17 August 2020 Lendlease Corporation Limited ABN 32 000 226 228 and Lendlease Responsible Entity Limited ABN 72 122 883 185 AFS Licence 308983 as responsible entity for Lendlease Trust ABN 39 944 184 773 ARSN 128 052 595 Level 14, Tower Three, International Towers Sydney Telephone +61 2 9236 6111 Exchange Place, 300 Barangaroo Avenue Facsimile +61 2 9252 2192 Barangaroo NSW 2000 Australia lendlease.com Lendlease Group 2020 Full Year Results Announcement, Presentation and Appendix Lendlease Group today announced its results for the year ended 30 June 2020. Attached is the FY20 Results Announcement, Presentation and Appendix. A summary of Lendlease's Major Urbanisation Projects can be found on the Lendlease website, or by clicking on the link here. ENDS FOR FURTHER INFORMATION, PLEASE CONTACT: Investors: Media: Justin McCarthy Stephen Ellaway Mob: +61 422 800 321 Mob: +61 417 851 287 Authorised for lodgement by the Lendlease Group Disclosure Committee
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17 August 2020
Lendlease Corporation Limited ABN 32 000 226 228 andLendlease Responsible Entity Limited ABN 72 122 883 185 AFS Licence 308983as responsible entity for Lendlease Trust ABN 39 944 184 773 ARSN 128 052 595
Level 14, Tower Three, International Towers Sydney Telephone +61 2 9236 6111Exchange Place, 300 Barangaroo Avenue Facsimile +61 2 9252 2192Barangaroo NSW 2000 Australia lendlease.com
Lendlease Group 2020 Full Year Results Announcement, Presentationand Appendix
Lendlease Group today announced its results for the year ended 30 June 2020. Attached is theFY20 Results Announcement, Presentation and Appendix.
A summary of Lendlease's Major Urbanisation Projects can be found on the Lendlease website, orby clicking on the link here.
• Full year distributions of 33.3 cents per stapled security:
o Interim distribution 30 cents;
o Final distribution 3.3 cents from Trust, no dividend from Corporation
Core business:
• Profit after Tax of $96 million, Return on Equity of 1.5 per cent2
• $212 million after tax loss in H2FY20, significantly impacted by COVID-19
• Development pipeline of $113 billion, up 48 per cent
Strategic progress:
• Secured two major urbanisation projects, estimated end development value of $37 billion
• Three3 new investment partnerships across c.$7 billion of development value
• Completed development of Paya Lebar Quarter, Singapore – $3.3 billion of FUM
• Listed the Lendlease Global Commercial REIT in Singapore
• Launched new sustainability targets including net zero carbon by 2025 and absolute zero carbon by 2040
Non Core business:
• Loss after Tax of $406 million, including $368 million in exit costs
• Sale of the Engineering business anticipated to be completed shortly, subject to satisfaction of the final conditions
FY20 Result
Group Chief Executive Officer and Managing Director, Steve McCann, said Lendlease experienced
a disappointing financial result in FY20 as the Group brought to account costs for the exit of the
Engineering business, while the Core business was impacted by COVID-19 in the second half.
“The Group responded swiftly to the onset of COVID-19 with the health and safety of our people
and customers paramount, along with measures to strengthen our financial position,” said Mr
McCann.
A range of mitigating actions were implemented including cost reductions and a review of project
expenditure. In addition, the balance sheet was strengthened significantly through issuing new
1. Comparative period, the year ended 30 June 2019. 2. Return on Equity is calculated using the Profit after Tax divided by the arithmetic average of beginning, half and year end securityholders’ equity. 3 One partnership was formed post balance date.
22 August 2018
Lendlease Corporation Limited ABN 32 000 226 228 and Lendlease Responsible Entity Limited ABN 72 122 883 185 AFS Licence 308983 as responsible entity for Lendlease Trust ABN 39 944 184 773 ARSN 128 052 595 Level 14, Tower Three, International Towers Sydney Telephone +61 2 9236 6111 Exchange Place, 300 Barangaroo Avenue Facsimile +61 2 9252 2192 Barangaroo NSW 2000 Australia lendlease.com
19 August 2019
17 August 2020
equity and arranging additional debt facilities to enable the Group to manage through a potential
sustained downturn and to take advantage of development and investment opportunities as they
emerge.
“Notwithstanding the challenging environment, the Group advanced its strategic agenda in FY20.
Significant progress was made on growing and converting the development pipeline, including
securing additional major urbanisation projects, achieving important planning milestones and
creating new investment partnerships to support projects moving into delivery. The Group has
made good progress in finalising the sale of the Engineering business.”
Core business
Following a solid first half, a significant deterioration in operating conditions as a result of the
impacts of COVID-19 led to a loss in the second half of the year.
Delays were experienced in converting development opportunities across our urbanisation pipeline
and the Communities business experienced weak trading conditions.
In Construction, the impact was greater in our international regions, particularly in cities where
mandated shutdowns were implemented. This included lower productivity, projects being put on
hold and delays in the commencement or securing of new projects.
The Group’s investment portfolio was impacted by declining real estate values as a result of
deteriorating market conditions.
While the financial performance was curtailed, substantial growth in the development pipeline
along with the establishment of new investment partnerships and the extension of existing
partnerships provide the foundations for future growth.
“Our ability to deliver transformational urban precincts with a focus on financial, environmental and
social outcomes is being recognised globally. Continued origination success during the year
resulted in the development pipeline more than doubling over the last five years to above $100
billion,” said Mr McCann.
The Group added two new major urbanisation projects to its portfolio – Thamesmead Waterfront in
London and a partnership with Google in the San Francisco Bay Area. These residential led
projects have a combined estimated development end value of approximately $37 billion.
