Waypoint REIT Annual Report 2021

FY2021 Annual Report · Waypoint REIT
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Annual Report 
2021

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 

FY21 Highlights 

Chair and Managing Director & CEO’s Report 

Board of Directors 

Executive Leadership Team 

Portfolio Overview 

Sustainability 

Financial Report 

Additional Information 

Disclosures 

Glossary 

Corporate Directory 

01

02

03

06

07

08

13

15

84

86

87

89

About this report 

This Annual Report is a summary of Waypoint REIT’s activities and financial 
position as at 31 December 2021. 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’, ‘2021’ and ‘FY21’ refer to the financial year 
ended 31 December 2021 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.

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

   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 acknowledges the Traditional Custodians of the lands  
on which our business and assets operate, and recognises their ongoing 
connection to land, waters and communities.

Ampol Meadow Springs (WA)

Cover image: Shell/Coles Express Coomera (QLD)

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

World-class operators

•  Roadside retail properties catering for F&C operators 

•  VEA supplies approximately one-quarter of 

focused on everyday needs

•  F&C tenants have continued to operate throughout 

COVID-19 lockdowns

Australia’s downstream petroleum market, and  
has sole rights to the Shell brand for the sale  
of retail fuels in Australia

•  Sites operated by one of Australia’s leading  

retailers, Coles (Coles Express)

Irreplicable network

Predictable income 
and growth

•  National footprint acquired/built over 100+ years

•  99.9% occupancy, 10.0-year WALE, 90%+  

•  Aligned with population density and concentrated 

in metropolitan locations along Australia’s  
eastern seaboard

NNN leases

•  Strong organic rental growth underpinned  

by 3.0% WARR1

•  Underpinned by 2.1 million square metres of land

•  Further growth potential via acquisitions, 

development fund-throughs and reinvestment  
in the portfolio

Internal management 
structure

Conservative capital 
structure

•  Majority-independent Board of Directors

•  Target gearing range of 30-40%

•  One of the lowest MERs in the S&P/ASX REIT 200

•  Investment grade credit rating (Moody’s Baa1)2

•  Diversified debt sources and tenor

1.  CPI assumed at 2.6%. 

2.   Credit rating must not be used, and WPR 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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Waypoint REIT Limited – Annual Report 2021

0101

Waypoint REIT Limited – Annual Report 2021 
 
 
 
 
 
 
 
 
FY21 Highlights

$443.6m

Statutory net profit
Up 58.5% year on year

28bps

MER
Remains one of the lowest in  
S&P/ASX 200 REIT Index

15.80cps1

Distributable EPS
Up 4.25% year on year

30.1%

Gearing
At the lower end of target 
gearing range

$2.95

NTA per security
Up 18.5% year on year

5.0 years

WADM
Up 0.7 years since 
December 2020

$320.1m

Gross valuation uplift
WACR of 5.16% (40bp compression 
since December 2020)

$137.1m2

Asset sale proceeds
40 assets sold at a premium  
to book of 10.5%

$173.3m

Capital returned
$132.2m capital return and  
$41.1m on-market buyback

Distributable EPS 3
5-year CAGR: 4.50%

+3.69%

+4.54%

+5.75%

c
1
4
.
3
1

c
2
0
.
4
1

c
4
5
.
4
1

c
8
6
.
2
1

+4.25%

c
0
8
.
5
1

+4.25%

c
5
1
.
5
1

NTA per security
5-year CAGR: 7.88%

+3.44%

+4.20%

+5.22%

2
1
.
2
$

0
2
.
2
$

9
2
.
2
$

2
0
.
2
$

+18.53%

5
9
.
2
$

+8.67%

9
4
.
2
$

FY16

FY17

FY18

FY19

FY20

FY21

FY16

FY17

FY18

FY19

FY20

FY21

1.   Based on weighted average number of securities on issue during the year.

2.   Includes three assets contracted but not yet settled and classified as held for sale as at 31 December 2021.

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

02

Shell/Coles Express Wallsend East (NSW)

Waypoint REIT Limited – Annual Report 2021Chair and Managing Director & CEO’s Report

“Portfolio optimisation and capital management 
were key priorities in 2021, with 40 assets sold 
at an average premium to book of 10.5%, and 
$173.3 million returned to securityholders.”

Laurence Brindle
Chair

Hadyn Stephens
Managing Director  
and CEO

Dear Securityholder,

On behalf of the Board of Directors and management team,  
we are pleased to present Waypoint REIT’s Annual Report  
for the year ended 31 December 2021.

Waypoint REIT has now delivered 
compound annual growth in Distributable 
EPS of 4.5% over the five-year period to  
31 December 2021.

Property portfolio
Significant progress was made during 2021 on improving  
the overall quality of Waypoint REIT’s property portfolio,  
with 40 assets sold during the year for $137.1 million at an 
average premium to prevailing book value of 10.5%. This was  
a pleasing result and Waypoint REIT will continue to pursue 
opportunities to further de-risk the portfolio over time.

As at 31 December 2021, Waypoint REIT owned 433 fuel and 
convenience properties valued at approximately $3.1 billion, 
with an occupancy rate of 99.9% and a weighted average  
lease expiry (WALE) of 10.0 years.

During the year, 159 properties were independently valued, 
with the remainder subject to Directors’ valuations. A gross 
valuation uplift of $320.1 million was recorded for the year, with 
Waypoint REIT’s weighted average capitalisation rate (WACR) 
compressing by 40bp from 5.56% at 31 December 2020 to 
5.16% at 31 December 2021.

Financial performance
Waypoint REIT recorded a statutory net profit of $443.6 million  
for the year, a 58.5% increase on the $279.9 million statutory 
net profit in 2020. Distributable EPS was 15.80 cents, 
representing growth of 4.25% on the prior year, with the impact 
of asset sales and higher management costs being offset by 
rental increases, lower interest expense and a reduction in 
securities on issue due to Waypoint REIT’s capital management 
program. Waypoint REIT has now delivered compound annual 
growth in Distributable EPS of 4.5% over the five-year period  
to 31 December 2021.

Despite management expenses increasing in 2021 (primarily 
due to higher insurance and property-level costs), Waypoint 
REIT’s management expense ratio (MER) of 28bp was 2bp 
lower than 2020, as a result of valuation gains on Waypoint 
REIT’s asset base. Waypoint REIT’s MER remains one of the 
lowest in the S&P/ASX 200 REIT Index.

Financial position
Total assets increased by 6.7% during the year to $3.1 billion, 
with valuation gains more than offsetting the impact of asset 
sales. With total liabilities increasing by only 2.3%, Waypoint 
REIT’s net asset base increased by 9.0% ($175.1 million) to 
$2.1 billion, while a lower number of securities on issue due to 
capital management initiatives resulted in net tangible assets 
(NTA) per security increasing by 18.5% from $2.49 to $2.95.

Gearing as at 31 December 2021 was 30.1%, at the bottom 
end of Waypoint REIT’s 30–40% target gearing range.

Capital management
Prudent capital management is a key focus for Waypoint REIT, 
and $173.3 million of capital was returned to securityholders 
during 2021 via a $132.2 million capital return (and associated 
security consolidation) and $41.1 million of Waypoint REIT 
securities being acquired under on-market buy-back programs.

Following its inaugural ~$250 million US Private Placement 
issuance in 2020, Waypoint REIT successfully accessed the 
domestic debt market with its inaugural $200 million Australian 
Medium-Term Notes (AMTN) issuance in September 2021. 
Waypoint REIT’s banking group was also rationalised from  
13 to 7 lenders as part of a $285 million refinancing during  
the year. Waypoint REIT’s weighted average debt maturity at  
31 December 2021 was 5.0 years, compared with 4.3 years  
at 31 December 2020.

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03

Waypoint REIT Limited – Annual Report 2021 
 
 
 
 
 
 
 
 
Chair and Managing Director & CEO’s Report continued

Future strategy
Continued portfolio optimisation and capital management 
remain key near-term objectives for Waypoint REIT, with  
$150 million of asset sales and $100 million of capital 
management initiatives assumed for 2022. Although we 
expect direct market conditions to remain relatively tight in  
the near-term, we continue to explore acquisition opportunities 
in the fuel and convenience sector that are in line with our 
strict investment criteria.

Looking further ahead, Waypoint REIT is examining ways  
to diversify its investment portfolio away from a pure fuel  
and convenience focus. Waypoint REIT’s core portfolio is  
well-placed to withstand the potential long-term impacts  
of the energy transition on the fuel and convenience sector, 
and further asset sales are expected to progressively de-risk 

the portfolio over time. Diversification is a natural extension  
of this portfolio optimisation strategy, with the long-term  
goal to reduce Waypoint REIT’s sector and tenant 
concentration and improving our ESG profile.

Waypoint REIT is in the early stages of implementing this 
strategy, with no current limitations imposed on asset classes 
to be considered. We intend to be very disciplined and patient 
in terms of investment selection, with a focus on the core 
investment characteristics that underpin Waypoint REIT’s 
current portfolio, namely long-term, triple-net leases to well-
capitalised tenants. We look forward to providing updates to 
securityholders on this diversification strategy in due course.

Thank you for your ongoing support of Waypoint REIT.

Yours sincerely,

Waypoint REIT is exploring ways to  
diversify its investment portfolio over  
the long-term, with a focus on commercial 
properties with long-term, triple-net  
leases to well-capitalised tenants.

Laurence Brindle 
Non-Executive Chair 

Hadyn Stephens
 Managing Director and  
Chief Executive Officer

Liberty Greenvale (VIC)

04

Waypoint REIT Limited – Annual Report 2021 
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05

Shell/Coles Express Coorparoo (QLD)

Waypoint REIT Limited – Annual Report 2021 
 
 
 
 
 
 
 
 
Board of Directors

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

Georgina has 28 years’ 
experience in the financial 
services and property 
industry. She is currently 
Independent Non-Executive 
Chair of Cbus Property, an 
Independent Non-Executive 
Director of Irongate Funds 
Management Limited, a 
Member of their Audit and 
Risk and Remuneration and 
Nomination Committees, an 
Independent Non-Executive 
Director of Tassal Group 
Limited, and a Member of 
their Risk and Responsible 
Business Committee and  
Nominations and Remuneration 
Committees, and an 
Independent Non-executive 
Director of Evolve Housing.

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.

Hadyn Stephens
Managing Director  
and CEO

Hadyn’s credentials  
are detailed on the  
following page.

Stephen has extensive 
industry experience spanning 
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. 
Stephen has also held various 
senior executive positions at 
Lend Lease.

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

Stephen is a member of 
both Chartered Accountants 
Australia and New Zealand 
and the Australian Institute  
of Company Directors (AICD). 
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.

Our Board is committed 
to maintaining and 
promoting a high 
standard of corporate 
governance. Our 
corporate governance 
platform is integral to 
supporting our strategy, 
protecting the rights of 
our securityholders and 
maximising long-term  
income and capital 
returns.

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

2021 Corporate 
Governance  
Statement

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

Laurence has extensive 
experience in funds 
management, finance and 
investment and is currently the 
Independent Non-Executive 
Chair of National Storage 
REIT and an Independent 
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 was 
formerly Chair of the Shopping 
Centre Council of Australia 
and formerly Independent 
Non-executive 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.

06

Waypoint REIT Limited – Annual Report 2021Executive Leadership Team

Hadyn Stephens
Managing Director  
and CEO

Hadyn has more than  
23 years’ experience in finance 
and commercial real estate, 
principally in strategy and 
transaction-related roles in the 
real estate funds management 
space covering direct capital 
transactions, (M&A), debt and 
equity (listed and unlisted).

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

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

Kerri Leech
Chief Financial Officer

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

Before joining Waypoint REIT, 
Kerri spent over six years in 
various roles at Charter Hall, 
including her most recent 
role as Head of Finance for 
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, 
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 and  
the AICD.

Tina Mitas
General Counsel &  
Company Secretary

Tina has 17 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)  
and the AICD.

Rodney Smith 
General Manager Property

Rodney has 20 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, Global 
Operation Excellence  
Manager for Shell Retail,  
and Development Project 
Manager at Waypoint REIT.

Rodney holds a Bachelor  
of Commerce from the 
University of Tasmania.

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07

Waypoint REIT Limited – Annual Report 2021 
 
 
 
 
 
 
 
 
Portfolio Overview

Overview since IPO

As at 31 December 2021

Number of properties

Property portfolio value

Total land area 

WACR 

NTA per security

Average value per property 

IPO Aug 
2016

no.

$m

425

2,105

FY16

425

2,105

FY17

438

2,281

FY18

454

2,496

FY19

469

2,652

FY20

470

2,898

FY21

433

3,091

sqm 1,903,422 1,903,422 1,959,739

2,107,937 2,198,086

2,213,474 2,092,279

% 

$

$m

5.9

2.00

5.0

5.9

2.02

5.0

5.8

2.12

5.2

5.8

2.20

5.5

5.8

2.29

5.7

5.6

2.49

6.2

5.2

2.95

7.1

Portfolio breakdown
During 2021 Waypoint REIT completed a comprehensive portfolio review process. An outcome of this process saw the  
re-segmentation of the portfolio from previous ‘Metropolitan’ and ‘Regional’ classifications to four new segments:

Category

Description

Capital 
Cities

Capitals of the 8 mainland 
states and territories

Other 
Metro

Urban areas with 
populations ~100k+

Highway

Service centres along key 
transport routes

Regional

Smaller regional cities and 
towns (<100k population)

Book  
Value  
(Dec-21) 

$2,050.6m 
(66%)

$332.0m 
(11%)

$319.2m 
(10%)

$389.1m  
(13%)

#

274

43

38

78

WACR 
(Dec-21)

Average  
value  
(Dec-21)

Average  
site area

WALE  
(Dec-21)

4.78%

$7.5m

3,605m2

10.0yrs

5.30%

$7.7m

4,012m2

10.5yrs

6.26%

$8.4m

17,115m2

10.5yrs

6.18%

$5.0m

3,612m2

9.2yrs

Total

433

$3,090.8m

5.16%

$7.1m

4,832m2

10.0yrs

10.0yr

WALE (by income)

99.9%

3.0%

Occupancy (by income)

WARR (by income)

90.5%

NNN leases

96.6%

of total rental income

08

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09

Queensland (20%)*

14%

87 properties

14%

$620.5m book value

5.74% WACR

20%

52%

New South Wales (33%)*

13%

127 properties

$1,015.3m book value

4.55% WACR

9%

15%

63%

Australian Capital  
Territory (2%)*

11 properties

$72.5m book value

5.53% WACR

100%

Victoria (28%)*

113 properties

9%

3%

10%

$879.2m book value

4.88% WACR

77%

Shell/Coles Express Ultimo (NSW)

Geographic diversification

Northern Territory (1%)*

5 properties

54%

$25.6m book value

6.88% WACR

Western Australia (9%)*

50 properties

$282.5m book value

6.17% WACR

68%

South Australia (5%)*

30 properties

$143.7m book value

77%

6.05% WACR

Chart key (% by value):

34%

13%

21%

12%

10%

13%

4%

49%

46%

Tasmania (2%)*

10 properties

$51.3m book value

5.72% WACR

Capital Cities

Other Metro

Highway

Regional

* Denotes % of F&C Portfolio by value

Waypoint REIT Limited – Annual Report 2021 
 
 
 
 
 
 
 
 
10

Shell/Coles Express Coomera (QLD)

Waypoint REIT Limited – Annual Report 2021Portfolio Overview continued

Lease expiry profile 1
Waypoint REIT has a portfolio weighted average lease expiry of 10 years. Five leases were renewed during 2021, with a total 
increase of 3.5% to passing income achieved across the five renewals. Of Waypoint REIT’s 449 leases, only 14 are due to expire 
before 2026, representing 1.1% of portfolio income. Only two of these leases are with fuel tenants.

Lease Expiry Profile as at 31 December 2021 
(weighted by income)

23.9%

WALE
10.0
years

18.7%

13.7%

10.3%

7.5%

6.7%

6.4%

5.8%

4.0%

0.1%2

0.4% 0.1%

0.6%

0.6%

0.9%

0.3%3

Vacant FY22 FY23 FY24 FY25 FY26 FY27 FY28 FY29 FY30 FY31 FY32 FY33 FY34 FY35 FY36 FY37 FY38 FY39

Acquisitions and development
Waypoint REIT invested $1.98m as part of its contracted fund-through developments during 2021. All fund-through developments 
were acquired and funded at a capitalisation rate of 7% (except Greenvale, Victoria, acquired at 5.50%), and have generated 
valuation gains through organic rental growth and capitalisation rate compression since acquisition and development.

Property

State

Location

Status

2021  
Spend

Total  
Spend*

Cap rate  
31-Dec-2021

825 Mickleham Road, Greenvale

18316 Warrego Highway, Dalby West

7-13 Burnett Highway, Biloela

47-55 Broad Street, Sarina

VIC

QLD

QLD

QLD

Capital Cities

Completed

Highways

Completed

Highways

Completed

$0.17m $3.81m

$1.05m $5.00m

$0.13m $5.37m

Highways

Post-construction

-

$3.30m

6-8 Mackay Street, Griffith

NSW

Highways

Post-construction

$0.18m $4.90m

10805 Brand Highway, Cataby

WA

Highways

Under-construction

$0.45m $1.33m

4.63%

6.00%

6.75%

6.75%

5.88%

6.50%

* Includes spend prior to FY21 and remaining contracted/committed expenditure for FY22.

1. As at 31 December 2021, exclusive of three contracted assets held for sale.

2. Assumed income for vacant tenancies.

3.  Lease expiry shown in FY39 represents committed lease extensions at development site, with lease term extension contracted to commence 

upon practical completion of the development.

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Waypoint REIT Limited – Annual Report 2021 
 
 
 
 
 
 
 
 
Portfolio Overview continued

Asset sales
As at 31 December 2021, Waypoint REIT had settled or exchanged 40 assets for gross proceeds of $137.1 million, achieving  
an average premium of 10.5%. Approximately 60% of the assets sold were located in regional towns or cities.

