIT’s strong track record of growth in Distributable EPS 3,4

+5.75%

13.41c

12.68c

+4.54%

14.02c

+3.69%

14.54c

+4.25%

15.15c

FY16

FY17

FY18

FY19

FY20

3.   Based on weighted average number of securities on 
issue during the reported period. FY16 is annualised.

4.   Distributable EPS shown to 2 decimal places.  

Growth calculated on exact figures.

Shell Redcliff WA

02

Waypoint REIT Limited – Annual Report 2020

Chair and Chief Executive Officer’s Report

“The value of Waypoint REIT’s investment 
portfolio increased by $213.1 million (7.9%)  
in 2020, driven primarily by valuation gains 
($176.6 million) and acquisitions/developments 
($51.3 million).”

Dear Securityholder,

On behalf of the Waypoint REIT Board 
of Directors and management team,  
it is our pleasure to present the  
Annual Report for the year ended  
31 December 2020.

The 2020 year was clearly challenging 
both domestically and internationally 
due to the disruption caused by 
COVID-19. However, we are pleased 
to report that Waypoint REIT’s 
performance was not materially 
impacted, with the majority of its 
income being generated from long-
term leases with well-capitalised 
tenants that continued to provide 
essential services throughout the year.

Laurence Brindle
Chair

Hadyn Stephens
Chief Executive Officer

Financial performance
The resilience of our property portfolio 
was reflected in Waypoint REIT’s 
financial performance in 2020, with  
a 6.1% increase in Distributable 
Earnings to $118.5 million, and a  
41.7% increase in statutory net  
profit to $279.9 million. Distributable 
Earnings per Security (Distributable 
EPS) increased by 4.25%, at the top 
end of the revised guidance range 
of 4-4.25% provided to the market in 
August 2020. This growth was driven 
primarily by contracted rental growth 
and debt-funded acquisitions and 
developments, and Waypoint REIT 
has now delivered compound annual 
growth in Distributable EPS of 4.5% 
since IPO in 2016. As at 31 December 
2020, the vehicle has delivered a total 
return for investors of 60.0% since IPO, 
compared with a total return for the 
S&P/ASX 200 Index of 15.3%.

Both the Board and management 
team remain focused on managing 
Waypoint REIT’s cost base, with our 
management expense ratio of 30bp  
in 2020 remaining one of the lowest  
in the S&P/ASX 200 REIT Index.

Financial position
The value of Waypoint REIT’s 
investment portfolio increased by 
$213.1 million (7.9%) in 2020, driven 
primarily by valuation gains ($176.6 
million) and acquisitions/developments 
($51.3 million), offset by compulsory 
acquisitions ($0.8 million) and assets 
now being held for sale ($14.3 million).

Total assets increased by 7.8% in 2020 
to $2.93 billion, more than offsetting  
a 4.5% increase in total liabilities to 
$977 million and resulting in a 9.6% 
increase in net assets to $1.95 billion. 
Net tangible assets per security 
increased from $2.29 in December 
2019 to $2.49 in December 2020, 
representing an 8.7% increase.

Gearing as at 31 December 2020 
was 29.4%, below the bottom end of 
Waypoint REIT’s 30-40% target gearing 
range. The top end of this gearing 
range was reduced from 45% to 40% 
to better reflect the historical operating 
range of the vehicle and the Board’s 
view on the sustainable gearing range 
for Waypoint REIT moving forward.

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Waypoint REIT Limited – Annual Report 2020

03

 
 
 
 
 
 
 
 
 
 
Chair and Chief Executive Officer’s Report continued

Capital management
In February 2020, Viva Energy Australia 
sold its entire 35.5% security holding in 
Waypoint REIT (then Viva Energy REIT)  
following a strategic review of its 
investment (Viva Selldown).

The Viva Selldown triggered a review 
event across Waypoint REIT’s  
$1.1 billion of debt facilities, at a time 
of significant global uncertainty due 
to the onset of COVID-19. Pleasingly, 
waiver consents were received in 
relation to 89% (by value) of these debt 
facilities, and we would like to thank 
these lenders for the support that they 
provided to Waypoint REIT at this time.

Waypoint REIT successfully refinanced 
$325 million of bank debt during the 
year on pricing generally consistent 
with existing bank debt, and was also 
successful in completing its first US 
Private Placement (USPP) transaction 
in October 2020, with US$178 million 
(approximately $250 million) issued 
across 7, 10 and 12 year tranches.

The net result of these events and 
initiatives was an increase in Waypoint 
REIT’s weighted average debt maturity 
from 2.9 years at 31 December 2019  
to 4.3 years at 31 December 2020.

As at 31 December 2020, Waypoint 
REIT had available liquidity (undrawn 
debt and unrestricted cash) of  
$127.3 million, providing significant 
capacity for future growth initiatives. 

Property portfolio
As at 31 December 2020, Waypoint 
REIT owned 470 properties valued at 
$2.9 billion, with an occupancy rate 
of 99.9% and a weighted average 
lease expiry (WALE) of 10.8 years. 
The portfolio remains geographically 
diversified with a strong weighting 
towards metropolitan markets along 
Australia’s eastern seaboard, and the 
portfolio has a stable rental income 
profile underpinned by 95.2% of leases 
being subject to fixed reviews of 3% or 
greater and 91.4% of the leases being 
‘Triple Net’ leases, where the tenant is 
responsible for all property outgoings 
and capital expenditure. 

As at 31 December 2020, Waypoint REIT owned  
470 properties valued at $2.9 billion, with an occupancy 
rate of 99.9% and a weighted average lease expiry 
(WALE) of 10.8 years. 

During the year, 263 of Waypoint REIT’s 
470 properties were independently 
valued, with the remainder subject 
to Directors’ valuations. The gross 
valuation uplift recorded for the 
portfolio in 2020 was $176.6 million, 
with the portfolio’s weighted average 
cap rate (WACR) compressing by 19bp 
from 5.81% at 31 December 2019 to 
5.62% at 31 December 2020.

Waypoint REIT invested $51.3 million 
in 2020 across five acquisitions and 
12 fund-through developments at a 
WACR of 6.4%. In addition, Waypoint 
REIT contracted to sell two non-core 
assets for a total price of $5.5 million, 
representing a 14.3% premium to the 
carrying value of these assets.

Management structure
Following the Viva Selldown in 
February 2020, agreement was  
reached in May 2020 with Viva Energy 
Australia for the internalisation 
(Internalisation) of Waypoint REIT’s 
management function. At this time, 
Viva Energy Australia’s nominee 
directors resigned from the Board, and 
an implementation agreement was 
executed providing a clear framework 
for the transition of management.

The Internalisation became effective 
on 1 October 2020, and all nine of 
the permanent employees previously 
employed by Viva Energy Australia 
to manage the vehicle accepted 
new employment contracts with 
the internalised Waypoint REIT on 
materially the same terms as their 
previous contracts.

Notwithstanding its exit from the 
Waypoint REIT register, Viva Energy 
Australia remains an important 
strategic partner, and we look forward 
to maintaining a strong landlord/tenant 
relationship with them moving forward.

Strategy
Waypoint REIT completed a strategic 
review in 2020, key highlights of which  
were presented to the market in 
February 2021.

This review identified a number of 
trends that we believe will impact the 
fuel and convenience sector over the 
long term, with the key ones being the 
transition to alternative fuels (electric 
vehicles or ‘EVs’) and the continued 
evolution of the convenience offer as a 
driver of site visitation and profitability.

By virtue of the long-term leases in 
place across our portfolio and our role 
as owner of the site freehold rather than 
leasehold operator, Waypoint REIT’s 
ability to directly influence on-site 
offerings is limited. This responsibility 
(and opportunity) sits primarily with the 
relevant operators, in Waypoint REIT’s 
case, the Viva Energy Australia/Coles 
Express Alliance. 

Accordingly, Waypoint REIT is seeking 
to address these long-term trends by 
concentrating our efforts in two areas: 

1.  Supporting our operators as  
capital partners as they evolve 
and adapt their offerings; we are 
currently in active dialogue with 
key stakeholders on potential 
opportunities across our portfolio.

2.  Making sure we own the ‘right’ 
sites through active portfolio 
management. In practice this  
means being selective in terms  
of the sites we buy and through  
the disposal of non-core sites,  
with the proceeds being recycled  
into higher-quality assets either  
via acquisition or by reinvesting  
in our core portfolio.

04

Waypoint REIT Limited – Annual Report 2020Another key element of Waypoint 
REIT’s strategy is an enhanced focus 
on ESG issues, and we are pleased  
to include an expanded Sustainability 
Report in this Annual Report (please 
refer to page 12).

We both look forward to working with 
the rest of the Board and management 
team to deliver on this strategy in 
2021 and beyond, and we remain 
committed to Waypoint REIT’s objective 
of maximising long-term income and 
capital returns for our investors.

Thank you for your ongoing support  
of Waypoint REIT.

Yours sincerely,

Laurence Brindle
Non-Executive Chair

Hadyn Stephens
Chief Executive Officer

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Shell Coles Express Milton QLD

05

Waypoint REIT Limited – Annual Report 2020 
 
 
 
 
 
 
 
 
 
Board of Directors

Our Board is committed 
to the high standards of 
corporate governance. 
Our corporate governance 
platform is integral to 
supporting our strategy, 
protecting the rights of our 
securityholders and creating 
sustainable growth. 

Corporate 
governance 
Our Corporate Governance 
Statement outlines our 
approach to governance, 
including the structure 
and responsibilities of 
our Board and various 
committees, and is available 
in the corporate governance 
section of our website at 
www.waypointreit.com.au/
investors.

2020 Corporate 
Governance Statement

06

Laurence Brindle
Independent Non-
Executive Chair, Chair of 
the Nominations Committee, 
Member of the Audit and 
Risk Management and 
Remuneration Committees.

Georgina Lynch
Independent Non-Executive 
Director, Chair of the 
Remuneration Committee 
and Member of the Audit 
and Risk Management and 
Nominations Committees.

Stephen Newton
Independent Non-Executive 
Director, Chair of the Audit 
and Risk Management 
Committee and Member 
of the Remuneration and 
Nominations Committees.

Georgina has over 26 years’ 
experience in the financial 
services and property 
industry. She is currently 
independent Non-Executive 
Chair of Cbus Property, Non-
Executive Director of Irongate 
Funds Management Limited 
and a member of their Audit 
and Risk and Remuneration 
Committees, and a Non-
Executive Director of Tassal 
Group Limited and a member 
of their Nominations and 
Remuneration Committees. 

Georgina has significant 
global experience in corporate 
transactions, capital raisings, 
initial public offerings (IPOs), 
funds management, corporate 
strategy and acquisitions  
and divestments.

Georgina holds a Bachelor  
of Arts and Bachelor of Laws.

Stephen has extensive 
industry experience spanning 
in excess of 40 years across 
real estate investment 
and funds management, 
development and property 
management, as well as in 
infrastructure investment and 
management. Stephen has 
been a Principal of Arcadia 
Funds Management for more 
than 18 years. Prior to that, 
Stephen held various senior 
executive positions at  
Lendlease Group over 22 years.

Stephen is currently a 
Non-Executive Director of 
Stockland Property Group, 
BAI Communications Group 
(formerly Broadcast Australia 
Group) and Sydney Catholic 
Schools Limited. Stephen  
was formerly a Director of 
Gateway Lifestyle Group.

Stephen is a member of 
both Chartered Accountants 
Australia and New Zealand 
and the Australian Institute of 
Company Directors. He holds 
a Bachelor of Arts (Economics 
and Accounting) degree from 
Macquarie University and a 
Masters of Commerce post-
graduate degree from the 
University of New South Wales.

Laurence has extensive 
experience in funds 
management, finance and 
investment and is currently 
independent Non-Executive 
Chair of National Storage REIT 
and a Non-Executive Director 
of Stockland Property Group. 

Until 2009, Laurence was an 
executive with Queensland 
Investment Corporation (QIC). 
During his 21 years with QIC, 
he served in various senior 
positions including Head of 
Global Real Estate, where he 
was responsible for QIC’s large 
global investment portfolio. 
Laurence was also a long-term 
member of QIC’s Investment 
Strategy Committee.

Laurence provides advice 
to a number of investment 
institutions on real estate 
investment and funds 
management matters. He is a 
former Chair of the Shopping 
Centre Council of Australia,  
and a former Director of 
Westfield Retail Trust and 
Scentre Group.

Laurence holds a Bachelor  
of Engineering (Honours)  
and a Bachelor of Commerce 
from the University of 
Queensland, and a Masters 
of Business Administration 
from Cass Business School, 
London, where he graduated 
with distinction.

Waypoint REIT Limited – Annual Report 2020Executive Leadership Team

Hadyn Stephens
Chief Executive Officer

Kerri Leech
Chief Financial Officer

Hadyn has over 20 years’ 
experience in finance and 
commercial real estate, 
including more than 15 years 
in strategy and transaction-
related roles in the real 
estate funds management 
space covering direct capital 
transactions, corporate 
transactions (merger and 
acquisitions), debt and equity 
(listed and unlisted).

Hadyn’s previous positions  
in real estate include senior 
roles with AMP Capital, Centuria 
Capital, LaSalle Investment 
Management, The GPT Group 
and Merrill Lynch.

Hadyn holds a Bachelor 
of Laws and Bachelor of 
Commerce from the University 
of Otago, New Zealand.

Kerri has over 19 years’ 
experience, listed and unlisted, 
working across a broad range 
of industries in Australia, the 
United States and Canada.

Prior to joining Waypoint REIT, 
Kerri spent over six years in 
various roles at Charter Hall, 
including her most recent 
role as Head of Finance for 
both the Charter Hall Long 
WALE REIT and Charter Hall’s 
Industrial business.

Kerri also spent 13 years with 
PricewaterhouseCoopers 
working in various roles in 
Australia and Canada, last 
as a Director in Financial 
Assurance (External Audit).

Kerri is a Chartered Accountant  
and holds a Bachelor of 
Commerce (Honours) from the 
University of Alberta, Canada. 
She is also a member of the 
Property Council of Australia’s 
Education Property and 
Precincts Committee.

Tina Mitas
General Counsel &  
Company Secretary

Tina has over 16 years’ 
experience in corporate law 
including corporate governance, 
compliance, mergers and 
acquisitions, private equity 
and information technology.

Tina’s previous positions 
include senior legal counsel 
roles at Aconex Limited and 
SMS Management Limited  
and senior associate at 
Herbert Smith Freehills.

Tina holds a Bachelor of  
Laws (Hons) and Bachelor  
of Commerce from the 
University of Melbourne and  
a Graduate Diploma in Applied 
Corporate Governance from 
the Governance Institute 
of Australia (GIA). Tina is 
a Chartered Secretary and 
Associate of the GIA, and  
is a member of the Institute  
of Chartered Secretaries  
and Administrators (ICSA).

Rodney Smith 
General Manager Property

Rodney has 19 years’ 
experience in property 
management, network 
planning and operations, 
having worked across  
Retail Fuel, Convenience  
and Downstream businesses 
for Shell and Viva Energy 
Australia in Australia as  
well as internationally.

Rodney’s previous positions 
include Operations Manager 
for Retail in Australia and 
New Zealand, Retail Network 
Planning Manager in Shell’s 
Oceania region, and Global 
Operation Excellence  
Manager for Shell Retail.

Immediately prior to 
commencing in this role 
in 2020, Rodney was the 
Development Project  
Manager at Waypoint REIT. 
Rodney holds a Bachelor  
of Commerce from the 
University of Tasmania.

07

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate DirectoryPortfolio Overview

Portfolio overview since IPO

As at 31 December

Number of properties

Property portfolio value

Total land area 

WACR 

NTA (reported as at) 

$ per security

Average value per property 

Metropolitan properties by property value 

$m

% 

IPO 
Aug 2016

no.

$m

425

2,105

2016

425

2,105

2017

438

2,281

2018

454

2,496

2019

469

2,652

2020

470

2,898

sqm 1,903,422 1,903,422

1,959,739

2,107,937 2,198,086

2,213,474

% 

5.9

2.00

5.0

76

5.9

2.02

5.0

76

5.8

2.12

5.2

76

5.8

2.20

5.5

75

5.8

2.29

5.7

73

5.6

2.49

6.2

72

Waypoint REIT is Australia’s largest 
listed REIT owning solely fuel and 
convenience retail properties.  
At 31 December 2020, the portfolio 
comprised 470 properties with a total 
valuation of $2.9 billion and weighted 
average capitalisation rate of 5.62%.

The portfolio is high-quality and 
geographically diversified in line with 
Australia’s population. It has been 
assembled over the last 100 years  
with many properties located in areas 
that would be almost impossible to 
secure again.

It covers 2.2 million square metres  
of real estate with 72% of properties  
by value located in metropolitan areas.

Occupancy as at 31 December 2020 
was 99.9%, with the majority of sites 
in the portfolio leased to Viva Energy 
Australia on long-term Triple Net 
leases5 with fixed 3% per annum6  
rental increases.   

Geographic diversification by value as at 31 December 2020

8 sites

1.2%

21.4%

99 sites

51 sites

9.0%

39 sites

5.2%

115 sites

28.1%

WA

NT

SA

QLD

NSW

ACT

VIC

TAS

31.1%

136 sites

2.2%

11 sites

1.7%

11 sites

% by value7

Number of sites

5.  37 of 484 leases (at the 470 properties in the portfolio) have Double Net leases.

6.  464 of 484 leases (at 470 properties in the portfolio) have fixed 3% or greater annual increases.

7.  Totals may not add due to rounding.

08

Waypoint REIT Limited – Annual Report 2020Waypoint REIT’s weighted average 
lease expiry was 10.8 years as at  
31 December 2020, with leases 
representing only 1.9% of income 
expiring before the end of 2025.

Waypoint REIT’s valuation policy 
requires independent valuations to  
be undertaken over a rolling three- 
year cycle. In 2020, 263 properties  
were independently valued (157 at  
30 June, and 106 at 31 December),  
and the balance of the portfolio  
was subject to Directors’ valuations 
resulting in a gross valuation increase 
of $176.7 million with the weighted 
average capitalisation rate tightening  
19 bps to 5.62% (2019: 5.81%).

As at 31 
December 
2020

Properties

Value 
($m)

Value 
(%)

Average 
land area  
(m2)

Average 
value 
($m)

WACR 
(%)

WALE 
(years)

Metropolitan

315 2,080.9

72

28

155

817.0

470 2,897.9

100

Regional

Total

3,712

6,736

4,710

6.6

5.3

6.2

5.26

6.55

5.62

11.0

10.3

10.8

Shell Redcliff WA

09

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate DirectoryPortfolio Overview continued

Lease expiry profile
Waypoint REIT has one of the longest WALEs in the S&P/ASX 200 REIT Index, currently standing at 10.8 years with only 17 leases 
expiring over the next five years (of which only five are with fuel tenants), representing approximately 1.9% of portfolio income. 
The first tranche of IPO lease expiries occur in FY26, with 39 leases expiring. The staggered lease expiry profile of the portfolio 
mitigates against renewal concentration risk and the impact of potential sector structural changes.

0%

5%

10%

15%

20%

25%

Leases
expiring8

% of income

Vacant

0.1

FY21

0.8

FY22

FY23

0.4

FY24

0.1

FY25

0.6

y
r
i
p
x
e
e
s
a
e

l

f
o
r
a
e
Y

FY26

FY27

FY28

FY29

FY30

FY31

FY32

FY33

FY34

FY35

0.6

FY36

0.9

FY37

FY38

FY39

0.2

4.1

6.4

7.4

7.4

6.7

10.3

14.2

17.0

22.8

2

5

0

4

2

6

39

44

44

37

35

55

67

70

70

2

3

0

0

1

8.  Four lease expiries shown in FY36-39 represent committed new leases or extensions at development sites, with lease terms contracted  

to commence upon Practical Completion of the respective development. 

10

Waypoint REIT Limited – Annual Report 2020 
 
 
Acquisitions
Waypoint REIT acquired five sites for $32.5 million with a WACR of 6.25% before acquisition costs.

Property

State

Location

Fuel Tenant

Lease Expiry

Purchase Price Cap Rate

439 Great Eastern Highway, Redcliffe

416 Princes Highway, Colac West

WA

VIC

Metro

Viva Energy Australia July 2034

$10.41m

Regional

Viva Energy Australia December 2034

$6.80m

25 Wills Road, Emerald

QLD

Regional

Liberty Oil Australia

October 2030

$2.83m

825 Mickleham Road, Greenvale (Land)

VIC

Metro

Viva Energy Australia  
– end tenant

Under development

$5.19m

15-year lease from 
completion of 
development) 

6.1%

6.8%

7.5%

5.5%

Lot 50 Mandurah Road, Meadow Springs WA

Metro

Ampol (formerly 
Caltex Australia)

September 2032

$7.28m

6.0%

Developments
Waypoint REIT invested $18.8m in development fund-through projects at 12 sites at a WACR of 6.7%.

Property

State

Location

Status

2020 Spend

Total Spend*

Cap Rate

555-557 Albany Highway, Albany

WA

Regional

Completed

120-124 Goldring Street, Richmond

QLD

Regional Completed

5 Princes Highway, Moruya

NSW Regional Completed

199-205 Charters Towers Road, Townsville QLD

Regional Completed

7-21 Shakespeare Street, Traralgon

80 Alfred Street, Warragul

VIC

VIC

Regional Completed

Regional Completed

6-8 Mackay Street, Griffith

NSW Regional

In progress

7-13 Burnett Highway, Biloela

QLD

Regional

In progress

47-55 Broad Street, Sarina

QLD

Regional

In progress

18316 Warrego Highway, Dalby West

QLD

Regional

In progress

825 Mickleham Road, Greenvale

10805 Brand Highway, Cataby

VIC

WA

Metro

In progress

Regional

In progress

$0.20m

$0.52m

$0.41m

$0.35m

$0.22m

$0.11m

$1.59m

$1.90m

$2.27m

$5.00m

$3.81m

$0.70m

* Includes expenditure prior to FY2020 and remaining contracted/committed expenditure for FY2021.

$4.50m

$6.30m

$5.10m

$3.50m

$5.40m

$3.00m

$4.90m

$5.37m

$3.30m

$5.00m

$3.81m

$1.33m

7.0%

7.0%

7.0%

7.0%

7.0%

7.0%

7.0%

7.0%

7.0%

7.0%

5.5%

7.0%

Disposals
Two assets sold for a combined value of $5.5 million at a yield of 5.41% and 14.3% premium to June 2020 carrying value.

Property

State

Location

Fuel Tenant

Lease Expiry

Sale Price

73 Pembroke Road, Minto

NSW Metro

Viva Energy Australia August 2026

Corner High Street and Smith Street, 
Maitland

NSW Metro

Viva Energy Australia August 2026

$2.96m

$2.55m

Yield

4.52%

6.44%

11

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate DirectorySustainability Report

The objective of our sustainability 
program is to operate our business  
in a way that is ethical, responsible  
and sustainable in the long term and  
in alignment with our values, strategy  
and the expectations of our employees, 
the communities in which we operate, 
and our external stakeholders. As part  
of this program, we also seek to support  
our tenants in their transition to a 
low-carbon future. This year we 
advanced our sustainability reporting 
by identifying the key focus areas that 
underpin our sustainability program 
and mapping them to the United 
Nations’ Sustainable Development 
Goals (UN SDGs). We have also 
established an environmental, social  
and governance (ESG) working group  
to coordinate and direct our priorities  
in this area.

Approach 
Waypoint REIT considers ESG as an 
integral part of its corporate philosophy.

We are committed to:

1.   The continuous improvement  

of the ESG aspects of our business. 

2.   Managing, minimising and 

mitigating (to the extent possible) 
the ESG-related risks associated 
with our business.

3.   Engaging and collaborating  
with our tenants and other 
stakeholders to influence positive 
change and drive mutually 
beneficial ESG outcomes.

4.   Being transparent about progress 

in this regard.

Our approach to sustainability considers  
the structure of our business and the 
passive nature of our business model 
as an investment trust. Specifically, 
our investment focus on leasing sites 
to fuel and convenience retailers 
presents additional specific ESG 
challenges associated with those 

sectors. However, this is also tempered 
by our predominant Triple Net leases, 
which limit our role in addressing these 
challenges relative to the role of our 
tenants. Our own direct ESG impacts 
are both relatively modest and local  
in their scope. 

We are committed to having broader 
discussions on these challenges with 
our tenants, particularly given the 
role our tenants play in the fuel and 
convenience retail industries and their 
impact on greenhouse gas emissions 
and related issues.

Governance structure
Our sustainability governance framework 
is designed to provide effective direction 
and oversight for our sustainability 
program. In 2020, Waypoint REIT 
expanded its governance structure 
to include an ESG Working Group 
with direct reporting responsibility to 
the Board. The ESG Working Group 
is responsible for bringing Waypoint 
REIT’s ESG strategy to life and for 
actioning ESG goals set by the Board.

12

Waypoint REIT Limited – Annual Report 2020ESG strategy
In 2020, our annual strategy review 
included a comprehensive review of 
ESG matters. The Board has adopted 
an ESG strategy focusing on the most 
material ESG topics facing Waypoint 
REIT today. The key focus areas 
covered in this sustainability report 
reflect the outputs of this materiality 
assessment. All of these focus areas 
are also considered as part of Waypoint 
REIT’s broader risk management 
framework, and as appropriate, are 
reflected in our risk appetite statement.

To date, Waypoint REIT has identified 
four key focus areas and will look to  
add further focus areas over time. 

These key focus areas are aligned  
to six of the United Nations’ 17 
Sustainable Development Goals.  
The UN SDGs underpin the 2030 
Agenda for Sustainable Development, 
adopted by all United Nations Member 
States in 2015, which provides a shared 
blueprint for peace and prosperity for 
people and the planet, now and into 
the future. It provides an urgent call for 
action by all countries – developed and 
developing – in a global partnership. 
They recognise that ending poverty 
and other deprivations must go hand-
in-hand with strategies that improve 
health and education, reduce inequality, 
and spur economic growth – all while 
tackling climate change and working  
to preserve our oceans and forests. 