The retail and residential components of Singapore’s newest lifestyle precinct completed in the
period. This marks the culmination of the four-year development of Paya Lebar Quarter with the
precinct now contributing $3.3 billion in funds and assets under management.
22 August 2018
Lendlease Corporation Limited ABN 32 000 226 228 and Lendlease Responsible Entity Limited ABN 72 122 883 185 AFS Licence 308983 as responsible entity for Lendlease Trust ABN 39 944 184 773 ARSN 128 052 595 Level 14, Tower Three, International Towers Sydney Telephone +61 2 9236 6111 Exchange Place, 300 Barangaroo Avenue Facsimile +61 2 9252 2192 Barangaroo NSW 2000 Australia lendlease.com
19 August 2019
17 August 2020
A new partnership was formed with PSP Investments, one of Canada’s largest pension funds to
develop the $4 billion Milano Santa Giulia project. The 58,000 sqm Victoria Cross over station
development in Sydney will be delivered in partnership with the Australian Prime Property Fund
Commercial.
Post year end, the Group established an investment partnership with Mitsubishi Estate to deliver
the first residential tower at One Sydney Harbour, Barangaroo South, which we expect to
contribute approximately $100 million to after tax profit in FY21.
Strong presales have been achieved at TRX Residences in Kuala Lumpur and One Sydney
Harbour, Barangaroo South. There are more than 1,600 apartments for rent in delivery, with four
additional buildings entering delivery across projects in London and Chicago.
“The ongoing conversion of our pipeline provides access to development opportunities and high
quality assets for our investment partners. This integrated approach, along with our placemaking
skills, provides a point of difference we believe few can match,” Mr McCann said.
The design and delivery capabilities of the Construction segment are critical to the success of
integrated projects. In addition, the business is well placed to secure Government sponsored
projects as part of potential stimulus measures across a range of sectors.
Today we announce the launch of our new ambitious environmental and social sustainability
targets. Lendlease is committed to being a 1.5ºC aligned company, with market leading carbon
targets of net zero carbon scope 1 and 2 by 2025 and absolute zero carbon, which extends to our
supply chain, by 2040. In addition, through our interaction with the communities we are part of, we
aim to create $250 million of social value by 2025.
Non-core business
The sale of the Engineering business is anticipated to complete shortly, subject to the satisfaction
of the final conditions. The sale price is $160 million, payable in instalments in FY21 including
completion adjustments.
The Group will retain three projects. The completion of NorthConnex is anticipated in the coming
months and Kingsford Smith Drive is scheduled to complete by the end of CY20. As previously
advised, the Cross Yarra Partnership consortium for the Melbourne Metro Tunnel Project is
continuing to work with the Victorian Government on a confidential basis to resolve issues in
relation to the scope and costs on the project.
22 August 2018
Lendlease Corporation Limited ABN 32 000 226 228 and Lendlease Responsible Entity Limited ABN 72 122 883 185 AFS Licence 308983 as responsible entity for Lendlease Trust ABN 39 944 184 773 ARSN 128 052 595 Level 14, Tower Three, International Towers Sydney Telephone +61 2 9236 6111 Exchange Place, 300 Barangaroo Avenue Facsimile +61 2 9252 2192 Barangaroo NSW 2000 Australia lendlease.com
19 August 2019
17 August 2020
Lendlease has previously disclosed a cost estimate to exit the Engineering and Services
businesses of $450 - $550 million4 on a pre-tax basis. Lendlease now expects these costs to be
approximately $550 million pre tax, with $525 million pre tax ($368 million after tax) accounted for
in FY205.
The sale process for the Services business has been paused as a result of current market
conditions. While the business has been performing well, it is non core and is expected to be
divested in future periods.
Financials
The Group’s Statutory Loss after Tax of $310 million for the year ended 30 June 2020 included
Engineering exit costs of $368 million after tax, along with $19m of goodwill impairment in
anticipation of the completion of the sale of Engineering, and COVID-19 related impacts on the
Core business.
The Core business generated profit after tax of $96 million for the full year. A solid first half with net
profit after tax of $308 million was largely offset by the sharp deterioration in operating conditions
following the onset of the pandemic, resulting in a loss after tax of $212 million in the second half.
A range of measures were undertaken to strengthen the financial position of the Group. $1.2 billion
of equity was raised through an Institutional Placement and Share Purchase Plan and $1.3 billion
of additional debt facilities were arranged. In addition, overhead and employee costs were reduced
and project expenditure was reviewed.
The Group entered the new financial year in a strong financial position with gearing of 5.7 per cent6
and $5.86 billion of liquidity.
Group Chief Financial Officer, Tarun Gupta said: “We remain focused on setting ourselves up for
the future to deliver our growing pipeline of urbanisation projects and pursue investment
opportunities. A robust balance sheet and available liquidity are paramount for this investment
phase.”
Cash generation was strong with underlying operating cash flow of $762 million. This included
apartment settlements across our development projects and the cash realisation of profit
recognised on development projects in prior periods. In addition, PLLACes7 on Barangaroo
apartment pre sales generated cash of $588 million. Adjusting for the $525 million of Engineering
exit costs, cash conversion of underlying operating cash flow to EBITDA for the last five years, was
102 per cent.
4 This cost estimate included implementation and selling costs, indemnities included in any sale agreements and potential costs to cover concluding projects retained by the Group. 5 $15m accounted for in FY19 with a further $10m expected in FY21. 6 FY20 includes $451m of cash and cash equivalents which have been classified as Disposal Group assets held for sale. 7 Presold Lendlease Apartment Cash flows.