Property

Auctions and private sales

Portfolio sale

Total

1.  WALE at sale date.

2.  Average of premium to book value at the time of sale.

Number

9

31

40

WALE  
(years)1

5.8

7.2

7.0

Sale price

$23.2m

$113.9m

$137.1m

Average  
premium  
to book2

12.5%

10.1%

10.5%

Yield

5.10%

6.42%

6.20%

1.  WALE at sale date.

2.  Average of premium to book value at the time of sale.

Shell/Coles Express Collingwood (VIC)

12

Waypoint REIT Limited – Annual Report 2021Sustainability

Shell/Coles Express Annerley (QLD)

Waypoint REIT’s ESG strategy is focused on four key areas aligned to the United Nations’ Sustainable Development Goals (UN SDGs).

WPR focus areas

Ethical conduct  
and transparency

Our people

Climate change  
and energy

Safety and environment

UN SDG
alignment

During the first half of 2021, Waypoint REIT issued its  
first Modern Slavery Statement (available on our website  
at 
 www.waypointreit.com.au), gained an understanding  
of its carbon emissions and set a target to offset emissions 
under its operational control by the end of 2021. 

In the second half of 2021, Waypoint REIT achieved its  
carbon neutral target with Scope 1, Scope 2 and direct  
Scope 3 emissions under its operational control totalling  
20.6 tonnes being offset through the purchase of carbon 
offsets administered by South Pole Carbon Asset 
Management Ltd. Waypoint REIT also obtained third-party 
limited assurance over its FY21 carbon emissions for the  
first time and completed a Task Force on Climate-related 
Financial Disclosures (TCFD) gap analysis. 

Waypoint REIT have supported VEA’s partnership with Evie 
Networks for electric vehicle charging stations through the 
provision of easements and landowner consents supporting 
the supply of electricity and installation of the charging 
infrastructure at five Waypoint REIT sites.

Waypoint REIT’s 2021 Sustainability Report can be viewed  
on our website at 

 www.waypointreit.com.au.

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Waypoint REIT Limited – Annual Report 2021 
 
 
 
 
 
 
 
 
 
 
 
Values

Excellence

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

Respect

For our people, 
community, environment, 
customers and investors

Trust

Building and maintaining 
long-term relationships 
through our actions

Integrity

Operating in an 
ethical manner that is 
transparent and honest

14

Waypoint REIT Limited – Annual Report 2021Financial Report

Directors’ Report 

Remuneration Report 

Auditor’s Independence Declaration 

Consolidated Statements of Comprehensive Income 

Consolidated Balance Sheets 

Consolidated Statements of Changes in Equity 

Consolidated Statements of Cash Flows 

16

25

40

41

42

43

44

Notes to the Financial Statements 

1.  Performance and results 

2.  Property portfolio 

3.  Capital management 

4.  Additional information 

Directors’ Declaration 

Independent Auditor’s Report 

45

46

50

54

70

78

79

Waypoint REIT Limited – Annual Report 2021

15

Overview and HighlightsChair and MD/CEO ReportBusiness ReviewSustainabilityFinancial ReportInvestor InformationCorporate DirectoryDirectors’ 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 (Waypoint REIT) and the financial 
statements of Waypoint REIT Trust Group (Trust Group) for the year ended 31 December 2021. 

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

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,  
unless otherwise noted:

Laurence Brindle

Georgina Lynch

Stephen Newton

Hadyn Stephens

Independent Non-Executive Chair

Independent Non-Executive Director

Independent Non-Executive Director

Managing Director (appointed 21 October 2021) and Chief Executive Officer 

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, unless otherwise noted:

Laurence Brindle

Georgina Lynch

Stephen Newton

Hadyn Stephens

Independent Non-Executive Chair

Independent Non-Executive Director

Independent Non-Executive Director

Managing Director (appointed 21 October 2021) and Chief Executive Officer 

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 majority of the properties in the portfolio are leased to Viva Energy Australia Pty Limited (Viva Energy – a wholly 
owned subsidiary of Viva Energy Group Limited (Viva Energy Group)), with other tenants including other fuel and convenience 
retail operators and non-fuel tenants.

Significant changes in state of affairs
Capital management initiatives totalling $173.3 million (before transaction costs) were completed during the year, including the  
buy-back of 15.3 million stapled securities for $41.1 million under on-market buy-back programs (average price of $2.68 per 
security) and a $132.2 million return of capital (17 cents per stapled security) on 12 November 2021. The number of stapled 
securities on issue was further reduced by 48.1 million following a security consolidation completed at a consolidation ratio  
of 0.9382 on 10 November 2021.

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

16

Waypoint REIT Limited – Annual Report 2021Distribution to securityholders
Distributions paid during the year were as follows: 

Distributions paid in 2021

Final distribution for year ended 31 December 2020
– 7.73 cents per security paid on 26 February 2021

Interim distribution for the half-year ended 30 June 2021
– 7.81 cents per security paid on 31 August 2021

Interim distribution for the quarter ended 30 September 2021* 
– 3.95 cents per security paid on 15 November 2021

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

Total distributions paid

2021 
$ million

2020 
$ million

60.7

61.3

30.9 

-

-

152.9

-

-

-

56.0

57.9

113.9

*  Distributions paid on a quarterly basis commencing the quarter ended 30 September 2021.

A distribution of 4.21 cents per security ($30.4 million) is to be paid on 28 February 2022 for the quarter ended 31 December 2021.

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 $4.1 million from $118.5 million in 2020 to $122.6 million in 2021, due to higher rental income 
($3.0 million) and lower net interest expense ($1.7 million) partially offset by higher management and administration expenses 
($0.6 million). 

Statutory net profit increased by $163.7 million from $279.9 million in 2020 to $443.6 million in 2021, largely due to net valuation 
gains on investment property ($152.7 million).

The management expense ratio (MER) in 2021 was 0.28% (2020: 0.30%) with the decrease attributed to higher management  
and administration expenses being more than offset by asset valuation growth.

Gearing was 30.1%3 at 31 December 2021 (31 December 2020: 29.4%).

Net tangible assets per security at 31 December 2021 increased by 18.5% during the period to $2.95 (31 December 2020:  
$2.49), primarily due to the combined impact of strong valuation gains and lower securities on issue as a result of capital  
management initiatives.

17

Overview and HighlightsChair and MD/CEO ReportBusiness ReviewSustainabilityFinancial ReportInvestor InformationCorporate DirectoryWaypoint REIT Limited – Annual Report 2021Directors’ Report continued

Operating and financial review continued

Key financial metrics

Statutory net profit after tax

Distributable Earnings1

Distributable EPS

Management expense ratio2

Total assets

Borrowings

Net assets

NTA per security

Gearing3

Covenant Gearing4

Year ended
31 Dec 2021

Year ended
31 Dec 2020

$443.6 million

$279.9 million

$122.6 million

$118.5 million

15.80 cents

15.15 cents

0.28%

0.30%

31 Dec 2021

31 Dec 2020

$3,128.2 million

$2,930.6 million

$955.6 million

$872.3 million

$2,128.3 million

$1,953.2 million

$2.95

30.1%

31.8%

$2.49

29.4%

32.1%

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 Waypoint REIT’s gearing covenants.

Financial results

Rental income

Finance income

Total operating income

Management and administration expenses

Interest expense

Distributable Earnings

Net gain on movement of fair value of investment properties

Net gain on sale of investment properties

Straight-line rental income

Amortisation of borrowing costs

Interest rate swap termination 

Net gain/(loss) from derivative financial instruments

Internalisation costs

Statutory net profit after tax

18

Year ended 
31 Dec 2021
$ million

Year ended 
31 Dec 2020
$ million

163.2

0.1

163.3

(9.9)

(30.8)

122.6

305.0

1.0

15.1

(1.9)

-

1.8

-

160.2

0.2

160.4

(9.3)

(32.6)

118.5

152.3

-

21.4

(2.7)

(3.5)

(0.3)

(5.8)

443.6

279.9

Waypoint REIT Limited – Annual Report 2021Investment property portfolio1

Total value of investment properties

Total properties in portfolio

Portfolio occupancy

Weighted average capitalisation rate

Weighted average lease expiry

31 Dec 2021

31 Dec 2020

$3,090.6 million

$2,897.3 million

433

99.9%

5.16%

470

99.9%

5.62%

10.0 years

10.8 years

1.  Includes six uncontracted assets classified as held for sale and excludes three assets subject to contracts for sale and classified as held for 

sale at 31 December 2021.

•  159 investment properties (representing over one-third of the portfolio) were independently valued during the year, including 80  
at 30 June and 79 at 31 December. Directors’ valuations were performed on the balance of the portfolio at each balance date. 

•  The weighted average capitalisation rate of the 433 assets owned at 31 December 2021 (including six uncontracted assets 

classified as held for sale) was 5.16%. 

•  40 non-core assets were settled or exchanged during the period for $137.1 million, representing a 10.5% premium to prevailing 

book value.

•  Weighted average lease expiry by income at 31 December 2021 is 10.0 years, with five leases renewed during the year for  

an aggregate 3.5% increase in rent.

Capital management

As at 31 December 2021:

•  Gearing was 30.1%1 with $955.6 million debt drawn and $93.0 million undrawn.

•  Weighted average debt maturity was 5.0 years, following the inaugural issuance of a $200.0 million Australian medium term 

note (AMTN) at a 2.4% coupon and the refinancing of $285.0 million of bank debt during the year. 

•  73% of Waypoint REIT’s debt was hedged and the weighted average hedge maturity was 3.6 years. 

Matters subsequent to the end of the financial period
Subsequent to the end of the financial period, Waypoint REIT:

•  settled one asset held for sale for total proceeds of $1.1 million on 4 February 2022; 

•  bought back an additional 6.4 million stapled securities for total consideration of $17.6 million; and

•  approved the distribution for the quarter ended 31 December 2021 of $30.4 million to be paid on 28 February 2022.

No other matter or circumstance has arisen since 31 December 2021 that has significantly affected, or may significantly affect:

•  the operations of Waypoint REIT in future financial years; 

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

•  the state of affairs of Waypoint REIT in future financial years.

2022 outlook
Waypoint REIT expects rental income from existing fuel and convenience retail tenancies to grow in line with contracted annual 
rental increases. Waypoint REIT does not expect to be materially impacted by any further COVID-19 travel restrictions that may be 
implemented, with all major tenants across the portfolio operating essential services that have remained open and continued to 
trade during previous periods of travel restriction. Waypoint REIT may consider opportunities to acquire new fuel and convenience 
retail properties and/or reinvest in its existing portfolio and will also consider further asset disposals where it is in the best 
interests of securityholders to do so. Waypoint REIT has also identified asset class diversification as a means by which to 
broaden avenues for growth, mitigate key risks (sector/tenant concentration) and improve ESG metrics of its investment  
portfolio, and may consider acquisition opportunities in line with this strategy.

1.  Calculated as net debt (excluding foreign exchange and fair value hedge adjustments)/total assets minus cash. This differs from Covenant 

Gearing, which is equal to 31.8%. 

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Overview and HighlightsChair and MD/CEO ReportBusiness ReviewSustainabilityFinancial ReportInvestor InformationCorporate DirectoryWaypoint REIT Limited – Annual Report 2021Directors’ Report continued

Material business risks
The material business risks that could adversely affect Waypoint REIT’s financial prospects include the following:

Tenant concentration risk, financial standing and sector concentration risk
96.6% of Waypoint REIT’s rental income is received from Viva Energy. If Viva Energy’s financial standing materially deteriorates 
and impacts its ability to make rental payments, Waypoint REIT’s financial results, financial position and ability to service and/or 
obtain financing may be adversely impacted. Furthermore, a material decline in the profitability of Viva Energy’s business due to 
the global transition to a low carbon economy or other factors (including international conflict) 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’s business could also lead to reduced capacity or ability for Viva Energy to pay market 
rents when renewal options are exercised, which could result in lower rental receipts and/or a decline in the values of Waypoint 
REIT’s investment properties if Waypoint REIT is unable to lease the property to an alternate tenant. 

Collection risk  
Waypoint REIT 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 (where required). Waypoint REIT 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. Waypoint REIT uses judgement in making these assumptions, based on Waypoint REIT’s past history and existing 
market conditions as well as forward-looking estimates at the end of each reporting period.

More than 99% of Waypoint REIT’s income is derived from fuel tenants that have continued to operate through COVID-19 to date, 
providing essential services to the community. Accordingly, Waypoint REIT’s performance has not been materially impacted  
by COVID-19. 

Re-leasing and vacancy risk
Waypoint REIT’s property portfolio is 99.9% occupied with only 12 leases (representing 1.1% of income) expiring before the end of 
2025 and a weighted average lease expiry of 10.0 years, with five leases renewed during the year for an aggregate 3.5% increase in 
rent. 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 2029) and/or its Alliance Agreement with Coles Express (current agreement expires in 2029) could also impact Viva Energy’s 
decision whether it renews its existing leases. Resulting vacancy or reduced rental income could negatively impact distributions  
of Waypoint REIT and/or the value of Waypoint REIT’s investment properties. 

Investment property value 
The value of Waypoint REIT’s portfolio of investment properties may be adversely affected by a number of factors, including 
factors outside the control of Waypoint REIT, such as increasing uptake of vehicles fuelled by alternative fuels (including as a 
result of changes in consumer behaviour, pro-emission reduction policies, reduced supply and/or higher pricing of fossil fuels), 
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’s financial condition deteriorating, occupiers not extending the term  
of leases, and general economic factors such as the level of inflation and interest rates, which may adversely impact  
capitalisation rates. 

As changes in valuations are recorded on the statutory statements of comprehensive income, any decreases in value will have a 
negative impact on the statutory statements of comprehensive income and balance sheets (including the net tangible assets per 
security) and in turn the market price of Waypoint REIT’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.

20

Waypoint REIT Limited – Annual Report 2021Environmental and climate risk
Waypoint REIT depends on its tenants to perform their obligations under various environmental arrangements in relation to 
properties they lease. Waypoint REIT has an indemnity from Viva Energy in respect of certain liability for historical environmental 
contamination across 386 assets acquired at the time of Waypoint REIT’s initial public offering. Waypoint REIT 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), Waypoint REIT may incur significant costs  
to rectify contamination on its properties and also on other properties that may be consequently impacted.

Waypoint REIT is subject to a range of regulatory regimes (including environmental regulations) that cover the specific assets of 
Waypoint REIT 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 Waypoint REIT’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 
Waypoint REIT, 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 Waypoint REIT’s assets and disrupt the 
tenants’ operations. Such events may increase costs for maintenance and insurance of Waypoint REIT’s assets and may affect 
the ability to re-lease Waypoint REIT’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 Waypoint REIT 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.

Personnel risk
Loss of key personnel could potentially have an adverse impact on the management and the financial performance of Waypoint 
REIT and in turn may affect the returns to securityholders. To mitigate this risk, processes and procedures are standardised and 
automated to the extent practicable, remuneration structures include components payable on a deferred basis to reduce key 
personnel risk, and employees are subject to market standard notice periods to ensure that Waypoint REIT has sufficient time  
in which to identify and hire replacement employees.

Cyber security risk
Cyber-attacks are becoming increasingly sophisticated and a material data breach, ransom attack or data loss could have an 
adverse financial or reputational impact. To help mitigate this risk, Waypoint REIT 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
Waypoint REIT 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 Waypoint REIT’s ability to 
refinance its debt facilities when required. If the covenants in these facilities are breached by Waypoint REIT, this may result in 
Waypoint REIT 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, Waypoint REIT may need to sell assets to repay debt. 
There is no guarantee that there will be willing purchasers for Waypoint REIT’s assets or that purchasers will pay prices at or 
greater than the 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 twelve months in 
advance of maturity.

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Material business risks continued
If a third-party entity gains control of Waypoint REIT, this would constitute a review event under certain of Waypoint REIT’s debt 
facility agreements, and (subject to specified negotiation and notification periods) a repayment of Waypoint REIT’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 Waypoint REIT.

Cash flow and fair value interest rate risk 
Waypoint REIT’s cash and cash equivalents, floating rate borrowings and interest rate swaps expose it to a risk of change in 
future cash flows or the fair value of interest rate swaps due to changes in interest rates. Waypoint REIT uses floating-to-fixed 
interest rate swaps to partially hedge its economic exposure to changes in interest rates on variable rate borrowings. By hedging 
against changes in interest rates, Waypoint REIT 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 Waypoint REIT. 

Foreign exchange rate risk 
A portion of Waypoint REIT’s debt is denominated in US dollars and as a result, Waypoint REIT is exposed to a risk of change 
in fair value or future cash flows due to changes in foreign exchange rates. Waypoint REIT 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, Waypoint REIT 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 Waypoint REIT. 

Liquidity risk
Liquidity risk is the risk that Waypoint REIT 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. Waypoint REIT 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. 

Title transfer risk
Transfer of freehold title to a property requires the land transfer to be registered with the governing state body, which is 
conditional on payment of stamp duty as assessed by the governing State Revenue Office. In the absence of freehold title being 
registered on title by the governing state body, one’s ability to transfer the title of a property is restricted.

In September 2018, Waypoint REIT received an assessment from the Victorian State Revenue Office (SRO) for $31.2 million  
in relation to the transfer of Victorian properties to Waypoint REIT from Viva Energy Group prior to its listing in August 2016. 
Pursuant to the arrangements between Waypoint REIT and Viva Energy Group, any such costs are payable by Viva Energy Group.  
In November 2018, Viva Energy Group lodged an objection to the assessment and assumed conduct of this matter under a conduct 
and indemnity deed between Waypoint REIT and Viva Energy Group. In May 2020, the SRO disallowed Viva Energy Group’s objection 
and Viva Energy Group appealed this decision with the case heard at the Victorian Supreme Court in November 2021. In February 
2022, the Victorian Supreme Court handed down its judgment in favour of Viva Energy Group with an assessment of $nil; 
however, the transfers of title have not yet been stamped and remain with the SRO. 

Viva Energy Group remains listed as the registered proprietor of these properties on the Victorian land titles registry maintained 
by Land Use Victoria pending confirmation from the SRO that stamp duty has been paid. Once this matter is resolved, the signed 
transfers of the titles to the properties are required to be registered in the name of Waypoint REIT.

The transfer of the control of these properties to Waypoint REIT occurred in August 2016 under the sale agreement with  
Viva Energy Group and these properties continue to be recognised in the Consolidated Balance Sheets.