This approach is consistent with that 
adopted by our main tenant, Viva Energy 
Australia, who we will be working with 
closely to further our ESG efforts.  
Viva Energy Australia aligns its focus 
areas to UN SDGs and some focus 
areas are common to both of our  
ESG strategies.

For each focus area, we have separately 
identified work streams that are in our 
direct control from those that we work 
on collectively with our tenants. 

A summary of our ESG strategy is set 
out in the table below. 

Focus area

Key matters

Impact Stakeholders

UN SDGs9 Actions to date 

Direct

Employees

•  Strong corporate governance and risk  

Ethical 
conduct and 
transparency

Governance

Compliance

Communities

Risk Management

Business partners

Securityholders

management models.

•  No significant governance incidents.

•  Adopted new corporate values that underpin our 

approach and response to sustainability focus areas.

•  Established ESG Working Group which reports to  

the Board.

•  Adopted Supplier Code of Conduct and Human 

Rights policy, including focus on modern slavery 
provisions.

Our people

Diversity and 
inclusion

Flexible working

Health and 
wellness

Remuneration

Climate change 
and energy

Climate risks and 
opportunities 

Energy efficiency

Direct

Employees

•  33% of Board and 67% of Executive KMP are female.

Securityholders

•  44% of staff on flexible work arrangements  

(pre COVID-19).

•  Successful working from home protocols during  

the pandemic.

•  Implemented Charitable Giving and Employee  

Assistance programs.

•  New LTI scheme encouraging performance,  
alignment of interests and staff retention.

Direct

Tenants

•  Climate impact assessment performed across  

Direct/
Indirect

Employees

Securityholders

Safety and 
environment

Personal and 
process safety

Spill prevention

Direct/
Indirect

Indirect

Employees

Tenants

Contractors

Communities

Government

9. https://sdgs.un.org/goals.

property portfolio.

•  Updated Corporate Investment Policy and acquisition 

checklist to specifically consider climate change impacts.

•  Sustainable design elements adopted across  

15 developments.

•  5+ NABERS office leases entered in Sydney  

and Melbourne.

•  Zero work-related injuries in 2020.

•  Under majority of lease terms, maintenance of fuel 
tanks and associated environmental responsibility 
resides with tenants.

•  96.8% of portfolio leased to Viva Energy Australia 
with strong corporate governance model around 
safety and the environment.

•  Reporting and appropriate oversight arrangements 
regarding Health, Safety and Environment in place  
with key tenants and contractors.

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Waypoint REIT Limited – Annual Report 2020 
 
 
 
 
 
 
 
 
 
 
Sustainability Report continued

Focused on delivering long-term sustainable returns for our investors

Values

Excellence

Doing our best, and 
always looking for 
ways to do better

Respect

Trust

Integrity

For our people, 
community, environment, 
customers and investors

Building and maintaining 
long-term relationships 
through our actions

Operating in an 
ethical manner that is 
transparent and honest

14

Waypoint REIT Limited – Annual Report 2020The majority of the actions completed 
in 2020 have been in relation to forming 
frameworks, policies and procedures to 
better govern and monitor ESG matters 
going forward. Some of the key actions 
and accomplishments are described in 
further detail below.

Our goal is to provide lasting social, environmental 
and economic benefits to society. We strive towards 
the implementation and maintenance of management 
systems for sustainable development that drive 
continual improvement. 

By adopting high standards we not  
only ensure our commercial success 
for our investors, but also earn the 
respect of our stakeholders, business 
partners and the communities in which 
we operate. 

Transparency
The Board has also adopted the following 
policies governing ethical conduct: 

•  Anti-Bribery and Corruption and  
Anti-Terrorism Financing Policy; 

•  Whistleblower Policy; 

•  Securities Trading Policy;

•  Diversity Policy; 

•  Disclosure Policy; and 

•  Investor Communications Policy. 

All Directors and employees are 
required to complete awareness training 
on these policies, with more advanced 
training provided depending on their 
role within the organisation. You can  
find more information on the above at 
www.waypointreit.com.au/investors.

2020 Corporate Governance 
Statement

We are also subject to several ESG 
corporate ratings and respond to 
information requests from such  
rating organisations where appropriate 
and feasible. 

In addition, we continue to support  
the recommendations of the Taskforce 
for Climate-related Financial Disclosure 
(TCFD) and intend to thoughtfully 
transition our reporting over time to be 
consistent with the TCFD framework. 

New in 2020
In 2020, Waypoint REIT adopted a 
Supplier Code of Conduct. Waypoint 
REIT encourages its suppliers and 
contractors to abide by and we 
endeavour to procure goods and 
services from those organisations 
demonstrating good ethical practices. 

Our commitment is to manage 
our operations and investments 
in line with the UN SGDs and the 
Australian Modern Slavery legislation. 
This commitment extends to our 
Directors, employees, contractors, 
sub-contractors, consultants and our 
suppliers, who we expect to comply 
with all applicable laws, regulations  
and standards when conducting 
business. Waypoint REIT adopted 
a Human Rights Policy in 2020 
demonstrating this commitment.

Modern slavery is a common umbrella 
term used to describe a range of 
extreme labour rights abuses, including 
slavery, servitude, human trafficking 
and forced or compulsory labour. 
Procuring goods ethically is not only a 
socially responsible business practice, 
it is now a regulatory requirement in 
Australia, following the enacting of  
the Commonwealth’s Modern Slavery 
Act 2018. In 2020, we reviewed our own 
labour practices and initiated a review 
of our supply chain and all Directors 
and senior management personnel 
attended a modern slavery training 
session delivered by a third-party 
provider. We will publish our Modern 
Slavery Statement on or before  
30 June 2021 in accordance with  
our legislative obligations.

Focus area 1: Ethical 
conduct and transparency 
Waypoint REIT is committed to 
operating our business in a way that  
is ethical, responsible and sustainable 
in the long term.

Values
Post the internalisation of management 
completed on 30 September 2020,  
the Board approved a refreshed 
statement of Waypoint REIT Values. 
These Values reflect what Waypoint 
REIT stands for and underpin our 
business and behaviours. 

Code of Conduct
Our Code of Conduct outlines how 
we expect our Directors, senior 
management, employees and any third 
party acting on our behalf to behave and 
conduct themselves in the workplace. 

Our goal is to provide lasting social, 
environmental and economic benefits 
to society. We strive towards the 
implementation and maintenance  
of management systems for 
sustainable development that drive 
continual improvement. 

Waypoint REIT’s key commitments  
to our community and the  
environment include: 

•  contributing to making the 

communities in which Waypoint REIT 
operates better places to live and  
do business;

•  being sensitive to local communities’ 
cultural, social and economic needs;

•  endeavouring to support ethical trade 

in our purchasing practices; 

•  operating a Charitable Giving Policy  
to assist the communities in which 
we operate; and 

•  protecting the environment in  

terms of Waypoint REIT’s use of 
resources and minimisation of waste 
and pollution.

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Waypoint REIT Limited – Annual Report 2020 
 
 
 
 
 
 
 
 
 
Sustainability Report continued

Focus area 2: Our people

Diversity
Waypoint REIT’s Diversity Policy 
describes our approach to diversity 
and the importance of diversity in 
contributing to growth, innovative 
thinking and overall success and 
our commitment to fostering and 
maintaining an inclusive workplace 
that respects individuals. The Diversity 
Policy is available on the Waypoint REIT 
website and its scope extends beyond 
gender and includes, but is not limited 
to, issues of gender, age, language, 
ethnicity, religious beliefs or cultural 
background, sexual orientation or 
preference, and family responsibilities. 

Waypoint REIT has adopted a 
methodology to establish measurable 
objectives for achieving gender 
diversity and, on an annual basis, to 
review these objectives and Waypoint 
REIT’s progress in achieving them. 

Our performance in 2020 reflects  
no change from the previous year.  
Both performance and targets for 2021 
are summarised in the table above.

We are committed to Board renewal 
and will actively seek well-qualified 
female candidates through a diverse 
interview panel whenever a Board 
vacancy becomes available. Please see 
our Corporate Governance Statement 
for further information on diversity  

 www.waypointreit.com.au/investors.

Culture and engagement
Both the Chief Executive Officer and 
Chief Financial Officer joined Waypoint 
REIT shortly before the COVID-19 
pandemic and worked with senior 
management to successfully cultivate 
a team culture focused on governance, 
risk management and inclusiveness, 
all while working remotely. Culture is 
reviewed periodically by the Board in 
conjunction with senior management, 
and given the small size of the team, 
the Board had the unique opportunity to 
interact with the majority of staff directly 
in some capacity during the year.

Flexible working
44% of staff were on flexible work 
arrangements (i.e. reduced days  
and/or hours, working remotely)  
before the COVID-19 pandemic.  
As a result, Waypoint REIT’s small  

Staff category

Waypoint REIT Board

Senior management

Employees

Males

Females

67%

50%

45%

33%

50%

55%

2021 target  
for females

33% 

50% 

50%

team successfully navigated the 
challenges posed by the COVID-19 
pandemic, in terms of both Waypoint 
REIT’s business and the impact on day-
to-day working conditions, with flexible 
working arrangements quickly adapted 
as required and no redundancies or 
reduced working hours required. 

Focus area 3: Climate 
change and energy
Our profits depend on the financial 
viability of our tenants, who predominantly 
operate in the fuel and convenience  
retail sectors, and on the ongoing 
lending capacity of our financiers. 

Disruptions to the supply and demand 
for traditional fuel, alternative fuels 
and/or convenience retail products, 
supply and demand for fuel and 
convenience retail properties and the 
availability and cost of credit (including 
sector-specific ESG considerations) can 
all in turn impact our business as well.

As the landlord of manufacturers  
and suppliers of hydrocarbon-derived 
products, we recognise that we have 
an important role to play in supporting 
the transition to lower carbon energies 
while at the same time facilitating the 
safe and reliable supply of traditional 
hydrocarbon fuels to motorists. Based on 
the ‘Projections for small-scale embedded 
technologies’ report issued by the CSIRO 
in June 2020 and other forecasts and 
projections reviewed, we do not consider 
these to present material short-term 
risks to our business. Given the systemic 
nature of such risks, however, we 
consider that these should be prudently 
monitored and assessed so that we 
can best prepare our business for the 
medium to long term. 

Risk type

Description

Waypoint REIT’s property portfolio  
has a weighted average lease expiry  
of 10.8 years, and the majority of leases 
have multiple option periods in place. 
This, coupled with 91.4% (by income)  
of our leases being on Triple Net terms  
provides a secure income stream to 
securityholders but limits management’s 
ability to monitor and reduce the 
environmental impact of our sites, as 
operational control and responsibility 
for a site’s environmental impact 
largely resides with our tenants.  
Noting our own direct environmental, 
social and governance impacts are 
both relatively modest and local in their 
scope, Waypoint REIT supports our 
tenants to the best of our ability under 
the lease terms in place to minimise 
the environmental impact of their 
operations on our sites.

Our risk management framework  
and related risk management policies 
and procedures are discussed in our 
Operating and Financial Review in  
the Directors Report (see page 21).  
Effective risk management is a core 
component of Waypoint REIT’s 
corporate governance. Waypoint REIT 
has a Risk Management Framework to 
identify, assess, manage and monitor 
and report key risks. The Board, via 
the CEO, is responsible for overseeing 
the establishment and implementation 
of the Risk Management Framework 
and for approving and monitoring 
compliance with the framework.

Climate-change risk is included in the 
risk register, which is communicated 
to the Audit and Risk Management 
Committee and the Board. Climate-
change risk is broadly divided into  
two categories below.

A. Transition Risk

Risks associated with an expected shift to a  
lower-carbon economy.

B. Physical Risk

Risks to our assets, including acute risks, such as intense 
weather events or fire risk increased by the change in 
climate, or chronic risks arising from longer-term shifts  
in climate and its effects, such as changes in sea levels.

16

Waypoint REIT Limited – Annual Report 2020p p o r t i n g  our operators

u

S

Adapt offering
over time

Optimise current
F&C offering

Facilitate
innovation and
sustainability

Sustainable
gearing

Maximise
long-term income
and capital returns

Selective
acquisitions

P

r
u
d
e

n

t

l

y

Disciplined
allocation
of capital

m

a

n

a

g

i

n

g

c

a

pital

Diversified
sources
of debt

Focus on
terminal
value/risks

o

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o
f
t
r
o
p
r
u

g o

Sell 
non-core
assets

c ti v ely  m anagin

A

A. Transition risk strategy

Strategy

Aim

Description/comments

Support our 
operators

Assist long-term viability/
success of our operators, 
primarily as a capital partner

• Optimise current offering (e.g. site redevelopments)

• Adapt offering over time (e.g. reconfiguration for addition of alternative fuels  

to site mix)

• Facilitate innovation and sustainability (e.g. electricity easements for EV 

charging stations)

• Selective acquisitions

• Non-core disposals

• Focus on long-term risks/returns (incl. underlying land value)

• Acquisition/disposal criteria to be refined over time as the sector evolves

• Sustainable gearing levels and diversified sources and tenor of debt

• Disciplined allocation of capital

• Evaluate capital management initiatives in context of investment opportunities

Actively 
manage  
our portfolio

Improve portfolio quality  
and increase likelihood  
of lease renewals at expiry

Prudently 
manage 
capital

Capital management  
strategy consistent  
with portfolio strategy

EV charging stations
Waypoint REIT has provided land- 
owner support to Viva Energy Australia 
with respect to the installation of 
350kw ultra-fast electric vehicle 
charging stations at selected sites. 
The pilot sites are expected to be 
constructed in the first half of 2021 
and will enable Viva Energy Australia 
to further understand the development 
of charging infrastructure, customer 
uptake trends and behaviours.

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Waypoint REIT Limited – Annual Report 2020 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report continued

Waypoint REIT is pleased to confirm  
all 15 developments have:

•  non-corrodible underground fuel 

systems;

•  automated tank gauging and spill 

containment systems;

•  energy efficient LED lighting;

•  monitorable power metering; and

•  recycling arrangements.

Further, 10 sites have drought-tolerant 
landscaping, six sites have solar panel 
installations and 13 sites offer bio-fuels 
as part of their fuel offering.

Office premises
Waypoint REIT has corporate offices 
based in Sydney and Melbourne. 
Both office buildings have NABERS 
5+ ratings, which assist to minimise 
Waypoint REIT’s direct carbon footprint.

Focus area 4: Safety  
and the environment

Safety
Waypoint REIT carefully considers the 
safety credentials of the tenants and 
parties with whom it deals with across 
its portfolio. This extends to ensuring 
alignment with tenants’ safe operating 
procedures when attending and working 
on sites across the portfolio, including 
with contractors engaged by Waypoint 
REIT to carry out any landlord works. 

Further, Waypoint REIT’s incident 
reporting protocols requires Waypoint 
REIT to confirm with tenants  
Waypoint REIT’s expectations on 
Work, Health, Safety or Environment 
matters. Incidents reported by tenants 
are managed under Waypoint REIT’s 
incident escalation protocols, and 
a summary of reported incidents is 
also reviewed by the Audit and Risk 
Management Committee on a minimum 
quarterly basis. 

B. Physical risk strategy
To better understand and address  
the physical risk of our portfolio, 
Waypoint REIT undertook the following 
activities in 2020:

Climate change Impact 
assessments
A consultant was engaged to 
undertake a Climate Change Impact 
Assessment to understand the physical 
and transition climate risks of the 
existing property portfolio as well as 
to inform about the risks associated 
with future property acquisitions. 
This process did not reveal any new 
material risks, and both our insurance 
coverage and maintenance capital 
expenditure programs were deemed 
adequate. While assets located in 
extreme temperature zones may 
experience shorter useful lives or 
higher maintenance costs, these costs 
are largely borne by our tenants given 
91.4% of leases are Triple Net.

Investment and due diligence
Our Investment and Due Diligence 
Policy and supporting acquisition 
checklists were revised to explicitly 
consider an asset’s exposure to certain 
physical climate risks, including extreme 
weather events such as floods, storms 
and hail as part of the investment 
considerations. 

Sustainable development 
assessments
Over the two-year period since 
Waypoint REIT commenced its 
sustainability reporting, it has invested 
$50 million across 15 fund-through 
development projects predominantly 
located in regional New South Wales, 
Queensland, Victoria and Western 
Australia. In 2020, we completed 
an assessment of sustainability 
design elements for each of these 
development projects focusing on  
the following key criteria:

•  Environmental protection;

•  Energy efficiency;

•  Water efficiency; and

•  Waste management.

Environmental responsibility
Properties in the portfolio are subject 
to various environmental standards, 
regulations and laws, which, from  
time to time, may give rise to  
liabilities in respect of the status  
and remediation of those properties. 
The main environmental risk 
associated with service stations is 
soil and groundwater contamination 
caused by fuel leaks. However, the 
lease attaching to the majority of sites 
requires the tenant to use reasonable 
endeavours to prevent contamination 
at each site and indemnify Waypoint 
REIT for any contamination caused  
by their operations.

If any property in the portfolio is 
contaminated by a fuel tenant or its 
invitee during the term of the lease, 
the tenant under that lease must 
remediate it, at their cost to a standard 
consistent with operating the site as 
a fuel and convenience property or 
similar commercial use. However, if 
the tenants were to fail to meet their 
obligations under these arrangements 
(including due to their insolvency), 
Waypoint REIT may incur significant 
costs to rectify contamination on its 
properties and on other properties  
that may consequently be impacted.

To minimise Waypoint REIT’s potential 
exposure, it ensures its fuel tenants 
are strong operators with a focus on 
environmental protection and personal 
safety. As at 31 December 2020, 96.8% 
of Waypoint REIT’s income was derived 
from Viva Energy Australia.

Viva Energy Australia is a sophisticated 
and experienced operator of service 
station infrastructure and has  
policies and procedures in place to 
minimise the risk of harmful fuel 
leaks, with a focus on early fuel-leak 
detection. Viva Energy Australia 
has in place a comprehensive Work, 
Health, Safety and Environment 
control framework and management 
system. Viva Energy Australia has 
also implemented spill prevention 
and control measures across all of 
its operations, including operational 
procedures, routine surveillance, 
risk-based inspection programs, and 
utilising leak detection technology.10

10. Viva Energy Australia Annual Report 2019.

18

Waypoint REIT Limited – Annual Report 2020Financial Report

Directors’ Report 

Remuneration Report 

Auditor’s Independence Declaration 

20

28

39

Consolidated Statement of Comprehensive Income  40

Consolidated Balance Sheet 

Consolidated Statement of Changes in Equity 

Consolidated Statement of Cash Flows 

41

42

43

Notes to the Consolidated Financial Statements 

1.  Performance and results 

2.  Property portfolio 

3.  Capital management 

4.  Additional information 

Directors’ Declaration 

Independent Auditor’s Report 

44

45

49

53

66

74

75

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19

Waypoint REIT Limited – Annual Report 2020 
 
 
 
 
 
 
 
 
 
Directors’ Report

The Directors of Waypoint REIT Limited (Company) and VER Limited (Responsible Entity), the responsible entity of Waypoint 
REIT Trust (Trust), present their report together with the financial statements of Waypoint REIT (Group) and the financial 
statements of Waypoint REIT Trust Group (Trust Group) for the year ended 31 December 2020. 

Waypoint REIT (Group) is a stapled group consisting of the Company and the Trust and their respective controlled entities. 
The financial statements of the Group comprise the Company, the Trust and their respective controlled entities.

The financial statements of the Trust Group comprise the Trust and its controlled entities. The portfolio of fuel and convenience 
retail properties are held by 100% controlled entities of the Trust.

Effective 14 May 2020, the Company was renamed from Viva Energy REIT Limited to Waypoint REIT Limited and the Trust was 
renamed from Viva Energy Trust to Waypoint REIT Trust. Refer to ‘Significant changes in state of affairs’ for further details.

The Company owns all of the shares in VER Limited (the Responsible Entity). 

Directors of Waypoint REIT Limited
The following persons were Directors of Waypoint REIT Limited during the year and up to the date of this report:

Laurence Brindle 

Independent Non-Executive Chair

Georgina Lynch 

Independent Non-Executive Director

Stephen Newton 

Independent Non-Executive Director

Jevan Bouzo 

Non-independent Non-Executive Director (resigned 14 May 2020)

Lachlan Pfeiffer 

Non-independent Non-Executive Director (resigned 14 May 2020)

Tina Mitas was appointed as Company Secretary on 15 May 2018 and continues in office at the date of this report.

Directors of VER Limited
The following persons were Directors of VER Limited during the year and up to the date of this report:

Laurence Brindle 

Independent Non-Executive Chair

Georgina Lynch 

Independent Non-Executive Director

Stephen Newton 

Independent Non-Executive Director

Lachlan Pfeiffer 

Non-independent Non-Executive Director (resigned 14 May 2020)

Tina Mitas was appointed as Company Secretary on 15 May 2018 and continues in office at the date of this report.

Principal activities
During the period, the principal activity of Waypoint REIT was investment in fuel and convenience retail property.

Waypoint REIT owns a large portfolio of fuel and convenience retail properties across all Australian states and mainland territories. 
The properties in the portfolio are leased on a long-term basis to Viva Energy Australia Pty Limited (Viva Energy Australia –  
a wholly owned subsidiary of Viva Energy Group) and other fuel and/or convenience retail operators.

Significant changes in state of affairs
Following Viva Energy Group’s sale of its entire 35.5% interest in the Group in February 2020, an implementation deed was 
executed on 14 May 2020, providing a clear framework for the internalisation of management to the Group, which was completed 
on 30 September 2020. In connection with the transaction, the Group paid a $2.5 million facilitation payment to Viva Energy Group 
and related expenses totalling approximately $3.3 million (including a $1.4 million expense in relation to a run-off insurance 
policy in favour of VER Manager and VER Limited). None of these non-recurring costs totalling $5.8 million form part of 
Distributable Earnings.

There were no other significant changes in the state of affairs of the Group that occurred during the period.

20

Waypoint REIT Limited – Annual Report 2020Distribution to securityholders
Distributions paid to or provided for during the period were as follows: 

Distributions paid in 2020

Final distribution for year ended 31 December 2019  
– 7.19 cents per security paid on 27 February 2020

Interim distribution for the six months ended 30 June 2020  
– 7.41 cents per security paid on 27 August 2020

Distributions paid in 2019

Final distribution for year ended 31 December 2018  
– 7.03 cents per security paid on 28 February 2019

Interim distribution for the six months ended 30 June 2019  
– 7.18 cents per security paid on 29 August 2019

Total distributions paid

2020  
$ million

2019  
$ million

56.0

57.9

–

–

113.9 

–

51.0

55.7

106.7 

The Group paid a distribution of 7.73 cents per security ($60.7 million) on 26 February 2021 for the six months ended 
31 December 2020.

Operating and financial review

Key highlights
Waypoint REIT is Australia’s largest listed REIT owning solely fuel and convenience retail properties with a high quality portfolio 
of properties across all Australian states and mainland territories. Waypoint REIT’s objective is to maximise the long-term income 
and capital returns from its ownership of the portfolio for the benefit of all securityholders.

Distributable Earnings increased by $6.8 million from $111.7 million in 2019 to $118.5 million in 2020 due to higher rental 
income from acquisitions and contracted rent reviews ($11.7 million) partially offset by lower finance income ($1.2 million), 
higher management and administration expenses ($1.0 million) and higher associated funding costs ($2.7 million).

Statutory net profit increased by $82.3 million from $197.6 million in 2019 to $279.9 million in 2020 largely due to higher 
Distributable Earnings ($6.8 million) and net valuation gains ($79.5 million) and lower derivative movements ($5.4 million) 
partially offset by lower straight-line rental income ($2.0 million) and higher borrowing cost amortisation ($1.7 million) 
and internalisation costs ($5.8 million).

The management expense ratio (MER) in 2020 was 0.30% (2019: 0.28%) with the increase attributable primarily to higher 
insurance and regulatory costs, additional compliance costs and non-recurring costs associated with management changes.

Gearing was 29.4%3 at 31 December 2020 (31 December 2019: 30.4%), just under the lower end of the revised target gearing 
range of 30% to 40%.

Net tangible assets per security at 31 December 2020 increased by 8.7% to $2.49 (31 December 2019: $2.29) largely due to net 
valuation gains on investment property.

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Operating and financial review continued

Key financial metrics

Statutory net profit after tax

Distributable Earnings1

Distributable EPS

Management expense ratio2

Total assets

Investment properties

Borrowings

Net assets

NTA per security

Gearing3

Covenant Gearing4

Year ended 
31 Dec 2020

Year ended 
31 Dec 2019

 $279.9 million

$197.6 million

 $118.5 million

$111.7 million

 15.15 cents

14.54 cents

0.30%

0.28%

As at 31 Dec 2020

As at 31 Dec 2019

$2,930.6 million

$2,718.1 million

 $2,897.3 million

$2,684.2 million

 $872.3 million

$846.7 million

$1,953.2 million

$1,782.9 million

$2.49

29.4%

32.1%

$2.29

30.4%

33.5%

1.   Distributable Earnings is a non-statutory measure of profit and is calculated as net profit adjusted to remove transaction costs, specific  
non-recurring items and non-cash items, including straight-lining of rental income, the amortisation of debt establishment fees and any 
fair value adjustment to investment properties and derivatives.

2.   Management expense ratio is calculated as the ratio of management and administration expenses (excluding net property expenses) over 

average total assets (excluding derivative financial assets). 

3.  Gearing is calculated as net debt (excluding foreign exchange and fair value hedge adjustments)/total assets excluding cash.

4.   Covenant Gearing is calculated as total liabilities/total assets but excluding any mark-to-market valuations of derivative assets/liabilities.  

This is the measure used to determine compliance with the Group’s gearing covenants.