22 August 2018
Lendlease Corporation Limited ABN 32 000 226 228 and Lendlease Responsible Entity Limited ABN 72 122 883 185 AFS Licence 308983 as responsible entity for Lendlease Trust ABN 39 944 184 773 ARSN 128 052 595 Level 14, Tower Three, International Towers Sydney Telephone +61 2 9236 6111 Exchange Place, 300 Barangaroo Avenue Facsimile +61 2 9252 2192 Barangaroo NSW 2000 Australia lendlease.com
19 August 2019
17 August 2020
The completion of the Engineering sale will result in a cash flow impact comprising a transfer of the
working capital cash balance to the buyer, less sale proceeds in FY21. As at 30 June 2020 the
working capital balance was approximately $450 million. The cash outflow from the exit costs of
$525 million accounted for in FY20 is expected to be incurred over the period FY21 – FY25.
Outlook
Since the onset of COVID-19 our priorities have been to keep our people safe and protect our
balance sheet. While the duration of the impacts of the pandemic is uncertain, near term effects
from COVID-19 are continuing and we expect current conditions to suppress first half earnings.
The Group entered FY21 in a strong financial position and is well positioned to execute delivery of
the global development pipeline and take advantage of new investment opportunities as market
conditions improve.
The Group’s ability to partner with public and private sector clients to secure long dated projects
provides substantial earnings visibility over the medium to long term.
“Our core business is at an exciting point with a development pipeline of $113 billion and a growing
number of major urbanisation projects in our international gateway cities across the US and Europe
in particular,” Mr McCann said.
Construction backlog revenue for the core business is $14 billion. Beyond the current backlog,
there is approximately $8 billion of work for which the Group is in a preferred position, across both
external and integrated projects.
“Our urbanisation pipeline is expected to create more than $50 billion of institutional grade assets
for our investment partners and the Group’s investments platform. We are well placed to double
our current $36 billion funds under management as this pipeline is delivered,” Mr McCann said.
The Investments segment is in a solid position to continue to deliver recurring earnings derived
from the $4 billion of investments, $36 billion in funds under management and $29 billion of assets
under management.
Further information regarding Lendlease’s results is set out in the Group’s financial results
presentation for the full year ended 30 June 2020 and is available on www.lendlease.com.
ENDS
22 August 2018
Lendlease Corporation Limited ABN 32 000 226 228 and Lendlease Responsible Entity Limited ABN 72 122 883 185 AFS Licence 308983 as responsible entity for Lendlease Trust ABN 39 944 184 773 ARSN 128 052 595 Level 14, Tower Three, International Towers Sydney Telephone +61 2 9236 6111 Exchange Place, 300 Barangaroo Avenue Facsimile +61 2 9252 2192 Barangaroo NSW 2000 Australia lendlease.com
19 August 2019
17 August 2020
FOR FURTHER INFORMATION, PLEASE CONTACT:
Investors: Media:
Justin McCarthy Stephen Ellaway
Mob: +61 422 800 321 Mob: +61 417 851 287
2020 Key Dates for Investors
Securities quoted ex-distribution on the Australian Securities Exchange 21 August
Distribution record date 24 August
Strategy Market Briefing 31 August
Distribution payable 15 September
Annual General Meetings 20 November
Authorised for lodgement by the Lendlease Group Disclosure Committee
DR
AF
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2020Full YearResults
Singapore: Paya Lebar Quarter
17 August 2020
Lendlease FY20 Financial Results 2
As a developer, builder and
manager of assets on land
across Australia, we pay
our respects to the traditional
owners, especially their
elders past and present,
and value their custodianship
of these lands.
Acknowledgement
of Country
Lendlease FY20 Financial Results 3
Group
Performance Steve McCann
Group Chief Executive
Officer and Managing
Director
Chicago: Cooper at Southbank
End to end capabilities
across all aspects of real
estate – from concept
planning, to design and
delivery, through to
funding and investment
management – generate
superior economic, social
and environmental
outcomes.
Our approach
Lendlease FY20 Financial Results 4
Lendlease FY20 Financial Results 5
• Significant deterioration in operating conditions in the second half as a result of the pandemic
• Financial impact to Core business:
− Solid H1 FY20 with a net profit after tax of $308m
− H2 FY20 loss after tax of $212m
• Health and safety paramount:
− Range of measures to protect our people, customers and the communities in which we operate
− Early introduction of travel bans and workplace changes to prevent the spread of the virus
− Initiatives across the commercial assets, retirement villages and residential communities we manage
• Actions to mitigate the impact on the Group:
− Overhead and employee cost reductions
− Review of project expenditure
− Balance sheet strengthened by $1.2b equity raising and $1.3b in additional debt facilities
• Despite a challenging year, substantial progress made on the Group’s strategic agenda
• The strengthening of the balance sheet positions the Group to:
− Manage through a potential sustained downturn
− Accelerate delivery of development pipeline and take advantage of new investment opportunities
2020 significantly impacted by onset of COVID-19
Swift response following the onset of the pandemic
Well placed to navigate ongoing uncertainty
COVID-19
Lendlease FY20 Financial Results 6
Value creation: non financial focus areas
1. Calculated on a rolling 12 month basis. 2. Calculated to provide a rate of instances per 1,000,000 hours worked. 3. Comparative period the year ended 30 June 2019. 4. A Critical Incident is an event that caused, or had the potential to cause,
death or permanent disability. This is an indicator unique to Lendlease. 5. Global Real Estate Sustainability Benchmark (2019).
Health and Safety
Health and Safety is our number one
priority. We remain committed to the
health and safety of our people, our
subcontractors, and all of those who
interact with a Lendlease place.
Our People
Our people are the greatest
contributors to our success and enable
us to fulfil our vision to create the best
places.
