New Zealand Professional Investment Services Firm, Forsyth Barr

Forsyth Barr

New Zealand Professional Investment Services Firm

We are proud to be a New Zealand owned firm, with 21 offices throughout the country and over 300 employees. We assist personal, institutional and corporate clients providing a full range of investment services.

Forsyth Barr is a foundation New Zealand Exchange firm (NZX) and accredited market participant. We have been confirmed by the Financial Markets Authority as a Qualifying Financial Entity (QFE).

Research is the cornerstone of our advice. We have one of New Zealand's leading teams of analysts. Our global affiliations ensure comprehensive research coverage of all major investment markets.

Equity Bottom-Up

<ul><li>Strong retail sales underpin a solid operational result: KPG reported adjusted funds from operations (AFFO) +16% to NZ$116m with lower COVID costs offset by higher operating expenses and interest cost.</li><li>Gearing elevated with more asset sales to come: FY23 reported gearing was 35.0% vs. the top end of management's target range of 25%–35% and its lowest covenant of 45%</li><li>A challenging phase in its transformation: KPG is in the early stages of a strategic transformation aimed at lowering its retail exposure and reinvesting in its best assets</li></ul>

Strong retail sales underpin a solid operational result: KPG reported adjusted funds from operations (AFFO) +16% to NZ$116m with lower COVID costs offset by higher operating expenses and interest cost.Gearing elevated with more asset sales to come: FY23 reported gearing was 35.0% vs. the top end of management's target range of 25%–35% and its lowest covenant of 45%A challenging phase in its transformation: KPG is in the early stages of a strategic transformation aimed at lowering its retail exposure and reinvesting in its best assets

Kiwi Property Group: FY23 Result — A Year of Consolidation Ahead

<ul><li>Kiwi Property (KPG) has delivered FY23 adjusted funds from operations (AFFO) +16% to NZ$117m</li><li>Top line rental income was slightly ahead of our forecast but higher corporate costs and tax resulted in underlying NPAT in line</li><li>AFFO was above largely due to the one-off add back of digital implementation costs.</li></ul>

Kiwi Property (KPG) has delivered FY23 adjusted funds from operations (AFFO) +16% to NZ$117mTop line rental income was slightly ahead of our forecast but higher corporate costs and tax resulted in underlying NPAT in lineAFFO was above largely due to the one-off add back of digital implementation costs.

Kiwi Property Group: FY23 Result – Initial Thoughts

Thematic (Sector/Industry)

<ul><li>Flat month for the property sector: The NZ LPV sector was broadly flat in April, underperforming the NZX50G which was up +1.1%.</li><li>Looking ahead to the May reporting season: Low vacancy, solid tenant demand, and the high cost of new supply all continue to underpin solid rent growth.</li><li>Sector valuations track sideways: The property sector continues to look attractive relative to other yield stocks, however, spreads remain compressed when compared to long-term relationships to bond yields</li></ul>

Flat month for the property sector: The NZ LPV sector was broadly flat in April, underperforming the NZX50G which was up +1.1%.Looking ahead to the May reporting season: Low vacancy, solid tenant demand, and the high cost of new supply all continue to underpin solid rent growth.Sector valuations track sideways: The property sector continues to look attractive relative to other yield stocks, however, spreads remain compressed when compared to long-term relationships to bond yields

Real Estate Reflections: Gearing Up for Reporting Season

<ul><li>Property sector underperforms the broader market: The NZ LPV sector was down -1.2% in March, underperforming the NZX50G which was broadly flat.</li><li>Cap rates starting to creep higher: Goodman (GMT), Investore (IPL), Kiwi Property (KPG) and Stride (SPG) have all reported 2H23 valuation movements ahead of their full year results in May</li><li>Balance sheets remain in the spotlight: Portfolio valuation changes also lifted loan-to-value ratios</li></ul>

Property sector underperforms the broader market: The NZ LPV sector was down -1.2% in March, underperforming the NZX50G which was broadly flat.Cap rates starting to creep higher: Goodman (GMT), Investore (IPL), Kiwi Property (KPG) and Stride (SPG) have all reported 2H23 valuation movements ahead of their full year results in MayBalance sheets remain in the spotlight: Portfolio valuation changes also lifted loan-to-value ratios

Real Estate Reflections: Cap Rates Creep Higher

<ul><li>Dust settles on February reporting season: Four property companies reported in February; Precinct Properties (PCT), Property for Industry (PFI), Winton (WIN) and Vital Healthcare (VHP). </li><li>Solid month for the property sector: The NZ LPV sector was up +1.6% in February, outperforming the NZX50 which was down -0.6%</li><li>Relative valuations looking attractive but only back to fairer value vs bond yields</li></ul>

Dust settles on February reporting season: Four property companies reported in February; Precinct Properties (PCT), Property for Industry (PFI), Winton (WIN) and Vital Healthcare (VHP). Solid month for the property sector: The NZ LPV sector was up +1.6% in February, outperforming the NZX50 which was down -0.6%Relative valuations looking attractive but only back to fairer value vs bond yields

Real Estate Reflections: Refurbishing the Monthly

New Zealand

Kiwi Property Group Ltd is a property trust that invests in, manages and develops a portfolio of diversified properties throughout New Zealand. The Trust's properties include office, retail and industrial properties.

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Kiwi Property (KPG NZ)

Kiwi Property Group: FY23 Result — A Year of Consolidation Ahead

Kiwi Property Group (KPG) reported a solid FY23 result in line with our expectations on an underlying basis; While trading at its malls has been...

Forsyth Barr

Kiwi Property Group: FY23 Result – Initial Thoughts

Kiwi Property (KPG) has delivered FY23 adjusted funds from operations (AFFO) +16% to NZ$117m; Top line rental income was slightly ahead of our...

Forsyth Barr

Real Estate Reflections: Gearing Up for Reporting Season

April was a flat month for the listed property sector; Long-bond yields have been range bound for the last eight months, as tight yield spreads...

Forsyth Barr

Real Estate Reflections: Cap Rates Creep Higher

March was a mixed month for the property sector where interest rates are typically a key driver of LPV sector performance, but despite a -40bp fall...

Forsyth Barr

Real Estate Reflections: Refurbishing the Monthly

Listed property companies that reported in February saw strong operational results; While results were broadly in line with our expectations, we...

Forsyth Barr

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