Financial results

Rental income

Finance income

Total operating income

Management and administration expenses

Interest expense

Distributable Earnings

Gain/(loss) on valuation of investment properties

Straight-line rental income

Amortisation of borrowing costs

Interest rate swap termination/restructure expense

Loss on derivative financial instruments

Internalisation costs

Statutory net profit after tax

22

Year ended 
31 Dec 2020  
$ million

Year ended 
31 Dec 2019  
$ million

160.2

0.2

160.4

(9.3)

(32.6)

118.5

152.3

21.4

(2.7)

(3.5)

(0.3)

(5.8)

148.5

1.4

149.9

(8.3)

(29.9)

111.7

72.8

23.4

(1.1)

(9.2)

–

–

279.9

197.6

Waypoint REIT Limited – Annual Report 2020Investment property portfolio

Total value of investment properties

Total properties in portfolio1

Portfolio occupancy

Weighted average lease expiry

1.  Excludes four assets classified as held for sale.

31 Dec 2020

31 Dec 2019

$2,897.3 million

$2,684.2 million

470

99.9%

469

99.9%

10.8 years

11.7 years

During the year, five properties were acquired for $32.5 million at a WACR of 6.25% and $18.8 million was invested across 
12 development fund-through projects, with a further $0.6 million contracted or committed. Four properties were also re-classified 
to held for sale, including two properties contracted for sale in December 2020 at a $0.7 million premium to book value. Refer to 
‘Matters subsequent to the end of the financial year’ for further details.

Since listing on the ASX in 2016, approximately one-third of the Group’s property portfolio has been independently valued as at 
31 December each year. Due to the uncertainty caused by COVID-19, the Group independently valued approximately one-third 
of the portfolio at 30 June and approximately one-fifth of the portfolio at 31 December. In the absence of COVID-19 or other 
extenuating circumstances, the Group intends to have approximately one-sixth of the portfolio independently valued every 
six months going forward. 

Capital management
The Group’s Distribution Reinvestment Plan (DRP) is currently inactive, however, the Group raised $16.5 million from issuing 
6.4 million securities via the DRP during the year. 

On 31 May 2020, the Trust reallocated capital of $5.7 million to the Company in accordance with recent Constitutional amendments 
and in the ordinary course of business. This capital reallocation did not affect the number of shares on issue or the number of 
units held by securityholders and did not result in any cash distribution to securityholders.

In April 2020, consent to waive the review event triggered by Viva Energy Group’s sale of its 35.5% stake in the Group was received 
on $976.6 million of debt facilities in place at the time (89% of total debt). In connection with the review event, the terms of a 
$100 million bilateral facility were amended and a $20 million institutional term loan was repaid with an associated interest rate 
swap terminated at a cost of $3.5 million.

During the year, the Group refinanced $325 million of its revolving credit facilities on pricing generally consistent with existing 
bank debt. The Group also issued US$178 million (c.A$250 million) of USPP notes spread across seven, 10 and 12-year tranches 
at a weighted average maturity of 9.2 years and a weighted average margin of 2.81% over BBSY and entered associated cross 
currency swaps.

In June 2020, the Group extended interest rate swaps with a $196.5 million notional value to a five-year term maturing in 
August 2025, reducing the weighted average hedge rate from 2.1% to 1.88% and increasing the weighted average hedge maturity 
to 2.4 years. At 31 December 2020, 89% of the Group’s debt was hedged.

2021 outlook
The Group expects rental income from existing fuel and convenience retail tenancies to grow in line with contracted annual rental 
increases. The Group may consider opportunities to acquire new fuel and convenience retail properties that satisfy its investment 
objectives as well as the disposal of non-core assets. Further, the Group will continue to review its capital management strategy 
and opportunities for enhancement to the sources, pricing and tenor of funding.

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Matters subsequent to the end of the financial year
Subsequent to the end of the financial year:

•  The Victorian state government effected the compulsory acquisition of an asset held for sale with a carrying value of $6.8 million 
on 12 January 2021. Under the terms of the resumption, the Group is no longer entitled to collect rent from tenancies on the 
property from this date.

•  Settlement of two assets held for sale for total sale proceeds of $5.5 million occurred on 8 and 10 February 2021.

•  A distribution for the six months ended 31 December 2020 of $60.7 million was paid on 26 February 2021.

No other matter or circumstance has arisen since 31 December 2020 that has significantly affected, or may significantly affect:

•  the operations of the Group in future financial years; 

•  the results of those operations in future financial years; or

•  the state of affairs of the Group in future financial years.

Material business risks
The Group has reviewed its Risk Management Framework and amended the structure to include new risks associated with 
the internalisation of management, including human resources, employee safety and working practices as well as cyber security 
risks. No other material changes have been made to the structure of the framework; however, changes have been made to the 
way the framework is implemented in order to ensure appropriate risk management. These changes include ongoing monitoring 
and reporting of COVID-19 impacts to the Board. The Group’s Risk Appetite Statement has also been reviewed and updated by 
Management and the Board to reflect the impact of internalisation and COVID-19. The Responsible Entity also has a Compliance 
Plan which sets out the key processes, systems and measures that the Responsible Entity will apply in operating the Trust. 
The Compliance Plan, including a compliance management and reporting structure, was also updated in connection with the 
internalisation of management. 

The material business risks that could adversely affect the achievement of the Group’s financial prospects include the following:

Tenant concentration risk, financial standing and sector concentration risk
97% of the Group’s rental income is received from Viva Energy Australia. If Viva Energy Australia’s financial standing materially 
deteriorates, Viva Energy Australia’s ability to make rental payments to Waypoint REIT may be adversely impacted, which may 
have a material adverse impact on the Group’s results of operations, financial position and ability to service and/or obtain 
financing. Furthermore, a material decline in the profitability of Viva Energy Australia’s business could affect the perceived  
stability of the rental income of Waypoint REIT and may affect Waypoint REIT’s ability to obtain financing on acceptable terms.  
A material decline in the profitability of Viva Energy Australia’s business could also lead to reduced capacity or ability for  
Viva Energy Australia to pay market rents when renewal options are exercised, which could result in a decline in the values  
of Waypoint REIT’s investment properties. 

Collection risk
The Group performs financial due diligence on potential new tenants and holds collateral in the form of security deposits or 
bank guarantees where appropriate. Rent is due in advance on the first day of each billing period (typically monthly), with arrears 
monitored and arrears notices issued on a regular basis. The Group applies the AASB 9 simplified approach to measuring expected 
credit losses, which uses a lifetime expected loss allowance for all trade and other financial assets. The loss allowances for trade 
and other financial assets are based on assumptions about risk of default and expected loss rates. The Group uses judgement in 
making these assumptions, based on the Group’s past history and existing market conditions as well as forward-looking estimates 
at the end of each reporting period.

In excess of 99% of the Group’s income is derived from fuel tenants who have continued to operate through COVID-19, providing 
essential services to the community. Accordingly, the Group’s performance has not been materially impacted by COVID-19 to date with 
rental relief of $0.1 million agreed with seven non-fuel tenants (of which 50% has been waived and 50% deferred in accordance 
with the Commercial Code of Conduct). 

24

Waypoint REIT Limited – Annual Report 2020Re-leasing and vacancy risk
The Group’s total property portfolio is 99.9% occupied with only 19 leases (representing 2.0% of income) expiring before the end 
of 2025 and a weighted average lease expiry of 10.8 years. The majority of the portfolio is subject to multiple 10-year options 
in favour of the tenant, with the rent from commencement of each option period to either be agreed between the parties or 
set by independent market rent determination. However, there is a risk that tenants may not exercise their option, or that the 
commencing rent will be lower than passing rent and/or market rent (if agreed between the parties). Further, termination of 
Viva Energy Group’s right to use Shell branding (current agreement expires in 2026) and/or its Alliance Agreement with Coles 
Express (current agreement expires in 2029), could also impact Viva Energy Australia’s decision whether it renews its existing 
leases. Resulting vacancy or reduced rental income could negatively impact distributions of the Group and/or the value of the 
Group’s investment properties. 

Investment property value 
The value of the Group’s portfolio of investment properties may be adversely affected by a number of factors, including factors 
outside the control of the Group, such as supply and demand for traditional fuel, alternative fuels and/or convenience retail products, 
supply and demand for fuel and convenience retail properties, general property market conditions, the availability and cost of 
credit including sector-specific environmental, sustainability and governance considerations, the ability to attract and implement 
economically viable rental arrangements, Viva Energy Australia’s financial condition deteriorating, occupiers not extending the 
term of leases, capitalisation rates and general economic factors such as the level of inflation and interest rates. 

As changes in valuations are recorded on the statutory net profit statement, any decreases in value will have a negative impact 
on the statutory net profit statement and net tangible assets per security, and in turn the market price of the Group’s securities 
may fall. The property portfolio is geographically diversified to mitigate the risk of localised valuation impacts, and the majority 
of assets are located in metropolitan areas, which typically have higher underlying land values and alternative use potential. 
Active asset management, including the disposal of non-core assets, also, in part, mitigates this risk.

Environmental and climate risk
The Group depends on its tenants to perform their obligations under various environmental arrangements in relation to properties 
they lease. The Group has an indemnity from Viva Energy Australia in respect of certain liability for historical environmental 
contamination across 425 assets acquired at the time of the Group’s initial public offering. The Group also carries out environmental 
due diligence in relation to potential property acquisitions. If any property in the portfolio is contaminated by a fuel tenant or 
its invitee during the term of the lease, the tenant under that lease must remediate it, at their cost to a standard consistent 
with operating the site as a fuel and convenience property or similar commercial use. If the tenants were to fail to meet their 
obligations under these arrangements (including due to their insolvency), the Group may incur significant costs to rectify 
contamination on its properties and also on other properties which may be consequently impacted.

The Group is subject to a range of regulatory regimes (including environmental regulations) that cover the specific assets of the 
Group and how they are operated. These regulatory regimes are subject to ongoing review and change that may increase the cost 
of compliance, reporting and maintenance of the Group’s assets. There remains a risk (for example, where the regulator is unable 
to pursue the polluter, the polluter cannot be identified or the polluter is unable to meet its obligations) that the Group, as owner 
of the properties in the portfolio, may face liability for breach of environmental laws and regulations.

Extreme weather and other climate change-related events have the potential to damage the Group’s assets and disrupt the tenants’ 
operations. Such events may increase costs for maintenance and insurance of the Group’s assets, and may affect the ability to 
re-lease the Group’s investment properties in the future and the rent levels for which they can be leased, thereby affecting future 
investment property valuations and rental cash flows. Insurance premiums and/or deductibles may change or insurance may 
not be able to be obtained at all. 

The precise nature of these risks is uncertain as it depends on complex factors such as policy change, technology development, 
market forces, and the links between these factors and climatic conditions. 

AFSL compliance risk
VER Limited, a subsidiary of Waypoint REIT Limited, holds an Australian Financial Services Licence (AFSL) and acts as the responsible 
entity for Waypoint REIT Trust. The AFSL requires, among other matters, minimum levels of net tangible assets, liquid assets, 
cash reserves and liquidity, which may restrict the Group in paying distributions that would breach these requirements.

The Directors review and monitor VER Limited’s balance sheet quarterly and the adequacy and ongoing training of responsible 
managers annually to ensure compliance with its AFSL requirements.

25

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate DirectoryDirectors’ Report continued

Material business risks continued

Personnel risk
Loss of key personnel could potentially have an adverse impact on the management and the financial performance of the 
Group and in turn may affect the returns to securityholders. To mitigate this risk, processes and procedures are standardised 
and automated to the extent practicable, succession planning is undertaken and remuneration structures include components 
payable on a deferred basis to reduce key personnel risk.

Cyber security risk
Cyber-attacks are becoming increasing sophisticated and a material data breach could have an adverse financial or reputation 
impact. To help mitigate this risk, the Group uses the services of third party technology experts, provides regular staff training 
and performs pre-implementation and annual reviews over key Software as a Service (SaaS) providers.

Debt agreement and refinancing risk
The Group has outstanding debt facilities. General economic and business conditions as well as sector-specific environmental, 
sustainability and governance considerations that impact the debt or equity markets could impact the Group’s ability to refinance 
its debt facilities when required. If the covenants in these facilities are breached by the Group, this may result in the Group being 
subject to increased interest rate margins and covenants restricting its ability to engage in certain types of activities or to pay 
distributions to securityholders. Debt may not be able to be obtained at all.

If debt facilities are not available or are not available in adequate volume, the Group may need to sell assets to repay debt. 
There is no guarantee that there will be willing purchasers for the Group’s assets or that purchasers will pay prices at or greater 
than book value of these investment properties. To help mitigate this risk, debt maturities are staggered, debt is held across a 
diverse set of sources, lenders and geographies, and debt is typically refinanced at least 12 months in advance of maturity.

If a third party entity gains control of Waypoint REIT, then this would constitute a review event under certain of the Group’s debt 
facility agreements, and (subject to specified negotiation and notification periods) a repayment of the Group’s debt facilities may 
be required. 

The Directors regularly monitor the debt facility covenants to ensure compliance and consider the refinancing options and timing 
available to the Group.

Cash flow and fair value interest rate risk 
The Group’s cash and cash equivalents, floating rate borrowings and interest rate swaps expose it to a risk of change in fair value 
or future cash flows due to changes in interest rates. The Group uses floating-to-fixed interest rate swaps to partially hedge its 
exposure to changes in interest rates on variable rate borrowings. By hedging against changes in interest rates, the Group has 
reduced exposure to changes in interest rates on its outward cash flows so long as the counterparties to those interest rate 
swaps meet their obligations to the Group. 

Foreign exchange rate risk 
A portion of the Group’s debt is denominated in US dollars and as a result, the Group is exposed to a risk of change in fair value 
or future cash flows due to changes in foreign exchange rates. The Group economically hedges 100% of its exposure to changes 
in foreign exchange rates by using cross currency swaps. By hedging against changes in foreign exchange rates, the Group 
eliminates its exposure to changes in foreign exchange rates on its outward cash flows so long as the counterparties to those 
cross currency swaps meet their obligations to the Group. 

Liquidity risk
Liquidity risk is the risk that the Group may not be able to generate sufficient cash resources to settle its obligations in full as 
they fall due or can only do so on terms that are materially disadvantageous. The Group monitors its exposure to liquidity risk 
by setting budgets and projecting cash flows to help ensure there is sufficient cash on hand as required or debt facility funding 
is available to meet financial liabilities as they fall due. 

Environmental regulation
As a landlord, the operations of the Group are subject to a range of environmental laws and regulations under Commonwealth, 
state and territory law. However, the lease attaching to the majority of sites requires the tenant to use reasonable endeavours 
to prevent contamination at each site and indemnify the Group for any contamination caused by their operations.

The Group did not receive any environmental infringements or notices from environmental regulators in the year ended 
31 December 2020.

26

Waypoint REIT Limited – Annual Report 2020Information on Directors and Officers

Laurence Brindle

Independent Non-Executive Chair, Chair of the Nomination Committee, Member of the Audit and Risk Management 
and Remuneration Committees.
Laurence has extensive experience in funds management, finance and investment and is currently independent Non-Executive 
Chair of National Storage REIT and a Non-Executive Director of Stockland Property Group. 

Until 2009, Laurence was an executive with Queensland Investment Corporation (QIC). During his 21 years with QIC, he served 
in various senior positions including Head of Global Real Estate, where he was responsible for QIC’s large global investment 
portfolio. Laurence was also a long-term member of QIC’s Investment Strategy Committee.

Laurence provides advice to a number of investment institutions on real estate investment and funds management matters. 
He is a former chair of the Shopping Centre Council of Australia and a former Director of Westfield Retail Trust and Scentre Group.

Laurence holds a Bachelor of Engineering (Honours) and a Bachelor of Commerce from the University of Queensland, and a Masters 
of Business Administration from Cass Business School, London, where he graduated with distinction.

Georgina Lynch

Independent Non-Executive Director, Chair of the Remuneration Committee and Member of the Audit and Risk 
Management and Nomination Committees.
Georgina has over 26 years’ experience in the financial services and property industry. She is currently independent Non-Executive 
Chair of Cbus Property, Non-Executive Director of Irongate Funds Management Limited and a member of their audit and risk 
and remuneration committees, and a Non-Executive Director of Tassal Group Limited and a member of their nominations and 
remuneration committees. 

Georgina has significant global experience in corporate transactions, capital raisings, initial public offerings (IPOs), funds management, 
corporate strategy and acquisitions and divestments.

Georgina holds a Bachelor of Arts and Bachelor of Laws.

Stephen Newton

Independent Non-Executive Director, Chair of the Audit and Risk Management Committee and Member 
of the Remuneration and Nomination Committees.
Stephen has extensive industry experience spanning in excess of 40 years across real estate investment and funds management, 
development and property management, as well as in infrastructure investment and management. Stephen has been a Principal 
of Arcadia Funds Management for more than 18 years. Prior to that, Stephen held various senior executive positions at Lend Lease 
over 22 years.

Stephen is currently a Non-Executive Director of Stockland Property Group, BAI Communications Group (formerly Broadcast 
Australia Group) and Sydney Catholic Schools Limited. Stephen was formerly a Director of Gateway Lifestyle Group.

Stephen is a member of both Chartered Accountants Australia and New Zealand and the Australian Institute of Company Directors. 
He holds a Bachelor of Arts (Economics and Accounting) degree from Macquarie University and a Masters of Commerce post-
graduate degree from the University of New South Wales.

Tina Mitas

Company Secretary
Tina has over 16 years’ experience in corporate law including corporate governance, compliance, mergers and acquisitions, 
private equity and information technology.

Tina’s previous positions include senior legal counsel roles at Aconex Limited and SMS Management Limited and senior 
associate at Herbert Smith Freehills.

Tina holds a Bachelor of Laws (Hons) and Bachelor of Commerce from the University of Melbourne and a Graduate Diploma 
in Applied Corporate Governance from the Governance Institute of Australia (GIA). Tina is a Chartered Secretary and Associate 
of the GIA and is a member of the Institute of Chartered Secretaries and Administrators (ICSA).

27

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Meetings of Directors
The numbers of meetings of the Directors and of each Board Committee held during the year ended 31 December 2020, 
and the numbers of meetings attended by each Director were:

Waypoint REIT 
Limited

VER Limited

Audit and Risk 
Management 
Committee

Remuneration 
Committee*

Nomination 
Committee*

Independent 
Board 
Committee

Name

Laurence Brindle

Georgina Lynch

Stephen Newton 

Jevan Bouzo**

Lachlan Pfeiffer**

A

16

16

16

8

8

B

16

16

16

8

8

A

16

16

16

8

8

B

16

16

16

8

8

A

6

6

6

1

1

B

6

6

6

1

1

A

3

3

3

0

0

B

3

3

3

0

0

A

1

1

1

0

0

B

1

1

1

0

0

A

6

6

6

0

0

B

6

6

6

0

0

A = Number of meetings attended.

B = Number of meetings held during the time the Director held office or was a member of the committee during the year.

* = Committee formed on 1 October 2020 following the internalisation of Management.

** = Resigned 14 May 2020.

Remuneration report
This remuneration report (Remuneration Report) presents Waypoint REIT’s remuneration arrangements for Key Management 
Personnel (KMP) for the year ended 31 December 2020. The report has been prepared and audited in accordance with the 
requirements of the Corporations Act 2001 and Corporations Regulations 2001.

Letter from Chair of the Remuneration Committee
On behalf of the Remuneration Committee and the Board, I am pleased to present the Remuneration Report for the year ended 
31 December 2020. 

2020 Remuneration framework
Waypoint REIT’s remuneration priorities in 2020 were driven by the internalisation of the management function previously 
undertaken by VER Manager Pty Limited (Manager), which took effect from 1 October 2020 (Internalisation). Prior to 
1 October 2020, all employees involved in the management of Waypoint REIT were employed under employment contracts 
with Viva Energy Australia Pty Limited, the parent entity of the Manager. As part of the Internalisation, all permanent 
employees accepted new employment contracts with Waypoint REIT (on materially the same terms as their previous contracts), 
effective 1 October 2020. 

Prior to the Internalisation, a nomination and remuneration committee was not in place on the basis that neither the Company 
nor the Trust had any employees (other than the Directors), and the senior executives of the Manager were employed and 
remunerated by Viva Energy Australia Pty Limited. The Directors considered nomination and remuneration matters from 
time to time at their regularly scheduled Board meetings during this period.

Formation of Remuneration Committee
Following the Internalisation on 1 October 2020, Waypoint REIT’s Remuneration Committee, comprised of independent Directors, 
was formed. The Remuneration Committee makes recommendations on remuneration policies and practices (including long-term 
incentive and short-term incentive plans; gender diversity; remuneration budget, annual salary reviews and Non-Executive Director 
remuneration) to Waypoint REIT’s Board. 

Waypoint REIT’s Board and Remuneration Committee are responsible for overseeing remuneration policy for Waypoint REIT. 
Specific responsibilities of the Board and the Remuneration Committee are detailed in their respective Charters, which are 
available on the Waypoint REIT website at www.waypointreit.com.au.

28

Waypoint REIT Limited – Annual Report 20202020 Remuneration considerations
While COVID-19 impacted Waypoint REIT’s operating environment, Waypoint REIT’s performance was not materially impacted 
as the vast majority of its income is generated from long-term leases with well-capitalised tenants that continued to provide 
essential services throughout 2020. The Board is particularly pleased that Waypoint REIT was able to collect 99.9% of rent 
due during the year, whilst at the same time supporting the seven non-fuel tenants that qualified for rent relief under the Federal 
Government’s Commercial Code of Conduct implemented through state legislation. Waypoint REIT also did not request or receive 
JobKeeper payments during 2020. 

Waypoint REIT’s small team successfully navigated the challenges posed by COVID-19 in terms of both Waypoint REIT’s business 
and the impact on day-to-day working conditions, with flexible working arrangements quickly adapted as required and no redundancies 
or reduced working hours required. 

The key challenges and achievements for Waypoint REIT in 2020 included:

•  New Management Team: Both the Chief Executive Officer and Chief Financial Officer joined Waypoint REIT shortly before the 

pandemic and worked with the other executives to successfully cultivate a team culture focused on governance, risk management 
and inclusiveness, all whilst working remotely.

•  Review Event: In February 2020, Viva Energy Australia’s sale of its 35.5% interest held in Waypoint REIT triggered a review event 

across the $1 billion debt portfolio of Waypoint REIT. Dealing with this review event as debt and capital markets became more 
uncertain due to the impacts of COVID-19 was challenging. Management successfully managed the review event by obtaining 
consent from 89% of lenders with debt facilities in place at the time. 

•  Debt Capital Markets: In addition to successfully refinancing $325 million of debt facilities during the height of COVID-19 

uncertainty, Management completed Waypoint REIT’s inaugural ~$250 million US private placement (USPP) issuance. The USPP 
issuance was achieved working remotely and dealing with all counterparties remotely. These combined transactions extended 
the weighted average debt maturity to 4.3 years and further diversified Waypoint REIT’s debt sources. 

•  Internalisation: Management successfully negotiated and completed the Internalisation one month ahead of the effective 

date agreed with Viva Energy Australia. The Internalisation largely comprised the establishment of stand-alone IT and payroll 
functions (and associated data migration) and corporate policies.

•  Portfolio Management: Waypoint REIT completed $51.3 million of acquisitions and fund-through development expenditure 
and entered unconditional contracts to sell $5.5 million of non-core assets. Management has conducted a thorough review 
of Waypoint REIT’s portfolio and has put in place a strategy that will better position the vehicle to deliver on its objective of 
maximising the long-term income and capital returns from its ownership of the portfolio.

Despite the challenges presented in 2020, Waypoint REIT delivered Distributable EPS of 15.15 cents, representing growth of 
4.25% on 2019. This result was at the top end of Waypoint REIT’s upgraded growth guidance of 4-4.25% and significantly higher 
than its initial growth guidance of 3-3.75%.

In light of these achievements, the Board has awarded Executive Key Management Personnel (Executive KMP) their maximum 
short-term incentive (STI) awards for the year ended 31 December 2020. 

2021 Remuneration framework
The Board recognises that the key to our ongoing success lies in retaining and attracting high-performing people. Accordingly, 
following Internalisation, the Remuneration Committee undertook a comprehensive review of Waypoint REIT’s remuneration 
policy and underlying executive remuneration, supported by input on market practice insights and trends in relation to executive 
remuneration approaches from an external remuneration consultant. This review was undertaken in consideration of the new 
internalised management structure and to ensure our remuneration framework is aligned with the best practice remuneration 
principles. No remuneration recommendations were made by the remuneration consultant and advice provided represents just 
one of many inputs the Remuneration Committee uses to make remuneration decisions.

The Board believes that the outcomes achieved over the 2020 year have demonstrated that the new executive team has brought 
new standards of executive performance to Waypoint REIT.

It is important that there is good alignment between executive pay and securityholder value and that our remuneration framework 
is designed to link Waypoint REIT’s strategy and performance with the remuneration outcomes for Executive KMP.

Following its review of market practice and benchmarks, the Remuneration Committee determined that adjustments to the 
structure of Executive KMP remuneration including the balance between fixed and ‘at risk’ pay components and devices designed 
to encourage retention of Executive KMP were required in order to better align Executive KMP with market benchmarks and 
securityholder expectations. 

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Remuneration report continued
Key changes to the remuneration framework for 2021 are as follows:

•  Fixed Annual Remuneration (FAR) for Executive KMP has been reviewed, resulting in the following changes:

Hadyn Stephens

Kerri Leech

Tina Mitas

2020

2021

$500,000

$550,000

$350,000

$400,000

$208,000

$244,000

•  The STI plan has been amended to require the deferred portion of the CEO’s STI to be delivered in securities rather than cash. 

The portion of the CEO’s STI subject to deferral (50%) and the deferral time period (25% for 12 months and 25% for 24 months) 
remain unchanged. The STI plan has been further amended to require 33% of STI awarded to other Executive KMP to be issued 
in securities with a 12-month deferral period. A new balanced scorecard approach will be introduced to set and measure 
employees’ STI, aligned to the key financial and non-financial value drivers of our business. Details will be included in the 2021 
Remuneration Report.

•  An equity-based long-term incentive (LTI) plan will be introduced, with a three-year performance period. 50% of the LTI will be 

based on Total Securityholder Return (TSR) relative to constituents of the S&P/ASX300 A-REIT index and 50% will be based on 
growth in Distributable EPS (50%). Consistent with best market practice, details of the Chief Executive Officer’s (CEO) LTI grant 
will be put forward for securityholder approval at our upcoming 2020 Annual General Meeting.