Environmental regulation
As a landlord, the operations of Waypoint REIT 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 Waypoint REIT for any contamination caused by their 
operations.

Waypoint REIT did not receive any environmental infringements or notices from environmental regulators in the year ended  
31 December 2021.

22

Waypoint REIT Limited – Annual Report 2021Information on Directors 

Laurence Brindle

Independent Non-Executive Chair, and Member of the Audit and Risk Management, Nomination and  
Remuneration Committees

Laurence has extensive experience in funds management, finance and investment and is currently the Independent  
Non-Executive Chair of National Storage REIT and an Independent 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 Independent Non-Executive 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 and Nomination Committees and Member of the  
Audit and Risk Management Committee.

Georgina has over 28 years’ experience in the financial services and property industry. She is currently the Independent Non-
Executive Chair of Cbus Property, an Independent Non-Executive Director of Irongate Funds Management Limited and a Member 
of their Audit and Risk and Remuneration and Nomination Committees, an Independent Non-Executive Director of Tassal Group 
Limited and a Member of their Risk and Responsible Business Committee and Nomination and Remuneration Committees,  
and an Independent Non-Executive Director of Evolve Housing.

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 for over 22 years.

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

Stephen is a member of both Chartered Accountants Australia and New Zealand and the Australian Institute of Company 
Directors (AICD). 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.

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Hadyn Stephens

Managing Director and Chief Executive Officer

Hadyn has approximately 23 years’ experience in finance and commercial real estate, principally in strategy and transaction-
related roles in the real estate funds management space covering direct capital transactions, corporate transactions (M&A),  
debt and equity (listed and unlisted).

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

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

Tina Mitas

Company Secretary

Tina has over 17 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, a Member of the Institute of Chartered Secretaries and Administrators (ICSA) and the AICD.

Meetings of Directors
The numbers of meetings of the Directors and of each Board Committee held during the year ended 31 December 2021,  
and the numbers of meetings attended by each Director were:

Name

Laurence Brindle

Georgina Lynch

Stephen Newton 

Hadyn Stephens*

Waypoint  
REIT Limited

VER Limited

A

16

16

16

3

B

16

16

16

3

A

16

16

16

3

B

16

16

16

3

Audit and Risk 
Management 
Committee

Remuneration 
Committee

Nomination 
Committee

A

5

5

5

1

B

5

5

5

1

A

4

4

4

2

B

4

4

4

2

A

2

2

2

1

B

2

2

2

1

A  =  Number of meetings attended.

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

*  =  Appointed Managing Director on 21 October 2021.

24

Waypoint REIT Limited – Annual Report 2021Remuneration Report
This remuneration report (Remuneration Report) presents Waypoint REIT’s remuneration arrangements for Key Management 
Personnel (KMP) for the year ended 31 December 2021. 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 2021. 

2021 Remuneration framework
As communicated last year, Waypoint REIT’s long-term remuneration objectives are to:

•  reward strong performance;

•  encourage executive retention;

•  achieve the right balance between ‘fixed’ and ‘at risk’ pay; and

•  achieve alignment between executive and securityholders’ interests. 

Following the internalisation of management in October 2020, a remuneration framework was adopted in 2021 by the newly 
formed Remuneration Committee which has implemented these objectives, including:

•  increased fixed annual remuneration (FAR) to better align to market benchmarks;

•  requirement for deferred STI to be payable in securities; and

•  establishment of a new equity-based long-term incentive (LTI) plan with the first grant of Performance Rights made in April 

2021.

2021 Remuneration considerations
Waypoint REIT’s operations were again not materially impacted by COVID-19 this year as the vast majority of its income continues to 
be generated from long-term leases with well-capitalised tenants that continued to provide essential services throughout the year. 

The key achievements of the Waypoint REIT team in 2021 include:

•  Completed comprehensive review of Waypoint REIT’s investment portfolio and strategy, with non-core asset sales and asset 
class diversification identified as key strategies to improve overall portfolio quality and mitigate key risks associated with 
Waypoint REIT’s fuel and convenience portfolio.

•  Sold (or agreed to sell) 40 non-core assets for proceeds of $137.1 million at an average premium to book value of 10.5%.

•  Completed capital management initiatives totalling $173.3 million (before transaction costs), including the buy-back of  

15.3 million stapled securities for $41.1 million (average price of $2.68 per security) and a $132.2 million return of capital  
(17 cents per stapled security), resulting in surplus sale proceeds being returned to investors and optimisation of Waypoint 
REIT’s capital structure, gearing and liquidity metrics.

•  Extended weighted average debt maturity by 0.7 years to 5.0 years through an inaugural $200.0 million Australian medium 

term note (AMTN) issuance and the refinancing of $285.0 million of bank debt.

•  Improved ESG framework and Board-level reporting, including the formation of WPR’s carbon reduction strategy and  

a significant improvement in key sustainability rankings.

In recognition of the above achievements, the Board has awarded Executive KMP their maximum short-term incentive (STI) 
awards for the year ended 31 December 2021.

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Future considerations
To fully achieve its long-term remuneration objectives, the Remuneration Committee intends to increase LTI as a percentage  
of total remuneration over time until the Remuneration Committee is satisfied the level of ’at risk’ pay is consistent with  
market practice.

On behalf of the Directors and the Remuneration Committee, I look forward to welcoming you and receiving your feedback  
at our upcoming Annual General Meeting.

Georgina Lynch
Chair, Remuneration Committee

26

Waypoint REIT Limited – Annual Report 2021Report structure
This report is divided into the following sections:

(i)  Key Management Personnel

(ii)  FY21 annual remuneration summary

(iii)  Remuneration governance

(iv)  Remuneration Policy for Executive KMP (defined as the Managing Director & Chief Executive Officer (MD/CEO)  

and Other Reported Executives)

(v)  Detailed remuneration outcomes 

(vi)  Executive KMP equity holdings

(vii)  Other information

(viii)  Remuneration Policy for Non-Executive Independent Directors

(ix)  Non-Executive Independent Directors’ 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

Independent Non-Executive Directors

Laurence Brindle

Georgina Lynch

Stephen Newton

Managing Director

Hadyn Stephens

Other reported executives

Kerri Leech

Tina Mitas

Role

Chair

Director

Director

MD/CEO

Chief Financial Officer (CFO)

General Counsel & Company Secretary

KMP period

Full Year

Full Year

Full Year

Full Year1,2

Full Year2

Full Year2

1.  Appointed Managing Director on 21 October 2021.

2.  Appointed KMP on 1 October 2020, the date the management function previously undertaken by VER Manager Pty Limited,  

a subsidiary of Viva Energy Australia Pty Limited, was internalised (Internalisation).

(ii)  FY21 annual remuneration summary
The table below outlines the key remuneration changes in FY21 compared to FY20 following the Remuneration Committee’s 
review of market practice and benchmarks post the Internalisation and the remuneration outcomes achieved in FY21.

Element

Outcomes

Fixed Annual 
Remuneration 
(FAR)
(refer to section v)

As outlined in the FY20 Remuneration Report, KMP FAR was adjusted to better align with market 
benchmarks and encourage retention. FY21 KMP FAR (excluding leave provisions and other benefits)  
is as follows:

KMP

MD/CEO

CFO

General Counsel & Company Secretary

FY21 FAR

$550,000

$400,000

$244,000

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Element

Outcomes

Short-term  
Incentive 
(STI)
(refer to section v) 

New balanced scorecard adopted incorporating financial and non-financial criteria with STI awards 
assessed as follows:

Element

Financial

Financial – 
outperformance

Award scale Criteria

0 or 33%

0 – 33%

Delivery of initial Distributable Earnings per security (DEPS) 
guidance. No award if criteria not met.

Delivery of DEPS in excess of initial guidance. 
Sliding scale award determined at the Board’s discretion based  
on level of outperformance achieved. 

Individual KPIs

0 – 33%

Delivery of financial and non-financial performance criteria set out  
in KMP balanced scorecards agreed at the start of the year. 

Maximum STI awards have also been adjusted to achieve the right balance between fixed and ‘at risk’ pay 
components and an equity-based deferral component has been introduced to encourage retention, better 
align Executive KMP remuneration with market benchmarks and securityholder value.

MD/CEO

No change to maximum STI award. The 50% deferred STI component (25% for one year, 25% for two 
years) is now payable in Waypoint REIT securities (rather than cash) subject to trade-lock during the 
deferral period. 

Other reported executives

Maximum STI awards increased for the CFO (60% to 75% of FAR) and General Counsel & Company 
Secretary (40% to 50% of FAR) with one-third now deferred for one year and payable in Waypoint REIT 
securities subject to trade-lock during the deferral period rather than cash. 

FY21 outcome

Waypoint REIT delivered DEPS of 15.80 cps (4.25% growth on FY20) compared to initial market guidance 
of 15.72 cps (3.75% growth on FY20). Accordingly, the criteria for payment of the ‘Financial’ and ‘Financial 
– outperformance’ elements were met, and the Remuneration Committee determined that 66.67% of the 
STI for each Executive KMP was payable.

In assessing Executive KMP delivery against their Individual KPIs, the Remuneration Committee has 
determined all members of Executive KMP have met or exceeded expectations in all Key Performance 
Indicator (KPI) categories (Corporate Strategy, Portfolio Management, Financial and Capital  
Management, ESG). 

Key achievements in FY21 include:

•  Completed comprehensive review of Waypoint REIT’s investment portfolio and strategy, with non-core 

asset sales and asset class diversification identified as key strategies to improve overall portfolio quality 
and mitigate key risks associated with Waypoint REIT’s fuel and convenience portfolio.

•  Sold (or agreed to sell) 40 non-core assets for proceeds of $137.1 million at an average premium to 

book value of 10.5%.

•  Completed capital management initiatives totalling $173.3 million (before transaction costs), including 
the buy-back of 15.3 million stapled securities for $41.1 million (average price of $2.68 per security) 
and a $132.2 million return of capital (17 cents per stapled security), resulting in surplus sale proceeds 
being returned to investors and optimisation of Waypoint REIT’s capital structure, gearing and liquidity 
metrics.

•  Extended weighted average debt maturity by 0.7 years to 5.0 years through an inaugural $200.0 million 

Australian medium term note (AMTN) issuance and the refinancing of $285.0 million of bank debt.

•  Improved ESG framework and Board-level reporting, including the formation of WPR’s carbon reduction 

strategy and a significant improvement in key sustainability rankings.

In recognition of the above achievements, all Executive KMP have earned their maximum STI awards in FY21.

28

Waypoint REIT Limited – Annual Report 2021Element

Outcomes

Long-term  
Incentive 
(LTI)
(refer to section vi)

New LTI Plan established in FY21 to foster greater alignment of interests with securityholders. The initial 
grant of Performance Rights to Executive KMP under this plan were made around the date of the 2021 
Annual General Meeting, with a notional value of $323,000 and a maximum fair value (statutory basis)  
of $207,092. Performance Rights are subject to certain performance and service vesting conditions being 
satisfied over a three-year Performance Period ending 31 December 2023. 

MD/CEO

LTI award was equivalent to approximately 33% of FAR.

Other reported executives

LTI award was equivalent to approximately 16-25% of FAR.

Non-Executive 
Directors
(NED)
(refer to section ix) 

As outlined in the FY20 Remuneration Report, Board fees were adjusted to better align with market 
benchmarks. FY21 Board fees (inclusive of Committee fees) are as follows:

Board Chair

Board Members

FY21 fees

$220,000

$139,500 – $142,000

(iii)  Remuneration governance
The Remuneration Committee oversees all remuneration-related matters, balancing both short-term and long-term strategic 
objectives, corporate values and Waypoint REIT’s broader Risk Management Framework. The Remuneration Committee reviews 
and provides guidance and, as appropriate, endorses management recommendations on remuneration matters (including 
FAR, STI and LTI for Executive KMP), Board and Committee fees and submits these for Board approval. The Remuneration 
Committee’s Charter, setting out its detailed responsibilities, is reviewed annually.

To ensure that it is fully informed when making decisions, including on recent market trends and practices and other 
remuneration-related matters, the Remuneration Committee may seek external remuneration advice from time to time. 
Remuneration consultants are engaged directly by the Remuneration Committee as needed. 

(iv)  Remuneration Policy for Executive KMP

Introduction

Following Internalisation in FY20, the newly formed Remuneration Committee established its remuneration objectives and 
undertook a comprehensive review of Waypoint REIT’s Remuneration Policy and underlying executive remuneration and made 
necessary adjustments to achieve alignment with these remuneration objectives. This review was undertaken in consideration 
of the new internalised management structure and to ensure the remuneration framework aligned to best practice remuneration 
principles. It also included input from an external remuneration consultant on market practice insights and trends in relation  
to executive remuneration approaches including:

•  market review of executive pay structure and design;

•  CEO and executive remuneration benchmarking; and

•  NED benchmarking.

No remuneration recommendations were made by the remuneration consultant in FY21 and advice provided was one of many 
inputs used by the Remuneration Committee to make remuneration decisions.

Remuneration objectives 

The Board recognises the key to Waypoint REIT’s ongoing success lies in retaining and attracting high-performing people.  
The remuneration framework has been designed to link Waypoint REIT’s strategy of maximising long-term income and capital 
returns and performance with the remuneration outcomes for Executive KMP and foster strong alignment between executive  
pay and securityholder value. 

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Remuneration structure

Waypoint REIT aims to ensure that the split of fixed and variable remuneration for Executive KMP is consistent with its remuneration 
objectives, appropriate for the size and nature of its business and provides fair and equitable outcomes for individuals.

The table below sets out Waypoint REIT’s Executive KMP remuneration arrangements: 

Type

FAR

STI

LTI

STI details

Basis

Purpose

Performance 
conditions

What?

Why?

Comprises base salary, superannuation contributions 
and other benefits.

Reviewed annually and independently benchmarked  
on a periodic basis against comparable organisations. 

Opportunity award based on a percentage of fixed 
remuneration, subject to specific performance  
and employment conditions (including a deferred  
equity component).

Opportunity award based on a percentage of fixed 
remuneration in the form of Performance Rights  
with a three-year Performance Period

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 set and measured through a 
balanced scorecard approach, with KPIs aligned to the 
key financial and non-financial value drivers of Waypoint 
REIT’s business. Deferred equity component designed  
to encourage retention and securityholder alignment.

‘At risk’ component designed to align executive 
performance with securityholder interests, to attract  
and retain executives and provide the opportunity to 
reward executives for long-term achievements.

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.

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 as follows:

Criteria

Financial

Financial – 
outperformance

Award scale Criteria

0 or 33%

0 – 33%

Delivery of initial Distributable Earnings per security (DEPS) 
guidance. No award if criteria not met.

Delivery of DEPS in excess of initial guidance. Sliding scale 
award determined at the Board’s discretion based on level of 
outperformance achieved. 

Individual KPIs

0 – 33%

Delivery of financial and non-financial performance criteria set  
out in KMP balanced scorecards agreed at the start of the year. 

The Board believes that having a mix of financial and non-financial KPIs will provide measurable 
performance criteria strongly linked to year-on-year securityholder returns and encourage the achievement 
of individual goals consistent with Waypoint REIT’s overall strategic objectives. The key FY21 KPIs are 
detailed in section (v).

Performance 
assessment

The MD/CEO evaluates the performance of the other Executive KMP against their KPIs as set out in  
their balanced scorecard and other applicable measures, including evidence of behaviour in line with 
Waypoint REIT’s corporate values and Risk Management Framework. This information is presented  
to the Remuneration Committee ,which performs the same evaluation of the MD/CEO performance.  
The Remuneration Committee then recommends the STI awards, if any, to the Board for approval.

30

Waypoint REIT Limited – Annual Report 2021Delivery

MD/CEO

50% of the STI entitlement is payable in securities subject to trade-lock with 25% vesting after one year  
and 25% vesting after two years. 

Other reported executives

Cessation of 
employment

Board discretion

33% of the STI entitlement is payable in securities subject to trade-lock with vesting after one year.

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

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

LTI details

Basis

Purpose

An LTI award will be delivered in the form of an annual grant of Performance Rights to Waypoint REIT 
stapled securities under the Waypoint REIT Equity Incentive Plan. Performance Rights will be allocated  
to eligible executives (including all Executive KMP) on or around the date of the Annual General Meeting 
(i.e. FY21 Performance Rights allocated in April/May 2021).

LTI is designed to align the interests of eligible executives with the interests of securityholders by providing 
them with the opportunity to receive an equity interest in Waypoint REIT through the granting of Performance 
Rights. Waypoint REIT uses Performance Rights because they create security price alignment between 
eligible executives and securityholders, but do not provide eligible executives with the full benefits of security 
ownership (such as distribution and voting rights) unless and until the Performance Rights vest.

Value determination The value of Performance Rights granted is determined by dividing the dollar value of an eligible executive’s 
annual LTI opportunity (as determined by the Remuneration Committee) by the weighted average traded 
price of Waypoint REIT’s stapled securities traded on the ASX during the 10 business days following the 
release of the annual results, rounded up to the nearest whole number of Performance Rights.

Vesting period

The Performance Period commences on 1 January of the year Performance Rights are granted and 
concludes on the third anniversary date (i.e. FY21 Performance Rights: 1 January 2021 to 31 December 2023).

Performance Rights will vest on or around 1 March following the end of the Performance Period  
(i.e. FY21 Performance Rights will vest on or around 1 March 2024). 

Vesting conditions

Vesting of the Performance Rights will be subject to the achievement of two vesting conditions:

•  50% of the Performance Rights will be tested against a relative Total Securityholder Return (TSR) 

condition; and

•  the remaining 50% of the Performance Rights will be tested against an average growth in DEPS condition.

See below for further details.

TSR condition 
(50% weighting)

The TSR condition measures Waypoint REIT’s performance relative to a peer group (i.e. FY21 comparator 
group of companies comprises the constituents of the S&P/ASX 300 A-REIT index as at 1 January 2021) 
over the Performance Period. TSR measures the growth in Waypoint REIT’s security price together with  
the value of distributions paid during the period, assuming that all those distributions are reinvested into
new securities. 