Our Customers
Designing and delivering innovative,
customer driven solutions allows us to
win the projects we want to win and
ultimately deliver the best places.
Sustainability
We pride ourselves on reaching
industry firsts – not because they’re
milestones, it’s a signal we’re pushing
ourselves for better outcomes for
people and the planet.
Safety
• Despite a significant improvement
in performance across our safety
metrics, it is with much sadness we
report a fatality in FY20
• Improved metrics following further
enhancements to safety standards:
− Record low Group Lost Time
Injury Frequency Rate1,2 1.5,
down from 1.83
− Operations without a Critical
Incident4 91%, up from 90%3
Developing talent at all levels
• 39 senior leaders participated in our
Urbanisation Project Director and
Construction Director programs – a
further 47 senior leaders have
completed the programs
• 26.9% of leadership positions held
by women, up from 26.1%3
• 404 graduates accepted into our
global graduate program
Customer Focus
• Attracted significant new investment
partners to the Group
• #1 ranked infrastructure contractor
for Australian Department of
Defence
• #1 ranked multi-family residential
contractor in the US – 20th
consecutive year
• Customer satisfaction and loyalty
ratings positive across our three
segments following a survey of
25,000 customers
Leadership
• 1.5°C aligned company targeting:
− Net zero carbon scope 1 & 2 by
2025
− Absolute zero carbon by 2040
• Target $250m social value created
by 2025
• Barangaroo South: Australia’s first
carbon neutral precinct
• GRESB5 leadership
− #1 ranked fund globally
− Four funds in global top 10
Lendlease FY20 Financial Results 7
FY20 result
1. Comparative period the year ended
30 June 2019.
2. Return on Equity is calculated using
the Profit after Tax divided by the
arithmetic average of beginning, half
and year end securityholders’
equity.
3. Net debt to total tangible assets, less
cash.
4. FY20 includes $451m of cash and
cash equivalents which have been
classified as Disposal Group assets
held for sale.
• Group Statutory Loss after Tax of $310m:
− Core Profit after Tax of $96m, earnings per stapled security of 15.9 cents, Return on Equity of 1.5%2
− Non core Loss after Tax of $406m, including $368m after tax in exit costs
• Full year distributions of 33.3 cents per security
− Interim distribution of 30 cents per security
− Final distribution of 3.3 cents per security from Trust earnings, no dividend from Corporation
• Financial performance of the Core business significantly impacted by COVID-19:
− Delay in conversion of opportunities across urbanisation projects
− Mandatory site shutdowns, lower productivity and delays in new work in Construction
− Valuation declines in the Group’s c.$4b investment portfolio
• Mitigating actions implemented in response to the pandemic:
− Balance sheet strengthened by equity raising and additional debt facilities
− Initiatives to reduce overheads and review project expenditure
• Despite a challenging year, substantial progress made on strategic agenda:
− Development pipeline up 48% to $113b with two additional major urbanisation projects secured
− New investment partnerships formed
• Strong financial position: gearing of 5.7%3,4, and liquidity of $5.8b4 providing capacity to:
− Accelerate development production activity as economy recovers
− Take advantage of new investment opportunities
Securityholder returns1
Performance
Lendlease FY20 Financial Results 8
Progress on exit of Non coresegment
1. Comparative period the year ended
30 June 2019.
2. Previously disclosed range of $450m
- $550m pre tax.
3. $15m accounted for in FY19 with a
further $10m expected in FY21.
4. Final working capital amount and
associated cash to be determined at
completion.
Sale of Engineering business to Acciona
• Sale of Engineering business to Acciona anticipated to complete shortly, subject to satisfaction of the final conditions:
− Third party consents being secured
− Sale price of $160m, payable in instalments in FY21 including completion adjustments
Update on retained contracts and Services business
• Three retained engineering projects:
− NorthConnex: completion anticipated in the coming months
− Kingsford Smith Drive: completion expected by end of CY20
− Melbourne Metro Tunnel Project:
o Consortium working with Government on a confidential basis to resolve issues in relation to scope and costs
• Services business:
− Sale paused until market conditions normalise
− Underlying performance maintained with new work secured of $1.4b, up from $1.0b1
− c.$10m pre tax of costs incurred in FY20 relating to the wind down of the Energy and Technology unit
Financial impact
• Costs to exit Engineering and Services business expected to be approximately $550m2 pre tax
− $525m pre tax exit costs accounted for in FY203 - cash outflow expected to be incurred over FY21-25
• Goodwill impairment of $19m related to Engineering sale
• On completion of the sale, a working capital cash balance will transfer to the buyer. As at 30 June 2020 the balance was c.$450m4
Lendlease FY20 Financial Results 9
Strategic initiatives progressed, Development pipeline $113b
1. Total estimated development end value. 2. Secured post balance date. 3. Comparative period the year ended 30 June 2019. 4. Artist’s impression (image subject to change and further design development and planning approval). 5. Victoria
Cross over station development.