I hope you find this Remuneration Report informative and on behalf of the Directors and the Remuneration Committee, I look 
forward to welcoming you and receiving your feedback at our 2020 Annual General Meeting.

Georgina Lynch
Chair, Remuneration Committee

30

Waypoint REIT Limited – Annual Report 2020 
Report structure
This report is divided into the following sections:

(i)  Key Management Personnel

(ii)  Remuneration Policy for Executive KMP

(iii)  Details of Executive KMP Remuneration and other information

(iv)  Remuneration Policy for Non-Executive Directors

(v)  Details of Non-Executive Director Fees and other information

(i)  Key Management Personnel 
This report discloses the remuneration arrangements and outcomes for the individuals listed below, being individuals who have 
been determined as KMP as defined by AASB 124 Related Party Disclosures.

Name

Directors

Independent Non-Executive

Laurence Brindle

Georgina Lynch

Stephen Newton

Non-Independent Non-Executive

Jevan Bouzo

Lachlan Pfeiffer

Executive KMP

Hadyn Stephens

Kerri Leech

Tina Mitas

* Date of Internalisation.

Role

Chair

Director

Director

Director

Director

KMP period

Full Year

Full Year

Full Year

Resigned 14 May 2020

Resigned 14 May 2020

Chief Executive Officer (CEO)

Chief Financial Officer (CFO)

From 1 October 2020*

From 1 October 2020*

General Counsel & Company Secretary 

From 1 October 2020*

(ii)  Remuneration Policy for Executive KMP

Introduction
Prior to 1 October 2020, all employees involved in the management of Waypoint REIT were employed under employment contracts 
with Viva Energy Australia Pty Limited, the parent entity of the Manager. Following Internalisation, all employees accepted new 
employment contracts with Waypoint REIT on materially the same terms as their previous contracts.

From time to time, the Remuneration Committee may seek external remuneration advice to ensure that it is fully informed 
when making decisions, including on recent market trends and practices and other remuneration-related matters. Remuneration 
consultants are engaged directly by the Remuneration Committee as needed. In 2020, no remuneration recommendations were 
received from remuneration consultants as defined under the Corporations Act 2001. 

Remuneration objectives and structure
The table below sets out the objectives and structure of Waypoint REIT’s Executive KMP remuneration arrangements for the 
whole of 2020. 

The remuneration arrangements in place prior to Internalisation were established by the Manager in consultation with the 
Waypoint REIT Board as required under the management agreement with the Manager. The Board determined it was appropriate 
to leave the remuneration arrangements in place immediately prior to Internalisation on materially the same basis for the 
remainder of the 2020 financial year. 

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Remuneration report continued
The arrangements in place for 2020 are summarised in the table below:

Remuneration type

What?

Why?

FAR

STI

Comprises base salary, superannuation 
contributions and other benefits.

Cash-based award, subject to specific 
performance and employment conditions.

Fixed component set with reference to role, 
market, experience and skill-set to attract and 
retain the executives capable of leading and 
delivery the strategy.

‘At risk’ component designed to maximise 
performance in key strategic areas detailed in 
each executive’s Key Performance Indicators 
(KPIs) with employment conditions designed 
to encourage retention.

Short Term Incentive
In 2020, STI awards were recommended by the Remuneration Committee and endorsed by the Board. Details are included in  
the table below.

Basis

Each executive may be eligible for participation in an STI program, which may be amended, replaced or 
withdrawn at any time at the Board’s absolute discretion.

Purpose

Performance 
conditions

Performance 
assessment

STI awards are set with reference to a maximum STI opportunity level relative to the executive’s FAR, 
with the actual STI award to be determined based on performance against KPIs determined by the Board.

To motivate and reward executives for increasing securityholder value by meeting or exceeding Waypoint 
REIT and individual targets determined by the Board.

The value of the STI award for each Executive KMP is determined having regard to the financial performance 
of Waypoint REIT and achievement against the KPIs agreed at the start of the year. The general elements 
and performance criteria for the Executive KMP are detailed in the following pages.

The CEO evaluates the performance of the other Executive KMP against their KPIs and other applicable 
measures. This information is presented to the Remuneration Committee, which performs the same 
evaluation of the CEO performance. The Remuneration Committee then recommends the STI awards, 
if any, to the Board for approval.

Board discretion

Entitlements are at the sole discretion of the Board. Waypoint REIT can amend, replace or withdraw 
any incentive program in its absolute discretion. 

Cessation of 
employment

An Executive KMP will generally not be entitled to be paid an STI award if they resign or if their employment 
is terminated with cause.

32

Waypoint REIT Limited – Annual Report 2020Performance indicators 
The Remuneration Committee and Board aim to align Executive KMP remuneration with Waypoint REIT’s strategic and business 
objectives and the creation of securityholder wealth. The table below shows statutory and alternative measures of Waypoint 
REIT’s financial performance since its initial public offering in 2016. Statutory measures are not necessarily consistent with 
the measures used in determining the variable amounts of remuneration to be awarded to Executive KMP as noted above. 
Consequently, there may not always be a direct correlation between the statutory key performance measures and the variable 
remuneration awarded.

Statutory profit ($’m)

Distributable earnings2 ($’m)

Basic earnings per security (cents)

Distributable earnings per security2 (cents)

Distributions paid/payable (cents)

Closing security price (31 December)

Net tangible assets per security3

Weighted average securities on issue

1.  Period from 3 August to 31 December.

2.  Distributable earnings is unaudited.

20161

1.0

36.5

0.14

5.28

5.28

$2.40

$2.02

690.2

2017

170.5

95.0

23.08

13.41

13.20

$2.26

$2.12

708.2

2018

167.1

101.7

21.34

14.02

14.02

$2.25

$2.20

725.7

2019

197.6

111.7

25.72

14.54

14.37

$2.66

$2.29

768.4

2020

279.9

118.5

35.79

15.15

15.14

$2.73

$2.49

782.0

3.  Net tangible assets per security include the impact of the fair value movements. 

2020 STI outcomes
The following table sets out the awards made to each Executive KMP based on their performance during the year ended 
31 December 2020.

$

Hadyn Stephens

Kerri Leech

Tina Mitas**

FAR as per 
contract*

Maximum STI 
as per contract

Actual STI 
awarded

500,000

350,000

208,000

500,000

210,000

83,200

500,000

210,000

100,000

% of maximum 
possible current 
award earned

100

100

120

*  FAR is inclusive of superannuation and presented as at 31 December 2020 on an annualised basis.

**   Tina Mitas works four days per week. Ms Mitas’ FAR and Maximum STI are based on 0.8 Full-time Equivalent (FTE). Ms Mitas’ Actual STI 

and % of Maximum reflect a pro rata payment of a higher bonus to reflect additional days worked during the financial year over and above her 
contractual obligation.

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Remuneration report continued
2020 STI annual assessment
Executive KMP 2020 Key Performance Indicators (KPIs) were initially set under their previous employment arrangements with 
Viva Energy Australia in consultation with the Waypoint REIT Board under the terms of the management agreement with the 
Manager. These KPIs remained in place upon Internalisation with additional KPIs added in relation to achieving a successful 
Internalisation. The resulting KPIs were assessed and reviewed by the Remuneration Committee and Board. 

The annual assessments for the CEO and other Executive KMP are similar but with different emphasis and KPIs applicable 
to their individual roles. KPIs for Executive KMP in 2020 varied from person to person; however, the key KPIs driving the 
Remuneration Committee and Board’s decision to award the 2020 STIs were as follows:

Category

Financial performance

•  Achieve DPS in line with guidance approved 

by the Board

Performance detail

•  Waypoint REIT delivered Distributable Earnings 
growth per security of 4.25%, at the top end of 
the revised guidance range of 4-4.25% announced 
in August 2020 and in excess of the original 
guidance range of 3-3.75% set at the start of 
the year.

Result

Above target

Financial and capital management

•  Inaugural $248 million USPP issuance  

Above target

•  Diversify debt sources

•  Optimise bank debt facilities

•  Extend debt maturity

•  Manage liquidity to support the delivery 

of Waypoint REIT’s strategy

completed in August 2020.

•  $325 million of bank debt refinanced during the 

year on pricing generally consistent with existing 
bank debt.

•  Weighted average debt maturity extended from 

2.9 years to 4.3 years.

•  Consent to waive the review event caused by 

Viva Energy Australia’s sale of its 35.5% interest in 
Waypoint REIT obtained from lenders representing 
89% of debt in difficult market conditions.

Property portfolio

•  $51.3 million of acquisitions and development 

Target met

•  Deliver acquisitions in line with approved criteria 

fund-through expenditure completed.

and targets, as amended from time to time

•  Entered contracts to sell $5.5 million  

•  Strategically review portfolio for value-add 

and risk mitigating opportunities

of non-core assets.

Corporate strategy

•  Review completed and presented to the Board  

Target met

•  Review Waypoint REIT strategy and recommend 

in November 2020.

changes as appropriate

•  Communicated revised strategy to securityholders 

with 2020 results

Corporate governance and compliance

•  Implemented effective and comprehensive 

Target met

•  Establish stand-alone corporate governance 

and risk procedures at Waypoint REIT following 
internalisation that build trust, create long-term 
securityholder value and align with Waypoint 
REIT’s values 

governance structure, corporate policies and 
risk management processes in a timely manner 
post internalisation.

•  Strong Board engagement throughout the process 

with transparent reporting of material issues.

•  Continual review of governance to ensure 

arrangements remain appropriate in light of 
changing expectations and general developments 
in good corporate governance.

People

•  Retain key talent through internalisation process

•  100% retention of permanent employees on the 

Target met

internalisation of Management.

34

Waypoint REIT Limited – Annual Report 2020(iii)  Details of Executive KMP Remuneration and Other Information
Details of the remuneration of the Executive KMP are set out below.

Remuneration for the year ended 31 December 2020
Executives were designated KMP from 1 October (date of the Internalisation). Prior to this date, Executives were employees of 
the Manager. Accordingly, the table below shows fixed remuneration for the period 1 October to 31 December 2020 and variable 
remuneration for the entire 2020 calendar year, including the first nine months of the year when Executive KMP were employed 
by the Manager, as it was determined for the year as a whole by the Board. 

Fixed

Variable

Salary 
$

Super-
annuation  
$

Other 
benefits  
$

84,254

60,694

5,424

3,273

6,833

264,524

15,530

417

292

155

864

Hadyn Stephens

119,576

Kerri Leech

Tina Mitas

Total

Annual 
and long 
service 
leave1  
$

5,282

2,453

5,066

Total  
$

Cash STI  
$

Total  
$

130,699

500,000

630,699

90,272

72,748

210,000

300,272

100,000

172,748

At risk 
element2  
%

49

37

26

12,801

293,719

810,000

1,103,719

1.  Amounts disclosed in this column represent the increase in the associated provisions. 

2.  Presented on an annualised basis. Actual percentages for the three-month period KMP were appointed were 79, 70 and 58 respectively.

Remuneration for the year ended 31 December 2019
KMP for the year ended 31 December 2019 do not include any Executives as neither the Company nor the Trust had any employees 
(other than the Directors). Executives were remunerated by Viva Energy Australia Pty Limited, the parent entity of the Manager. 

Other information

(a)  Interest in securities
None of the Executive KMP held securities during the year ended 31 December 2020. 

As described in the Chair of the Remuneration Committee’s letter, the Board has subsequently introduced an equity-based long-term 
incentive (LTI) plan for Executive KMP and also amended the terms of the STI plan, requiring a portion of STI paid to all Executive 
KMP to be deferred up to 24 months and settled in securities. 

(b)  Employment contracts and termination entitlements 
In connection with the internalisation of management, all Executive KMP entered new employment contracts dated 1 October 2020. 
Contracts can be terminated by Waypoint REIT by providing 12 months’ written notice or payment in lieu of notice. Notice periods 
applicable to termination at the Executive KMP’s election vary as follows: Chief Executive Officer – 12 months; Chief Financial 
Officer – 6 months; and Company Secretary – three months.

Waypoint REIT may terminate an Executive KMP’s service at any time without notice if serious misconduct has occurred. 
Where termination with cause occurs, the Executive KMP is only entitled to remuneration up to the date of termination. 

(c)  Other transactions with Executive KMP
There were no loans made, guaranteed or secured, directly or indirectly, by Waypoint REIT to Executive KMP or their related parties 
during the year. There were no other transactions between Waypoint REIT and any Executive KMP or their related parties during 
the year.

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Remuneration report continued

(iv)  Remuneration Policy for Non-Executive Directors

Objective
With effect from the Internalisation, the Remuneration Committee is responsible for making recommendations to the Board 
on the remuneration arrangements for the Independent Non-Executive Directors. 

The Board and the Remuneration Committee periodically assesses, with the benefit of independent advice as required, 
the appropriateness of the nature and amount of remuneration of Independent Non-Executive Directors by reference to market 
rates with the overall objective of attracting and retaining Board members with an appropriate combination of industry and 
specialist functional knowledge and experience. 

Former Non-Independent Non-Executive Directors were representatives of Viva Energy Group Limited and waived their entitlement 
to fees.

Remuneration structure
Under the Company Constitution, the Board may decide the remuneration to which each Director is entitled for his or her services 
as a Director. However, the total amount provided to all Directors for their services as Directors must not exceed in aggregate in 
any financial year the amount fixed by Waypoint REIT. This amount has been fixed at $750,000 per annum.

Annual fees payable, inclusive of superannuation, to Independent Non-Executive Directors during 2020 were as follows:

Role

Chair 

Member

Board

$200,0002

$100,000

Audit and Risk 
Management 
Committee

$25,0003

$12,5003

Remuneration 
Committee1

Nomination 
Committee1

$20,000

$10,000

–

–

1.  The Remuneration and Nomination Committees were formed on 1 October 2020 following the Internalisation. 

2.  The Board Chair does not receive fees for membership on Board Committees.

3.   Audit Committee fees increased effective 1 October 2020 in light of expanded responsibilities following the Internalisation and retirement 

of nominee Directors (the increases were: Chair – $5,000 and Member – $2,500). 

Additionally, Directors are entitled to reimbursement of travel and other out of pocket expenses, which totalled $4,554 in the year 
ended 31 December 2020 (2019: $24,574). 

(v)  Details of Non-Executive Director Fees and Other Information
Details of Non-Executive Director fees and security interests are set out below.

Remuneration for the year ended 31 December 2020

Laurence Brindle

Georgina Lynch

Stephen Newton

Total

2020

Super-
annuation  
$

17,352

10,031

10,736

38,119

Base fee  
$

182,648

105,594

113,014

401,256

Total  
$

200,000

115,625

123,750

439,375

Base fee  
$

182,648

100,457

109,589

392,694

2019

Super-
annuation  
$

17,352

9,543

10,411

37,306

Total  
$

200,000

110,000

120,000

430,000

Note: Director Board base fees have not changed since Waypoint REIT listed on the ASX in August 2016. Effective 1 January 2021, Directors’ Board 
base fees have been adjusted (Chair: $220,000, Other Independent Directors: $107,000). For 2021, Committee fees remain unchanged from those 
applicable at 31 December 2020.

36

Waypoint REIT Limited – Annual Report 2020Other information

(a)  Interests in securities
The number of securities held during the period by each Director of Waypoint REIT, including their personally related parties, 
are set out below:

2020

Independent Non-Executive Directors

Laurence Brindle

Georgina Lynch

Stephen Newton

Former Non-Independent Non-Executive Directors

Jevan Bouzo

Lachlan Pfeiffer

1.  Securityholding as at resignation date.

Balance 
1 January

On market 
purchases

On market 
disposals

Balance 
31 December

Other

100,000

50,000

25,000

-

50,000

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

100,000

50,000

25,000

–1

50,0001

(b)  Other transactions with Directors
There were no loans made, guaranteed or secured, directly or indirectly, by Waypoint REIT to any Director or their related parties 
during the year. There were no other transactions between Waypoint REIT and any Director or their related parties during the year.

Insurance and indemnification of officers and auditors
The Company has paid premiums in respect of a contract insuring all Directors and officers of the Company and its related 
entities against certain liabilities incurred in that capacity. The insurance policies cover former Directors and officers of the 
Company. Disclosure of the nature of the liability covered by the insurance and premiums paid is subject to confidentiality 
requirements under the contract of insurance. 

The Company has entered a Deed of Indemnity with each of its Directors, Hadyn Stephens (Chief Executive Officer), Kerri Leech 
(Chief Financial Officer) and Tina Mitas (Company Secretary) providing these persons with an indemnity, to the fullest extent 
permitted by law, against all losses and liabilities incurred in their respective role for the Company and its related entities. 
The Deeds also require the Company to grant the indemnified person with access to certain Company documents and insure 
the indemnified persons.

In addition, the Company’s and the Responsible Entity’s constitutions provide for the indemnity of officers of the Company/
Responsible Entity or its related bodies corporate from liability incurred by a person in that capacity. 

No indemnity payment has been made under any of the documents referred to above during, or since the end of, the financial year.

The Group has not during or since the end of the financial year indemnified or agreed to indemnify an auditor of the Group 
or of any related body corporate against a liability incurred in their capacity as an auditor.

Audit and non-audit services
The Group may decide to employ the auditor on assignments additional to their statutory audit duties where the auditor’s 
expertise and experience with the Group are important.

Details of the amounts paid or payable to the auditor for audit and non-audit services provided during the year are disclosed 
in Note 4.(d) to the consolidated financial statements.

The Directors have considered the position and, in accordance with advice received from the Group’s Audit and Risk Management 
Committee (ARMC), are satisfied that the provision of non-audit services is compatible with the general standard of independence 
for auditors imposed by the Corporations Act 2001 for the following reasons:

•  all non-audit services have been reviewed by the ARMC to ensure they do not impact the impartiality and objectivity of the 

auditor; and

•  none of the services undermines the general principles relating to auditor independence as set out in APES 110 Code of Ethics 

for Professional Accountants.

37

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate DirectoryDirectors’ Report continued

Auditor’s independence declaration
A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 39.

Transactions with Viva Energy Group Limited or its associates
Up to the internalisation of the Group’s management on 30 September 2020, VER Manager, a subsidiary of Viva Energy Group 
Limited, was reimbursed for costs incurred in the provision of staff and related services to the Group. 

Reimbursement of costs paid to VER Manager Pty Limited  
(reported as part of Management and administrative expenses)

2020

2019

$4.7 million

$2.5 million

On 24 September 2018, the Group received an assessment from the Victorian State Revenue Office (SRO) for $31.2 million. 
The assessment relates to the transfer of Victorian properties to the Group prior to its listing in August 2016. Pursuant to the 
arrangements between the Group and Viva Energy Group, any such costs will remain payable by Viva Energy Group. Viva Energy 
Group lodged an objection to the assessment on 2 November 2018 and assumed conduct of this matter under a conduct and 
indemnity deed. In May 2020, the SRO disallowed Viva Energy Group’s objection and Viva Energy Group is appealing this matter, 
which has now been referred to the Supreme Court.

Confirmation from the SRO that stamp duty has been paid is a prerequisite for Land Use Victoria, the agency that manages 
Victoria’s land titles registry, to register a transfer of land. Pending resolution of the above matter, Viva Energy Group remains 
the registered proprietor of these properties. Once this matter is resolved, the signed transfers of the titles to the properties 
are required to be registered to Waypoint REIT.

In connection with the internalisation of the Group’s management function, the Group paid a $2.5 million facilitation payment 
to Viva Energy Group and incurred a $1.4 million expense in relation to a run-off insurance policy in favour of VER Manager 
and VER Limited.

Rounding of amounts to the nearest million dollars
The Group is of a kind referred to in ASIC Legislative Instrument 2016/191, relating to the ‘rounding off’ of amounts in the 
Directors’ Report. Amounts in the Directors’ Report have been rounded off in accordance with that instrument to the nearest 
hundred thousand dollars, or in certain cases, to the nearest dollar.

The report is made in accordance with a resolution of Directors.

Laurence Brindle
Non-Executive Chair

26 February 2021

38

Waypoint REIT Limited – Annual Report 2020Auditor’s Independence Declaration

39

PricewaterhouseCoopers, ABN 52 780 433 757 2 Riverside Quay, SOUTHBANK  VIC  3006, GPO Box 1331, MELBOURNE  VIC  3001 T: 61 3 8603 1000, F: 61 3 8603 1999, www.pwc.com.au Liability limited by a scheme approved under Professional Standards Legislation.   Auditor’s Independence Declaration As lead auditor for the audit of Waypoint REIT Limited and its controlled entities and Waypoint REIT Trust and its controlled entities (together the Group) and Waypoint REIT Trust and its controlled entities (together the Trust) for the year ended 31 December 2020, I declare that to the best of my knowledge and belief, there have been:  (a)no contraventions of the auditor independence requirements of the Corporations Act 2001 inrelation to the audit; and(b)no contraventions of any applicable code of professional conduct in relation to the audit.This declaration is in respect of Waypoint REIT Limited and the entities it controlled during the period and Waypoint REIT Trust and the entities it controlled during the period. Charles Christie Melbourne Partner PricewaterhouseCoopers 26 February 2021 Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate DirectoryConsolidated Statement of Comprehensive Income
For the year ended 31 December 2020

Group

Trust

Notes

2020  
$ million

2019  
$ million

2020  
$ million

2019  
$ million

Rental income from investment properties  
(incl. non-cash straight-line lease adjustment)

Finance income

Net gain on movement in fair value of 
investment properties

Management and administration expenses

Internalisation costs

Finance expense

3.(b)

181.6

0.2

2.(a)

152.3

(9.3)

(5.8)

3.(b) 

(35.3)

Interest rate swap termination/restructure expense

Net loss from derivative financial instruments

3.(b)

Net profit before income tax

Income tax expense

Net profit after tax

(3.5)

(0.3)

279.9

–

279.9

171.9

1.3

72.8

(8.3)

–

(30.9)

(9.2)

–

197.6

–

197.6

181.6

0.1

152.3

(9.5)

(5.8)

(35.3)

(3.5)

(0.3)

279.6

–

279.6

171.9

1.2

72.8

(8.3)

–

(30.9)

(9.2)

–

197.5

–

197.5

Other comprehensive income

  Items that may be reclassified subsequently 

to profit or loss

 Unrealised losses on cash flow hedges

Total comprehensive income 

Total comprehensive income for the year attributable 
to Waypoint REIT securityholders, comprising:

– shareholders of Waypoint REIT Limited

–  unitholders of Waypoint REIT Trust  

(non-controlling interests) 

Earnings per security

Basic and diluted earnings per stapled security

(7.6)

272.3

(19.0)

178.6

(7.6)

272.0

(19.0)

178.5

272.0

0.3

0.1

–

–

178.5

272.3

Cents

35.79

272.0

178.6

Cents

25.72

178.5

272.0

Cents

35.76

178.5

Cents

25.70

The above consolidated statements of comprehensive income should be read in conjunction with the accompanying notes.

40

Waypoint REIT Limited – Annual Report 2020 
 
 
 
 
 
Consolidated Balance Sheet
As at 31 December 2020

ASSETS

Current assets

Cash and cash equivalents

Assets held for sale

Other current assets

Total current assets

Non-current assets

Investment properties

Other non-current assets

Total non-current assets

Total assets

LIABILITIES

Current liabilities

Trade and other payables

Rent received in advance

Interest payable

Distribution payable

Derivative financial instruments

Provisions

Other current liabilities

Total current liabilities

Non-current liabilities

Borrowings

Derivative financial instruments

Provisions

Other non-current liabilities

Total non-current liabilities

Total liabilities

Net assets

EQUITY

Waypoint REIT Limited

Contributed equity

Accumulated losses

Parent entity interest

Waypoint REIT Trust

Contributed equity

Retained profits

Reserves

Non-controlling interests

Total equity

Group

Trust

31 Dec 2020  
$ million

31 Dec 2019  
$ million

31 Dec 2020  
$ million

31 Dec 2019  
$ million

Notes

1.(c)

2.(b)

15.5

14.3

2.4

32.2

27.5

–

0.9

28.4

2.1

14.3

14.5

30.9

17.5

–

16.2

33.7

2.(a) 

2,897.3

2,684.2

2,897.3

2,684.2

1.1

2,898.4

2,930.6

5.5

2,689.7

2,718.1

–

2,897.3

2,928.2

5.5

2,689.7

2,723.4

4.9

2.3

6.5

60.7

1.0

1.2

0.3

76.9

845.8

53.6

0.3

0.8

900.5

977.4

4.9

2.3

3.0

56.0

–

–

–

11.8

2.3

6.5

60.7

1.0

–

–

10.9

2.3

3.0

56.0

–

–

–

66.2

82.3

72.2

843.1

25.9

–

–

869.0

935.2

845.8

53.6

–

–

899.4

981.7

843.1

25.9

–

–

869.0

941.2

1,953.2

1,782.9

1,946.5

1,782.2

7.7

(1.0)

6.7

2.0

(1.3)

0.7

–

–

–

–

–

–

1,627.1

1,616.3

1,627.1

1,616.3

352.9

(33.5)

1,946.5

1,953.2

191.8

(25.9)

1,782.2

1,782.9

352.9

(33.5)

1,946.5

1,946.5

191.8

(25.9)

1,782.2

1,782.2

1.(a) 

3.(d)

3.(a) 

3.(d)

3.(f)

3.(g)

3.(h)

The above consolidated balance sheets should be read in conjunction with the accompanying notes.