The vesting schedule applicable for FY21 – FY23 is:

Percentile ranking

Vesting level of Performance Rights subject to TSR condition

Equal to the 75th percentile or higher

100%

Between the 50th and 75th percentile

Straight-line pro rata vesting between 50% and 100%

Equal to the 50th percentile

Below the 50th percentile

50%

0%

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DEPS condition 
(50% weighting)

The vesting schedule applicable for FY21 – FY23 is:

Average annual growth in DEPS

Vesting level of Performance Rights subject to the DEPS condition

Equal to 4.5% or higher

100%

Between 3.75% and 4.5%

Straight-line pro rata vesting between 50% and 100%

At 3.75%

Less than 3.75%

50%

0%

Rationale for 
conditions

The LTI performance conditions have been set by the Board to align with securityholder expectations and 
Waypoint REIT’s strategy. 

The TSR condition measures the overall returns that an entity has provided its securityholders, reflecting 
security price movements and reinvestment of distributions over a specified period. Relative TSR is the 
most widely used LTI hurdle adopted in Australia. It ensures that value is only delivered to participants  
if the investment return actually received by Waypoint REIT securityholders is sufficiently high relative  
to the returns they could have received by investing in a portfolio of alternative S&P/ASX 300 A-REIT index 
securities over the same period.

The DEPS condition aligns the LTI Plan with commercial long-term performance, which is within 
executives’ ability to influence and aligns with securityholder expectations. The performance hurdles  
have been set with reference to:

•  organic rental growth of WPR’s property portfolio (FY21 – 3.0%) plus the effect of gearing (target 

gearing: 30-40%); and

•  WPR’s historical performance.

Distributions on 
unvested LTI awards

Forfeiture

Delivery

Prior to vesting, Performance Rights do not entitle eligible executives to any distributions or voting rights.

LTI awards will usually be forfeited if an executive resigns or is summarily dismissed prior to the vesting 
date (see the ‘Cessation of employment’ section below for more detail). If the Board determines that an 
executive is responsible for misconduct resulting in material non-compliance with financial reporting 
requirements or for excessive risk taking, the executive will forfeit all unvested performance right 
entitlements.

Each performance right entitles eligible executives to one ordinary security in Waypoint REIT on vesting. 
Securities allocated on vesting of Performance Rights carry the same distribution and voting rights as 
other securities issued by Waypoint REIT. The Board retains discretion to make a cash equivalent payment 
in lieu of an allocation of securities. 

Clawback provisions The Board has broad ‘clawback’ powers to determine that Performance Rights lapse, any securities 

Cessation of 
employment

Change of control

Board discretion

allocated on vesting of Performance Rights are forfeited or clawed back, or that amounts are to be repaid,  
in certain circumstances.

Where eligible executives’ employment with Waypoint REIT is terminated for cause or ceases due to 
resignation, all unvested Performance Rights will lapse, unless the Board determines otherwise. In all other 
circumstances (including due to genuine retirement, redundancy, death, permanent disability, or ill health, 
the expiry of a fixed-term contract or separation by mutual agreement), a pro rata portion of unvested 
Performance Rights will remain on foot unless the Board determines otherwise.

Where there is a change of control event (including a takeover bid or any other transaction, event or state  
of affairs that, in the Board’s opinion, is likely to result in a change in the control of Waypoint REIT),  
the Board may determine the manner in which all unvested Performance Rights will be dealt with.

While the number of Performance Rights that vest will primarily be determined by testing against  
the vesting conditions, the Board retains an overriding discretion to reduce or increase the vesting  
outcome where it considers it appropriate in light of Waypoint REIT’s performance overall and any  
other relevant circumstances. 

Restrictions  
on dealing

Eligible executives must not sell, transfer, encumber, hedge or otherwise deal with Performance Rights, 
unless the dealing is required by law. 

32

Waypoint REIT Limited – Annual Report 2021(v)  Detailed remuneration outcomes 

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 historical financial performance. 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 Earnings1 ($’m)

Basic earnings per security (cents)

DEPS1 (cents)

Distributions paid/payable (cents)

Capital return (cents)

Closing security price (31 December)

Net tangible assets per security2

Weighted average securities on issue (m)

1.  DEPS is unaudited.

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

2021

443.6

122.6

57.17

15.80

15.97

17.00

$2.83

$2.95

775.8

2.  Net tangible assets per security includes the impact of the fair value movements.

FY21 STI annual assessment

The STI balanced scorecard contains three equally weighted elements that are assessed independently of each other.  
These elements and the relevant criteria for FY21 are:

Element

Financial

Financial – 
outperformance

Scale

33.3%

0 – 33.3%

Criteria

Achieve FY21 DEPS guidance as announced on 26 February 2021 (15.72 cents). 

Exceed the FY21 DEPS guidance as announced on 26 February 2021 (15.72 cents).  
Sliding scale award determined at the Board’s discretion based on level of 
outperformance achieved.

Individual KPIs

0 – 33.3%

Individual financial and non-financial performance criteria set in conjunction  
with the Board or MD/CEO (as applicable). Please refer to the table below.

33

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Remuneration Report continued

(v)  Detailed remuneration outcomes continued
The annual assessments for the MD/CEO and other reported executives are similar but with different emphasis and KPIs 
applicable to their individual roles. The KPI categories have been set with regard to Waypoint REIT’s strong risk management  
and corporate governance culture. KPIs for Executive KMP in FY21 varied from person to person; however, the key KPIs driving  
the Remuneration Committee and Board’s decision to award the FY21 STIs were as follows:

KPI categories

Corporate strategy

•  Align strategy with investment objective of maximising  
long-term income and capital returns for securityholders

Portfolio management

•  Execute non-core asset sales strategy

•  Deliver acquisitions in line with approved criteria  

and return hurdles

•  Proactively manage lease expiries

•  Engage with tenants on site and portfolio  

optimisation opportunities

Financial and capital management

•  Diversify and optimise debt funding sources

•  Extend debt maturities

•  Manage liquidity to support the delivery of  

Waypoint REIT’s strategy

•  Optimise capital management in coordination  

with portfolio management strategy

ESG

KPI performance

•  Comprehensive portfolio review completed, with 

approximately 15% of Waypoint REIT’s fuel and convenience 
portfolio identified for potential disposal over the near-to-
medium term (including FY21) to improve overall portfolio 
quality and reduce future income and capital risk

•  Long-term diversification strategy identified to broaden 

Waypoint REIT’s avenues for growth and mitigate sector  
and tenant concentration risk

•  40 non-core assets settled or exchanged for proceeds  
of $137.1 million at a 10.5% premium to book value

•  All lease renewals executed at a weighted average leasing 

spread of 3.5% and no downtime

•  Maintained disciplined approach to acquisitions, leveraging 

strong market conditions to sell non-core assets

•  Inaugural $200.0 million AMTN issuance completed  
and $285.0 million of bank debt refinanced/banking  
group rationalised

•  Weighted average debt maturity increased 0.7 years  

to 5.0 years

•  Business funding, liquidity and gearing maintained within 

approved parameters 

•  $173.3 million of capital management initiatives executed 
($41.1 million buy-back and $132.2 million capital return)

•  No employee turnover; no employee injuries

•  Ongoing focus on people, culture and safety

•  No reportable compliance breaches

•  Maintain strong corporate governance

•  Net carbon neutral target set and achieved

•  Set carbon reduction strategy

•  Modern Slavery Statement published

•  Adopt inaugural Modern Slavery Statement

•  Sustainability rankings materially improved (S&P Corporate 

•  Actively seek to improve ESG external ratings

•  Identify and execute other initiatives to further ESG strategy

Sustainability, Sustainalytics, MSCI)

•  TCFD gap analysis performed

•  Regular ESG reporting to Board implemented

In assessing Executive KMP delivery against their respective and collective KPIs, the Remuneration Committee has determined all 
members of Executive KMP have met or exceeded expectations in all KPI categories as evidenced in the table above. Accordingly, 
all members of Executive KMP have been awarded their maximum STI allocations. Refer to FY21 STI outcomes section below for 
further details.

34

Waypoint REIT Limited – Annual Report 2021FY21 STI outcomes

The following table sets out the awards made to each Executive KMP based on their performance during the year ended  
31 December 2021.

$

Hadyn Stephens

Kerri Leech

Tina Mitas2

FAR as per  
contract1

Maximum STI  
as per contract

550,000

400,000

244,000

550,000

300,000

122,000

Actual STI  
awarded

550,000

300,000

140,000

% of maximum 
possible current 
award earned

100

100

115

1.  FAR comprises salary and superannuation.

2.  FAR and maximum STI are based on a 0.8 Full-time Equivalent (FTE) basis consistent with Tina Mitas’s standard terms of employment.  

Tina Mitas’s Actual STI and % maximum in the above table and the actual figures in the table below reflect a pro rata payment for additional  
days worked during the financial year over and above her contractual obligation.

FY21 total remuneration (statutory basis)

Executives were designated KMP from 1 October 2020 (date of Internalisation). Prior to this date, executives were employees  
of VER Manager Pty Limited, a subsidiary of Viva Energy Australia Pty Limited (the Manager). Accordingly, the comparative 
figures in the table below show fixed remuneration for the period 1 October to 31 December 2020 and variable remuneration  
for the entire FY20 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. 

Table 1 of 2

Hadyn Stephens

2021 (full year)

2020 (part year)

Kerri Leech

2021 (full year)

2020 (part year)

Tina Mitas

2021 (full year)

2020 (part year)

Total

2021 (full year)

2020 (part year)

Short-term benefits

Post-
retirement 
benefits

Other 
long-term 
benefits

Annual 
leave1
$

Other 
benefits
$

Super-
annuation
$

Long service 
leave1
$

Salary
$

527,369

119,576

377,369

84,254

245,083

60,694

1,149,821

264,524

14,253

2,155

19,896

553

4,075

2,222

38,224

4,930

3,997

417

2,000

292

2,467

155

8,464

864

22,631

5,424

22,631

3,273

23,026

6,833

68,288

15,530

1.  Amounts disclosed represent the movement in the associated leave provisions. 

Total
fixed
$

582,601

130,699

432,347

90,272

14,351

3,127

10,451

1,900

8,058

2,844

282,709

72,748

32,860

1,297,657

7,871

293,719

35

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Remuneration Report continued

FY21 total remuneration (statutory basis) continued

Table 2 of 2

Hadyn Stephens

2021 (full year)

2020 (part year)

Kerri Leech

2021 (full year)

2020 (part year)

Tina Mitas

2021 (full year)

2020 (part year)

Total

2021 (full year)

2020 (part year)

Short-term 
benefits

Current 
STI
(cash)
$

Other 
long-term 
benefits

Deferred  
STI
(cash)
$

Share-based payments

Deferred STI1
(equity)
$

Deferred 
LTI2
(rights)
$

Total 
variable
$

Grand 
total
$

At risk 
element3
%

275,000

250,000

200,000

210,000

93,333

100,000

568,333

560,000

-

103,419

23,922

250,000

-

-

402,341

500,000

984,942

630,699

-

-

-

-

-

44,444

13,239

-

-

257,683

210,000

690,030

300,272

20,741

-

5,296

-

119,370

100,000

402,079

172,748

168,604

42,457

779,394

2,077,051

250,000

-

-

810,000

1,103,719

41

49

37

37

30

26

1.  Represents the accounting expense attributed to each Executive KMP in accordance with AASB 2 Share-based Payments. The face values  

of deferred STI awards anticipated to be granted to Hadyn Stephens, Kerri Leech and Tina Mitas in March 2022 are $275,000, $100,000 and 
$46,667 respectively. Subject to ongoing service conditions being satisfied, the difference in value will be expensed over FY22 ($168,604) and 
FY23 ($73,882) and FY24 ($10,577) accordingly.

2.  Represents the accounting expense attributed to each Executive KMP in accordance with AASB 2 Share-based Payments. The face values  

of LTI awards granted to Hadyn Stephens, Kerri Leech and Tina Mitas were $183,000, $100,000 and $40,000 respectively.

3.  Comparative figures are presented on an annualised basis. Actual percentages for the three-month period KMP were appointed were 79,  

70 and 58 respectively.

(vi)  Executive KMP equity holdings
As outlined in the FY20 Remuneration Report, the Board has introduced an equity-based LTI Plan for Executive KMP and requires 
any deferred component of KMP STI to now be delivered in the form of equity.

Stapled securities

FY21

Hadyn Stephens

Kerri Leech

Tina Mitas

Balance
1 January

On-market 
purchases

Vesting of 
deferred 
STI1

Vesting of 
Performance 
Rights

-

-

-

41,666

7,499

8,400

-

-

-

-

-

-

Other2

(2,574)

(463)

(519)

Balance
31 December

39,092

7,036

7,881

1.  Deferred portion of FY21 STI payable in securities subject to trade-lock restrictions will be acquired on-market in March 2022 and held in 

Waypoint REIT’s Employee Share Trust until the end of the deferral period. Refer to section (v) above for further details.

2.  Holdings adjusted for security consolidation effected 10 November 2021 at a ratio of 0.9382.

36

Waypoint REIT Limited – Annual Report 2021Performance rights

Waypoint REIT issued 155,916 Performance Rights in FY21, including 78,801 granted on 9 April 2021 and 77,115 granted on  
13 May 2021. All Performance Rights have a nil exercise price, vest on or around 1 March 2024 if vesting conditions are met  
or otherwise expire on this date and are subject to DEPS and TSR conditions over the Performance Period of 1 January 2021  
to 31 December 2023. 

Accounting standards require the estimated valuation of the grants be recognised over the Performance Period. The minimum 
value of the grant is nil if the vesting conditions are not met. The maximum value is based on the estimated fair value calculated  
at the time of the grant and amortised in accordance with the accounting standard requirements.

FY21

Hadyn Stephens1

Kerri Leech2

Tina Mitas2

Opening 
balance
#

-

-

-

Rights 
granted
#

77,115

42,139

16,856

Rights 
vested
#

-

-

-

Fair value to 
be expensed 
in future 
years3
($)

92,907

51,234

20,494

Closing 
balance
#

77,115

42,139

16,856

1.  Grant date of 13 May 2021. Fair value per right at grant date of $2.13 (DEPS tranche) and $0.90 (TSR tranche).

2.  Grant date of 9 April 2021. Fair value per right at grant date of $2.14 (DEPS tranche) and $0.92 (TSR tranche).

3.  The maximum value of the grants yet to vest is the fair value amount at the grant date yet to be reflected in Waypoint REIT’s Consolidated 

Statement of Comprehensive Income. 

Performance Rights are valued using the Black-Scholes-Merton methodology, which discounts for dividends/distributions foregone. 
This is used for allocation purposes for all rights and accounting purposes for non-market-based Performance Rights. The Monte 
Carlo method is used for accounting purposes for market-based Performance Rights. The accounting value determined using  
a Monte Carlo simulation valuation is in accordance with AASB 2.

(vii)  Other information 

Employment contracts and termination entitlements 

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: 

Hadyn Stephens

Kerri Leech

Tina Mitas

12 months

6 months

3 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. 

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.

(viii)  Remuneration Policy for Non-Executive Independent Directors

Objective

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 Non-Executive Independent 
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.

37

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Remuneration Report continued

Remuneration structure

Under the Company Constitution, the Board may decide the remuneration to which each Non-Executive Independent Director is 
entitled for his or her services as a Director. However, the total amount provided to all Non-Executive Independent 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 Non-Executive Independent Directors during FY21 were as follows:

Role

Chair 

Member

Board

$220,0002

$107,0003

Audit and Risk 
Management 
Committee

$25,0004

$12,5004

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. Fees increased $20,000 on 1 January 2021. Prior to this date, 

Board Chair fees had remained unchanged since Waypoint REIT listed on the ASX in August 2016. 

3.  Fees increased $7,000 on 1 January 2021. Prior to this date, Board Member fees had remained unchanged since Waypoint REIT listed  

on the ASX in August 2016.

4.  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, Non-Executive Independent Directors are entitled to reimbursement of travel and other out of pocket expenses,  
which totalled $265 in the year ended 31 December 2021 (2020: $4,554). 

(ix)  Non-Executive Independent Director fees and other information
Details of Non-Executive Independent Director fees and security interests are set out below.

Fees 

Fees payable to each Non-Executive Independent Director of Waypoint REIT during the year are set out below:

2021

Super-
annuation
$

19,543

12,392

12,614

44,549

Base fee
$

200,457

127,108

129,386

456,951

Total
$

220,000

139,500

142,000

501,500

Base fee
$

182,648

105,594

113,014

401,256

2020

Super-
annuation
$

17,352

10,031

10,736

38,119

Total
$

200,000

115,625

123,750

439,375

Laurence Brindle

Georgina Lynch

Stephen Newton

Total

Interests in securities

The number of securities held during the year by each Non-Executive Independent Director of Waypoint REIT, including their 
personally related parties, are set out below:

2021

Non-Executive Directors

Laurence Brindle

Georgina Lynch

Stephen Newton

Balance
1 January

On-market 
purchases

On-market 
disposals

Other1

Balance
31 December

100,000

50,000

25,000

-

-

-

-

-

-

(6,180)

(3,090)

(1,545)

93,820

46,910

23,455

1.  Holdings adjusted for security consolidation effected 10 November 2021 at a ratio of 0.9382.

38

Waypoint REIT Limited – Annual Report 2021Other transactions with Non-Executive Independent Directors

There were no loans made, guaranteed or secured, directly or indirectly, by Waypoint REIT to any Non-Executive Independent 
Director or their related parties during the year. There were no other transactions between Waypoint REIT and any Non-Executive 
Independent 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 and the Responsible Entity are party to Deeds of Indemnity with each of its Directors, Hadyn Stephens (Managing 
Director & Chief Executive Officer), Kerri Leech (Chief Financial Officer) and Tina Mitas (Company Secretary) providing these 
persons with an indemnity on a full indemnity basis, to the fullest extent permitted by law, against all losses and liabilities incurred 
in their respective role for the Company, the Responsible Entity 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.

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

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

Details of the amounts paid or payable to the auditor for audit and non-audit services provided in relation to the year ended  
31 December 2021 are disclosed in Note 4.(d) to the Consolidated Financial Statements.

The Directors have considered the position and, in accordance with advice received from Waypoint REIT’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.

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 40.