• Investment partner initiatives:
− New investment partnerships extending to $7b1 in development value:
o Milano Santa Giulia: entire precinct
o Victoria Cross over station development, Sydney
o Barangaroo South: One Sydney Harbour Tower 12
− Progress on existing investment partnerships:
o Elephant Park: further two residential for rent buildings in delivery
o Lakeshore East and Southbank: additional three residential buildings in delivery
o Completed Paya Lebar Quarter, Singapore: $3.3b FUM
− Launched Lendlease Global Commercial REIT in Singapore
− New c.$2b multi sector investment mandate secured in Australia3
• Development pipeline $113b up from $76.1b3
• c.$37b of urbanisation projects secured:
− Thamesmead Waterfront, London: $15.1b1
− San Francisco Bay Area project: $21.8b1
Executing on our strategy
Milan: Milano Santa Giulia4
London: Elephant Park4
Sydney: Victoria Cross4,5
Chicago: Lakeshore East4
Lendlease FY20 Financial Results 10
Tarun Gupta
Group Chief Financial
Officer
Financial
Performance
Sydney: Sydney Place
Artist’s impression
Lendlease FY20 Financial Results 11
$m FY19 FY20 Change
Core
Development 793 322 (59%) • PLQ completion; Victoria Cross over station development and MSG Development JVs; apartment settlements
Construction 211 101 (52%) • EBITDA margin 1.3%
Investments 489 140 (71%) • Modest growth in base fees from higher average FUM; PLQ performance fee
Operating EBITDA 1,493 563 (62%)
Corporate costs1 (165) (158) 4%
Group EBITDA 1,328 405 (70%)
Depreciation and amortisation (94) (160) (70%)
EBIT 1,234 245 (80%)
Net finance costs (125) (153) (22%)
PBT 1,109 92 (92%) • Depreciation and amortisation and Net finance costs increased due to implementation of AASB16 Leases4
Income tax (expense)/benefit (305) 4 na2
PAT 804 96 (88%)
Non core
EBITDA (461) (495) (7%) • Operating result of $30m (including $19m goodwill impairment), $525m of exit costs
PAT (337) (406) (20%)
Total
PAT 467 (310) na2
Weighted avg. securities3 (#m) 588 603 3%
Earnings per Stapled Security3 (cents) 79.4 (51.4) na2
1. Corporate costs of $158m comprise Group services costs of $129m and Group Treasury costs of $29m. 2. Figures are non meaningful. 3. FY19 Total Earnings per Security and Weighted avg Securities have been updated to reflect the share issue
in FY20 (previously reported as 82.4 cents and 567 #(m) respectively). 4. The net impact to the Income statement on adoption of AASB16 is an $11m pre tax increase in expense in FY20.
Financial performance
H1FY20 H2FY20
Development 272 50 Delays in transactions across urbanisation projects
Construction 101 - Site shutdowns, lower productivity, project delays
Investments 255 (115) Total investment devaluations of $211m in H2
Operating EBITDA 628 (65)
H2 performance impacted by COVID-19
Lendlease FY20 Financial Results 12
1,269
860
1,547
1,228 4,9044,279
Operatingcash flow
Interest andtax paid
Netinvestment
intodevelopment
inventory
Adjustmentfrom investing
cash flow
Underlyingoperatingcash flow
EBITDA
1,111
4511,290
762 (184)(810)
504 1,562
FY19 closingcash
Underlyingoperating cash
flow
Interest andtax paid
Underlyinginvesting cash
flow
Net financingand other
adjustments
FY20 closingcash
Cash flow movements
Underlying operating cash flow
Cash flow
1. Presold Lendlease Apartment Cash
flows.
2. $525m added back to EBITDA
3. Reconciliation on appendix slides
12 and 13.
4. Includes the impact of foreign
exchange movements on opening
cash.
5. $451m of cash and cash
equivalents has been classified as
Disposal Group assets held for sale
at FY20.
6. Underlying operating cash flow
relative to EBITDA.
7. Movement in development
properties inventory, less
movement in deferred land
payments.
8. Reallocation reflects cash proceeds
from sell down of development
entities and realised gains on sale
of assets not reflected in operating
cash flow.
Strong underlying operating cash flows:
• Development receipts, including cash realisation from profit
recognised in previous periods
• $588m inflow from PLLACes1 transaction
• Cash conversion of 175% after adjusting for Engineering exit costs2
Underlying investing cash flow:
• Development expenditure across a range of projects and partnerships
• Investment in Lendlease Global Commercial REIT $0.3b
Financing cash flows:
• Raised $1.2b in equity via Institutional Placement and SPP
Underlying operating cash flow of $4.9b from FY16 to FY20:
• Statutory operating cash flow of $1,269m:
− $0.9b has been paid in interest and tax
− $1.5b of the Group’s operating cash flow has been reinvested
into development inventories
− $1.2b cash realisation from the sell down of deconsolidated
development entities and gains on sale of assets
• Cash conversion of 115% FY16 – FY20:
− Conversion 102% adjusted for exit costs in FY202
− Longer term average anticipated to be below 100% given
revaluations in Investments segment included in EBITDA
FY16 – FY20 ($m)
FY20 ($m)
3 3 4
5
7
8
FY20 cash conversion 175%
adj for exit costs
6
FY16 – FY20 cash conversion 115%6
Disposal Group cash
Lendlease FY20 Financial Results 13
Financial strength Invested capital: Development
Invested capital: Investments
Financial position
1. Target range 10 – 20%.
2. FY20 includes $451m of cash and
cash equivalents which have been
classified as Disposal Group assets
held for sale.
3. EBITDA plus interest income,
divided by interest finance costs,
including capitalised finance costs.
EBITDA has been adjusted to
exclude one off items related to the
Engineering business pre tax exit
costs (FY20: $525m).
4. The sum of the underlying
investment positions does not tie to
invested capital due to other non-
investment related items in the
segment.