41

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate Directory 
 
 
 
 
 
 
 
Consolidated Statement of Changes in Equity
For the year ended 31 December 2020

Group

Trust

Contri-
buted 
equity  
$ million

Accumu-
lated 
losses  
$ million

Non-
controlling 
interests  
$ million

Contri-
buted 
equity  
$ million

Accumu-
lated 
profit  
$ million

TOTAL  
$ million

Notes

Reserves  
$ million

TOTAL  
$ million

Balance at 1 January 2019

Profit for the period

Other comprehensive income:

  Effective portion of 

changes in fair value 
of cash flow hedges

Total comprehensive profit 
for the period

Transactions with owners 
in their capacity as owners

  Issue of securities under 
Institutional Placement

  Issue of securities under 
Security Purchase Plan

  Equity raising costs

  Issue of securities 
under Distribution 
Reinvestment Plan

  Distributions paid 
or provided for

Total transactions with owners 
in their capacity as owners

Balance at 31 December 2019

Balance at 1 January 2020

Profit for the period

Other comprehensive income:

  Effective portion of 

changes in fair value 
of cash flow hedges

Total comprehensive 
profit for the period

Capital reallocation 

Transactions with owners 
in their capacity as owners

  Issue of securities 
under Distribution 
Reinvestment Plan

  Distributions paid 
or provided for

Total transactions with owners 
in their capacity as owners

3.(f)

3.(f)

3.(f)

1.(a)

3.(f)

1.(a)

2.5

–

–

–

0.1

–

(0.6)

–

–

(0.5)

2.0

2.0

–

–

–

5.7

–

–

–

(1.4)

1,593.5

1,594.6

1,494.4

0.1

197.5

197.6

–

(19.0)

(19.0)

0.1

178.5

178.6

–

–

–

106.0

197.5

(6.9)

1,593.5

–

197.5

–

(19.0)

(19.0)

197.5

(19.0)

178.5

–

–

–

–

–

–

99.9

100.0

99.9

10.0

(1.5)

10.0

(2.1)

10.0

(1.5)

13.5

13.5

13.5

–

–

–

–

(111.7)

(111.7)

–

(111.7)

10.2

9.7

121.9

(111.7)

–

–

–

–

–

–

99.9

10.0

(1.5)

13.5

(111.7)

10.2

(1.3)

1,782.2

1,782.9

1,616.3

(1.3)

1,782.2

1,782.9

1,616.3

0.3

279.6

279.9

–

(7.6)

(7.6)

272.0

272.3

191.8

191.8

279.6

(25.9)

1,782.2

(25.9)

1,782.2

–

279.6

–

(7.6)

(7.6)

279.6

(7.6)

272.0

–

–

–

(5.7)

–

(5.7)

–

–

(5.7)

16.5

16.5

16.5

–

(118.5)

(118.5)

–

(118.5)

(102.0)

(102.0)

16.5

(118.5)

–

–

–

16.5

(118.5)

(102.0)

0.3

–

–

–

–

Balance at 31 December 2020

7.7

(1.0)

1,946.5

1,953.2

1,627.1

352.9

(33.5)

1,946.5

The above consolidated statements of changes in equity should be read in conjunction with accompanying notes. 

42

Waypoint REIT Limited – Annual Report 2020 
 
 
 
 
 
 
 
Consolidated Statement of Cash Flows
For the year ended 31 December 2020

Group

Trust

Notes

2020  
$ million

2019  
$ million

2020  
$ million

2019  
$ million

Cash flows from operating activities

Rental income from investment properties  
(inclusive of GST)

Payments to suppliers and employees  
(inclusive of GST)

Interest received

Interest paid

Income taxes refunded

Net cash inflow from operating activities

1.(d)

175.4

164.1

175.4

164.1

(29.6)

145.8

0.2

(29.2)

–

116.8

(18.3)

145.8

1.2

(30.8)

0.5

116.7

(27.4)

148.0

0.2

(29.2)

–

119.0

(22.0)

142.1

0.6

(30.8)

–

111.9

Cash flows from investing activities

Payments for acquisition of investment properties

(49.6)

(100.4)

(49.5)

(100.4)

Proceeds on sale and compulsory resumption 
(including reimbursement of legal fees and other costs)

Net cash outflow from investing activities

0.9

(48.7)

0.4

(100.0)

0.9

(48.6)

0.4

(100.0)

Cash flows from financing activities

Proceeds from issue of securities (net of costs)

Proceeds from borrowings (net of borrowing costs)

Repayments of borrowings

Payments in relation to derivatives

Payment for capital reallocation

Distributions paid to securityholders

1.(a)

Net cash inflow/(outflow) from financing activities

Net increase/(decrease) in cash and cash equivalents

Cash and cash equivalents at beginning of the year

Cash and cash equivalents at end of the year

1.(c)

–

664.7

(644.0)

(3.5)

–

(97.3)

(80.1)

(12.0)

27.5

15.5

107.8

98.1

(105.0)

(9.2)

–

(93.2)

(1.5)

15.2

12.3

27.5

–

664.7

(644.0)

(3.5)

(5.7)

(97.3)

(85.8)

(15.4)

17.5

2.1

108.4

98.3

(105.0)

(9.2)

–

(93.3)

(0.8)

11.1

6.4

17.5

The above consolidated statements of cash flows should be read in conjunction with accompanying notes.

43

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate Directory 
 
 
 
 
Notes to the Consolidated Financial Statements

This report contains the financial statements of Waypoint REIT (Group) and Waypoint REIT Trust Group (Trust Group) for the year 
ended 31 December 2020. The financial statements of the Group comprise the Company, the Trust and their respective controlled 
entities. The financial statements of the Trust Group comprise the Trust and its controlled entities.

As permitted by Class Order 13/1050, issued by ASIC, this financial report is a combined financial report that presents the 
financial statements and accompanying notes of both Waypoint REIT Limited and Waypoint REIT Trust as at and for the year 
ended 31 December 2020.

Waypoint REIT is a stapled group consisting of the Company and the Trust and their wholly owned entities. The Trust indirectly 
owns the investment property portfolio through its 100% ownership of the trusts, which own the investment properties and 
receive rent under leases. The Company directly owns all of the shares in VER Limited (Responsible Entity).

Waypoint REIT is listed on the Australian Securities Exchange (ASX) and registered and domiciled in Australia. 

Effective 14 May 2020, the Company was renamed from Viva Energy REIT Limited to Waypoint REIT Limited and the Trust was 
renamed from Viva Energy Trust to Waypoint REIT Trust. Effective 18 May 2020, the ASX ticker was also changed from VVR to WPR. 

The notes to these consolidated financial statements include additional information which is required to understand the operations, 
performance and financial position of Waypoint REIT. The notes are set out as follows: 

1.  Performance and results – an overview of key metrics used by the Group to measure financial performance

1.(a)  Distributions to securityholders

1.(b)  Earnings per stapled security 

1.(c)  Cash and cash equivalents

1.(d)  Cash flow information

2.  Property portfolio – an overview of the Group’s investment property portfolio

2.(a)  Investment properties

2.(b)  Assets held for sale

2.(c)  Commitments and contingencies

3.  Capital management – an overview of the Group’s capital management structure

3.(a)  Borrowings

3.(b)  Net finance costs

3.(c)  Net debt reconciliation

3.(d)  Derivative financial instruments

3.(e)  Financial risk management

3.(f)  Contributed equity

3.(g)  Non-controlling interests

3.(h)  Reserves

4.  Additional information – additional disclosures relating to the Group’s financial statements

4.(a)  Related party information

4.(b)  Parent entity financial information

4.(c)  Investments in subsidiaries

4.(d)  Remuneration of auditors

4.(e)  Subsequent events

4.(f)  Summary of significant accounting policies

44

Waypoint REIT Limited – Annual Report 2020 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Critical accounting estimates and judgements
The Group makes estimates and judgements that affect the reported amounts of assets and liabilities. Estimates are continually 
evaluated and based on historical experience and other factors, including expectations of future events that are believed to 
be reasonable under the circumstances. Estimates and judgements which are material to the financial report are found in the 
following notes:

•  2.(a) Investment properties

•  3.(d) Derivative financial instruments

In response to the increased uncertainty, the Group has assessed the carrying value of its assets and liabilities in light of COVID-19. 
Specific areas of assessment include assessment of expected credit losses and fair value measurement of investment properties 
and associated disclosures within the financial statements.

1. Performance and results
Key financial metrics used to define the results and performance of Waypoint REIT, including Distributable Earnings, distributions, 
earnings per stapled security and distributable earnings per stapled security, are set out below. 

Distributable Earnings is a non-statutory measure of profit and is calculated as net profit adjusted to remove transaction costs, 
specific non-recurring item and non-cash items, including straight-lining of rental income, the amortisation of debt establishment 
fees and any fair value adjustment to investment properties and derivatives.

A reconciliation between Distributable Earnings and statutory profit is below:

Financial results

Rental income

Finance income

Total operating income

Management and administration expenses

Interest expense

Distributable Earnings

Gain/(loss) on valuation of investment properties

Straight-line rental income

Amortisation of borrowing costs

Interest rate swap termination/restructure expense

Loss on derivatives financial instruments

Internalisation costs

Statutory net profit

Year ended  
31 Dec 2020  
$ million

Year ended  
31 Dec 2019  
$ million

160.2

0.2

160.4

(9.3)

(32.6)

118.5

152.3

21.4

(2.7)

(3.5)

(0.3)

(5.8)

148.5

1.4

149.9

(8.3)

(29.9)

111.7

72.8

23.4

(1.1)

(9.2)

–

–

279.9

197.6

45

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate Directory1. Performance and results continued

1. (a)  Distributions to securityholders

Distributions paid in 2020

Final distribution for the year ended 31 December 2019  
– 7.19 cents per security paid on 27 February 2020

Interim distribution for the six months ended 30 June 2020  
– 7.41 cents per security paid on 27 August 2020

Distributions paid in 2019

Final distribution for the year ended 31 December 2018  
– 7.03 cents per security paid on 28 February 2019

Interim distribution for the six months ended 30 June 2019  
– 7.18 cents per security paid on 29 August 2019

Total distributions paid

2020  
$ million

2019  
$ million

56.0

57.9

–

–

113.9

–

51.0

55.7

106.7

The Trust paid a distribution of 7.73 cents per security ($60.7 million) on 26 February 2021 for the six months ended 
31 December 2020.

The Company has franking credits available for subsequent reporting periods of $0.03 million based on a tax rate of 30% 
(2019: $0.03 million at a tax rate of 30%). There was no dividend paid or payable from the Company during the year.

Accounting policy – Distributions to securityholders
The Group distributes Distributable Earnings. A provision is made for any distribution amount declared but not distributed, 
being appropriately disclosed and no longer at the discretion of the Group, on or before the reporting date. When declared, 
the distributions are recognised within the consolidated balance sheet and consolidated statement of changes in equity 
as a reduction in equity.

46

Notes to the Consolidated Financial Statements continuedWaypoint REIT Limited – Annual Report 20201. (b)  Earnings per stapled security

Basic/diluted earnings per stapled security (cents) attributable to 

 Shareholders of Waypoint REIT Limited

 Unitholders of Waypoint REIT Trust (non-controlling interest)

Stapled securityholders of Waypoint REIT Group

Group

Trust

2020  
Cents

0.03

35.76

35.79

2019  
Cents

2020  
Cents

0.02

25.70

25.72

–

35.76

35.76

2019  
Cents

–

25.70

25.70

Statutory net profit after tax ($ million)

279.9

197.6

279.6

197.5

Distributable earnings ($ million)

Distributable earnings per stapled security (cents)

118.5

15.15

111.7

14.54

Weighted average number of stapled securities 

782.0

768.4

782.0

768.4

Accounting policy – Earnings per stapled security
(i)  Basic earnings per stapled security is calculated by dividing:

•  the profit for the period attributable to the securityholders, excluding any costs of servicing equity other than ordinary 

securities; by

•  the weighted average number of ordinary securities outstanding during the financial period.

(ii)  Diluted earnings per security adjust the figures used in the determination of basic earnings per security to take into account:

•  the effect of interest and other financial costs associated with potential ordinary securities; and

•  the weighted average number of additional ordinary securities that would have been outstanding assuming the conversion 

of all potential ordinary securities.

(iii)  Distributable earnings per stapled security is calculated by dividing:

•  Distributable Earnings for the period attributable to the securityholders; by

•  the weighted average number of ordinary securities outstanding during the financial period.

1. (c)  Cash and cash equivalents 

Cash at bank*

Total cash and cash equivalents

Group

Trust

31 Dec 2020  
$ million

31 Dec 2019  
$ million

31 Dec 2020  
$ million

31 Dec 2019  
$ million

15.5

15.5

27.5

27.5

2.1

2.1

17.5

17.5

*  Includes $5.5 million held in bank accounts as restricted cash maintained to satisfy the regulatory requirements of the Responsible Entity’s 

Australian Financial Services Licence (AFSL). 

Accounting policy – Cash and cash equivalents
For the purpose of presentation in the consolidated statement of cash flows, cash and cash equivalents include cash on hand, 
deposits held at call with financial institutions, and other short-term, highly liquid investments with maturities of three months or less 
from the date of acquisition that are readily convertible to known amounts of cash and which are subject to an insignificant risk 
of changes in value.

47

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate Directory1. Performance and results continued

1. (d)  Cash flow information

(i)  Reconciliation of net profit after income tax to net cash inflow from operating activities

Profit for the year

Amortisation of borrowing costs

Interest rate swap termination/restructure expense

Net revaluation of investment properties

Straight-line adjusting on rental income

Net loss from derivative financial instruments

Change in operating assets and liabilities

Increase in other current assets

Increase in other non-current assets

Increase/(Decrease) in trade and other payables

Increase in rent received in advance

Increase/(Decrease) in interest payable

Net cash inflow from operating activities

(ii)  Non-cash investing and financing activities

Loan establishment costs netted off against borrowings drawn down

Total non-cash financing and investing activities

Group

Trust

2020  
$ million

279.9

2.7

3.5

(152.3)

(21.4)

0.3

(1.5)

(1.0)

3.0

0.1

3.5

116.8

2019  
$ million

2020  
$ million

197.6

279.6

2019  
$ million

197.5

1.1

9.2

(72.8)

(23.4)

–

(0.1)

–

5.9

0.1

(0.9)

116.7

2.7

3.5

(152.3)

(21.4)

0.3

(1.2)

–

4.2

0.1

3.5

1.1

9.2

(72.8)

(23.4)

–

7.5

–

(6.4)

0.1

(0.9)

119.0

111.9

Group

Trust

2020  
$ million

2019  
$ million

2020  
$ million

2019  
$ million

1.2

1.2

–

–

1.2

1.2

–

–

48

Notes to the Consolidated Financial Statements continuedWaypoint REIT Limited – Annual Report 20202. Property portfolio 

2. (a)  Investment properties

(i)  Valuations and carrying amounts

Fuel and convenience retail properties – at fair value

Total investment properties 

Group

Trust

31 Dec 2020  
$ million

31 Dec 2019  
$ million

31 Dec 2020  
$ million

31 Dec 2019  
$ million

2,897.3

2,897.3

2,684.2

2,684.2

2,897.3

2,897.3

2,684.2

2,684.2

Each investment property is subject to independent valuation at least once every three years. Independent valuations were 
carried out by CBRE on 106 investment properties as at 31 December 2020, representing approximately one-fifth of the portfolio 
and a broad cross-section of both metro (74%) and regional (26%) assets. 

Independent valuations were carried out in a manner consistent with prior periods with the exception of valuers not being able 
to inspect areas not accessible to the public (i.e. store rooms) at certain locations. These limitations did not impact overall 
valuation outcomes. 

The independent valuations can be relied upon for a 90-day period ending 31 March 2021. Given the heightened uncertainty and 
unknown impact that COVID-19 may have on real estate markets in the future, a higher degree of caution should be exercised 
when relying upon CBRE’s valuations. Values and incomes may change more rapidly and significantly than during standard 
market conditions. 

The Directors have reviewed the independent valuation outcomes and determined they are appropriate to adopt as at 
31 December 2020. The key inputs into the valuation are based on market information for comparable properties. The independent 
valuers have experience in valuing similar assets and have access to market evidence to support their conclusions. Comparable sales 
are considered to be those in similar markets, of similar scale and condition and with similar lease terms to the subject property.

Directors’ valuations have been performed on the balance of the portfolio, with reference to the capitalisation rates determined 
for the corresponding independently valued properties in the same state and with similar lease terms, segregated between 
metropolitan and regional sites. 

The key inputs and assumptions for valuations are below:

Annual market rent per site

Weighted average capitalisation rate

Range of capitalisation rates

Range of lease terms

31 Dec 2020

31 Dec 2019

$78,386 to $1,425,879

$76,103 to $1,384,349

5.62%

5.81%*

3.35% to 9.76%

3.44% to 9.76%

0.4 to 14.6 years

1.2 to 14.8 years

*  WACR at 31 December 2019 changed from 5.78% previously reported to 5.81% as a result of methodology change adopted to include 

developments at completion value (inclusive of committed capital) rather than book value.

Investment properties have been classified as level 3 in the fair value hierarchy (refer to Note 3.(e)(i)). There have been no transfers 
between the levels in the fair value hierarchy during the period.

All investment properties are freehold, apart from all sites in the Australian Capital Territory and one site in New South Wales 
that are subject to either perpetual or crown leases.

49

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate Directory2. Property portfolio continued

2. (a)  Investment properties continued

(i)  Valuations and carrying amounts continued

Accounting policy – Investment properties
All of Waypoint REIT’s properties are treated as investment properties for the purpose of financial reporting. Under Australian 
Accounting Standards, investment property buildings and improvements are not depreciated over time. Instead, investment 
properties are initially valued at cost, including transaction costs, and at the end of each accounting period the carrying values 
are restated at their fair value at the time. 

Changes in fair value are recognised as a non-cash gain or loss in the statutory net profit in the accounting period in which they arise. 
As a result of this accounting policy, changes in the fair value of Waypoint REIT’s investment properties may have a significant 
impact on its reported statutory net profit in any given period. The fair value of investment property is determined based on real 
estate valuation experts using recognised valuation techniques and the principles of AASB 13 Fair Value Measurement.

The fair value of the properties is reviewed by the Directors at each reporting date. The Directors’ assessment of fair value is 
periodically assessed by engaging an independent valuer to assess the fair value of individual properties with at least one-sixth 
of the properties within the portfolio being independently valued every six months (31 December 2019: one-third of the portfolio 
was independently valued each year end). Valuations may occur more frequently if there is reason to believe that the fair value 
of a property has materially changed from its carrying value (e.g. as a result of changes in market conditions, leasing activity in 
relation to the property or capital expenditure). 

The independent valuer is rotated at least every three years unless the Board approves the use of a valuer for a fourth year due 
to extenuating circumstances. The Board exercised this discretion and approved the use of Jones Lang La Salle as independent 
valuer as at 30 June 2020 due to the extenuating circumstances posed by COVID-19; however, CBRE was subsequently appointed 
as the new valuer for the 31 December 2020 valuation cycle.

Valuations are derived from a number of factors that may include a direct comparison between the subject property and a range 
of comparable sales, the present value of net future cash flow projections based on reliable estimates of future cash flows, 
existing lease contracts, external evidence such as current market rents for similar properties, and using capitalisation rates 
and discount rates that reflect current market assessments of the uncertainty in the amount and timing of cash flows.

(ii)  Movements during the financial period

At fair value

Opening balance

Property acquisitions

Capital expenditure on site development

Straight-line rental asset

Fair value adjustment to investment properties

Revaluation decrement attributable to acquisition costs, and 
straight-lining of rental income

Transfer to assets held for sale

Disposal of investment properties**

Closing balance

Group

Trust

2020  
$ million

2,684.2

2019  
$ million

2020  
$ million

2,496.1

2,684.2

2019  
$ million

2,496.1

35.2

19.3

21.4

176.7

(24.4)

(14.3)

(0.8)

60.2

32.0*

23.4

99.9

(27.1)

–

(0.3)

35.2

19.3

21.4

176.7

(24.4)

(14.3)

(0.8)

60.2

32.0*

23.4

99.9

(27.1)

–

(0.3)

2,897.3

2,684.2

2,897.3

2,684.2

*  Reclassified from Other Non-Current Assets to conform with current year presentation.

**  Represents the resumption of three parcels of ancillary land by state governments.

50

Notes to the Consolidated Financial Statements continuedWaypoint REIT Limited – Annual Report 2020(iii)  Sensitivities
The Group’s investment properties expose it to a risk of change in the fair value due to changes in market capitalisation rates 
of such investment properties. Investment properties of the type owned by the Group are generally valued on a capitalisation 
of income basis.

Sensitivity of profit and loss to movements in market capitalisation rates:

Decreases by 25 basis points

Increases by 25 basis points

2020  
$ million

2019  
$ million

134.8

(123.4)

119.9

(110.0)

The impacts on carrying values as shown above for the noted movement in capitalisation rates would impact the statutory net 
profit but not impact Distributable Earnings unless an interest margin increase is triggered by the lower investment property value 
causing the covenant gearing ratio to rise beyond 40%, as the unrealised movement in carrying value of investment properties is 
excluded from the Distributable Earnings calculation.

In relation to the Group’s drawn debt facilities as at 31 December 2020, the market capitalisation rate expansion required to trigger:

•  higher margin pricing is 140 bps;

•  applicability of draw stop provisions is 230 bps; and

•  a covenant breach is 319 bps.

The Group’s average fixed annual rent review of 3% also provides a natural buffer against up to approximately 90 bps per annum 
of potential capitalisation rate expansion before gearing would be negatively impacted, holding all other variables constant.

(iv)  Amounts recognised in profit or loss for investment properties

Rental income

Other non-cash rental income (recognised on a straight-line basis)

Net direct operating expenses from property that generated 
rental income

Net revaluation of investment properties

Group

Trust

2020  
$ million

2019  
$ million

2020  
$ million

2019  
$ million

160.2

21.4

0.8

152.3

148.5

23.4

0.9

72.8

160.2

21.4

0.8

152.3

148.5

23.4

0.9

72.8

51

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate Directory2. Property portfolio continued

2. (a)  Investment properties continued

(v)  Leasing arrangements
The investment properties are leased to Viva Energy Australia Pty Limited (96.8% of rental income), other fuel operators and 
various convenience and fast food store operators (3.2% of rental income) under long-term operating leases with rent payable in 
advance monthly, quarterly or annually. Rental income for 95.2% of the investment properties is subject to fixed annual increases 
of 3.0% or greater. The remainder of the leases include CPI increases, but there are no other variable lease payments that depend 
on an index or rate. Where considered necessary to reduce credit risk, the Group may obtain bank guarantees or security deposits 
for the term of the lease.

Minimum undiscounted future payments to be received under non-cancellable operating leases of investment properties not 
recognised in the financial statements are receivable as follows:

Within one year

Later than one year but not later than two years

Later than two years but not later than three years

Later than three years but not later than four years

Later than four years but not later than five years

Later than five years

Total

Group

Trust

31 Dec 2020  
$ million

31 Dec 2019  
$ million

31 Dec 2020  
$ million

31 Dec 2019  
$ million

163.6

167.4

171.8

177.0

181.1

1,194.5

2,055.4

155.8

158.8

162.2

166.6

171.7

163.6

167.4

171.8

177.0

181.1

1,327.6

2,142.7

1,194.5

2,055.4

155.8

158.8

162.2

166.6

171.7

1,327.6

2,142.7

Accounting policy – Rental income
Rental income from operating leases is recognised as income on a straight line basis. Where a lease has a fixed annual increase, 
the total rent receivable over the operating lease is recognised as revenue on a straight-line basis over the lease term. This results 
in more income being recognised early in the lease term and less late in the lease term compared to the lease conditions (i.e. actual 
cash received). The difference between the lease income recognised and the actual lease payment received is shown within the 
fair value of the investment property on the consolidated balance sheet. 

2. (b)  Assets held for sale

Investment properties

Current assets held for sale

Group

Trust

31 Dec 2020  
$ million

31 Dec 2019  
$ million

31 Dec 2020  
$ million

31 Dec 2019  
$ million

14.3

14.3

–

–

14.3

14.3

–

–

The Group has four investment properties held for sale at 31 December 2020. Contracts for the sale of two of these properties 
were exchanged prior to 31 December 2020, with settlements completed on 8 and 10 February 2021 and one of the properties 
is subject to a compulsory acquisition by the Victorian state government (refer to Note 4.(e) for further details).

Accounting policy – Assets held for sale
Investment properties are classified as held for sale and measured at fair value if their carrying amounts will be recovered 
principally through a sale transaction rather than through continuing use. This condition is met only when the sale is highly 
probable and the asset is available for immediate sale in its present condition. Management must be committed to the sale, 
which should be expected to qualify for recognition as a completed sale within one year from the date of classification.

52

Notes to the Consolidated Financial Statements continuedWaypoint REIT Limited – Annual Report 20202. (c)  Commitments and contingencies

Capital expenditure commitments

Within one year

After one year but not more than five years

Group

Trust

31 Dec 2020  
$ million

31 Dec 2019  
$ million

31 Dec 2020  
$ million

31 Dec 2019  
$ million

0.6

–

0.6

35.5

–

35.5

0.6

–

0.6

35.5

–

35.5

The Group has committed to contracts for the construction of one fuel and convenience retail property with an aggregate 
completion value of $1.3 million, including $0.6 million for which no accrual has been made as at 31 December 2020. This site 
is expected to reach practical completion over the next six months.

Other items
On 24 September 2018, the Group received an assessment from the Victorian State Revenue Office (SRO) for $31.2 million. 
The assessment relates to the transfer of Victorian properties to the Group prior to its listing in August 2016. Pursuant to the 
arrangements between the Group and Viva Energy Group, any such costs will remain payable by Viva Energy Group. Viva Energy 
Group lodged an objection to the assessment on 2 November 2018 and assumed conduct of this matter under a conduct and 
indemnity deed. In May 2020, the SRO disallowed Viva Energy Group’s objection and Viva Energy Group is appealing this matter, 
which has now been referred to the Supreme Court.

Confirmation from the SRO that stamp duty has been paid is a prerequisite for Land Use Victoria, the agency that manages 
Victoria’s land titles registry, to register a transfer of land. Pending resolution of the above matter, Viva Energy Group remains 
the registered proprietor of these properties. Once this matter is resolved, the signed transfers of the titles to the properties 
are required to be registered to Waypoint REIT.

Other than noted above, there are no material outstanding contingent assets, liabilities or commitments as at 31 December 2020.

3. Capital management
The Group’s activities expose it to numerous external financial risks such as market risk, credit risk and liquidity risk. This section 
explains how the Group utilises its risk management framework to reduce volatility from these external factors. 