Rounding of amounts to the nearest million dollars
Waypoint REIT 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
Chair

28 February 2022

39

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Auditor’s Independence Declaration 

As lead auditor for the audit of Waypoint REIT Limited and Waypoint REIT Trust for the year ended 31 
December 2021, 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 in 

relation 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. 

Jane Reilly 
Partner 
PricewaterhouseCoopers 

Sydney 
28 February 2022 

PricewaterhouseCoopers, ABN 52 780 433 757 
One International Towers Sydney, Watermans Quay, Barangaroo, GPO BOX 2650, SYDNEY  NSW  2001 
T: +61 2 8266 0000, F: +61 2 8266 9999, www.pwc.com.au 

Level 11, 1PSQ, 169 Macquarie Street, Parramatta NSW 2150, PO Box 1155 Parramatta NSW 2124 
T: +61 2 9659 2476, F: +61 2 8266 9999, www.pwc.com.au 

Liability limited by a scheme approved under Professional Standards Legislation. 

40

Waypoint REIT Limited – Annual Report 2021 
  
 
Consolidated Statements of Comprehensive Income
For the year ended 31 December 2021

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

Finance income

Net gain on sale of investment properties 

Net gain on movement in fair value of  
investment properties

Management and administration expenses

Finance expense

Net gain/(loss) from derivative financial instruments

Internalisation costs

Interest rate swap termination 

Net profit before income tax

Income tax expense

Net profit after tax

Other comprehensive income

Items that may be reclassified subsequently  
to profit or loss

Unrealised gains/(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

–  unit holders of Waypoint REIT Trust  

(non-controlling interests) 

Earnings per security

Basic earnings per security

Diluted earnings per security

Waypoint REIT

Trust Group

Notes

2021 
$ million

2020 
$ million

2021 
$ million

2020 
$ million

178.3

181.6

178.3

181.6

3.(b)

2.(a)

3.(b) 

3.(b)

0.1

1.0

305.0

(9.9)

(32.7)

1.8

-

-

443.6

-

443.6

0.2

-

152.3

(9.3)

(35.3)

(0.3)

(5.8)

(3.5)

0.1

0.2

305.0

(10.1)

(32.7)

1.8

-

-

279.9

442.6

-

-

279.9

442.6

0.1

-

152.3

(9.5)

(35.3)

(0.3)

(5.8)

(3.5)

279.6

-

279.6

27.8

471.4

(7.6)

272.3

27.8

470.4

(7.6)

272.0

1.0

0.3

-

-

470.4

471.4

Cents

57.17

57.16

272.0

272.3

Cents

35.79

35.79

470.4

470.4

Cents

57.05

57.04

272.0

272.0

Cents

35.76

35.76

1.(b)

1.(b)

The above Consolidated Statements of Comprehensive Income should be read in conjunction with the accompanying notes.

41

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Consolidated Balance Sheets
At 31 December 2021

ASSETS

Current assets

Cash and cash equivalents

Derivative financial instruments

Other current assets

Assets classified as held for sale

Total current assets

Non-current assets

Investment properties

Derivative financial instruments

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 and other current liabilities

Total current liabilities

Non-current liabilities

Borrowings

Derivative financial instruments

Provisions and other non-current liabilities

Total non-current liabilities

Total liabilities

Net assets

EQUITY

Waypoint REIT Limited

Contributed equity

Retained profits/(Accumulated losses)

Reserves

Parent entity interest

Waypoint REIT Trust

Contributed equity

Retained profits

Reserves

Non-controlling interests

Total equity

Waypoint REIT

Trust Group

31 Dec 2021 
$ million

31 Dec 2020 
$ million

31 Dec 2021 
$ million

31 Dec 2020 
$ million

Notes

1.(c)

3.(d)

2.(b)

2.(a) 

3.(d)

1.(a) 

3.(d)

3.(a) 

3.(d)

3.(f)

19.0

0.7

3.3

23.0

33.9

56.9

15.5

-

2.4

17.9

14.3

32.2

2.7

0.7

13.9

17.3

33.9

51.2

2.1

-

14.5

16.6

14.3

30.9

3,069.0

2,897.3

3,069.0

2,897.3

1.5

0.8

3,071.3

3,128.2

-

1.1

2,898.4

2,930.6

1.5

-

3,070.5

3,121.7

-

-

2,897.3

2,928.2

3.4

2.4

5.9

30.4

-

1.9

44.0

929.5

25.5

0.9

955.9

999.9

4.9

2.3

6.5

60.7

1.0

1.5

76.9

845.8

53.6

1.1

900.5

977.4

2,128.3

1,953.2

7.6

-

-

7.6

7.7

(1.0)

-

6.7

7.3

2.4

5.9

30.4

-

-

46.0

929.5

25.5

-

955.0

1,001.0

2,120.7

-

-

-

-

11.8

2.3

6.5

60.7

1.0

-

82.3

845.8

53.6

-

899.4

981.7

1,946.5

-

-

-

-

3.(f)

1,453.5

1,627.1

1,453.5

1,627.1

3.(h)

672.9

(5.7)

2,120.7

2,128.3

352.9

(33.5)

1,946.5

1,953.2

672.9

(5.7)

2,120.7

2,120.7

352.9

(33.5)

1,946.5

1,946.5

The above Consolidated Balance Sheets should be read in conjunction with the accompanying notes.

42

Waypoint REIT Limited – Annual Report 2021 
 
 
 
 
 
 
 
Consolidated Statements of Changes in Equity
For the year ended 31 December 2021

  Notes

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

1.(a)

Total transactions with owners 
in their capacity as owners

Cont-
ributed 
equity 
$ million

2.0

-

-

-

5.7

-

-

-

(1.3)

0.3

-

0.3

-

-

-

-

Waypoint REIT

Trust Group

Retained 
profits 
$ million

Reserves 
$ million

Non-
cont-
rolling 
interests 
$ million

Cont-
ributed 
equity 
$ million

Retained 
profits 
$ million

TOTAL 
$ million

Reserves 
$ million

TOTAL 
$ million

- 1,782.2 1,782.9 1,616.3

191.8

(25.9) 1,782.2

-

-

-

-

-

-

-

279.6

279.9

(7.6)

(7.6)

272.0

272.3

-

-

-

(5.7)

-

(5.7)

16.5

16.5

16.5

279.6

-

279.6

-

(7.6)

(7.6)

279.6

(7.6)

272.0

-

-

-

-

-

-

(5.7)

16.5

(118.5)

(102.0)

(118.5)

(118.5)

-

(118.5)

(102.0)

(102.0)

16.5

(118.5)

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

Balance at 1 January 2021

7.7

Profit for the period

Other comprehensive income:

Effective portion of changes in 
fair value of cash flow hedges

3.(d)

Total comprehensive profit  
for the period

Transactions with owners  
in their capacity as owners

  On-market buy-back, net of 

transaction costs

  Capital return and security 

consolidation, net of 
transaction costs

  Distributions paid or  

provided for

Total transactions with owners 
in their capacity as owners

Balance at 31 December 2021

3.(f)

1.(a)

-

-

-

(0.1)

-

-

(0.1)

7.6

(1.0)

1.0

-

1.0

-

-

-

-

-

- 1,946.5 1,953.2 1,627.1

352.9

(33.5) 1,946.5

-

-

-

-

-

-

-

442.6

443.6

27.8

27.8

470.4

471.4

-

-

-

442.6

-

442.6

-

27.8

27.8

442.6

27.8

470.4

(41.4)

(41.5)

(41.4)

(132.2)

(132.2)

(132.2)

-

-

(122.6)

(122.6)

-

(122.6)

(296.2)

(296.3)

(173.6)

(122.6)

-

-

-

-

(41.4)

(132.2)

(122.6)

(296.2)

- 2,120.7 2,128.3 1,453.5

672.9

(5.7) 2,120.7

The above Consolidated Statements of Changes in Equity should be read in conjunction with accompanying notes.

43

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Consolidated Statements of Cash Flows
For the year ended 31 December 2021

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

Net cash inflow from operating activities

Cash flows from investing activities

Acquisition and development expenditure

Net proceeds on sale of investment properties

Net cash inflow/(outflow) from investing activities

Cash flows from financing activities

Proceeds from borrowings (net of borrowing costs)

Repayments of borrowings

Payments in relation to derivatives

On-market buy-back of stapled securities  
(net of costs)

Capital return and security consolidation  
(net of costs)

Payment for capital reallocation

Waypoint REIT

Trust Group

Notes

2021 
$ million

2020 
$ million

2021 
$ million

2020 
$ million

181.2

175.4

181.2

175.4

(29.0)

152.2

0.1

(31.1)

121.2

(2.2)

129.8

127.6

686.6

(605.7)

-

(41.1)

(132.2)

-

(152.9)

(245.3)

3.5

15.5

19.0

(29.6)

145.8

0.2

(29.2)

116.8

(49.6)

0.9

(48.7)

664.7

(644.0)

(3.5)

-

-

-

(97.3)

(80.1)

(12.0)

27.5

15.5

(31.9)

149.3

-

(31.1)

118.2

(2.2)

129.8

127.6

686.6

(605.7)

-

(41.0)

(132.2)

-

(152.9)

(245.2)

0.6

2.1

2.7

(27.4)

148.0

0.2

(29.2)

119.0

(49.5)

0.9

(48.6)

664.7

(644.0)

(3.5)

-

-

(5.7)

(97.3)

(85.8)

(15.4)

17.5

2.1

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 period

Cash and cash equivalents at end of the period

1.(c)

The above Consolidated Statements of Cash Flows should be read in conjunction with accompanying notes.

44

Waypoint REIT Limited – Annual Report 2021 
 
 
 
 
Notes to the Financial Statements

This general-purpose financial report contains the financial statements of Waypoint REIT and Waypoint REIT Trust Group (Trust 
Group) for the year ended 31 December 2021. The financial statements of Waypoint REIT 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 at and for the year  
ended 31 December 2021.

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). Each stapled security 
consists of one share in the Company and one unit in the Trust.

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

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 Waypoint REIT to measure financial performance. 

1.(a)  Distributions to securityholders

1.(b)  Earnings per security

1.(c)  Cash and cash equivalents

1.(d)  Cash flow information

2. Property portfolio – an overview of Waypoint REIT’s investment property portfolio. 

2.(a) 

Investment properties

2.(b)  Assets held for sale

2.(c)  Sensitivities

2.(d)  Commitments and contingencies

3. Capital management – an overview of Waypoint REIT’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 

3.(i) 

Security-based benefits expense

4. Additional information – additional disclosures relating to Waypoint REIT’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

45

Overview and HighlightsChair and MD/CEO ReportBusiness ReviewSustainabilityFinancial ReportInvestor InformationCorporate DirectoryWaypoint REIT Limited – Annual Report 2021Notes to the Financial Statements continued

1.  Performance and results
Waypoint REIT (and Trust Group) has one reportable segment in which it operates, being fuel and convenience retail investment 
properties. The Board of Waypoint REIT, in its capacity as chief operating decision maker, monitors the performance of 
Waypoint REIT and Trust Group in a manner consistent with that of the financial report. Refer to the Consolidated Statements of 
Comprehensive Income for the segment financial performance and the Consolidated Balance Sheets for the assets and liabilities.

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 statutory 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.

A reconciliation between Distributable Earnings and statutory profit is set out below:

Financial results

Rental income

Finance income

Total operating income

Management and administration expenses

Interest expense

Distributable Earnings

Net gain on movement in fair value of investment properties

Net gain on sale of investment properties

Straight-line rental income

Amortisation of borrowing costs

Interest rate swap termination 

Net gain/(loss) from derivatives financial instruments

Internalisation costs

Statutory net profit

Year ended 
31 Dec 2021
$ million

Year ended 
31 Dec 2020
$ million

163.2

0.1

163.3

(9.9)

(30.8)

122.6

305.0

1.0

15.1

(1.9)

-

1.8

-

160.2

0.2

160.4

(9.3)

(32.6)

118.5

152.3

-

21.4

(2.7)

(3.5)

(0.3)

(5.8)

443.6

279.9

46

Waypoint REIT Limited – Annual Report 20211.(a)  Distributions to securityholders

Distributions paid in 2021

Final distribution for year ended 31 December 2020
– 7.73 cents per security paid on 26 February 2021

Interim distribution for the half-year ended 30 June 2021
– 7.81 cents per security paid on 31 August 2021

Interim distribution for the quarter ended 30 September 2021* 
– 3.95 cents per security paid on 15 November 2021

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

Total distributions paid

2021 
$ million

2020 
$ million

60.7

61.3

30.9 

-

-

152.9

-

-

-

56.0

57.9

113.9

* Distributions paid on a quarterly basis commencing the quarter ended 30 September 2021.

The Trust also returned $132.2 million (17 cents per stapled security) of capital to securityholders on 12 November 2021 and a 
distribution of 4.21 cents per security ($30.4 million) is to be paid on 28 February 2022 for the quarter ended 31 December 2021.

The Company has franking credits available for subsequent reporting periods of $0.03 million based on a tax rate of 30%  
(2020: $0.03 million). There was no dividend paid or payable from the Company during the year.

1.(b)  Earnings per security

Basic earnings per security (cents) attributable to: 

 Shareholders of Waypoint REIT Limited

 Unit holders of Waypoint REIT Trust (non-controlling interest)

Securityholders of Waypoint REIT 

Diluted earnings per security (cents) attributable to: 

 Shareholders of Waypoint REIT Limited

 Unit holders of Waypoint REIT Trust (non-controlling interest)

Securityholders of Waypoint REIT 

Waypoint REIT

Trust Group

2021 
Cents

0.12

57.05

57.17

0.12

57.04

57.16

2020 
Cents

2021 
Cents

0.03

35.76

35.79

0.03

35.76

35.79

-

57.05

57.05

-

57.04

57.04

2020 
Cents

-

35.76

35.76

-

35.76

35.76

Statutory net profit after tax ($ million)

443.6

279.9

442.6

279.6

Distributable Earnings ($ million)

Distributable Earnings per stapled security (cents)

122.6

15.80

118.5

15.15

122.6

N/A

118.5

N/A

47

Overview and HighlightsChair and MD/CEO ReportBusiness ReviewSustainabilityFinancial ReportInvestor InformationCorporate DirectoryWaypoint REIT Limited – Annual Report 2021Notes to the Financial Statements continued

1.  Performance and results continued

1.(b)  Earnings per security continued

Weighted average number of securities used as the denominator  
in calculating basic earnings per security 

Adjustments for calculation of diluted earnings per stapled 
security – Performance Rights*

Weighted average number of securities and potential securities 
used as the denominator in calculating diluted earnings per security 

Waypoint REIT

Trust Group

2021 
million

2020 
million

2021 
million

2020 
million

775.8

782.0

775.8

782.0

0.1

-

0.1

-

775.9

782.0

775.9

782.0

*  Performance Rights are unquoted securities and conversion to stapled securities and vesting to executives is subject to performance and/or 

service conditions.

1.(c)  Cash and cash equivalents

Cash at bank*

Total cash and cash equivalents

Waypoint REIT

Trust Group

31 Dec 2021 
$ million

31 Dec 2020 
$ million

31 Dec 2021 
$ million

31 Dec 2020 
$ million

19.0

19.0

15.5

15.5

2.7

2.7

2.1

2.1

*  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.

48

Waypoint REIT Limited – Annual Report 20211.(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 

Net revaluation of investment properties

Straight-line adjusting on rental income

Net gain on sale of investment properties

Net (gain)/loss from derivative financial instruments

Change in operating assets and liabilities

(Increase)/Decrease 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

Increase in provisions and other liabilities

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

Waypoint REIT

Trust Group

2021 
$ million

443.6

1.9

-

(305.0)

(15.1)

(1.0)

(1.8)

-

0.2

(1.1)

0.1

(0.6)

-

2020 
$ million

2021 
$ million

279.9

442.6

2.7

3.5

(152.3)

(21.4)

-

0.3

(1.5)

(1.0)

3.0

0.1

3.5

-

1.9

-

(305.0)

(15.1)

(0.2)

(1.8)

(6.8)

-

3.1

0.1

(0.6)

-

2020 
$ million

279.6

2.7

3.5

(152.3)

(21.4)

-

0.3

(1.2)

-

4.2

0.1

3.5

-

121.2

116.8

118.2

119.0

Waypoint REIT

Trust Group

2021 
$ million

2020 
$ million

2021 
$ million

2020 
$ million

2.4

2.4

1.2

1.2

2.4

2.4

1.2

1.2

49

Overview and HighlightsChair and MD/CEO ReportBusiness ReviewSustainabilityFinancial ReportInvestor InformationCorporate DirectoryWaypoint REIT Limited – Annual Report 2021Notes to the Financial Statements continued

2.  Property portfolio
Waypoint REIT’s property portfolio comprises both investment properties (Note 2.(a)) and assets held for sale (Note 2.(b)):

# Properties

Waypoint REIT

Trust Group

31 Dec 2021

31 Dec 2020

31 Dec 2021 
$ million

31 Dec 2020 
$ million

31 Dec 2021 
$ million

31 Dec 2020 
$ million

Investment properties (Note 2.(a))

Assets held for sale –  
uncontracted (Note 2.(b))

Sub-total

Assets held for sale –  
contracted (Note 2.(b))

Total 

427

6

433

3

436

470

3,069.0

2,897.3

3,069.0

2,897.3

2

472

2

474

21.6

9.0

21.6

9.0

3,090.6

2,906.3

3,090.6

2,906.3

12.3

5.3

12.3

5.3

3,102.9

2,911.6

3,102.9

2,911.6

The key inputs and assumptions for valuation of investment properties are below:

Annual market rent per site

Weighted average capitalisation rate

Range of capitalisation rates

Range of lease terms

2.(a)  Investment properties

(i)  Valuations and carrying amounts

31 Dec 2021

31 Dec 2020

$96,542 to $1,468,656

$78,386 to $1,425,879

5.16%

3.38% to 10.0%

1.7 to 14.9 years

5.62%

3.35% to 9.76%

0.4 to 14.6 years

Fuel and convenience retail properties – at fair value

Investment properties 

Waypoint REIT

Trust Group

31 Dec 2021 
$ million

31 Dec 2020 
$ million

31 Dec 2021 
$ million

31 Dec 2020 
$ million

3,069.0

3,069.0

2,897.3

2,897.3

3,069.0

3,069.0

2,897.3

2,897.3

Each investment property is subject to independent valuation at least once every three years, with approximately one-sixth  
of the portfolio representing a broad cross-section of both metro and regional assets independently valued every six months.  
During the year, CBRE independently valued 159 investment properties (representing over one-third of the portfolio), including  
79 at 31 December 2021 and 80 at 30 June 2021.