5. Comparative period the year ended
30 June 2019.
Capital structure
• Gearing 5.7%1,2, down from 9.9% at FY19; net debt $0.8b2,
down from $1.4b at FY19:
− Strong underlying operating cash flow offset by underlying
investing cash outflow
− c.$1.2b equity raising
• Invested capital up $0.4b to $8.2b
• Investment grade credit ratings (no change in period):
− Moody’s: Baa3 negative outlook
− Fitch: BBB- stable
• Discontinued operations:
− $0.8b assets, $0.7b liabilities held for sale
Debt metrics
• Interest cover3 of 2.8 times
• Average cost of debt 3.4%, maturity 4.2 years
Funding and liquidity
• Total liquidity of $5.8b2 provides capacity to increase
development and investment activity
− $1.6b2 cash, $4.2b undrawn facilities
• Balanced debt maturity profile
$4.8bDevelopment
$3.7b4
Investments
$1.4bRetirement
$2.0bCo-investments
$0.6bOther
investments
17Communities
projects
21Major
urbanisation
projects
Other
Unchanged4
Up $0.1b5
Lendlease FY20 Financial Results 14
Portfolio Management FrameworkEBITDA mix Invested capital
1. Core operating EBITDA. 2. Total invested capital at 30 June 2020 was $8.2b. Development and Investments totalled $8.5b, Construction and Non core ($0.4b) and Corporate $0.1b. 3. Return on Invested Capital (ROIC) is calculated using the
Profit after Tax divided by the arithmetic average of beginning, half and year end invested capital. 4. Through-cycle target based on rolling three to five year timeline. 5. Core business only.
Returns
Development – ROIC3,4 Investments – ROIC3,4Construction – EBITDA margin5
By segment By region
57%
18%
25%
$563m¹
Development(40 - 50%)
Construction(10 - 20%)
Investments(35 - 45%)
56%
44%$8.5b²
Development(40 - 60%)
Investments(40 - 60%)
42%
17%
22%
19%
$8.1b²
Australia(50 - 70%)
Asia(5 - 20%)
Europe(5 - 20%)
Americas(5 - 20%)
11.6%
4.7%
Target 10 - 13%
FY19 FY20
2.2%1.3%
Target 2 - 3%
FY19 FY20
10.8%
2.8%
Target 8 - 11%
FY19 FY20
Lendlease FY20 Financial Results 15
Development segment ($m) Construction segment ($m) Investments segment ($m)
Average ROIC: FY16 – FY20 Average EBITDA margin: FY16 – FY20 Average ROIC: FY16 – FY20
Core financial returns
.
• Average Return on Equity FY16 – FY20:
10.4%Target2
10-13%
2.4%Target
2-3%
10.2%Target2
8-11%
10.8%1
Target
10 – 14%
1. Group average ROE FY16 – FY20 7.9%, including Non core segment. 2. Through-cycle target based on rolling three to five year timeline. 3. Includes Engineering and Services businesses.
500 552673
793
322
11.7%13.7% 13.4%
11.6%
4.7%
FY16 FY17 FY18 FY19 FY20
1H EBITDA 2H EBITDA ROIC
288 271296
211
101
2.4% 2.6%3.1%
2.2%1.3%
FY16 FY17 FY18 FY19 FY20
1H EBITDA 2H EBITDA EBITDA Margin
3
458 495
669
489
140
11.2% 11.7%
15.5%
10.8%
2.8%
FY16 FY17 FY18 FY19 FY20
1H EBITDA 2H EBITDA ROIC
Lendlease FY20 Financial Results 16
Operational
Update Steve McCann
Group Chief Executive
Officer and Managing
Director
London: International Quarter London
Artist’s impression
Lendlease FY20 Financial Results 17
Growth in platform across target gateway cities
Development
Pipeline ($b)
Construction
backlog revenue ($b)
Funds Under
Management ($b) Investments ($b)
49 49
7176
113
FY16 FY20
15 16 15 1614
FY16 FY20
2426
30
35 36
FY16 FY20
3.03.3 3.4
3.74.0
FY16 FY20
Lendlease FY20 Financial Results 18
Apartment settlements and completions
Apartment pipeline
Performance
Development
1. Post balance date.
2. Major buildings only.
• Significant COVID-19 impact
− H1 EBITDA $272m and H2 $50m
Apartments
• 2,236 residential settlements and completions:
− 870 residential for rent apartment completions in Boston and Chicago
• Strong apartment presales at two projects:
− Sydney: Barangaroo South, One Sydney Harbour:
o 317 for sale apartments, c.75% presold
o Investment partnership with Mitsubishi Estate1
− Kuala Lumpur: TRX Residences: 443 apartments, >50% presold
• UK Residential Investment Partnership progressing next two buildings at
Elephant Park: 241 apartments for rent
• Two residential led major projects secured:
− Thamesmead Waterfront, London: more than 11,500 units
− San Francisco Bay Area project: more than 15,000 units
Outlook
• Total pipeline of approximately 56,000 units across 12 gateway cities:
− c.19,000 residential for rent
• Apartments for sale:
− 1,418 apartment presales in delivery2
• Apartments for rent:
− 1,624 units in delivery
− Potential for c.4,000 units to convert FY21 - FY25
Target 1,000 –
2,000 units p.a.
1,6231,366
452 870
1,203
2,533
1,314
2,0752,236
FY16 FY17 FY18 FY19 FY20
For sale For rent
66%
34%
For sale
For rent
56,225
units
Lendlease FY20 Financial Results 19
Commercial building commencements
Indicative conversion timing2
Commercial
Development
1. Total estimated development end
value.
2. Subject to planning approvals and
market conditions.
Performance
• Partnership formed to develop the Milano Santa Giulia project:
− $41 billion major urbanisation project
− First two office buildings forward sold
o Tenant secured for >85% of 46,000 sqm NLA
• Investment partnership formed to deliver Victoria Cross over station
development, Sydney:
− $1.2b major urbanisation project, 58,000 sqm office tower
• Major commercial developments completed, 66,000 sqm, $1.9b:
We measure our success by the value we create in these five focus areas.
Health and Safety
Everyone has the right to go
home safely. We remain
committed to the health and
safety of our people, our
subcontractors, and all of
those who interact with a
Lendlease place.