3. (a)  Borrowings

Non-current liabilities

Bank facilities

USPP Notes*

Institutional term loans

Gross unsecured borrowings

Unamortised borrowing costs

Net unsecured borrowings 

Group

Trust

31 Dec 2020  
$ million

31 Dec 2019  
$ million

31 Dec 2020  
$ million

31 Dec 2019  
$ million

583.7

227.8

40.0

851.5

(5.7)

845.8

786.7

–

60.0

846.7

(3.6)

843.1

583.7

227.8

40.0

851.5

(5.7)

845.8

786.7

–

60.0

846.7

(3.6)

843.1

Total undrawn facilities available

178.0

250.0

178.0

250.0

* Net of a fair value hedge adjustment of $3.3 million (31 December 2019: Not applicable).

53

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate Directory3. Capital management continued

3. (a)  Borrowings continued

USPP Notes
The USPP Notes are further detailed below:

USD fixed 
coupon

2.89%

3.18%

3.33%

Maturity 
date

29 Oct 27

29 Oct 30

29 Oct 32

Notional 
value of 
cross 
currency 
swaps  
$ million

108.9

76.8

62.9

248.6

AUD 
equivalent 
on issuance 
date  
$ million

Foreign 
exchange 
and fair 
value 
movement  
$ million

Carrying 
amount  
31 Dec 2020  
$ million

108.9

76.8

62.9

248.6

–

248.6

(17.5)

(3.3)

(20.8)

101.3

71.4

58.4

231.1

(3.3)

227.8

27.5

1.3

28.8

256.6

7 year tranche

10 year tranche

12 year tranche

Total Exposure

Fair value hedge adjustment

Total 

Cross currency interest rate swaps

Accrued interest on swaps

Total cross currency interest rate swaps

Net USPP Notes exposure

The fair value of the USPP Notes is $231.1 million as at 31 December 2020 based on discounted cash flows using a current borrowing 
rate. They are classified as level 3 fair values in the fair value hierarchy.

Maturities, interest rates and covenants
The weighted average debt maturity as at 31 December 2020 was 4.3 years (31 December 2019: 2.9 years), with maturity dates 
ranging from June 2022 to October 2032. 

The interest rate applying to the drawn amount of the bank and institutional term loan facilities is set on a periodic basis 
(one, three or six months) at the prevailing market interest rate at the commencement of the period (Australian dollar, bank bill 
swap rate), plus the applicable margin. For the majority of these debt facilities, the interest margin has a rate increase/decrease 
applied if:

•  Debt Covenant Gearing is higher than 40% – increase by 0.20%

•  Debt Covenant Gearing is lower than 30% – decrease by 0.10%

The interest rate applying to the USPP notes is fixed in USD as noted above, with cross currency swaps in place for 100% of these 
facilities to mitigate the foreign exchange risk and convert the USD interest rate exposure to a floating AUD interest rate exposure.

Facility agreement covenants and related restrictions include:

•  Interest cover ratio of not less than 2.0 times (actual at 31 December 2020: 5.3 times).

•  Gearing ratio of not more than 50% (actual at 31 December 2020: 32.1%).

•  A draw down cannot be completed if Gearing is or will exceed 45% via the draw down being completed.

•  Review events will occur if Viva Energy Group Limited or its affiliates sells or transfers their securityholding such that their 

holding falls below 20% or another entity takes control of the Group (no longer applicable after February 2020 review event).

Consent to waive the review event triggered by Viva Energy Group’s sale of its remaining interest in the Group in February 2020 
was obtained from the majority of lenders as required under the facility agreements. In connection with the review event, 
the terms of a $100 million bilateral facility were amended and a $20 million institutional term loan was repaid. 

The Group was in compliance with its covenants throughout the period. 

The fair values of bank and institutional term loan borrowings are not materially different from their carrying amounts due to their 
short-term nature.

54

Notes to the Consolidated Financial Statements continuedWaypoint REIT Limited – Annual Report 2020Accounting policy – Borrowings
Borrowings are initially recognised at fair value and subsequently measured at amortised cost using the effective interest 
rate method. Under the effective interest rate method, any transaction fees, costs, discounts and premiums directly related 
to borrowings are recognised in the profit and loss over the expected life of the borrowings. Borrowings are removed from 
the consolidated balance sheet when the obligation specified in the contract is discharged, cancelled or expired. 

Borrowings with maturities greater than 12 months after reporting date are classified as non-current liabilities.

3. (b)  Net finance costs

Finance income

Finance income

Interest expense 

Write off of loan establishment costs due to refinancing 

Finance expense

Designated hedge accounting relationship

Gain/(loss) on fair value movements – fair value hedges

Derivatives not designated in hedge accounting 

Gain/(loss) on fair value movements

Net gain/(loss) on derivative financial instruments

Group

Trust

2020  
$ million

2019  
$ million

2020  
$ million

2019  
$ million

0.2

0.2

33.9

1.4

35.3

1.1

(1.4)

(0.3)

1.3

1.3

30.9

0.0

30.9

–

–

–

0.1

0.1

33.9

1.4

35.3

1.1

(1.4)

(0.3)

1.2

1.2

30.9

0.0

30.9

–

–

–

Accounting policy – Finance costs
Finance costs include interest expense on debt financing arrangements, settlements (including restructure and termination costs 
unless material, in which case separate disclosure will apply) of interest rate swaps and amortisation of upfront borrowing costs 
incurred in connection with the arrangement of borrowings available to the Group.

3. (c)  Net debt reconciliation

Net debt at 1 January 2019

Cash flows

Net debt at 31 December 2019

Cash flows

Movement in fair value hedge adjustment

Movement in foreign exchange

Net debt at 31 December 2020

Cash 
and cash 
equivalents  
$ million

Borrowings 
due within 
1 year  
$ million

Borrowings 
due after 
1 year  
$ million

12.2

15.3

27.5

(12.0)

–

–

15.5

–

–

–

–

–

–

–

852.7

(6.0)

846.7

25.6

(3.3)

(17.5)

851.5

Net total  
$ million

840.5

(21.3)

819.2

37.6

(3.3)

(17.5)

836.0

55

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate Directory3. Capital management continued

3. (d)  Derivative financial instruments
The Group has the following derivative financial instruments:

Current liabilities

Instruments in a designated cash flow hedge

 Interest rate swaps

Current liabilities

Non-current liabilities

Instruments held at fair value through profit or loss

 Interest rate swaps 

Instruments in a designated cash flow hedge

 Interest rate swaps 

Instruments in a designated fair value hedge

 Cross currency swaps

Non-current liabilities

Total

Group

Trust

31 Dec 2020  
$ million

31 Dec 2019  
$ million

31 Dec 2020  
$ million

31 Dec 2019  
$ million

1.0

1.0

17.8

–

–

–

1.0

1.0

17.8

8.3

25.9

8.3

27.5

53.6

54.6

–

25.9

25.9

27.5

53.6

54.6

–

–

–

25.9

–

25.9

25.9

(i)  interest rate swaps
The notional principal amounts and periods of expiry of the interest rate swap contracts are as follows:

Less than 1 year

1 to 2 years

2 to 3 years

3 to 4 years

4 to 5 years

5 to 6 years

6 to 7 years

7 to 8 years

8 to 9 years

Group

Trust

31 Dec 2020  
$ million

31 Dec 2019  
$ million

31 Dec 2020  
$ million

31 Dec 2019  
$ million

275.8

78.9

185.1

–

196.5

40.0

–

–

–

776.3

–

368.3

110.0

258.0

–

–

40.0

–

20.0

796.3

275.8

78.9

185.1

–

196.5

40.0

–

–

–

776.3

–

368.3

110.0

258.0

–

–

40.0

–

20.0

796.3

As at 31 December 2020, interest rate swaps were in place to cover 89% of drawn facilities, the weighted average hedge rate 
was 1.88% per annum and the weighted average term was 2.4 years.

56

Notes to the Consolidated Financial Statements continuedWaypoint REIT Limited – Annual Report 2020(ii)  Cross currency swaps
As at 31 December 2020, cross currency swaps were in place to cover 100% of debt denominated in foreign currency and the 
weighted average term was 9.0 years. Refer to Note 3.(a) for further details.

Accounting policy – Derivative financial instruments
Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured 
to their fair value at the end of each reporting period. The accounting for subsequent changes in fair value depends on whether 
the derivative is designated as a hedging instrument, and, if so, the nature of the item being hedged. The Group designates  
certain derivatives as either:

•  hedges of the fair value of recognised assets or liabilities or a firm commitment (fair value hedges); or

•  hedges of a particular risk associated with the cash flows of recognised assets and liabilities and highly probable forecast 

transactions (cash flow hedges).

Where applicable, the Group documents at the inception of the hedging transaction the relationship between hedging  
instruments and hedged items, as well as its risk management objective and strategy for undertaking various hedge transactions. 
The Group also documents its assessment, both at hedge inception and on an ongoing basis, of whether the derivatives that are 
used in hedging transactions have been and will continue to be highly effective in offsetting changes in fair values or cash flows 
of hedged items.

(i) Fair value hedges
Cross currency swaps are used to hedge 100% of the currency risk on US dollar denominated debt. The portion of the cross 
currency swap that equates to the fair value hedge having a $nil fair value at inception is designated as a fair value hedge and 
hedge accounting is applied.

The gain or loss relating to interest payments on interest rate swaps hedging fixed rate borrowings is recognised in profit or 
loss within finance costs. Changes in the fair value of derivative hedging instruments and the hedged fixed rate borrowings 
attributable to interest rate risk are recognised within ‘Net gains/(losses) from derivative financial instruments’. The gain or loss 
relating to the ineffective portion is also recognised in profit or loss within ‘Net gains/(losses) from derivative financial instruments’.

(ii) Cash flow hedges
Interest rate swaps are used to partially hedge interest rate risk on floating rate debt. Hedge accounting applies to interest 
rate swaps entered on or before 31 December 2019. In accordance with industry practice, hedge accounting does not apply 
to commercial interest rate hedges entered after this date. 

Cross currency swaps are also used to hedge 100% of the currency risk on US dollar denominated debt. The residual portion 
of the cross currency swap is designated as a cash flow hedge and hedge accounting is applied.

The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognised 
in other comprehensive income and accumulated in reserves in equity. The gain or loss relating to the ineffective portion is 
recognised immediately in profit or loss within other income or other expense.

Amounts accumulated in equity are reclassified to profit or loss in the periods when the hedged item affects profit or loss 
(for instance when the forecast sale that is hedged takes place). The gain or loss relating to the effective portion of interest rate 
swaps hedging variable rate borrowings is recognised in profit or loss within finance costs. 

When a hedging instrument expires or is sold or terminated, or when a hedge no longer meets the criteria for hedge accounting, 
any cumulative gain or loss existing in equity at that time remains in equity and is recognised when the forecast transaction is 
ultimately recognised in profit or loss. When a forecast transaction is no longer expected to occur, the cumulative gain or loss 
that was reported in equity is immediately reclassified to profit or loss.

57

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate Directory3. Capital management continued

3. (d)  Derivative financial instruments continued

(ii)  Cross currency swaps continued

(ii) Cash flow hedges continued
The following table shows balance sheet movements during the year relative to the gain/(loss) recorded in profit and loss for both 
borrowings and derivatives:

Change in 
borrowings

Net drawn/
(repaid)

Gain/
(loss) on 
fair value 
of debt

Change in 
derivatives

Paid

Cash flow 
hedge 
reserve 
impact

Gain/(loss) 
on fair 
value of 
derivatives

Net gain/
(loss) in 
profit  
and loss

$ million

USD

USPP

Foreign exposure

AUD

227.8

227.8

248.6

248.6

20.8

20.8

(27.5)

(27.5)

Bank facilities

(203.0)

(203.0)

Institutional term loans

(20.0)

(20.0)

Interest rate swaps

Borrowing costs

Total

–

(2.1)

2.7

–

–

–

–

–

–

–

–

(1.2)

–

25.6

20.8

(28.7)

–

–

–

–

(3.5)

–

(3.5)

(7.8)

(7.8)

(19.7)

(19.7)

–

–

0.2

–

–

–

(4.9)

–

(7.6)

(24.6)

1.1

1.1

–

–

(4.9)

–

(3.8)

(iii) Derivatives that do not qualify for hedge accounting
Hedge accounting is not adopted for certain derivative instruments. Changes in the fair value of any such derivative instrument 
are recognised immediately in profit or loss and are included in other income or other expenses.

Key estimate – Valuation of derivative financial instruments
The Group’s financial instruments are over-the-counter derivatives for which there are no quoted market prices. Valuation techniques 
(including pricing models, which estimate the present value of estimated future cash flows based on observable yield curves) are 
used to determine fair values. 

Models use observable data, to the extent practicable. However, areas such as credit risk (both own and counterparty), volatilities 
and correlations require management to make estimates. Changes in assumptions about these factors could affect the reported 
fair value of financial instruments.

3. (e)  Financial risk management

(i)  Fair value hierarchy

(i) Classification of financial assets and financial liabilities
AASB 13 Fair Value Measurement requires disclosure of fair value measurements by level of fair value hierarchy. The fair value 
hierarchy has the following levels:

•  quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1);

•  inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) 

or indirectly (that is, derived from prices) (level 2); and

•  inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3).

58

Notes to the Consolidated Financial Statements continuedWaypoint REIT Limited – Annual Report 2020The level in the fair value hierarchy within which the fair value measurement is categorised in its entirety is determined on the 
basis of the lowest level input that is significant to the fair value measurement in its entirety. For this purpose, the significance 
of an input is assessed against the fair value measurement in its entirety. If a fair value measurement uses observable inputs 
that require significant adjustment based on unobservable inputs, that measurement is a level 3 measurement. Assessing the 
significance of a particular input to the fair value measurement in its entirety requires judgement, considering factors specific 
to the asset or liability.

The determination of what constitutes observable requires significant judgement by the Directors. The Directors consider 
observable data to be that market data that is readily available, regularly distributed or updated, reliable and verifiable, 
not proprietary, and provided by independent sources that are actively involved in the relevant market.

The following table presents the Group’s financial assets and liabilities (by class) measured at fair value according to the fair value 
hierarchy at 31 December 2020 on a recurring basis:

31 December 2020

Assets held for sale

Investment properties

USPP Notes

Derivatives

Total

31 December 2019 

Investment properties

Derivatives

Total

Level 1  
$ million

Level 2  
$ million

Level 3  
$ million

Total  
$ million

–

–

–

–

–

–

–

–

(54.6)

(54.6)

14.3

14.3

2,897.3

2,897.3

(231.1)

–

(231.1)

(54.6)

2,683.8

2,629.2

Level 1  
$ million

Level 2  
$ million

Level 3  
$ million

Total  
$ million

–

–

–

–

 2,684.2 

2,684.2

(25.9)

(25.9)

–

(25.9)

2,684.2

2,658.3

The Group’s policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the end of the reporting 
period. There were no transfers between levels during the period.

The Group did not measure any financial assets or financial liabilities at fair value on a non-recurring basis as at 31 December 2020.

(ii) Valuation techniques used to derive level 2 and level 3 values
The fair value of financial instruments that are not traded in an active market (for example, over-the-counter derivatives) is 
determined using valuation techniques. These valuation techniques maximise the use of observable market data where it is 
available and rely as little as possible on entity specific estimates. If all significant inputs required to fair value an instrument 
are observable, the instrument is included in level 2.

If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

The fair value of interest rate swaps is calculated as the present value of the estimated future cash flows based on observable 
yield curves, taking into account any material credit risk.

(ii)  Investment risk

(i) Tenant concentration risk, financial standing and sector concentration risk
97% of the Group’s rental income is received from Viva Energy Australia. If Viva Energy Australia’s financial standing materially 
deteriorates Viva Energy Australia’s ability to make rental payments to Waypoint REIT may be adversely impacted, which may have 
a material adverse impact on the Group’s results of operations, financial position and ability to service and/or obtain financing. 
Furthermore, a material decline in the profitability of Viva Energy Australia’s business could affect the perceived stability of the 
rental income of Waypoint REIT and may affect Waypoint REIT’s ability to obtain financing on acceptable terms. A material 
decline in the profitability of Viva Energy Australia’s business could also lead to reduced capacity or ability for Viva Energy 
Australia to pay market rents when renewal options are exercised, which could result in a decline in the values of Waypoint REIT’s 
investment properties. 

59

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate Directory3. Capital management continued

3. (e)  Financial risk management continued

(ii)  Investment risk continued

(ii) Collection risk
The Group performs financial due diligence on potential new tenants and holds collateral in the form of security deposits or 
bank guarantees where appropriate. Rent is due in advance on the first day of each billing period (typically monthly), with arrears 
monitored and arrears notices issued on a regular basis. The Group applies the AASB 9 simplified approach to measuring expected 
credit losses, which uses a lifetime expected loss allowance for all trade and other financial assets. The loss allowances for trade 
and other financial assets are based on assumptions about risk of default and expected loss rates. The Group uses judgement in 
making these assumptions, based on the Group’s past history and existing market conditions as well as forward-looking estimates 
at the end of each reporting period.

In excess of 99% of the Group’s income is derived from fuel tenants who have continued to operate through COVID-19, providing 
essential services to the community. Accordingly, the Group has not been materially impacted by COVID-19 to date with $0.1 million 
of rental relief agreed with seven non-fuel tenants (of which 50% has been waived and 50% deferred in accordance with the 
Commercial Code of Conduct). 

(iii) Re-leasing and vacancy risk
The Group’s total property portfolio is 99.9% leased with only 19 leases (representing 2.0% of income) expiring before the end of 
2025 and a weighted average lease expiry of 10.8 years. The majority of the portfolio is subject to multiple 10-year options in favour 
of the tenant, with the rent from commencement of each option period to either be agreed between the parties or set by independent 
market rent determination. However, there is a risk that tenants may not exercise their option, or that the commencing rent will 
be lower than passing rent and/or market rent (if agreed between the parties). Further, termination of Viva Energy Group’s right to 
use Shell branding (current agreement expires in 2026) and/or its Alliance Agreement with Coles Express (current agreement expires 
in 2029) could also impact Viva Energy Australia’s decision whether it renews its existing leases. Resulting vacancy or reduced rental 
income could negatively impact distributions of the Group and/or the value of the Group’s investment properties. 

(iv) Investment property value 
The value of the Group’s portfolio of investment properties may be adversely affected by a number of factors, including factors 
outside the control of the Group, such as supply and demand for traditional fuel, alternative fuels and/or convenience retail products, 
supply and demand for fuel and convenience properties, general property market conditions, the availability and cost of credit 
including sector-specific environmental, sustainability and governance considerations, the ability to attract and implement 
economically viable rental arrangements, Viva Energy Australia’s financial condition deteriorating, occupiers not extending the 
term of leases, capitalisation rates and general economic factors such as the level of inflation and interest rates. 

As changes in valuations are recorded on the statutory net profit statement, any decreases in value will have a negative impact 
on the statutory net profit statement and net tangible assets per security and in turn the market price of the Group’s securities 
may fall. The property portfolio is geographically diversified to mitigate the risk of localised valuation impacts and the majority 
of assets are located in metropolitan areas which typically have higher underlying land values and alternative use potential. 
Active asset management, including the disposal of non-core assets, also, in part, mitigates this risk. 

(v) Environmental and climate risk
The Group depends on its tenants to perform their obligations under various environmental arrangements in relation to the properties 
they lease. The Group has an indemnity from Viva Energy Australia in respect of certain liability for historical environmental 
contamination across the 425 assets acquired at the time of the Group’s initial public offering. The Group also carries out 
environmental due diligence in relation to potential property acquisitions. If any property in the portfolio is contaminated by a fuel 
tenant or its invitee during the term of a lease, the tenant under that lease must remediate it, at their cost to a standard consistent 
with operating the site as a fuel and convenience retail property or similar commercial use. If the tenants were to fail to meet 
their obligations under these arrangements (including due to their insolvency), the Group may incur significant costs to rectify 
contamination on its properties and also on other properties which may be consequently impacted.

The Group is subject to a range of regulatory regimes (including environmental regulations) that cover the specific assets of the 
Group and how they are operated. These regulatory regimes are subject to ongoing review and change that may increase the cost 
of compliance, reporting and maintenance of the Group’s assets. There remains a risk (for example, where the regulator is unable 
to pursue the polluter, the polluter cannot be identified or the polluter is unable to meet its obligations) that the Group, as owner 
of the properties in the portfolio, may face liability for breach of environmental laws and regulations.

60

Notes to the Consolidated Financial Statements continuedWaypoint REIT Limited – Annual Report 2020Extreme weather and other climate change-related events have the potential to damage the Group’s assets and disrupt the tenants’ 
operations. Such events may increase costs for maintenance and insurance of the Group’s assets, and may affect the ability to 
re-lease the Group’s investment properties in the future and the rent levels for which they can be leased, thereby affecting future 
investment property valuations and rental cash flows. Insurance premiums and/or deductibles may change or insurance may 
not be able to be obtained at all. 

The precise nature of these risks is uncertain as it depends on complex factors such as policy change, technology development, 
market forces, and the links between these factors and climatic conditions.

(vi) Debt agreement and refinancing risk
The Group has outstanding debt facilities. General economic and business conditions as well as sector-specific environmental, 
sustainability and governance considerations that impact the debt or equity markets could impact the Group’s ability to refinance 
its debt facilities when required. If the covenants in these facilities are breached by the Group, this may result in the Group being 
subject to increased interest rate margins and covenants restricting its ability to engage in certain types of activities or to pay 
distributions to securityholders. Debt may not be able to be obtained at all.

If debt facilities are not available or are not available in adequate volume, the Group may need to sell assets to repay debt. There is 
no guarantee that there will be willing purchasers for the Group’s assets or that purchasers will pay prices at or greater than book 
value of these investment properties. To mitigate this risk, debt maturities are staggered, debt is held across a diverse set of 
sources, lenders and geographies, and debt is typically refinanced at least 12 months in advance of maturity. 

If a third party entity gains control of Waypoint REIT, then this would constitute a review event under certain of the terms of the 
Group’s debt facility agreements, and (subject to specified negotiation and notification periods) a repayment of the Group’s debt 
facilities may be required. 

The Directors regularly monitor the debt facility covenants to ensure compliance and consider the refinancing options and timing 
available to the Group.

(vii) AFSL compliance risk
VER Limited, a subsidiary of Waypoint REIT Limited, holds an AFSL and acts as the responsible entity for Waypoint REIT Trust. 
The AFSL requires, among other matters, minimum levels of net tangible assets, liquid assets, cash reserves and liquidity, 
which may restrict the Group in paying distributions that would breach these requirements.

The Directors review and monitor VER Limited’s balance sheet quarterly and the adequacy and ongoing training of responsible 
managers annually to ensure compliance with its AFSL requirements.

(viii) Personnel risk
Loss of key personnel could potentially have an adverse impact on the management and the financial performance of the 
Group and in turn may affect the returns to securityholders. To mitigate this risk, processes and procedures are standardised 
and automated to the extent practicable, succession planning is undertaken and remuneration structures include components 
payable on a deferred basis to reduce key personnel risk.

(ix) Cyber security risk
Cyber-attacks are becoming increasing sophisticated and a material data breach could have an adverse financial or reputation 
impact. To help mitigate this risk, the Group uses the services of third party technology experts, provides regular staff training 
and performs pre-implementation and annual reviews over key Software as a Service (SaaS) providers.

61

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate Directory3. Capital management continued

3. (e)  Financial risk management continued

(iii)  Credit risk
Credit risk is the risk that one party to a financial instrument will fail to discharge its obligation and cause the other party to incur 
a financial loss.

Maximum exposure to credit risk
The Group’s maximum credit risk exposure at balance date in relation to each class of recognised financial asset, other than 
derivative financial instruments, is the gross carrying amount of those assets as indicated in the consolidated balance sheet. 

Financial assets such as cash at bank and interest rate swaps are held with high credit quality financial institutions. Refer to Tenant 
concentration risk and Collection risk at Note 3.(e)(ii) for risk management policies pertaining to rent receivables.

The table below shows the ageing analysis of rent receivables of the Group.

31 December 2020

Rent receivables

Provision for expected credit losses

31 December 2019

Rent receivables

Provision for expected credit losses

Less than 
31 days  
$ million

31 to 
60 days  
$ million

61 to 
90 days  
$ million

More than 
90 days  
$ million

Total  
$ million

0.3

–

–

–

0.3

–

–

–

0.1

–

–

–

0.2

–

–

–

0.9

–

–

–

Accounting policy – Rent receivables
Other current assets includes rent receivables which are recognised initially at fair value and subsequently measured at amortised 
cost, less provision for expected credit losses. They are generally due for settlement within 30 days and are therefore all classified 
as current. The Group applies the AASB 9 simplified approach to measuring expected credit losses, which involves a lifetime 
expected loss allowance for all rent receivables and other financial assets. 

To measure the expected credit losses, rent receivables are grouped based on shared credit risk characteristics, the days past due 
and the expected loss rates based on historical credit losses experienced. The historical loss rates are adjusted to reflect current 
and forward-looking information on macroeconomic factors affecting the ability of the customers to settle the rent receivables. 

Rent receivables are written off where there is no reasonable expectation of recovery. Indicators that there is no reasonable 
expectation of recovery include, amongst others, the failure of a debtor to engage in a repayment plan with the Group and a failure 
to make contractual payments for a period of greater than 365 days past due. Impairment losses on rent receivables are recorded 
within management and administration expenses within distributable earnings. Subsequent recoveries of amounts previously 
written off are credited against the same line item.

(iv)  Liquidity risk
Liquidity risk is the risk that the Group may not be able to generate sufficient cash resources to settle its obligations in full as 
they fall due or can only do so on terms that are materially disadvantageous. The Group monitors its exposure to liquidity risk 
by setting budgets and projecting cash flows to help ensure there is sufficient cash on hand as required or debt facility funding 
is available to meet financial liabilities as they fall due. 

The weighted average debt maturity is 4.3 years, and the weighted average lease expiry is 10.8 years.

62

Notes to the Consolidated Financial Statements continuedWaypoint REIT Limited – Annual Report 2020The table below analyses the Group’s financial liabilities into relevant maturity groupings based on the remaining period as at the 
reporting date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows. 