The Directors have reviewed the independent valuation outcomes and determined they are appropriate to adopt at 31 December 
2021. The key inputs into the valuation are based on market information for comparable properties and the individual lease 
profiles for each investment property. 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 or territory and with similar lease terms, segregated 
between metropolitan and regional sites.  

Investment properties have been classified as level 3 in the fair value hierarchy. 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 that are subject to perpetual leases.

50

Waypoint REIT Limited – Annual Report 2021Accounting 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. 

Key estimate – Valuation of investment properties

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 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. 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.

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 period

At fair value

Opening balance (1 January)

Property acquisitions

Capital expenditure

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 (31 December)

Waypoint REIT

Trust Group

2021 
$ million

2,897.3

2020 
$ million

2021 
$ million

2,684.2

2,897.3

2020 
$ million

2,684.2

-

0.6

15.1

319.8

(15.1)

(146.9)

(1.8)

35.2

19.3

21.4

-

0.6

15.1

176.7

319.8

(24.4)

(14.3)

(0.8)

(15.1)

(146.9)

(1.8)

35.2

19.3

21.4

176.7

(24.4)

(14.3)

(0.8)

3,069.0

2,897.3

3,069.0

2,897.3

51

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2.  Property portfolio continued

2.(a)  Investment properties continued

(iii)  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

Net gain on sale of investment properties

(iv)  Leasing arrangements

Waypoint REIT

Trust Group

2021 
$ million

2020 
$ million

2021 
$ million

2020 
$ million

163.2

15.1

1.4

305.0

1.0

160.2

21.4

0.8

152.3

-

163.2

15.1

1.4

305.0

0.2

160.2

21.4

0.8

152.3

-

The investment properties are leased to Viva Energy Australia Pty Limited (96.6% of rental income), other fuel operators and 
various convenience and fast food store operators (3.3% of rental income) under long-term operating leases with rent payable 
in advance monthly, quarterly or annually. Rental income for 94.8% of the investment properties is subject to fixed annual 
increases of 3.0% or greater. The remainder of the leases largely have CPI-linked rent reviews, but there are no other variable lease 
payments that depend on an index or rate. Where considered necessary to reduce credit risk, Waypoint REIT 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

Accounting policy – Rental income

Waypoint REIT

Trust Group

31 Dec 2021 
$ million

31 Dec 2020 
$ million

31 Dec 2021 
$ million

31 Dec 2020 
$ million

161.2

165.7

170.2

174.2

176.1

1,009.7

1,857.1

163.6

167.4

171.8

177.0

181.1

161.2

165.7

170.2

174.2

176.1

1,194.5

2,055.4

1,009.7

1,857.1

163.6

167.4

171.8

177.0

181.1

1,194.5

2,055.4

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 and reversed on disposal of an asset.

52

Waypoint REIT Limited – Annual Report 20212.(b)  Assets held for sale

Investment properties – contracted

Investment properties – uncontracted

Current assets held for sale

Waypoint REIT

Trust Group

31 Dec 2021 
$ million

31 Dec 2020 
$ million

31 Dec 2021 
$ million

31 Dec 2020 
$ million

12.3

21.6

33.9

5.3

9.0

14.3

12.3

21.6

33.9

5.3

9.0

14.3

During the year, Waypoint REIT sold the four assets held for sale as at 31 December 2020 and reclassified a further 43 assets to 
held for sale during the year. At balance date, nine assets remain held for sale including an asset that subsequently settled on  
4 February 2022 and two assets under conditional contracts with settlement conditional on the resolution of the State Revenue 
Office (SRO) matter detailed in Note 2.(d) by 30 July 2022. 

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.

2.(c)  Sensitivities
Waypoint REIT’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 Waypoint REIT are generally valued on a capitalisation 
of income basis.

Sensitivity of fair value to movements in market capitalisation rates:

 Decreases by 25 basis points

 Increases by 25 basis points

2021 
$ million

2020 
$ million

151.4

(148.5)

134.8

(123.4)

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 on borrowings 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 Waypoint REIT’s drawn debt facilities at 31 December 2021, the market capitalisation rate expansion required  
to trigger:

•  higher margin pricing is 140 bps;

•  applicability of draw stop provisions is 224 bps; and

•  a covenant breach is 309 bps.

Waypoint REIT’s weighted average rent review of 3.0% also provides a natural buffer of approximately 19 bps per annum of  
potential capitalisation rate expansion before gearing would be negatively impacted, holding all other variables constant.

53

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2.  Property portfolio continued

2.(d)  Commitments and contingencies

Capital expenditure commitments

Within one year

Waypoint REIT

Trust Group

31 Dec 2021 
$ million

31 Dec 2020 
$ million

31 Dec 2021 
$ million

31 Dec 2020 
$ million

0.2

0.2

0.6

0.6

0.2

0.2

0.6

0.6

Waypoint REIT has committed to contracts for the refurbishment of one fuel and convenience retail property with an aggregate 
completion value of $1.3 million, including committed costs of $0.2 million. This site is expected to reach practical completion 
over the next six months.

Other items

In September 2018, Waypoint REIT received an assessment from the Victorian SRO for $31.2 million in relation to the transfer  
of Victorian properties to Waypoint REIT from Viva Energy Group prior to its listing in August 2016. Pursuant to the arrangements 
between Waypoint REIT and Viva Energy Group, any such costs are payable by Viva Energy Group. In November 2018, Viva Energy 
Group lodged an objection to the assessment and assumed conduct of this matter under a conduct and indemnity deed between 
Waypoint REIT and Viva Energy Group. In May 2020, the SRO disallowed Viva Energy Group’s objection and Viva Energy Group 
appealed this decision with the case heard at the Victorian Supreme Court in November 2021. In February 2022, the Victorian 
Supreme Court handed down its judgment in favour of Viva Energy Group with an assessment of $nil; however, the transfers  
of title have not yet been stamped and remain with the SRO. 

Viva Energy Group remains listed as the registered proprietor of these properties on the Victorian land titles registry maintained 
by Land Use Victoria pending confirmation from the SRO that stamp duty has been paid. Once this matter is resolved, the signed 
transfers of the titles to the properties are required to be registered in the name of Waypoint REIT.

The transfer of the control of these properties to Waypoint REIT occurred in August 2016 under the sale agreement with Viva 
Energy Group and these properties continue to be recognised in the Consolidated Balance Sheets.

Other than noted above, there are no material outstanding contingent assets, liabilities or commitments as at 31 December 2021.

3.  Capital management
Waypoint REIT’s activities expose it to numerous external financial risks such as credit risk, liquidity risk and market risk. This 
section explains how Waypoint REIT utilises its Risk Management Framework to reduce volatility from these external factors. 

3.(a)  Borrowings

Non-current liabilities

Bank facilities

USPP Notes1

AMTN2

Institutional term loans

Gross unsecured borrowings

Unamortised borrowing costs

Net unsecured borrowings 

Total undrawn facilities available

Waypoint REIT

Trust Group

31 Dec 2021 
$ million

31 Dec 2020 
$ million

31 Dec 2021 
$ million

31 Dec 2020 
$ million

467.0

229.6

199.1

40.0

935.7

(6.2)

929.5

93.0

583.7

227.8

-

40.0

851.5

(5.7)

845.8

178.0

467.0

229.6

199.1

40.0

935.7

(6.2)

929.5

93.0

583.7

227.8

-

40.0

851.5

(5.7)

845.8

178.0

1.  Net of fair value hedge adjustment of $15.7 million (31 December 2020: $3.3 million).

2.  Net of $0.9 million unamortised discount on the issue of these instruments.

54

Waypoint REIT Limited – Annual Report 2021USPP 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

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

Maturities, interest rates and covenants

AUD 
equivalent 
on issuance 
date
$ million

Foreign 
exchange 
and fair 
value 
movement
$ million

Carrying 
amount
31 Dec 2021
$ million

108.9

76.8

62.9

248.6

-

248.6

(3.3)

(15.7)

(19.0)

107.5

75.8

62.0

245.3

(15.7)

229.6

18.4

2.0

20.4

250.0

During the year, Waypoint REIT refinanced $485.0 million of its debt facilities through the $200.0 million AMTN issuance at a fixed 
2.4% coupon, which matures in September 2028, new bilateral and syndicated revolving credit facilities with combined facility 
limits of $235.0 million and a one-year extension of an existing bilateral facility. 

Waypoint REIT does not have any debt maturing before April 2024 and its weighted average debt maturity is 5.0 years  
(31 December 2020: 4.3 years). 

The interest rate applying to the drawn amount of the bank and institutional term loan facilities is set on a periodic basis  
(i.e. 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 2021: 5.5 times);

•  gearing ratio of not more than 50% (actual at 31 December 2021: 31.8%); and

•  a draw down cannot be completed if gearing is or will exceed 45% via the drawn down being completed.

Waypoint REIT 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.

The fair value of the USPP Notes and AMTN are $245.3 million and $191.2 million, respectively, as at 31 December 2021 based  
on discounted cash flows using a current borrowing rate. They are classified as level 3 fair values in the fair value hierarchy.

55

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3.  Capital management continued

3.(a)  Borrowings continued

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 Sheets 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) from derivative financial instruments

Accounting policy – Finance costs

Waypoint REIT

Trust Group

2021 
$ million

2020 
$ million

2021 
$ million

2020 
$ million

0.1

0.1

32.2

0.5

32.7

0.2

0.2

33.9

1.4

35.3

0.1

0.1

32.2

0.5

32.7

(0.4)

1.1

(0.4)

2.2

1.8

(1.4)

(0.3)

2.2

1.8

0.1

0.1

33.9

1.4

35.3

1.1

(1.4)

(0.3)

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 Waypoint REIT.

3.(c)  Net debt reconciliation

Net debt at 1 January 2020

Cash flows

Movement in fair value hedge adjustment

Movement in foreign exchange

Net debt at 31 December 2020

Cash flows

Movement in fair value hedge adjustment

Movement in foreign exchange

Movement in unamortised discount

Net debt at 31 December 2021

56

Cash 
and cash 
equivalents 
$ million

Borrowings 
due within  
1 year 
$ million

Borrowings 
due after  
1 year 
$ million

Net total 
$ million

27.5

(12.0)

-

-

15.5

3.5

-

-

-

19.0

-

-

-

-

-

-

-

-

-

-

846.7

25.6

(3.3)

(17.5)

851.5

83.3

(12.4)

14.1

(0.8)

819.2

37.6

(3.3)

(17.5)

836.0

79.8

(12.4)

14.1

(0.8)

935.7

916.7

Waypoint REIT Limited – Annual Report 20213.(d)  Derivative financial instruments
Waypoint REIT has the following derivative financial instruments:

Waypoint REIT

Trust Group

31 Dec 2021 
$ million

31 Dec 2020 
$ million

31 Dec 2021 
$ million

31 Dec 2020 
$ million

Current assets

Instruments in a designated cash flow hedge

 Interest rate swaps

Current assets

Non-current assets

Instruments held at fair value through profit or loss

 Interest rate swaps

Non-current assets

Total assets

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 liabilities

Net total

0.7

0.7

1.5

1.5

2.2

-

-

-

7.1

18.4

25.5

25.5

23.3

-

-

-

-

-

1.0

1.0

17.8

0.7

0.7

1.5

1.5

2.2

-

-

-

8.3

7.1

27.5

53.6

54.6

54.6

18.4

25.5

25.5

23.3

-

-

-

-

-

1.0

1.0

17.8

8.3

27.5

53.6

54.6

54.6

57

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3.  Capital management continued

3.(d)  Derivative financial instruments continued

(i)  Interest rate swaps

At 31 December 2021, interest rate swaps with a notional value of $500.5 million were in place. The relevant expiry dates  
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

Waypoint REIT

Trust Group

31 Dec 2021 
$ million

31 Dec 2020 
$ million

31 Dec 2021 
$ million

31 Dec 2020 
$ million

78.9

185.1

-

196.5

40.0

-

-

-

-

275.8

78.9

185.1

-

196.5

40.0

-

-

-

78.9

185.1

-

196.5

40.0

-

-

-

-

275.8

78.9

185.1

-

196.5

40.0

-

-

-

500.5

776.3

500.5

776.3

Through interest rate swaps and the AMTN, 73.3% of drawn facilities were at fixed rates with a weighted average hedge rate  
of 1.56% per annum and a weighted average term of 3.6 years.

(ii)  Cross-currency swaps

At 31 December 2021, cross-currency swaps were in place to cover 100% of debt denominated in foreign currency and the 
weighted average term was 8.0 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. Waypoint REIT 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, Waypoint REIT 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. 
Waypoint REIT 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’.

58

Waypoint REIT Limited – Annual Report 2021(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.

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:

$ million

USD

USPP

Foreign exposure

AUD

Bank facilities

AMTN

Interest rate swaps

Total

Change in 
borrowings

Net drawn/
(repaid)

Gain/
(loss) on 
fair value  
of debt

Change in  
derivatives

Cash flow 
hedge 
reserve 
impact

Gain/
(loss) on 
fair value of 
derivatives

Net gain/
(loss)  
in profit  
and loss

1.8

1.8

(116.7)

199.1

-

84.2

-

-

(116.7)

199.1

-

82.4

(1.8)

(1.8)

-

-

-

(1.8)

9.0

9.0

-

-

22.4

31.4

9.0

9.0

-

-

18.8

27.8

-

-

-

-

3.6

3.6

(1.8)

(1.8)

-

-

3.6

1.8

(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 net gain/(loss) from derivative financial instruments.

Key estimate – Valuation of derivative financial instruments

Waypoint REIT’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.

59

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3.  Capital management continued

3.(e)  Financial risk management

(i)  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. Waypoint REIT’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 Sheets. 

Financial assets such as cash at bank and interest rate swaps are held across a number of high credit quality financial 
institutions, therefore Waypoint REIT does not have a concentration of credit risk in relation to these financial assets.

(i) Tenant concentration risk, financial standing and sector concentration risk

96.6% of Waypoint REIT’s rental income is received from Viva Energy. If Viva Energy’s financial standing materially deteriorates 
and impacts its ability to make rental payments, Waypoint REIT’s financial results, financial position and ability to service and/or 
obtain financing may be adversely impacted. Furthermore, a material decline in the profitability of Viva Energy’s business due to 
the global transition to a low carbon economy or other factors (including international conflict) 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’s business could also lead to reduced capacity or ability for Viva Energy to pay market 
rents when renewal options are exercised, which could result in lower rental receipts and/or a decline in the values of Waypoint 
REIT’s investment properties if Waypoint REIT is unable to lease the property to an alternate tenant. 

(ii) Collection risk  

Waypoint REIT 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 (where required). Waypoint REIT 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. Waypoint REIT uses judgement in making these assumptions based on Waypoint REIT’s past history and existing market 
conditions, as well as forward-looking estimates at the end of each reporting period.

More than 99% of Waypoint REIT’s income is derived from fuel tenants that have continued to operate through COVID-19 to date, 
providing essential services to the community. Accordingly, Waypoint REIT’s performance has not been materially impacted  
by COVID-19. 

The table below shows the ageing analysis of rent receivables of Waypoint REIT.

31 December 2021

Rent receivables

Expected credit loss provision

31 December 2020

Rent receivables

Expected credit loss provision

Less than  
31 days 
$ million

31 to 60 
days 
$ million

61 to 90 
days 
$ million

More than 90 
days 
$ million

Total 
$ million

-

-

0.3

-

0.1

-

0.3

-

-

-

0.1

-

0.1

(0.1)

0.2

-

0.2

(0.1)

0.9

-

60

Waypoint REIT Limited – Annual Report 2021Accounting policy – Rent receivables

Other current assets include 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. Waypoint REIT 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 Waypoint REIT 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.

(ii)  Liquidity risk

Liquidity risk is the risk that Waypoint REIT 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. Waypoint REIT 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.

(i) Debt agreement and refinancing risk 

Waypoint REIT 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 Waypoint REIT’s ability to 
refinance its debt facilities when required. If the covenants in these facilities are breached by Waypoint REIT, this may result in 
Waypoint REIT 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, Waypoint REIT may need to sell assets to repay debt. 
There is no guarantee that there will be willing purchasers for Waypoint REIT’s assets or that purchasers will pay prices at  
or greater than the 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 twelve months in  
advance of maturity.

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

(ii) Cash flow and fair value interest rate risk

Waypoint REIT’s cash and cash equivalents, floating rate borrowings and interest rate swaps expose it to a risk of change in 
future cash flows or the fair value of interest rate swaps due to changes in interest rates. Waypoint REIT uses floating-to-fixed 
interest rate swaps to partially hedge its economic exposure to changes in interest rates on variable rate borrowings. By hedging 
against changes in interest rates, Waypoint REIT 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 Waypoint REIT. 

The table below analyses Waypoint REIT’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. 

61

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3.  Capital management continued

3. (e)  Financial risk management continued

Less than 
12 months 
$ million

Between  
1 and 2 years 
$ million

Over 
2 years 
$ million

Total 
contractual 
cash flows 
$ million

Carrying 
amount 
liabilities 
$ million

3.4

5.9

2.2

30.4

18.8

15.1

75.8

4.9

6.5

0.2

60.7

17.9

20.9

-

-

0.2

-

18.8

12.7

31.7

-

-

0.2

-

85.5

15.4

111.1

101.1

-

-

0.4

-

3.4

5.9

2.8

30.4

1,029.9

1,067.5

48.9

76.7

3.4

5.9

2.8

30.4

935.7

25.5

1,079.2

1,186.7

1,003.7

-

-

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

7.3

5.9

30.4

18.8

15.1

77.5

11.8

6.5

60.7

17.9

20.9

117.8

-

-

-

18.8

12.7

31.5

-

-

-

85.5

15.4

100.9

-

-

-

7.3

5.9

30.4

1,029.9

1,067.5

48.9

76.7

7.3

5.9

30.4

935.7

25.5

1,078.8

1,187.8

1,004.8

-

-

-

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

Waypoint REIT

31 December 2021

Trade and other payables

Interest payable

Provisions and other liabilities

Distribution payable

Borrowings

Derivative financial liabilities

Contractual cash flows 

31 December 2020

Trade and other payables

Interest payable

Provisions and other liabilities

Distribution payable

Borrowings

Derivative financial liabilities

Contractual cash flows 

Trust Group

31 December 2021

Trade and other payables

Interest payable

Distribution payable

Borrowings

Derivative financial liabilities

Contractual cash flows

31 December 2020

Trade and other payables

Interest payable

Distribution payable

Borrowings

Derivative financial liabilities

Contractual cash flows 

62

Waypoint REIT Limited – Annual Report 2021(iii)  Capital risk management

Waypoint REIT aims to invest to meet Waypoint REIT’s investment objectives while maintaining sufficient liquidity to meet its 
commitments. Waypoint REIT 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, Waypoint REIT 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.