Financial
A strong balance sheet and
access to third party capital
enables us to fund the
execution of our pipeline and
deliver quality earnings for
our securityholders.
Our Customers
Our customers love the
places we create when we
partner effectively,
collaborate and innovate.
Only through these actions
can we respond to a
changing world.
Our People
Our people are the greatest
contributors to our success
and enable us to fulfil our
vision to create the best
places.
Sustainability
Sustainability is core to our
planning and clear in our
outcomes. We have a
proud history of giving
emphasis to
environmental, social and
economic impacts.
Lendlease FY20 Financial Results 5
Valuecreation
Sydney: Barangaroo South
Lendlease FY20 Financial Results 6
Financial
1. The Group is currently reviewing the framework in
conjunction with the strategy review. The revised
framework will be provided in FY21.
2. Per region.
3. Through-cycle target based on rolling three to five
year timeline.
4. Net debt to total tangible assets, less cash.
Portfolio Management
Framework1
Maximising long term
securityholder value
1. Capital allocation
Focused on gateway cities
Australia 50-70%
International regions 5-20%2
2. Business model
Integrated model synergies
Target EBITDA mix:
Development 40-50%
Construction 10-20%
Investments 35-45%
3. Target returns
Group ROE 10-14%
Development ROIC 10-13%3
Construction EBITDA margin 2-3%
Investments ROIC 8-11%3
4. Capital structure
Investment grade credit rating
Optimised Weighted
Average Cost of Capital
Target gearing4 10-20%
5. Distribution policy
Payout of earnings 40-60%
Capital management discipline
We focus on Return on Equity
and Earnings per Security
as measures of return for
securityholders.
The Portfolio Management Framework1
provides the structure and financial
discipline across the operating segments
of Development, Construction and
Investments.
When these segments combine to leverage
the competitive advantage of our integrated
model, value will be enhanced for our
securityholders, partners and the
community.
A strong balance sheet and accessto third
party capital enables Lendlease to fund the
execution of its pipeline.
San Francisco: 30 Van Ness
Artist’s impression
Image subject to change and further design development and planning approval
Lendlease FY20 Financial Results 7
Sustainability
1. Lendlease managed Australian Prime Property Fund Commercial ranked first out of 964 respondents in the 2019 Global Real Estate Sustainability Benchmark.
Provides voluntary, consistent climate-related
financial risk disclosures for use by companies
in providing information to investors, lenders,
insurers and other stakeholders
Lendlease leadership
• In FY20 we progressed our disclosure under
the recommendations of the TCFD
Independent provider of research-driven insights
and tools for institutional investors
Lendlease leadership
• Lendlease continues to achieve highest AAA
ESG rating, placing in the top 7% of MSCI ACWI
Index constituents for Real Estate Development
and Diversified Activities
UN Global Compact
Voluntary initiative based on CEO
commitments to implement
universal sustainability principles
and to take steps to support UN goals
Lendlease leadership
• Signatory since April 2014
In 1983, Lendlease Founder, Dick
Dusseldorp, and the then Managing
Director, Stuart Hornery, set up the
Lendlease Foundation with a long term
vision to create a function that would
nurture and support its social
responsibility both internally to employees
as well as to the community.
Current Lendlease Foundation program
and engagement opportunities include:
• Springboard
• Great Barrier Reef Foundation
• Australian Business Community
Network
• MATES In Construction
• Red Cross
• OzHarvest
• Chicago Cook Workforce Partnership
• Loneliness Lab
®
Sustainability
Reconciliation Action Plan (RAP)
Framework for organisations to realise their vision for
reconciliation. RAPs are endorsed and monitored
by Reconciliation Australia, an independent, national,
not-for-profit organisation promoting reconciliation by
building relationships, respect and trust between the
wider Australian community and First Nations
Peoples
Lendlease’s Elevate RAP outlines our
commitment to recognition of Country and
support for the self-determination of First
Nations Peoples through the planning,
delivery and operation of our projects and
assets
World’s leading proponent of
responsible investment working to
understand the investment
implications of environmental, social
and governance (ESG) factors
Lendlease leadership
• Signatory since FY08
• A+ rated for both Strategy &
Governance and Property modules
(2019)
Investor driven organisation assessing the
sustainability performance of real asset sector
portfolios and assets
Lendlease leadership
• Beating 964 participants, APPF Commercial rated
worlds best by GRESB in 20191. It is the fifth time
in the past six years that APPF Commercial has
attained the prestigious number one global ranking
• Four Lendlease managed funds achieved top 10
GRESB global ranking
Group
London: Deptford Landings (formerly The Timberyard Deptford)
Artist’s impression
Image subject to change and further design development and planning approval
Lendlease FY20 Financial Results 9
Income Statement
1. FY19 balances have been restated for
discontinued operations during the
year.
2. FY19 Earnings per Stapled Security
has been updated to reflect the share
issue in FY20 (was 98.2 cents
continuing operations and 82.4 cents
total).