Group

31 December 2020

Trade and other payables

Interest payable

Lease liabilities

Distribution payable

Borrowings

Derivative financial liabilities

Contractual cash flows 

31 December 2019

Trade and other payables

Interest payable

Distribution payable

Borrowings

Derivative financial liabilities

Contractual cash flows 

Less than 
12 months  
$ million

Between 
1 and 2 years  
$ million

Over 2 years  
$ million

Total 
contractual 
cash flows  
$ million

Carrying 
amount 
liabilities  
$ million

4.9

6.5

0.2

60.7

17.9

20.9

–

–

0.2

–

85.5

15.4

111.1

101.1

–

–

0.7

–

863.9

62.9

927.5

4.9

6.5

1.1

60.7

967.3

99.2

1,139.7

4.9

6.5

1.1

60.7

851.5

54.6

979.3

Less than 
12 months  
$ million

Between 
1 and 2 years  
$ million

Over 2 years  
$ million

Total 
contractual 
cash flows  
$ million

Carrying 
amount 
liabilities  
$ million

4.9

3.0

56.0

22.7

9.5

96.1

–

–

–

141.8

9.5

151.3

–

–

–

752.8

12.1

764.9

4.9

3.0

56.0

917.3

31.1

1,012.3

4.9

3.0

56.0

846.7

25.9

936.5

Comparative disclosure updated to conform with current year presentation.

Trust

31 December 2020

Trade and other payables

Interest payable

Distribution payable

Borrowings

Derivative financial liabilities

Contractual cash flows 

31 December 2019

Trade and other payables

Interest payable

Distribution payable

Borrowings

Derivative financial liabilities

Contractual cash flows 

Less than 
12 months  
$ million

Between 
1 and 2 years  
$ million

Over 2 years  
$ million

Total 
contractual 
cash flows  
$ million

Carrying 
amount 
liabilities  
$ million

11.8

6.5

60.7

17.9

20.9

117.8

–

–

–

85.5

15.4

100.9

–

–

–

863.9

62.9

926.8

11.8

6.5

60.7

967.3

99.2

1,145.5

11.8

6.5

60.7

851.5

54.6

985.1

Less than 
12 months  
$ million

Between 
1 and 2 years  
$ million

Over 2 years  
$ million

Total 
contractual 
cash flows  
$ million

Carrying 
amount 
liabilities  
$ million

10.9

3.0

56.0

22.7

9.5

102.1

–

–

–

141.8

9.5

151.3

–

–

–

752.8

12.1

764.9

10.9

3.0

56.0

917.3

31.1

1,018.3

10.9

3.0

56.0

846.7

25.9

942.5

Comparative disclosure updated to conform with current year presentation.

63

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate Directory3. Capital management continued

3. (e)  Financial risk management continued

(v)  Capital risk management
The Group aims to invest to meet the Group’s investment objectives while maintaining sufficient liquidity to meet its commitments. 
The Group regularly reviews performance, including asset allocation strategies, investment and operational management strategies, 
investment opportunities and risk management.

In order to maintain an appropriate capital structure, the Group may adjust the amount of distributions paid to securityholders, 
return capital to securityholders, issue new securities, sell or buy assets or reduce or raise debt.

The Group monitors capital through the analysis of a number of financial ratios, including the Debt Covenant Gearing ratio.

Total liabilities (excluding mark-to-market positions and accrued capital expenditure)

Total assets (excluding mark-to-market positions) 

Debt Covenant Gearing ratio

31 Dec 2020  
$ million

31 Dec 2019  
$ million

941.6

2,930.6

32.1%

909.3

2,718.1

33.5%

(vi)  Market risk

(i) Interest rates
The Group’s cash and cash equivalents, floating rate borrowings and interest rate swaps expose it to a risk of change in fair value 
or future cash flows due to changes in interest rates. The Group uses floating-to-fixed interest rate swaps to partially hedge its 
exposure to changes in interest rates on variable rate borrowings. By hedging against changes in interest rates, the Group has 
reduced exposure to changes in interest rates on its outward cash flows so long as the counterparties to those interest rate 
swaps meet their obligations to the Group. 

The Group’s exposure to interest rate risk at reporting date, including its sensitivity to changes in market interest rates that were 
reasonably possible, is as follows:

Financial assets

Cash and cash equivalents

Derivative financial instruments (notional principal amount)

– Fixed interest rate swaps

Financial liabilities

Interest-bearing liabilities – floating rate interest

Derivative financial instruments (notional principal amount)

– Cross currency swaps

Net exposure

Sensitivity of profit and loss and other comprehensive income to movements in market interest rates:

Increased by 50 basis points

Decreased by 50 basis points 

31 Dec 2020  
$ million

31 Dec 2019  
$ million

15.5

27.5

776.3

796.3

623.7

846.7

248.6

(80.5)

–

(22.9)

2020  
$ million

2019  
$ million

(0.4)

0.4

(0.1)

0.1

The interest rate range for sensitivity purposes has been determined using the assumption that interest rates changed by 
+/- 50 basis points from balance date rates with all other variables held constant. In determining the impact of profit and loss 
movements arising from interest rate risk, the Group has considered historic and expected future interest rate movements in 
order to determine a reasonably possible shift in assumptions.

Where derivative financial instruments are designated as cash flow hedges, the impact of an interest rate change flows through 
other comprehensive income.

64

Notes to the Consolidated Financial Statements continuedWaypoint REIT Limited – Annual Report 2020(ii) Foreign exchange rates
A portion of the Group’s debt is denominated in US dollars and as a result, the Group is exposed to a risk of change in fair value 
or future cash flows due to changes in foreign exchange rates. The Group economically hedges 100% of its exposure to changes 
in foreign exchange rates by using cross currency swaps. By hedging against changes in foreign exchange rates, the Group 
eliminates its exposure to changes in foreign exchange rates on its outward cash flows so long as the counterparties to those 
cross currency swaps meet their obligations to the Group. 

3. (f)  Contributed equity

01/01/19

Opening balance

Group

Trust

Number of 
securities  
‘000

Number of 
securities  
‘000

 $ million

725,750

1,496.9

725,750

$ million

1,494.4

27/02/19

Issue of securities under institutional placement

43,103

27/02/19 

Equity raising costs

28/02/19 

Issue of securities under DRP

26/03/19

Issue of securities under Security Purchase Plan

29/08/19 

Issue of securities under DRP

–

2,515

4,309

3,013

100.0

(2.1)

5.6

10.0

7.9

43,103

–

2,515

4,309

3,013

99.9

(1.5)

5.6

10.0

7.9

31/12/19

778,690

1,618.3

778,690

1,616.3

27/02/20

Issue of securities under DRP

31/05/20 

Capital reallocation

27/08/20 

Issue of securities under DRP

31/12/20

2,169

–

4,163

5.8

–

10.7

2,169

–

4,163

5.8

(5.7)

10.7

785,022

 1,634.8

785,022

1,627.1

3. (g)  Non-controlling interests
The financial statements reflect the consolidation of Waypoint REIT. For financial reporting purposes, one entity in the stapled 
group must be identified as the acquirer or parent entity of the others. The Company has been identified as the acquirer of the 
Trust, resulting in the Trust being disclosed as non-controlling interests.

Opening balance 

Profit for the year 

Effective portion of changes in fair value of cash flow hedges

Capital reallocation

Contributions of equity, net of transaction costs

Distributions paid or provided for 

Distribution Reinvestment Plan 

Closing balance 

2020  
$ million

1,782.2

279.6

(7.6)

(5.7)

–

(118.5)

16.5

2019  
$ million

1,593.5

197.5

(19.0)

–

108.4

(111.7)

13.5

1,946.5

1,782.2

65

Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate Directory3. Capital management continued

3. (h) Reserves
The Group’s hedging reserves movements were:

Opening hedge reserve 

Net change in fair value of cash flow hedges

Reclassified to profit and loss

Closing hedge reserve

4. Additional information

4. (a)  Related party information

Group

Trust

2020  
$ million

2019  
$ million

2020  
$ million

2019  
$ million

25.9

8.8

(1.2)

33.5

6.9

25.4

(6.4)

25.9

25.9

8.8

(1.2)

33.5

6.9

25.4

(6.4)

25.9

(i)  Parent entity
The Company has been assessed as the parent entity of the Group; the securityholders’ interests in the Trust are included in equity 
as non-controlling interests relating to the stapled entity.

(ii)  Subsidiaries
Interests in subsidiaries are set out in Note 4.(c).

(iii)  Key management personnel compensation
Below are the aggregate amounts paid or payable to key management personnel (including Non-Executive Directors): 

Salary and fees

Short-term incentive

Other benefits

Superannuation

Annual and long-service leave

Group

Trust

31 Dec 2020  
$

31 Dec 2019  
$

31 Dec 2020  
$

31 Dec 2019  
$

665,780

810,000

864

53,649

12,801

392,694

665,780

392,694

–

–

37,306

–

810,000

864

53,649

12,801

–

–

37,306

–

1,543,094

430,000

1,543,094

430,000

KMP for the year ended 31 December 2020 includes Executives from 1 October 2020 (date of internalisation). KMP for the year 
ended 31 December 2019 only includes Directors as Executives were remunerated by Viva Energy Australia Pty Limited, the parent 
entity of the Manager. 

There were no loans made, guaranteed or secured, directly or indirectly, by the Group to KMP or their related parties during the year. 
There were no other transactions between the Group and any KMP or their related parties during the year.

(iv)  Stapled group
Waypoint REIT is a stapled group consisting of the Company and the Trust and their wholly owned entities. The Trust indirectly 
owns the investment property portfolio through its 100% ownership of the trusts, which own the investment properties and receive 
rent under operating leases. The Company directly owns all of the shares in VER Limited (Responsible Entity). Each stapled 
security consists of one share in the Company and one unit in the Trust.

66

Notes to the Consolidated Financial Statements continuedWaypoint REIT Limited – Annual Report 2020(v)  Transactions with related parties
Viva Energy Australia Pty Limited and VER Manager Pty Limited were related parties of the Group prior to the internalisation of the 
Group’s management on 30 September 2020.

The following transactions occurred with related parties:

Rental income received from Viva Energy Australia Pty Limited 
and its associated entities

Reimbursement of costs incurred by VER Manager Pty Limited 
in relation to managing the Group

Payment of distribution to Viva Energy Australia Pty Ltd

Payment to Viva Energy Group in relation to internalisation 
of the Group’s management function

Purchase of investment properties from an associated entity of  
Viva Energy Australia Pty Limited (Liberty Oil Holdings Pty Limited 
and its controlled entities)

Payments for construction and site development works to 
an associated entity of Viva Energy Australia Pty Limited  
(Liberty Oil Holdings Pty Limited and its controlled entities)

Responsible Entity fee paid to VER Limited

Payment of Responsible Entity fees and costs reimbursement 
to VER Limited

Reimbursement of costs to Waypoint REIT Limited

Reimbursement of costs to Waypoint Operations Pty Limited

Group

Trust

2020  
$ ’000

2019  
$ ’000

2020  
$ ’000

2019  
$ ’000

114,931

146,073

114,931

146,073

4,684

19,849

2,520

39,228

4,684

19,848

2,520

39,228

2.500

–

–

–

5,186

31,480

5,186

31,480

16,915

32,651

16,915

–

–

–

–

–

–

–

–

200

967

9,010

2,141

32,651

50

4,239

2,382

–

Amounts receivable:

Receivable from Waypoint REIT Limited

Receivable from VER Limited

Receivable from VER Custodian Pty Limited

Amounts payable:

Management costs reimbursable to VER Manager Pty Limited 
at the end of the period

Payable to Waypoint Operations Pty Limited

31 Dec 2020  
$’000

31 Dec 2019  
$’000

31 Dec 2020  
$’000

31 Dec 2019  
$’000

–

–

–

–

–

–

483

–

5,718

630

965

–

2,129

9,216

2,750

795

483

–

During the year in connection with the internalisation of the Group’s management function, the Group paid a $2.5 million facilitation 
payment to Viva Energy Group and incurred a $1.4 million expense in relation to a run-off insurance policy in favour of VER Manager 
and VER Limited. The Group also secured from Viva Energy Group, until 1 January 2030, the right (subject to the terms of the 
relevant lease) to be offered properties tenanted by Viva Energy Group where the owner wishes to sell the property and Viva Energy 
Group does not wish to exercise a pre-emptive right it might have to acquire the property. 

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Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate Directory4. Additional information continued

4. (b) Parent entity financial information
The individual financial statements for the parent entity of the Group, Waypoint REIT Limited, and the parent entity of the Trust 
Group, Waypoint REIT Trust, are below:

Balance sheet

Current assets

Non-current assets

Total assets

Current liabilities

Total liabilities

Shareholders’ equity

Contributed equity

Retained profits/(Accumulated losses)

Total equity

Profit/(loss) for the year

Total comprehensive income/(loss) for the year

Group

Trust

2020  
$ million

2019  
$ million

2020  
$ million

2019  
$ million

8.5

6.4

14.9

8.3

8.3

7.8

(1.2)

6.6

–

–

5.1

5.7

10.8

10.0

10.0

2.0

(1.2)

0.8

–

–

287.0

1,650.2

1,937.2

314.2

314.2

239.2

1,446.5

1,685.7

65.1

65.1

1,633.8

1,623.1

(10.8)

(2.5)

1,623.0

1,620.6

(3.7)

(3.7)

(4.8)

(4.8)

The parent entity did not have any guarantees, contingent liabilities or commitments as at 31 December 2020 or 31 December 2019.

4. (c)  Investments in subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following material subsidiaries of the 
Company and the Trust:

Name

Date of establishment

Controlled by the Company

VER Limited 

VER Custodian Pty Limited

Waypoint Operations Pty Limited*

Controlled by the Trust

VER Trust 

VER Finco Pty Limited

16 December 2015

27 May 2016

5 May 2020

10 July 2016

10 June 2016

* Waypoint Operations Pty Limited was formed in connection with the internalisation of the Group’s management.

All companies and trusts are incorporated or established in Australia. 

2020  
%

2019  
%

100

100

100

100

100

100

100

–

100

100

68

Notes to the Consolidated Financial Statements continuedWaypoint REIT Limited – Annual Report 20204. (d)  Remuneration of auditors
During the period the following fees were paid or payable for services provided by the auditor of the parent entity and its 
related practices. 

PricewaterhouseCoopers Australia

Audit and review of financial statements

 Group

 Trust

Total audit and review of financial reports

Other statutory assurance services

Total audit and statutory assurance services

Other services

 Tax compliance services

 Tax advisory services*

Total other non-audit services

2020  
$

2019  
$

137,845

22,275

160,120

20,975

181,095

86,700

104,601

191,301

129,400

21,625

151,025

20,275

171,300

44,667

81,200

125,867

Total remuneration of auditors

372,396

297,167

* Includes $43,401 incurred in relation to the internalisation of management.

4. (e)  Subsequent events
Subsequent to the end of the financial year:

•  The Victorian state government effected the compulsory acquisition of an asset held for sale with a carrying value of $6.8 million 
on 12 January 2021. Under the terms of the resumption, the Group is no longer entitled to collect rent from tenancies on the 
property from this date.

•  Settlement of two assets held for sale for total sale proceeds of $5.5 million occurred on 8 and 10 February 2021.

•  A distribution for the six months ended 31 December 2020 of $60.7 million was paid on 26 February 2021.

No other matter or circumstance has arisen since 31 December 2020 that has significantly affected, or may significantly affect:

•  the operations of the Group in future financial years; 

•  the results of those operations in future financial years; or

•  the state of affairs of the Group in future financial years.

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4. (f)  Summary of significant accounting policies
Significant accounting policies adopted in the preparation of these consolidated financial statements to the extent they have 
not already been disclosed in the other notes are listed below. These policies have been consistently applied to all the years 
presented, unless otherwise stated. 

(i)  Basis of preparation
These general purpose financial statements have been prepared in accordance with the requirements of the Corporations Act 
2001, Australian Accounting Standards (AASB) and interpretations issued by the Australian Accounting Standards Board and 
International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board. Waypoint REIT 
and Waypoint REIT Trust Group are for-profit entities for the purpose of preparing the financial statements.

The financial report has been prepared on an accruals and historical cost basis except for investment properties and derivative 
financial instruments which are measured at fair value. Cost is based on the fair value of consideration given in exchange for assets. 

The consolidated financial statements are prepared and presented in Australian dollars (the presentation currency).

Unless otherwise stated, the accounting policies adopted in the preparation of the financial report are consistent with those 
of the previous financial year. 

(ii)  Comparative information 
Where necessary, comparative information has been adjusted to conform to changes in presentation in the current period. 

(iii)  Going concern
As at 31 December 2020, the Group had a net current asset deficiency of $44.7 million and the Waypoint REIT Trust Group had 
a net current asset deficiency of $51.4 million. The Group uses cash at bank to pay for distributions and expenses (including 
property purchases), drawing down on revolving debt facilities when required. Revolving debt facilities are then repaid when there 
is excess cash available. The Group has $178.0 million of unused debt facilities at 31 December 2020, which can be drawn upon 
to fund the Group’s cash flow requirements provided that the Group meets its debt covenants and further borrowing will not 
cause Gearing to exceed 45%.

After taking into account all available information, the Directors have concluded that there are reasonable grounds to believe:

•  the Group will be able to pay its debts as and when they fall due; and

•  the basis of preparation of the financial report on a going concern basis is appropriate.

(iv)  New and amended standards adopted by the Group
The Group has applied the following standards and amendments for the first time for its annual reporting period commencing  
1 January 2020:

•  AASB 2018-7 Amendments to Australian Accounting Standards – Definition of Material [AASB 101 and AASB 108]

•  AASB 2018-6 Amendments to Australian Accounting Standards – Definition of a Business [AASB 3]

•  AASB 2019-3 Amendments to Australian Accounting Standards – Interest Rate Benchmark Reform [AASB 9, AASB 139 and AASB 7]

•  AASB 2019-5 Amendments to Australian Accounting Standards – Disclosure of the Effect of New IFRS Standards Not Yet issued 

in Australia [AASB 1054]

•  Conceptual Framework for Financial Reporting and AASB 2019-1 Amendments to Australian Accounting Standards – References 

to the Conceptual Framework

The Group also elected to adopt the following amendments early:

•  AASB 2020-3 Amendments to Australian Accounting Standards – Annual Improvements 2018-2020 and Other Amendments 

[AASB 1, AASB 3, AASB 9, AASB 116, AASB 137 and AASB 141]

•  AASB 2020-4 Amendments to Australian Accounting Standards – Covid-19-Related Rent Concessions [AASB 16]

The amendments listed above did not have any impact on the amounts recognised in prior periods and are not expected 
to significantly affect the current or future periods.

70

Notes to the Consolidated Financial Statements continuedWaypoint REIT Limited – Annual Report 2020(v)  Principles of consolidation

(i)  Stapled entities
Waypoint REIT is a stapled group consisting of the Company and the Trust and their wholly owned entities. The Trust indirectly 
owns the investment property portfolio through its 100% ownership of the trusts, which own the investment properties and 
receive rent under operating leases. The Company directly owns all of the shares in the Responsible Entity. Each stapled security 
consists of one share in the Company and one unit in the Trust. The shares and the units were stapled at allotment in accordance 
with the constitutions of the Company and the Trust and the Stapling Deed and trade together on the ASX. The securities in 
Waypoint REIT cannot be traded separately and can only be traded as a stapled security. 

AASB 3 Business Combinations requires one of the stapled entities in a stapling structure to be identified as the parent entity for 
the purpose of preparing consolidated financial reports. In accordance with this requirement, the Company has been identified 
as the parent entity in relation to the stapling with the Trust under Waypoint REIT.

The consolidated financial statements of the Group incorporate the assets and liabilities of the entities controlled by the Company 
during the period, including those deemed to be controlled by the Trust, by identifying it as the parent of the Group, and the results 
of those controlled entities for the period then ended. The effect of all transactions between entities in the Group are eliminated 
in full.

Non-controlling interests in the results and equity are shown separately in the consolidated statement of comprehensive income, 
consolidated balance sheet and consolidated statement of changes in equity respectively. Non-controlling interests are those 
interests in the Trust which are not held directly or indirectly by the Company.

(ii)  Subsidiaries
Subsidiaries are all entities (including trusts) over which the Group has control. The Group controls an entity when the Group 
is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns 
through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is 
transferred to the Group. They are deconsolidated from the date that control ceases.

The acquisition method of accounting is used to account for business combinations by the Group.

Inter-entity transactions, balances and unrealised gains on transactions between Group entities are eliminated. Unrealised losses 
are also eliminated unless the transaction provides evidence of an impairment of the transferred asset. Accounting policies of 
subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated statement of comprehensive 
income, consolidated balance sheet and consolidated statement of changes in equity respectively.

(vi)  Presentation of members’ interests in the Trust 
As the Company has been assessed as the parent entity of the Group, the securityholders’ interests in the Trust are included 
in equity as non-controlling interests relating to the stapled entity. Securityholders’ interests in the Trust are not presented as 
attributable to owners of the parent, reflecting the fact that they are not owned by the Company, but by the securityholders 
of the stapled group.

(vii)  Segment information
The Group has one business and geographic segment being the investment in fuel and convenience retail properties within Australia.

(viii)  Revenue
Interest income is recognised as it accrues using the effective interest rate method. Interest income is included in finance income 
in the consolidated statement of profit or loss. 

All income is stated net of goods and services tax.

(ix)  Expenses
All expenses are recognised in the consolidated profit or loss on an accruals basis.

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4. (f)  Summary of significant accounting policies continued

(x)  Management fees
Up until 30 September 2020, the Group reimbursed VER Manager for costs incurred in the management of Waypoint REIT’s 
operations. On 30 September 2020, to effect the internalisation of management, an implementation deed was executed under 
which VER Manager provided notice of its intention to retire as manager of the Group and the reimbursement of costs to VER 
Manager ceased.

(xi)  Employee benefits

(i)  Short-term obligations
Liabilities for wages and salaries, including non-monetary benefits and annual leave that are expected to be settled wholly within 
12 months after the end of the period in which the employees render the related service, are recognised in respect of employees’ 
service up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled. 
The liabilities are presented as current employee benefit obligations in the balance sheet.

(ii)  Other long-term employee benefit obligations
The liabilities for long-service leave that are not expected to be settled wholly within 12 months after the end of the period in which 
the employees render the related service are recognised as the expected future payments to be made in respect of services 
provided by employees up to the end of the reporting period. Consideration is given to expected future wages and salary levels, 
experience of employee departures, periods of service and market interest rates.

The obligations are presented as current liabilities in the balance sheet if the entity does not have an unconditional right to defer 
settlement for at least 12 months after the reporting period, regardless of when the actual settlement is expected to occur.

(xii)  Goods and services tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, unless the GST incurred is not recoverable from 
the taxation authority. In this case, it is recognised as part of the cost of acquisition of the asset or as part of the expense.

Receivables and payables are stated inclusive of GST receivable or payable. The net amount of GST recoverable from, or payable 
to, the taxation authority is included with other current assets and trade and other payables in the consolidated balance sheet.

Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities 
which are recoverable from, or payable to, the taxation authority are presented as operating cash flows.

(xiii)  Leases
The Group leases office premises. The Group assesses at contract inception whether a contract is, or contains, a lease. This is, 
if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Group 
applies a single recognition and measurement approach for all leases. The Group recognises lease liabilities to make lease payments 
and right of use assets representing the right to use the underlying assets.

(i)  Right of use assets
The Group right of use assets at the commencement date of the lease (that is, the date the underlying asset is available for use). 
Right of use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any 
remeasurement of lease liabilities. The cost of right of use assets includes the amount of lease liabilities recognised, initial direct 
costs incurred, and lease payments made at or before the commencement date less any lease incentives received. Right of use 
assets are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful lives of the assets.

(ii)  Lease liabilities
At the commencement date of the lease, the Group recognises lease liabilities measured at the present value of lease payments 
to be made over the lease term. The lease payments include fixed payments less any lease incentives receivable, variable lease 
payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees. The lease payments 
also include the exercise price of a purchase option reasonably certain to be exercised by the Group and payments of penalties 
for terminating the lease, if the lease term reflects the Group exercising the option to terminate.

In calculating the present value of lease payments, the Group uses its incremental borrowing rate at the lease commencement 
date because the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of 
lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying 
amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the lease payments 
(for example, changes to future payments resulting from a change in an index or rate used to determine such lease payments) 
or a change in the assessment of an option to purchase the underlying asset.

72

Notes to the Consolidated Financial Statements continuedWaypoint REIT Limited – Annual Report 2020(xiv)  Financial instruments

(i)  Classification
The Group’s investments are classified as at fair value through profit or loss. They comprise:

•  Financial instruments held for trading – Derivative financial instruments such as interest rate swaps are included under 

this classification.

•  Financial instruments designated at fair value through profit or loss upon initial recognition – These include financial assets 

that are not held for trading purposes and which may be sold. 

Financial assets designated at fair value through profit or loss at inception are those that are managed and their performance 
evaluated on a fair value basis in accordance with the Group’s documented investment strategy. The Group’s policy is for the 
Responsible Entity to evaluate the information about these financial instruments on a fair value basis together with other related 
financial information.

(ii)  Recognition/derecognition
Financial assets and financial liabilities are recognised on the date the Group becomes party to the contractual agreement 
(trade date) and it recognises changes in fair value of the financial assets or financial liabilities from this date.

Investments are derecognised when the right to receive cash flows from the investments has expired or the Group has transferred 
substantially all risks and rewards of ownership.

(iii)  Measurement

Financial assets and liabilities held at fair value through profit or loss
At initial recognition, financial assets are recognised at fair value. Transaction costs of financial assets carried at fair value through 
profit or loss are expensed in profit or loss.

The fair value of financial assets and liabilities traded in active markets is subsequently based on their quoted market prices at the 
end of the reporting period without any deduction for estimated future selling costs. The quoted market price used for financial 
assets held by the Group is the current bid price, and the quoted market price for financial liabilities is the current asking price.

The fair value of financial assets and liabilities that are not traded in an active market are determined using valuation techniques. 
Accordingly, there may be a difference between the fair value at initial recognition and amounts determined using a valuation 
technique. If such a difference exists, the Group recognises the difference in profit or loss to reflect a change in factors, including 
time that market participants would consider in setting a price.