Waypoint REIT 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

(iv)  Market risk

(i) Interest rate risk

31 Dec 2021 
$ million

31 Dec 2020 
$ million

993.9

3,126.1

31.8%

941.6

2,930.6

32.1%

Waypoint REIT’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. Waypoint REIT 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, 
Waypoint REIT 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 Waypoint REIT. 

Waypoint REIT’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 2021 
$ million

31 Dec 2020 
$ million

19.0

15.5

500.5

776.3

507.0

623.7

248.6

(236.1)

248.6

(80.5)

2021 
$ million

2020 
$ million

(1.2)

1.2

(0.4)

0.4

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, Waypoint REIT 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.

63

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3.  Capital management continued

3.(e)  Financial risk management continued

(ii) Foreign exchange rate risk

A portion of Waypoint REIT’s debt is denominated in US dollars and as a result, Waypoint REIT is exposed to a risk of change 
in fair value or future cash flows due to changes in foreign exchange rates. Waypoint REIT 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, Waypoint REIT 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 Waypoint REIT. 

(v)  Other material business risks

Waypoint REIT’s operations are also subject to the following other material business risks.

(i) Investment property value 

The value of Waypoint REIT’s portfolio of investment properties may be adversely affected by a number of factors, including factors 
outside the control of Waypoint REIT, such as increasing uptake of vehicles fuelled by alternative fuels (including as a result of 
changes in consumer behaviour, pro-emission reduction policies, reduced supply and/or higher pricing of fossil fuels), 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’s financial condition deteriorating, occupiers not extending the term of leases, and 
general economic factors such as the level of inflation and interest rates, which may adversely impact capitalisation rates. 

As changes in valuations are recorded on the statutory statements of comprehensive income, any decreases in value will have a 
negative impact on the statutory statements of comprehensive income and balance sheet (including the net tangible assets per 
security), and in turn the market price of Waypoint REIT’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. 

(ii) Re-leasing and vacancy risk

Waypoint REIT’s property portfolio is 99.9% occupied with only 12 leases (representing 1.1% of income) expiring before the 
end of 2025 and a weighted average lease expiry of 10.0 years, with five leases renewed during the year for an aggregate 3.5% 
increase in rent. 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 2029) and/or its Alliance Agreement with Coles Express (current agreement expires in 2029) could also 
impact Viva Energy’s decision whether it renews its existing leases. Resulting vacancy or reduced rental income could negatively 
impact distributions of Waypoint REIT and/or the value of Waypoint REIT’s investment properties. 

(iii) Environmental and climate risk

Waypoint REIT depends on its tenants to perform their obligations under various environmental arrangements in relation to 
properties they lease. Waypoint REIT has an indemnity from Viva Energy in respect of certain liability for historical environmental 
contamination across 386 assets acquired at the time of Waypoint REIT’s initial public offering. Waypoint REIT 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), Waypoint REIT may incur significant costs  
to rectify contamination on its properties and also on other properties that may be consequently impacted.

Waypoint REIT is subject to a range of regulatory regimes (including environmental regulations) that cover the specific assets of 
Waypoint REIT 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 Waypoint REIT’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 
Waypoint REIT, as owner of the properties in the portfolio, may face liability for breach of environmental laws and regulations.

64

Waypoint REIT Limited – Annual Report 2021Extreme weather and other climate change-related events have the potential to damage Waypoint REIT’s assets and disrupt the 
tenants’ operations. Such events may increase costs for maintenance and insurance of Waypoint REIT’s assets, and may affect 
the ability to re-lease Waypoint REIT’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.

(iv) 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 Waypoint REIT 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.

(v) Personnel risk

Loss of key personnel could potentially have an adverse impact on the management and the financial performance of Waypoint 
REIT and in turn may affect the returns to securityholders. To mitigate this risk, processes and procedures are standardised and 
automated to the extent practicable, remuneration structures include components payable on a deferred basis to reduce key 
personnel risk, and employees are subject to market standard notice periods to ensure that Waypoint REIT has sufficient time  
in which to identify and hire replacement employees.

(vi) Cyber security risk 

Cyber-attacks are becoming increasingly sophisticated and a material data breach, ransom attack or data loss could have an 
adverse financial or reputational impact. To help mitigate this risk, Waypoint REIT 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.

(vii) Title transfer risk

Transfer of freehold title to a property requires the land transfer to be registered with the governing state body, which is 
conditional on payment of stamp duty as assessed by the governing State Revenue Office. In the absence of freehold title  
being registered on title by the governing state body, one’s ability to transfer the title of a property is restricted.

In September 2018, Waypoint REIT received an assessment from the Victorian SRO for $31.2 million in relation to the transfer  
of Victorian properties to Waypoint REIT from Viva Energy Group prior to its listing in August 2016. Pursuant to the arrangements 
between Waypoint REIT and Viva Energy Group, any such costs are payable by Viva Energy Group. In November 2018, Viva Energy 
Group lodged an objection to the assessment and assumed conduct of this matter under a conduct and indemnity deed between 
Waypoint REIT and Viva Energy Group. In May 2020, the SRO disallowed Viva Energy Group’s objection and Viva Energy Group 
appealed this decision with the case heard at the Victorian Supreme Court in November 2021. In February 2022, the Victorian 
Supreme Court handed down its judgment in favour of Viva Energy Group with an assessment of $nil; however, the transfers  
of title have not yet been stamped and remain with the SRO. 

Viva Energy Group remains listed as the registered proprietor of these properties on the Victorian land titles registry maintained 
by Land Use Victoria pending confirmation from the SRO that stamp duty has been paid. Once this matter is resolved, the signed 
transfers of the titles to the properties are required to be registered in the name of Waypoint REIT.

The transfer of the control of these properties to Waypoint REIT occurred in August 2016 under the sale agreement with Viva 
Energy Group and these properties continue to be recognised in the Consolidated Balance Sheets.

65

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3.  Capital management continued

3.(e)  Financial risk management continued

(vi)  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).

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 Waypoint REIT’s financial assets and liabilities (by class) measured at fair value according  
to the fair value hierarchy at balance date on a recurring basis:

31 December 2021 

Assets held for sale

Investment properties

Derivatives

Total

31 December 2020

Assets held for sale

Investment properties

Derivatives

Total

Level 1 
$ million

Level 2 
$ million

Level 3 
$ million

Total 
$ million

-

-

-

-

-

-

-

-

-

-

(23.3)

(23.3)

-

-

(54.6)

(54.6)

33.9

33.9

3,069.0

3,069.0

-

(23.3)

3,102.9

3,079.6

14.3

14.3

2,897.3

2,897.3

-

(54.6)

2,911.6

2,857.0

Waypoint REIT’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.

Waypoint REIT did not measure any financial assets or financial liabilities at fair value on a non-recurring basis as at  
31 December 2021.

66

Waypoint REIT Limited – Annual Report 2021(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.

3.(f)  Contributed equity

01/01/20

Opening balance

27/02/20

Issue of securities under DRP

31/05/20 

Capital reallocation

27/08/20 

Issue of securities under DRP

Waypoint REIT

Trust Group

Number of 
securities
‘000

$ million

Number  
of units
‘000

778,690

1,618.3

778,690

2,169

-

4,163

5.8

-

10.7

2,169

-

4,163

$ million

1,616.3

5.8

(5.7)

10.7

31/12/20

Closing balance

785,022

1,634.8

785,022

1,627.1

01/01/21

Opening balance

Note 1

Note 2

On-market buy-back (net of transaction costs)

Capital return and security consolidation  
(net of transaction costs)

785,022

1,634.8

785,022

1,627.1

(7,139)

(48,067)

(19.5)

(132.2)

(7,139)

(48,067)

(19.4)

(132.2)

Note 3

On-market buy-back (net of transaction costs)

(8,166)

(22.0)

(8,166)

(22.0)

31/12/21

Closing balance

721,650

1,461.1

721,650

1,453.5

Note 1. On-market buy-back established on 30 July 2021 with securities bought back and cancelled between 16 August and 13 October 2021.  
The program concluded on 1 November 2021.

Note 2. Security consolidation effective 10 November 2021 and capital return paid on 12 November 2021.

Note 3. On-market buy-back established on 16 November 2021 with securities bought back and cancelled between 1 December and  
10 December 2021.

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

On-market buy-back (net of transaction costs)

Capital return and security consolidation (net of transaction costs)

Distributions paid or provided for 

Distribution reinvestment plan 

Closing balance 

2021 
$ million

1,946.5

442.6

27.8

-

(41.4)

(132.2)

(122.6)

-

2020 
$ million

1,782.2

279.6

(7.6)

(5.7)

-

-

(118.5)

16.5

2,120.7

1,946.5

67

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3.  Capital management continued

3.(h) Reserves
Waypoint REIT’s reserves movements were:

Hedge reserve

Opening hedge reserve 

Net change in fair value of cash flow hedges

Reclassified to profit and loss

Closing hedge reserve

Share-based payments reserve

Opening share-based payments reserve 

Share-based payment expenses*

Closing share-based payments reserve

Total closing reserves

*  Refer to Note 3. (i)(i) below for unrounded figures.

Waypoint REIT

Trust Group

2021 
$ million

2020 
$ million

2021 
$ million

2020 
$ million

(33.5)

21.9

5.9

(5.7)

-

-

-

(25.9)

(8.8)

1.2

(33.5)

-

-

-

(33.5)

21.9

5.9

(5.7)

-

-

-

(25.9)

(8.8)

1.2

(33.5)

-

-

-

(5.7)

(33.5)

(5.7)

(33.5)

3.(i)  Security-based benefits expense
Waypoint REIT established a new Equity Incentive Plan in 2021 under which participating employees are eligible to receive 
Waypoint REIT stapled securities on a deferred settlement basis under the short-term incentive (STI) and general employee offer 
plans and Performance Rights under the long-term incentive (LTI) plan. 

(i)  Share-based payment expense

Share-based payment expenses recognised during the year as part of management and administration expenses were as follows:

Deferred stapled securities1 

General employee offer2

Performance Rights 

Total

Waypoint REIT

Trust Group

31 Dec 2021 
$

31 Dec 2020 
$

31 Dec 2021 
$

31 Dec 2020 
$

168,604

5,300

48,679

222,583

N/A

N/A

N/A

N/A

168,604

5,300

48,679

222,583

N/A

N/A

N/A

N/A

1.  Granted under Waypoint REIT’s short-term incentive scheme, subject to ongoing service conditions.

2.  Cost of stapled securities bought on-market.

(ii)  Performance Rights – reconciliation 

Reconciliation of the number of Performance Rights outstanding during the year is as follows:

Waypoint REIT and Trust Group

Performance Rights

Opening balance

Granted during the year 

Closing balance

68

2021 
Number

-

155,916

155,916

Waypoint REIT Limited – Annual Report 2021(iii)  Performance Rights – valuation inputs

The Monte Carlo method is utilised for valuation and accounting purposes. The model inputs to assess the fair value of the 
Performance Rights granted during 2021 are as follows:

Grant date1

Stapled security price at grant date

Fair value of right

Expected volatility2

Dividend yield

Risk-free interest rate

CEO

Other 
Executives

13 May 2021

9 April 2021

$2.53

$1.52

20%

6.1%

0.20%

$2.55

$1.53

20%

6.1%

0.18%

1.  The grant date is determined in accordance with AASB 2 Share-based Payments. Performance Rights have a nil exercise price, vest on or around 
1 March 2024 if vesting conditions are met or otherwise expire on this date and are subject to DEPS and TSR conditions over a three-year 
Performance Period commencing on 1 January 2021. The weighted average remaining contractual life of Performance Rights outstanding  
as at 31 December 2021 is 2.2 years.

2.  Expected volatility takes into account historical market price volatility.

Accounting policy – Share-based compensation expense

Deferred securities (STI Plan) 

Eligible employees receive a portion of their STI in deferred securities, which are subject to ongoing service conditions between 
one and two years. The expense is recognised over the vesting period, commencing on the first day of the service period and 
ending on or around 1 March in the year following the end of the service period.

Deferred securities (general employee offer) 

Eligible employees receive up to $1,000 in stapled securities which vest immediately on issue but are subject to a trade lock until 
the earlier of the completion of three years’ service or termination. The expense is recognised in the period securities are acquired 
on-market.

Performance Rights (LTI Plan)

For market-based Performance Rights, the fair value at grant date is independently valued using a Monte Carlo simulation pricing 
model that takes into account the exercise price, the term of the rights, impact of dilution, stapled security price at grant date, 
expected price volatility of the underlying stapled security, expected dividend yield and the risk-free interest rate for the term of the 
rights and market vesting conditions, but excludes the impact of any non-market vesting conditions (i.e. Distributable Earnings 
growth targets). Non-market vesting conditions are included in assumptions about the number of rights that are expected to 
vest. For non-market-based Performance Rights, the fair value at grant date is independently valued using the binominal tree 
methodology. At each reporting date, Waypoint REIT revises its estimate of the number of rights that are expected to vest.  
The expense is recognised over the vesting period commencing on the first day of the service period and ending on or around  
1 March in the year following the end of the service period, with the annual expense recognised taking into account the most 
recent estimate. Upon the vesting of stapled securities, the balance of the stapled security-based benefits reserve relating to  
those stapled securities is transferred to contributed equity, net of any directly attributable transaction costs.

69

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4.  Additional information

4.(a) Related party information

(i)  Parent entity

The Company has been assessed as the parent entity of Waypoint REIT; 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):

Short-term benefits

Post-retirement benefits

Other long-term benefits

Share-based payments

Waypoint REIT

Trust Group

2021 
$

2020 
$

2021 
$

2020 
$

2,221,793

1,231,574

2,221,793

1,231,574

112,837

32,860

211,061

53,649

112,837

257,871

32,860

-

211,061

53,649

257,871

-

2,578,551

1,543,094

2,578,551

1,543,094

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

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

70

Waypoint REIT Limited – Annual Report 2021(iv)  Transactions with related parties

Management services are provided to VER Limited by Waypoint Operations Pty Limited, a subsidiary of Waypoint REIT Limited, 
on a cost recovery basis in accordance with a management agreement dated 30 September 2020. Responsible Entity fees are 
charged in accordance with VER Limited’s Constitution.

The following transactions occurred with related parties:

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

Disposal management fee paid to Waypoint REIT Limited

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 Waypoint REIT

Payment of distribution to Viva Energy Australia Pty Ltd

Payment to Viva Energy Group in relation to internalisation of 
Waypoint REIT’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)

Waypoint REIT

Trust Group

2021 
$ ’000

2020 
$ ’000

2021 
$ ’000

2020 
$ ’000

-

-

-

-

-

-

-

-

-

-

-

-

-

-

321

4,040

4,439

746

114,931

4,684

19,849

2,500

5,186

16,915

-

-

-

-

-

-

967

9,010

2,141

-

114,931

4,684

19,848

-

5,186

16,915

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

Payable to VER Limited

31 Dec 2021
$’000

31 Dec 2020
$’000

31 Dec 2021
$’000

31 Dec 2020
$’000

-

-

-

-

-

-

-

-

-

-

-

-

8,397

-

1,450

-

1,704

133

5,718

630

965

-

2,129

-

Viva Energy Australia Pty Limited and VER Manager Pty Limited were related parties of Waypoint REIT prior to the internalisation 
of Waypoint REIT’s management on 30 September 2020. Transactions with Viva Energy Australia Pty Limited and VER Manager 
Pty Limited after this date are not included in the table above.

During the prior year, in connection with the internalisation of Waypoint REIT’s management function, Waypoint REIT 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. Waypoint REIT 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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4.  Additional information continued

4.(b)  Parent entity financial information
The individual financial statements for the parent entity of the Waypoint REIT, 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 after tax

Total comprehensive income/(loss) for the year

Waypoint REIT Ltd

Waypoint REIT Trust

2021 
$ million

2020 
$ million

2021 
$ million

2020 
$ million

7.9

11.1

19.0

11.1

11.1

7.6

0.3

7.9

1.0

1.0

8.5

6.4

14.9

8.3

8.3

7.8

(1.2)

6.6

-

-

214.6

1,650.2

1,864.8

546.7

546.7

1,453.5

(135.4)

1,318.1

287.0

1,650.2

1,937.2

314.2

314.2

1,627.1

(4.1)

1,623.0

(8.8)

(8.8)

(3.7)

(3.7)

The parent entity did not have any guarantees, contingent liabilities or commitments as at 31 December 2021 or 31 December 2020.

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

Controlled by the Company

VER Limited 

VER Custodian Pty Limited

Waypoint Operations Pty Limited

Controlled by the Trust

VER Trust 

VER Finco Pty Limited

Date of establishment

2021 
%

2020 
%

16 December 2015

27 May 2016

5 May 2020

10 July 2016

10 June 2016

100

100

100

100

100

100

100

100

100

100

All companies and trusts are incorporated or established in Australia. 

72

Waypoint REIT Limited – Annual Report 20214.(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

Other assurance services

Total audit and assurance services

Other services

 Tax compliance services

 Tax advisory services*

 Regulatory administration services

Total other non-audit services

Total remuneration of auditors

2021 
$

2020 
$

134,881

22,275

157,156

20,975

24,930

137,845

22,275

160,120

20,975

-

203,061

181,095

78,780

7,140

77,181

163,101

366,162

86,700

104,601

-

191,301

372,396

* 

Includes $43,401 in relation to the internalisation of management in the prior year.