Further detail on how the fair values of financial instruments are determined is disclosed in Note 3.(d).

(iv)  Offsetting financial instruments
Financial assets and liabilities are offset and the net amount reported in the consolidated balance sheet when there is a legally 
enforceable right to offset the recognised amounts and there is an intention to settle on a net basis, or realise the asset and settle 
the liability simultaneously.

(xv)  Provisions
A provision is recognised when the Group has a legal or constructive obligation as a result of past events, it is probable that an 
outflow of resources will be required to settle the obligation and the amount can be reliably estimated. Provisions are measured 
at the present value of the Group’s best estimate of the expenditure required to settle the present obligation at the end of the 
reporting period. The discount rate used to determine the present value reflects current market assessments of the time value 
of money and the risks specific to the liability.

(xvi)  Rounding of amounts
The Group is an entity of a kind referred to in ASIC Legislative Instrument 2016/191, relating to the ‘rounding off’ of amounts 
in the financial statements. Amounts in the financial statements have been rounded to the nearest hundred thousand dollars 
in accordance with that instrument, unless otherwise indicated.

(xvii)  New accounting standards and interpretations not yet adopted
There are no issued standards that are not yet effective and that are expected to have a material impact on the entity in the current 
or future reporting periods and on foreseeable future transactions.

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Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate DirectoryDirectors’ Declaration

In the Directors’ opinion: 

(a)  the financial statements and notes set out on pages 39 to 73 are in accordance with the Corporations Act 2001, including: 

(i)   complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting 

requirements; and

(ii)   giving a true and fair view of Waypoint REIT’s and Waypoint REIT Trust’s financial positions as at 31 December 2020  

and of their performance for the year ended on that date; and 

(b)   there are reasonable grounds to believe that Waypoint REIT and Waypoint REIT Trust will be able to pay their debts 

as and when they become due and payable. 

Note 4.(f)(i) to the financial statements confirms that the financial statements also comply with the International Financial Reporting 
Standards as issued by the International Accounting Standards Board.

The Directors have been given declarations by the Chief Executive Officer and the Chief Financial Officer as required by section 295A 
of the Corporations Act 2001.

This declaration is made in accordance with a resolution of the Directors.

Laurence Brindle
Chair

26 February 2021

74

Waypoint REIT Limited – Annual Report 2020 
 
Independent Auditor’s Report

75

PricewaterhouseCoopers, ABN 52 780 433 757 2 Riverside Quay, SOUTHBANK  VIC  3006, GPO Box 1331, MELBOURNE  VIC  3001 T: 61 3 8603 1000, F: 61 3 8603 1999, www.pwc.com.au Liability limited by a scheme approved under Professional Standards Legislation.   Independent auditor’s report To the stapled security holders of Waypoint REIT and the unitholders of Waypoint REIT Trust Report on the audit of the financial reports Our opinion In our opinion: The accompanying financial reports of Waypoint REIT Limited and its controlled entities and Waypoint REIT Trust and its controlled entities (together the Group) and Waypoint REIT Trust and its controlled entities (together the Trust) are in accordance with the Corporations Act 2001, including: (a)giving a true and fair view of the Group's and the Trust's financial positions as at 31 December2020 and of their financial performance for the year then ended(b)complying with Australian Accounting Standards and the Corporations Regulations 2001.What we have audited The Group and the Trust financial reports comprise: ●the consolidated balance sheets as at 31 December 2020●the consolidated statements of comprehensive income for the year then ended●the consolidated statements of changes in equities for the year then ended●the consolidated statements of cash flows for the year then ended●the notes to the financial statements, which include a summary of significant accounting policies●the directors’ declaration.The Group comprises Waypoint REIT Limited and the entities it controlled at year end or from time to time during the financial year and includes Waypoint REIT Trust and the entities it controlled at year end or from time to time during the financial year. The Trust comprises Waypoint REIT Trust and the entities it controlled at year end or from time to time during the financial year. Basis for opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial report section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Independence We are independent of the Group and the Trust in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional & Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the financial reports in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate DirectoryIndependent Auditor’s Report continued

76

Our audit approach An audit is designed to provide reasonable assurance about whether the financial reports are free from material misstatement. Misstatements may arise due to fraud or error. They are considered material if individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial reports. We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the financial reports as a whole, taking into account the geographic and management structure of the Group and the Trust, its accounting processes and controls and the industry in which it operates. Materiality ●For the purpose of our audit of the Group and the Trust we used overall materiality of $5.24 million and$5.22 million respectively, which represents 5% of the profit before tax, adjusted for significant non-cashitems such as investment property revaluations.●We applied this threshold, together with qualitative considerations, to determine the scope of our auditand the nature, timing and extent of our audit procedures and to evaluate the effect of misstatements onthe financial reports as a whole.●We chose profit before tax, adjusted for significant non-cash items such as investment propertyrevaluations because, in our view, it is the benchmark against which the performance  is most commonlymeasured.●We utilised a 5% threshold based on our professional judgement, noting it is within the range of commonlyacceptable thresholds.Audit Scope ●Our audit focused on where the Group and the Trust made subjective judgements; for example, significantaccounting estimates involving assumptions and inherently uncertain future events.Key audit matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial reports for the current period. The key audit matters were addressed in the context of our audit of the financial reports as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Further, any commentary on the outcomes of a particular audit procedure is made in that context. The key audit matters identified below relate to both the Group and the Trust audit, unless otherwise stated below. We communicated the key audit matters to the Audit and Risk Management Committee. Waypoint REIT Limited – Annual Report 202077

Key audit matter How our audit addressed the key audit matter Valuation of investment properties (Refer to note 2(a)) The Group and the Trust investment property portfolio consists of 470 service station properties located across Australia. At 31 December 2020 the carrying value of the total investment property portfolio was $2,897.3 million. Investment properties are carried at fair value. The Group’s and the Trust’s accounting policies are disclosed in note 2(a) of the financial reports. Valuations are derived from a number of factors that may include a direct comparison between the subject property and a range of comparable sales, the present value of net future cash flow projections based on reliable estimates of future cash flows, existing lease contracts, external evidence such as current market rents for similar properties, and using capitalisation rates and discount rates that reflect current market assessments of the uncertainty in the amount and timing of cash flows. The following key inputs and assumptions in estimating fair value are: •Market rent•Weighted average capitalisation rate•Range of capitalisation rates•Range of lease termsThe key judgemental assumption in estimating fair value is: •Capitalisation rateExternal valuations were obtained by the Group and the Trust to assist in estimating the fair value for 106 properties and director valuations were performed on the remainder of the portfolio.      This was a key audit matter because of the: •Relative size of the investment property balance inthe consolidated balance sheets•Quantum of revaluation gains that could directlyimpact the consolidated statements of comprehensiveincome through the net fair value gain/loss ofinvestment properties•Inherently subjective nature of investment propertyvaluations due to the use of assumptions in thevaluations•Sensitivity of valuations to key inputs/assumptionsExternal valuations For a sample of external valuations we: •Assessed the competency and capabilities of thevaluer.•Read the valuer’s terms of engagement - we did notidentify any terms that might affect their objectivity orimpose limitations on their work relevant to thevaluation.•Agreed the rental income and lease terms used in thevaluations to the tenancy schedule and leaseagreement, with no material differences noted.•Assessed the valuation reports based on our industryknowledge, including comparing the capitalisationrate assumption to a range we determined to bereasonable based on benchmark market data for thesector Waypoint operates in and also wider industrybenchmarks where applicable.•Inspected the final valuation reports and agreed thefair value to the Group’s and the Trust’s accountingrecords, noting no material differences.Director valuations For a sample of director valuations we: •Agreed the rental income and lease terms used in thedirector valuations to the tenancy schedule and leaseagreement, with no material differences noted.•Compared the capitalisation rate between thedirector valuations and external valuations to identifyany unusual trends or anomalies in the directorvaluations outcomes.•Agreed the director valuations to the Group’s andthe Trust’s accounting records, noting no materialdifferences.Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate DirectoryIndependent Auditor’s Report continued

78

Other information The directors of Waypoint REIT Limited and VER Limited (as the responsible entity of the Trust) are responsible for the other information. The other information comprises the information included in the annual report for the year ended 31 December 2020, but does not include the financial reports and our auditor’s report thereon. Prior to the date of this auditor's report, the other information we obtained included the director's report. We expect the remaining other information to be made available to us after the date of this auditor's report.  Our opinion on the financial reports does not cover the other information and we do not and will not express an opinion or any form of assurance conclusion thereon. In connection with our audit of the financial reports, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial reports or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we have performed on the other information that we obtained prior to the date of this auditor’s report, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. When we read the other information not yet received, if we conclude that there is a material misstatement therein, we are required to communicate the matter to the directors and use our professional judgement to determine the appropriate action to take. Responsibilities of the directors for the financial reports The directors of Waypoint REIT Limited and VER Limited (as the responsible entity of the Trust) are responsible for the preparation of the financial reports that give a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial reports that give a true and fair view and is free from material misstatement, whether due to fraud or error. In preparing the financial reports, the directors are responsible for assessing the ability of the Group and the Trust to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group and the Trust or to cease operations, or have no realistic alternative but to do so. Auditor’s responsibilities for the audit of the financial reports Our objectives are to obtain reasonable assurance about whether the financial reports as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial reports. A further description of our responsibilities for the audit of the financial reports is located at the Auditing and Assurance Standards Board website at: https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of our auditor's report. Waypoint REIT Limited – Annual Report 202079

Report on the remuneration report Our opinion on the remuneration report We have audited the remuneration report included in pages 28 to 37 of the directors’ report for the year ended 31 December 2020. In our opinion, the remuneration report of Waypoint REIT Limited for the year ended 31 December 2020 complies with section 300A of the Corporations Act 2001. Responsibilities The directors of Waypoint REIT Limited are responsible for the preparation and presentation of the remuneration report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the remuneration report, based on our audit conducted in accordance with Australian Auditing Standards.  PricewaterhouseCoopers Charles Christie Melbourne Partner 26 February 2021 Waypoint REIT Limited – Annual Report 2020Overview and HighlightsChair and CEO’s ReportBusiness ReviewSustainability ReportFinancial ReportInvestor InformationCorporate DirectoryAdditional Information

The information below is current as at 24 March 2021.

There were 785,022,077 fully paid securities on issue, held by 10,836 securityholders. There were 302 holders holding less than  
a marketable parcel based on a closing price of $2.49.

The voting rights attaching to the stapled securities, set out in section 253C of the Corporations Act 2001, are:

(i)  on a show of hands, every person present who is a securityholder has one vote; and

(ii)   on a poll, each securityholder present in person or by proxy or attorney has one vote for each dollar of value of the securities 

they have in the Group.

Top 20 securityholders
The top 20 largest registered securityholders as at 24 March 2021 are shown below.

Rank Holder name

Number of 
securities

% of issued 
capital

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

HSBC Custody Nominees (Australia) Limited

J P Morgan Nominees Australia Pty Limited

Citicorp Nominees Pty Limited

National Nominees Limited

BNP Paribas Nominees Pty Ltd

CS Third Nominees Pty Limited

BNP Paribas Noms Pty Ltd

BNP Paribas Noms (NZ) Ltd

Citicorp Nominees Pty Limited

Netwealth Investments Limited

BNP Paribas Nominees Pty Ltd

Australian Executor Trustees Limited

Charter Hall Wholesale Management Limited

BNP Paribas Nominees Pty Ltd Six Sis Ltd

One Managed Investment Funds Limited

Netwealth Investments Limited

BNP Paribas Nominees Pty Ltd Hub24 Custodial Serv Ltd

Charter Hall Wsale Mngt Limited

National Nominees Limited

AMP Life Limited

203,988,393

195,503,362

70,594,101

54,476,189

34,475,094

17,129,688

12,574,860

8,279,872

7,864,730

7,789,628

7,320,000

5,809,744

4,939,013

3,188,572

3,025,000

2,773,333

2,195,187

2,150,546

1,926,547

1,917,589

Total

647,921,448

Balance of register

137,100,629

25.99

24.91

8.99

6.94

4.39

2.18

1.60

1.06

1.00

0.99

0.93

0.74

0.63

0.41

0.39

0.35

0.28

0.27

0.25

0.24

82.54

17.46

Grand total

785,022,077

100.00

80

Waypoint REIT Limited – Annual Report 2020Distribution of securityholdings as at 24 March 2021

Range

100,001 and over

10,001 to 100,000

5,001 to 10,000

1,001 to 5,000

1 to 1,000

Total

Unmarketable parcels

Number of securities

% of total

Number of holders

673,910,333

80,416,706

20,387,577

9,708,761

598,700

785,022,077

9,927

85.84

10.24

2.60

1.24

0.08

100.00

-

108

3,542

2,670

3,214

1,302

10,836

302

Substantial securityholders as at 24 March 2021

Date of notice received 

Name of substantial securityholder

Number of securities 

% of capital 

31 December 2020 

The Vanguard Group, Inc. 

18 February 2021 

Pinnacle Investment Management Group Limited

22 December 2020 

BlackRock Group 

15 March 2021 

Resolution Capital Limited 

81,069,400 

56,544,917 

50,490,017 

47,019,222 

10.33 

7.20 

6.43

5.99

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Waypoint REIT Limited – Annual Report 2020 
 
 
 
 
 
 
 
 
 
Disclosures

On 1 August 2016, Waypoint REIT was granted certain waivers from the Australian Securities Exchange (ASX) with regard to ASX 
Listing Rule 10.1. Pursuant to those waivers, the following disclosures are outlined: 

Summary of Certain Arrangements between Waypoint REIT and Viva Energy Australia 
Waypoint REIT and Viva Energy Australia have entered into a Master Agreement to govern, among other things, certain rights and 
obligations with respect to the properties in the Initial Portfolio and any additional service station sites that become the subject  
of a lease between the parties in the future. 

Waypoint REIT’s 
first right of  
refusal

Waypoint REIT has a first right to acquire any service station site that Viva Energy Australia offers for sale, 
subject to the rights of Coles Express if that site is the subject of a Site Agreement.11

Viva Energy 
Australia’s first 
right of refusal

Viva Energy Australia has a first right to acquire any property that is subject of a lease or which is used  
as a retail service station and which Waypoint REIT offers for sale, subject to the rights of Coles Express  
if that site is the subject of a Site Agreement.11

Viva Energy 
Australia’s  
call option

•  Viva Energy Australia has a call option to acquire all or any part of the Initial Portfolio upon certain 

insolvency trigger events.

•  If a call option trigger event occurs and the call option is exercised by Viva Energy Australia in respect 

of a site, Viva Energy Australia may acquire that site for a price determined via an independent valuation 
process, subject to the rights of Coles Express if that site is the subject of a Site Agreement.11

Right of first 
refusal on new 
lease properties

If Waypoint REIT proposes to grant a new lease in respect of a site which is not (and has not been) the 
subject of a lease to Viva Energy Australia, Waypoint REIT must first offer to lease that site to Viva Energy 
Australia before entering into a new lease with another party.

Right of first 
refusal under a 
third party lease  

From 1 October 2020 to 1 January 2030, if Viva Energy Australia does not exercise its Third Party Lease 
right of first refusal in its own right it must offer a right of first refusal to Waypoint REIT.

In addition, in each lease entered in respect of the Initial Portfolio, Viva Energy Australia has a right of first refusal to acquire any 
leased site that Waypoint REIT offers for sale, subject to the rights of Coles Express if that site is the subject of a Site Agreement.11

In 2020, Waypoint REIT and Viva Energy Australia did not enter into (or conclude) any transactions pursuant to the rights  
listed above. 

In 2020 new leases were entered into between Viva Energy Australia and Waypoint REIT in respect of the following premises:

•  7-21 Shakespeare Street Traralgon

•  201 Charters Towers Road Townsville 

•  80 Alfred Street, Warragul

Viva Energy Australia has sold down its 35.5% securityholding in Waypoint REIT on 21 February 2020. As at the date of this Report, 
Viva Energy Australia has no remaining securityholding in Waypoint REIT. 

As at the date of this Report, the Master Agreement is still on foot and the rights of first refusals as described above still operate.

11.   Coles Express has a right of first refusal in respect of any disposal of any site that is the subject of a Site Agreement, but that right is unlikely 
to apply to any transfer between Viva Energy Australia and Waypoint REIT. Please refer to PDS Section 13.2 for a summary of the Master 
Agreement and PDS Section 13.10 for a summary of the Site Agreement. 

82

Waypoint REIT Limited – Annual Report 2020 
 
 
 
 
 
Glossary

ABS

bp

Australian Bureau of Statistics

Basis points

Cap Rate

Capitalisation rate

Coles Express

Coles Express, a division of Coles Group Limited (ABN 11 004 089 936)

Covernant Gearing

Covenant Gearing is calculated as total liabilities/total assets but excluding any mark-to-market 
valuations of derivative assets/liabilities. This is the measure used to determine compliance  
with the Group’s gearing covenants

COVID-19

CPI

cps

CSIRO

DA

Distributable Earnings

Distributable EPS

Double Net lease 

DRP

EBITDA

EV

F&C

FTE

FY

Gearing

Infectious disease caused by a newly discovered coronavirus in 2019 – COVID and COVID-19  
are utilised to describe the global pandemic as a result of the virus

Consumer Price Index

Cents per security

Commonwealth Scientific and Industrial Research Organisation

Development Application

Distributable Earnings is a non-statutory measure of profit and is calculated as net profit adjusted 
to remove transaction costs, specific non-recurring items and non-cash items, including straight-
lining of rental income, the amortisation of debt establishment fees and any fair value adjustment 
to investment properties and derivatives.

Distributable Earnings per security – calculated as Distributable Earnings divided by the weighted 
average number of ordinary securities on issue during the period

Agreement where the tenant is responsible for all outgoings except fair wear and tear, capital 
expenditure, the difference between single and multiple land tax and, in some cases, the landlord’s 
property management fees (if any)

Distribution Reinvestment Plan

Earnings before interest, tax, depreciation and amortisation (excluding any asset revaluations, 
mark-to-market movements and transaction costs)

Electric vehicle. General term used to cover battery electric vehicles, plug-in hybrid electric 
vehicles and hydrogen fuel cell vehicles

Fuel and Convenience

Full-Time Equivalent

Waypoint REIT financial year, being year end 31 December

Gearing is calculated as net debt (excluding foreign exchange and fair value hedge adjustments)/
total assets excluding cash

Internalisation

Agreement with Viva Energy Australia to internalise the management function of Waypoint REIT

Interest Cover Ratio

Earnings before interest, tax, depreciation and amortisation (excluding any asset revaluations, 
mark-to-market movements and transaction costs) divided by net interest expense

IPO

KMP

Liberty Oil

LTI Plan

Initial Public Offering

Key Management Personnel

Liberty Oil Holdings Pty Limited (ABN 67 068 080 124)

Long Term Incentive Plan

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Waypoint REIT Limited – Annual Report 2020 
 
 
 
 
 
 
 
 
 
Glossary continued

M&A expenses

Management and administration expenses

Master Agreement

The agreement between Viva Energy Australia and Viva Energy REIT, as summarised in Section 13.2 
of the PDS

Metropolitan or Metro

Properties that are located within the Urban Boundary, which is sourced from the Australian 
Bureau of Statistics (ABS 2016 Significant Urban Area (SUA) boundary)

MER

Moody’s

NABERS

Management expense ratio is calculated as the ratio of M&A expenses (excludes net property 
expenses) over average total assets (excluding derivative financial assets)

Moody’s Investors Service

National Australian Built Environment Rating System

Net Interest Expense

Finance costs less finance income

NTA

Regional

Review Event

Significant Urban Areas

Site Agreement

Triple Net lease

Net tangible assets

All other properties not located within the Significant Urban Areas

The review event triggered under Waypoint REIT’s debt facilities as a result of Viva Energy Australia’s 
sell down of its securityholding in Waypoint REIT in February 2020. As a result, existing lenders  
at the time had a period of 60 days to consult as to the continuation of the existing facilities

The Significant Urban Area (SUA) structure of the Australian Statistical Geography Standard 
(ASGS) represents significant towns and cities of 10,000 people or more. They are based on the 
Urban Centres and Localities (UCLs) but are defined by the larger Statistical Areas Level 2 (SA2s). 
A single SUA can represent either a single Urban Centre or a cluster of related Urban Centres. 
Using SA2s to define SUAs ensures a wider range of more regularly updated data is available  
for these areas (such as Estimated Resident Population), compared to UCLs where only Census 
data is available. Definition sourced from the Australian Bureau of Statistics

Means the leases, licences and options between Viva Energy Australia (as lessor, licensor and 
grantor respectively) and Coles Express (as lessee, licensee and grantee respectively) pursuant  
to which Coles Express occupies, and has certain rights to acquire, the properties in the Portfolio, 
as described in Section 13.10 of the PDS

A lease where the tenant is responsible for all outgoings relating to the property being leased 
in addition to the rent fee applied under the lease. This includes all repairs and maintenance 
(including structural repairs and maintenance), rates, taxes, insurance and other direct  
property costs

UN SDGs

USPP

United Nations Sustainable Development Goals

United States Private Placement

Viva Energy Australia or VEA Viva Energy Australia Pty Ltd (ABN 46 004 610 459) (a wholly owned subsidiary of Viva Energy 

Group Limited ABN 74 626 661 032)

Waypoint REIT or WPR

Waypoint REIT is a stapled entity comprising one share in Waypoint REIT Limited  
(ABN 35 612 986 517) and one unit in the Waypoint REIT Trust (ARSN 613 146 464)

WACR

WALE

WARR

Weighted average capitalisation rate, weighted by valuation

Weighted average lease expiry, weighted by rental income

Weighted average rent review, weighted by rental income

84

Waypoint REIT Limited – Annual Report 2020Corporate Directory

Waypoint REIT Limited

ABN 35 612 986 517

Directors of Waypoint REIT 
Limited

Waypoint REIT Trust

ARSN 613 146 464

VER Limited

ACN 609 868 000 AFSL 483795 
Responsible Entity

Registered office

Level 15, 720 Bourke Street 
Docklands VIC 3008  
Australia

www.waypointreit.com.au

Laurence Brindle  
Georgina Lynch  
Stephen Newton 

Directors of VER Limited

Laurence Brindle  
Georgina Lynch  
Stephen Newton 

Company Secretary

Tina Mitas

Auditor

PricewaterhouseCoopers
2 Riverside Quay 
Southbank VIC 3006  
Australia

Security registry

Link Market Services Limited
Locked Bag A14 
Sydney South NSW 1235  
Australia

Telephone: 1300 554 474

Investor enquiries and 
correspondence

admin@waypointreit.com.au

Stock exchange listing

Waypoint REIT stapled securities are 
listed on the Australian Securities 
Exchange with the code WPR.

Important information 
Waypoint REIT is a stapled entity comprising one share in Waypoint REIT Limited 
(ABN 35 612 986 517) and one unit in Waypoint REIT Trust (ARSN 613 146 464).

The Responsible Entity of Waypoint REIT Trust
VER Limited ACN 609 868 000 
Level 15, 720 Bourke Street, Docklands VIC 3008 

Reporting period
This Annual Report details the consolidated results of Waypoint REIT for the year 
ended 31 December 2020.

Disclaimer 
This Annual Report is for information purposes only, is of a general nature, does 
not constitute financial product advice, nor is it intended to constitute legal, tax  
or accounting advice or opinion. It does not constitute in any jurisdiction, whether 
in Australia or elsewhere, an invitation to apply for or purchase stapled securities  
of Waypoint REIT or any other financial product. 

In preparing this Annual Report, the authors have relied upon and assumed, 
without independent verification, the accuracy and completeness of all information 
available from public sources or which has otherwise been reviewed in preparation 
of the Annual Report. 

All reasonable care has been taken in preparing the information and assumptions 
contained in this Annual Report. However, no representation or warranty, express 
or implied, is made by Waypoint REIT, its related bodies corporate, any of their 
respective officers, directors, employees, agents or advisers as to the fairness, 
accuracy, completeness or correctness of the information, opinions and conclusions 
contained in this Annual Report. 

The information contained in this Annual Report is current as at the date it is 
published and is subject to change without notice. To the maximum extent permitted 
by law and subject to any continuing obligations under the ASX listing rules, 

Waypoint REIT Pty Ltd and VER Limited and each of their respective associates, 
related entities, officers, directors, employees, agents, consultants and advisers 
and each of the Limited Parties do not accept and expressly disclaim any liability 
for any loss or damage (including, without limitation, any liability for any loss or 
damage (whether direct, indirect, consequential or otherwise) arising from the  
use of, or reliance on, anything contained in or omitted from this report. 

This Annual Report contains forward-looking statements, including statements 
regarding the plans, strategies and objectives of Waypoint REIT management and 
distribution guidance. To the extent that certain statements in this Annual Report 
may constitute ‘forward-looking statements’ or statements about ‘future matters’, 
the information reflects Waypoint REIT’s intent, belief or expectations at the date  
of the Annual Report. Forward-looking statements can generally be identified by  
the use of forward-looking words such as ‘expect’, ‘anticipate’, ‘likely’, ‘intend’, 
‘should, ‘could’, ‘may’, ‘predict’, ‘plan’, ‘propose’, ‘will’, ‘believe’, ‘forecast’, ‘estimate’, 
‘target’, ‘guidance’ and other similar expressions. Indications of, and guidance or 
outlook on, future earnings or financial position or performance are also forward-
looking statements. Any forward-looking statements, including projections, 
guidance on future revenues, earnings and estimates, are provided as a general 
guide only and should not be relied upon as an indication or guarantee of future 
performance. Forward-looking statements involve known and unknown risks, 
uncertainties and other factors that may cause Waypoint REIT’s actual results, 
performance or achievements to differ materially from any future results, 
performance or achievements expressed or implied by these forward-looking 
statements. Any forward-looking statements, opinions and estimates in this 
presentation are based on assumptions and contingencies that are subject  
to change without notice, as are statements about market and industry trends, 
which are based on interpretations of current market conditions. This Annual 
Report may not be reproduced or published, in whole or in part, for any purpose 
without the prior written permission of Waypoint REIT.

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Waypoint REIT Limited – Annual Report 2020