4.(e)  Subsequent events
Subsequent to the end of the financial period, Waypoint REIT:

•  settled one asset held for sale for total proceeds of $1.1 million on 4 February 2022; 

•  bought back an additional 6.4 million stapled securities for total consideration of $17.6 million; and

•  approved the distribution for the quarter ended 31 December 2021 of $30.4 million to be paid on 28 February 2022.

No other matter or circumstance has arisen since 31 December 2021 that has significantly affected, or may significantly affect:

•  the operations of Waypoint REIT in future financial years; 

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

•  the state of affairs of Waypoint REIT in future financial years.

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4.  Additional information continued

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, derivative 
financial instruments and share-based payments, 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)  Rounding of amounts

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

(iii)  Comparative information 

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

(iv)  Net current asset deficiency position

At 31 December 2021, Waypoint REIT had a net current asset surplus of $12.9 million and the Trust Group had a net current 
asset surplus of $5.2 million. Excluding assets classified as held for sale, Waypoint REIT had a net current asset deficiency of 
$21.0 million and the Trust Group had a net current asset deficiency of $28.7 million. Waypoint REIT 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. Waypoint REIT has $93.0 million of unused debt facilities at  
31 December 2021, which can be drawn upon to fund Waypoint REIT’s cash flow requirements provided that Waypoint REIT  
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:

•  Waypoint REIT and the Trust Group will be able to pay their debts as and when they fall due; and

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

(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 that 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. 

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 and the Trust Group as at and for the year ended 31 
December 2021.

74

Waypoint REIT Limited – Annual Report 2021AASB 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 Waypoint REIT 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 Waypoint 
REIT, and the results of those controlled entities for the period then ended. The effect of all transactions between entities in 
Waypoint REIT are eliminated in full.

Non-controlling interests in the results and equity are shown separately in the Consolidated Statement of Comprehensive Income, 
Consolidated Balance Sheets and Consolidated Statement of Changes in Equity respectively. Non-controlling interests are those 
interests in the Trust that are not held directly or indirectly by the Company.

(ii) Subsidiaries

Subsidiaries are all entities (including trusts) over which Waypoint REIT has control. Waypoint REIT controls an entity when 
Waypoint REIT 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 Waypoint REIT. They are deconsolidated from the date that control ceases.

The acquisition method of accounting is used to account for business combinations by Waypoint REIT.

Inter-entity transactions, balances and unrealised gains on transactions between Waypoint REIT 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 Waypoint REIT.

Non-controlling interests in the results and equity of subsidiaries are shown separately in the Consolidated Statement  
of Comprehensive Income, Consolidated Balance Sheets 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 Waypoint REIT, 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)  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.

(viii)  Expenses

All expenses are recognised in the consolidated profit or loss on an accruals basis.

(ix)  Management fees

Up until 30 September 2020, Waypoint REIT 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 Waypoint REIT and the reimbursement of costs to  
VER Manager ceased.

(x)  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.

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4.  Additional information continued

4.(f)  Summary of significant accounting policies continued

(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 twelve months after the reporting period, regardless of when the actual settlement is expected to occur.

(xi)  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 Sheets.

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

(xii)  Leases

Waypoint REIT leases office premises. Waypoint REIT 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. 
Waypoint REIT applies a single recognition and measurement approach for all leases. Waypoint REIT 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

Waypoint REIT recognises 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, Waypoint REIT 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 Waypoint REIT  
and payments of penalties for terminating the lease, if the lease term reflects Waypoint REIT exercising the option to terminate.

In calculating the present value of lease payments, Waypoint REIT 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 s 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.

76

Waypoint REIT Limited – Annual Report 2021(xiii)  Financial instruments

(i) Classification

Waypoint REIT’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 Waypoint REIT’s documented investment strategy. Waypoint REIT’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 Waypoint REIT 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 Waypoint REIT 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 Waypoint REIT 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, Waypoint REIT 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 Sheets 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.

(xiv)  Provisions

A provision is recognised when Waypoint REIT 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 Waypoint REIT’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.

(xv)  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 Waypoint REIT in the 
current or future reporting periods and on foreseeable future transactions.

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In the Directors’ opinion: 

(a)  the financial statements and notes set out on pages 41 to 77 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 Group’s financial positions at 31 December 2021 

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 Group 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

28 February 2022

78

Waypoint REIT Limited – Annual Report 2021Independent Auditor’s Report

Independent auditor’s report 

To the stapled securityholders of Waypoint REIT and the unitholders of Waypoint REIT Trust 

Report on the audit of the financial report 

Our opinion 

In our opinion: 

The accompanying financial reports of Waypoint REIT, being the consolidated stapled entity, which 
comprises Waypoint REIT Limited and its controlled entities, and Waypoint REIT Trust and its 
controlled entities (together the “Trust Group” or the “Trust”) are in accordance with the Corporations 
Act 2001, including: 

(a) giving a true and fair view of the financial positions of Waypoint REIT and the Trust as at 31

December 2021 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 financial reports of Waypoint REIT and the Trust (the financial report) comprise: 

●
●
●
●
●

●

the consolidated balance sheets as at 31 December 2021
the consolidated statements of comprehensive income for the year then ended
the consolidated statements of changes in equity 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
and other explanatory information
the directors’ declaration.

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 Waypoint REIT 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 report in 
Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. 

PricewaterhouseCoopers, ABN 52 780 433 757 
One International Towers Sydney, Watermans Quay, Barangaroo, GPO BOX 2650, SYDNEY  NSW  2001 
T: +61 2 8266 0000, F: +61 2 8266 9999 

Level 11, 1PSQ, 169 Macquarie Street, Parramatta NSW 2150, PO Box 1155 Parramatta NSW 2124 
T: +61 2 9659 2476, F: +61 2 8266 9999 

Liability limited by a scheme approved under Professional Standards Legislation. 

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Our audit approach 

An audit is designed to provide reasonable assurance about whether the financial report is 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 report. 

We tailored the scope of our audit to ensure that we performed enough work to be able to give an 
opinion on the financial report as a whole, taking into account the geographic and management 
structure of Waypoint REIT and the Trust, their accounting processes and controls and the industry in 
which they operate. 

Materiality 

● For the purpose of our audit of Waypoint REIT and the Trust we used overall materiality of $6.0 million and
$6.0 million respectively, which represents approximately 5% of Distributable Earnings. The metric is
defined in note 1 of the financial report.

● We applied this threshold, together with qualitative considerations, to determine the scope of our audit and
the nature, timing and extent of our audit procedures and to evaluate the effect of misstatements on the
financial report as a whole.

● We chose Distributable Earnings because, in our view, it is the benchmark against which the performance

of Waypoint REIT and the Trust are most commonly measured in the industry.

● We chose a 5% threshold based on our professional judgement, noting that it is within the common range

relative to profit-based benchmarks.

Audit Scope 

● Our audit focused on where Waypoint REIT and the Trust made subjective judgements; for example,
significant accounting estimates involving assumptions and inherently uncertain future events.

●

The audit team consisted of individuals with the appropriate skills and competencies needed for the audit,
which included industry expertise in real estate as well as valuation and treasury professionals.

Key audit matters 

Key audit matters are those matters that, in our professional judgement, were of most significance in 
our audit of the financial report for the current period and were determined separately for Waypoint 

80

Waypoint REIT Limited – Annual Report 2021REIT and the Trust. Relevant amounts listed for each part of the stapled group represent balances as 
they are presented in the financial report and should not be aggregated. The key audit matters were 
addressed in the context of our audit of the financial report 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.  

Key audit matter 

How our audit addressed the key audit matter 

Valuation of Investment Properties 
(Refer to note 2(a)) 
Waypoint REIT Group – $3,069 million 
Waypoint REIT Trust Group – $3,069 million 

Waypoint REIT and the Trust’s investment property 
portfolio comprised fuel and convenience retail 
properties (“Investment Property”) at 31 December 
2021. 

Investment Properties were valued at fair value 
as at reporting date primarily using a combination of 
the income capitalisation and the direct comparison 
methods, as well as transaction prices where 
relevant. 

The value of Investment Properties was primarily 
dependent on the valuation methodology adopted 
and the significant assumptions and inputs into the 
valuation model. Factors such as prevailing market 
conditions, the individual nature, condition and 
location of each property and the expected future 
income for each property, directly impact fair values. 
Amongst others, the following inputs and 
assumptions were key in establishing fair value: 
● market and contracted rent
● market and contracted rental growth rates
● capitalisation rate

At the end of each reporting period the directors 
determine the fair value of the Investment Properties 
in accordance with their valuation policy as described 
in note 2(a). 

This was a key audit matter because of the: 
● relative size of the Investment Property portfolio to
net assets and related valuation movements, and
● inherent subjectivity of the key assumptions that
underpin the valuations.

Other information 

Our procedures included, amongst others: 
● Obtaining an understanding of Waypoint REIT’s
process for determining the valuation of Investment
Property;
● Assessing the scope, competence and objectivity of
the independent valuation firm engaged by Waypoint 
REIT to provide independent valuations at reporting 
date; 
● Meeting with the independent valuation expert to
develop an understanding of their processes,
judgements and observations including how they dealt
with the uncertainties arising from COVID-19 and
emerging climate considerations;
● Assessing the appropriateness of the valuation
methodologies utilised;
● Agreeing a sample of the underlying lease terms to
the tenancy schedule and tracing the rental income 
used in the valuation to the tenancy schedule; 
● Assessing the appropriateness of certain significant
assumptions, including comparing the capitalisation
rates to market data, including comparable transactions,
where possible;
● Testing the mathematical accuracy of a sample of the
Investment Property valuations;
● Reconciling the fair value recorded in
note 2(a) to, as relevant, the independent valuation
reports for all the properties independently valued at
balance date, the contract price for each of the
properties contracted for sale at balance date, and to
the Directors valuations;
● Considering the reasonableness of the
disclosures made in relation to the significant
assumptions, including the sources of estimation
uncertainty in note 2(a) in light of the requirements of
Australian Accounting Standards.

The directors of Waypoint REIT Limited and VER Limited, the responsible entity of Waypoint REIT 
Trust (collectively referred to as the “directors”) are responsible for the other information. The other 
information comprises the information included in the annual report for the year ended 31 December 

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2021, but does not include the financial report and our auditor’s report thereon. Prior to the date of this 
auditor's report, the other information we obtained included the Appendix 4E and Directors' 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 report 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 report, our responsibility is to read the other information 
and, in doing so, consider whether the other information is materially inconsistent with the financial 
report 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 report 

The directors are responsible for the preparation of the financial report that gives 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 report that 
gives a true and fair view and is free from material misstatement, whether due to fraud or error. 

In preparing the financial report, the directors are responsible for assessing the ability of Waypoint 
REIT 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 
Waypoint REIT 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 report 

Our objectives are to obtain reasonable assurance about whether the financial report as a whole is 
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 report. 

A further description of our responsibilities for the audit of the financial report 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. 

82

Waypoint REIT Limited – Annual Report 2021Report on the remuneration report 

Our opinion on the remuneration report 

We have audited the remuneration report included in pages 25 to 39 of the directors’ report for 
the year ended 31 December 2021. 

In our opinion, the remuneration report of Waypoint REIT and the Trust for the year ended 31 
December 2021 complies with section 300A of the Corporations Act 2001. 

Responsibilities 

The directors 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 

Jane Reilly 
Partner 

Sydney
28 February 2022

83

Overview and HighlightsChair and MD/CEO ReportBusiness ReviewSustainabilityFinancial ReportInvestor InformationCorporate DirectoryWaypoint REIT Limited – Annual Report 2021Additional Information

The information below is current as at 15 March 2022. 

There were 711,816,547 fully paid securities on issue, held by 14,850 securityholders. There were 343 holders holding less than  
a marketable parcel based on a closing price of $2.74.

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

On a poll:

•  in the case of a resolution of Waypoint REIT Limited, each shareholder has one vote for each share held in the Company; and 

•  in the case of a resolution of the Waypoint REIT Trust, each unitholder has one vote for each $1.00 of the value of the units held 

in the Trust

Top 20 securityholders
The top 20 largest registered securityholders as at 15 March 2022 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

BNP PARIBAS NOMS PTY LTD

AUSTRALIAN EXECUTOR TRUSTEES LIMITED

CITICORP NOMINEES PTY LIMITED

CS THIRD NOMINEES PTY LIMITED

BNP PARIBAS NOMS(NZ) LTD

NEWECONOMY COM AU NOMINEES PTY LIMITED

NETWEALTH INVESTMENTS LIMITED

BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV LTD

ALCEON GROUP NO75 PTY LTD

BRISPOT NOMINEES PTY LTD

BNP PARIBAS NOMINEES PTY LTD SIX SIS LTD

BNP PARIBAS NOMINEES PTY LTD

AUSTRALIAN EXECUTOR TRUSTEES LIMITED

NETWEALTH INVESTMENTS LIMITED

AUSTRALIAN EXECUTOR TRUSTEES LIMITED

172,181,746

158,246,762

76,229,622

47,209,187

32,013,513

8,449,390

6,917,896

6,859,424

6,380,945

5,598,211

4,656,030

4,556,024

3,880,405

3,808,681

3,020,741

2,991,279

2,067,706

1,922,391

1,234,143

1,148,841

Total

549,372,937

Balance of register

162,443,610

24.19

22.23

10.71

6.63

4.50

1.19

0.97

0.96

0.90

0.79

0.65

0.64

0.55

0.54

0.42

0.42

0.29

0.27

0.17

0.16

77.18

22.82

Grand total

711,816,547

100.00

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Waypoint REIT Limited – Annual Report 2021Distribution of securityholdings as at 15 March 2022

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

570,548,593

98,590,937

27,590,204

14,241,868

844,945

80.15

13.85

3.88

2.00

0.12

711,816,547

100.00

9,337 

112

4,414

3,705

4,826

1,793

14,850

343

Substantial securityholders as at 15 March 2022

Date of notice received 

Name of substantial securityholder

Number of securities1 

31 Dec 2020

30 Nov 2021

20 Aug 2021

23 Aug 2021

10 Nov 2021

The Vanguard Group, Inc.

BlackRock Group

First Sentier Investors Holdings Pty Limited

Mitsubishi UFJ Financial Group, Inc.

State Street Corporation

81,069,400

54,638,681

39,265,257

39,265,257

38,780,800

1.  The number of securities quoted are based on the number of securities disclosed in the substantial shareholder notices lodged by each holder. 
Effective 11 November 2021 Waypoint REIT has undertaken a security consolidation where each security held on 10 November 2021 was 
consolidated into 0.9382 securities (with any resulting fraction of an ordinary security rounded up to the next whole number of securities).

Securities purchased on-market

Waypoint REIT purchases securities on-market for the purposes of our Employee Security Plan. During FY21, 2,105 securities 
were purchased on-market at an average price of $2.515 per security.

Unquoted equity securities

As at 15 March 2022, Waypoint REIT has on issue:

•  178,084 Deferred Securities, held by nine employees; and

•  155,916 Performance Rights, held by four employees.

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Waypoint REIT Limited – Annual Report 2021 
 
 
 
 
 
 
 
 
Disclosures

On 1 August 2016, Waypoint REIT was granted certain waivers from the Australian Securities Exchange (ASX) with regard  
to ASX 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.1

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.1

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.1

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.1

In 2021 new leases were entered into between Viva Energy Australia and Waypoint REIT in respect of the following premises:

•  7-13 Burnett Highway, Biloela, Queensland

•  18316 Warrego Highway, Dalby West, Queensland

•  825 Mickleham Road, Greenvale, Victoria

1.  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.

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Waypoint REIT Limited – Annual Report 2021 
 
 
 
Glossary

bp

cap rate

Basis points

Capitalisation rate

Coles Express

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

COVID-19

CPI

cps

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

Consumer Price Index

Cents per security

Distributable Earnings

This is a non-IFRS measure being statutory net profit adjusted to remove transaction costs  
and non-cash items, including straight-lining of rental income, amortisation of debt and 
establishment fees and any fair value adjustments to investment properties or derivatives

Distributable EPS

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

DRP

Distribution Reinvestment Plan

Employee Security Plan

An equity incentive plan under which participating employees are eligible to receive Waypoint REIT 
stapled securities on a deferred settlement basis under the short-term incentive (STI) and general 
employee offer plans and Performance Rights under the long-term incentive (LTI) plan

EV

F&C

FY

gearing

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

Fuel and Convenience

Waypoint REIT financial year, being year end 31 December

Net debt (excluding foreign exchange and fair value hedge adjustments) to total assets 
(excluding cash)

Internalisation

Agreement with Viva Energy Australia to internalise the management function of Waypoint REIT 
(completed 30 September 2021)

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

M&A expenses

Management and administration expenses

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Waypoint REIT Limited – Annual Report 2021 
 
 
 
 
 
 
 
 
Glossary continued

Master Agreement

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

MER

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

Moody’s Investors Service

Net Interest Expense

Finance costs less finance income

NNN

NTA

Review Event

Site Agreement

See Triple Net Lease

Net tangible assets

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 leases, licences and options between Viva Energy Australia (as lessor, licensor and grantor 
respectively) and Coles Express (as lessee, licensee and grantee respectively) relating to sites 
that Coles Express occupies. This extends to Coles Express having certain rights to acquire  
the properties in the Portfolio, as described in Section 13.10 of the PDS

Triple Net lease (NNN)

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

WADM

WALE

WARR

Weighted average capitalisation rate, weighted by valuation

Weighted average debt maturity

Weighted average lease expiry, weighted by rental income

Weighted average rent review, weighted by rental income

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Waypoint REIT Limited – Annual Report 2021Corporate Directory

Waypoint REIT Limited

ABN 35 612 986 517

Directors of Waypoint REIT 
Limited

Security registry

Link Market Services 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 
Hadyn Stephens

Directors of VER Limited

Laurence Brindle
Georgina Lynch
Stephen Newton
Hadyn Stephens

Company Secretary

Tina Mitas

Auditor

PricewaterhouseCoopers

One International Towers  
Watermans Quay, Barangaroo  
NSW 2000 Australia

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 2021.

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 2021