$m FY191,2 FY20
Revenue from contracts with customers 14,889 11,671
Other revenue 152 163
Cost of sales (13,929) (11,361)
Gross profit 1,112 473
Share of profit of equity accounted investments 338 (13)
Other income 293 352
Other expenses (863) (1,195)
Results from operating activities from continuing operations 880 (383)
Finance revenue 17 12
Finance costs (142) (165)
Net finance costs (125) (153)
Profit/(Loss) before tax from continuing operations 755 (536)
Income tax (expense)/benefit (198) 194
Profit/(Loss) after tax from continuing operations 557 (342)
(Loss)/Profit after tax from discontinued operations (90) 32
Profit/(Loss) after tax 467 (310)
Profit/(Loss) after tax attributable to:
Members of Lendlease Corporation Limited 313 (342)
Unitholders of Lendlease Trust 154 32
Profit/(Loss) after tax attributable to securityholders 467 (310)
External non controlling interests - -
Profit/(Loss) after tax 467 (310)
Earnings per Stapled Security from continuing operations cents 94.7 (56.7)
Earnings per Stapled Security cents 79.4 (51.4)
Lendlease FY20 Financial Results 10
Statement of Financial Position
$m FY19 FY20
Current Assets
Cash and cash equivalents 1,290 1,111
Loans and receivables 2,050 1,667
Inventories 2,238 2,256
Other financial assets 97 16
Current tax assets 11 27
Other assets 70 59
Disposal Group assets held for sale - 841
Total current assets 5,756 5,977
Non Current Assets
Loans and receivables 688 744
Inventories 3,345 3,113
Equity accounted investments 3,452 3,671
Investment properties 501 658
Other financial assets 1,103 1,076
Deferred tax assets 101 141
Property, plant and equipment 548 693
Intangible assets 1,457 1,457
Defined benefit plan asset 140 156
Other assets 87 62
Total non current assets 11,422 11,771
Total assets 17,178 17,748
$m FY19 FY20
Current Liabilities
Trade and other payables 5,724 4,496
Provisions 332 343
Borrowings and financing arrangements 225 134
Other financial liabilities 6 10
Disposal Group liabilities held for sale - 670
Total current liabilities 6,287 5,653
Non Current Liabilities
Trade and other payables 1,401 2,405
Provisions 45 62
Borrowings and financing arrangements 2,490 2,261
Other financial liabilities 1 1
Deferred tax liabilities 597 434
Total non current liabilities 4,534 5,163
Total liabilities 10,821 10,816
Net assets 6,357 6,932
Equity
Issued capital 1,300 1,889
Treasury securities (68) (68)
Reserves 105 65
Retained earnings 3,815 3,265
Total equity attributable to members of
Lendlease Corporation Limited 5,152 5,151Total equity attributable to unitholders of
Lendlease Trust 1,182 1,756
Total equity attributable to securityholders 6,334 6,907
External non controlling interests 23 25
Total equity 6,357 6,932
Lendlease FY20 Financial Results 11
Statement of Cash Flows1
1. Balances include cash flows relating to
both continuing and discontinued
operations.
2. FY19 comparatives are $nil as Interest
in relation to lease liabilities and
Repayment of lease liabilities were not
recognised under AASB117 Leases.
Operating lease expenses were
recorded as Cash payments in the
course of operations.
3. $451m million of cash and cash
equivalents has been classified as
Disposal Group assets held for sale at
FY20.
$m FY19 FY20
Cash Flows from Operating Activities
Cash receipts in the course of operations 17,026 13,488
Cash payments in the course of operations (16,902) (13,313)
Interest received 13 16
Interest paid in relation to other corporations (152) (164)
Interest in relation to lease liabilities2 - (25)
Dividends/distributions received 105 146
Income tax paid in respect of operations (30) (11)
Net cash provided by operating activities 60 137
Cash Flows from Investing Activities
Sale/redemption of investments 571 448
Acquisition of investments (378) (709)
Acquisition of/capital expenditure on investment properties (53) (57)
Net loan drawdowns from associates and joint ventures (22) (9)
Disposal of consolidated entities (net of cash disposed and transaction costs) 266 136
Disposal of property, plant and equipment 14 11
Acquisition of property, plant and equipment (165) (112)
Acquisition of intangible assets (66) (77)
Net cash provided by/(used in) investing activities 167 (369)
Cash Flows from Financing Activities
Net proceeds from share issue - 1,193
Proceeds from borrowings 4,640 4,658
Repayment of borrowings (4,347) (4,970)
Dividends/distributions paid (258) (327)
Payments for on market buyback of stapled securities (174) -
Payments for on market buyback of stapled securities - Dividend Reinvestment Plan (11) -
Increase in capital of non controlling interest 22 2
Repayment of lease liabilities2 - (61)
Net cash (used in)/provided by financing activities (128) 495
Other Cash Flow Items
Effect of foreign exchange rate movements on cash and cash equivalents 14 9
Net increase in cash and cash equivalents 113 272
Cash and cash equivalents at beginning of financial year 1,177 1,290
Cash and cash equivalents at end of financial year3 1,290 1,562
Lendlease FY20 Financial Results 12
Underlying operating cash flow1
1. Balances include cash flows relating to
both continuing and discontinued
operations.
2. Cash conversion is nonmeaningful in
FY20 due to the Group statutory loss.
3. Refer to Financial and Operational
Metrics data file for full reconciliation.
4. Movement in development properties
inventory, less movement in deferred
land payments.
5. Reallocation reflects cash proceeds
from sell down of development entities
and realised gains on sale of assets not
reflected in operating cash flow.
Cash conversion (FY16 – FY20) ($m)
Reconciliation3 (FY16 – FY20) ($m)
• Underlying operating cash flow has been included to
provide a more accurate cash comparator against
Group EBITDA
• This represents 115% of Group EBITDA over the period
• If the $525m Engineering exit costs are excluded, cash
conversion in FY20 is 175% and since FY16 would have
been 102%
Total conversion against EBITDA of 115%
Cash
Conversion157% 104% 73% 36% n/a2
Group
EBITDA
Underlying
operating
cash flow
• Lendlease has delivered underlying operating cash
flow of $4.9b from FY16 to FY20
• $0.9b has been paid in interest and tax
• Since FY16, $1.5b (32%) of the Group’s underlying
operating cash flow has been reinvested into development
inventories4
• $1.2b has been generated from the sell down of
deconsolidated development entities and realised net gain
on sales of assets (classified as statutory investing cash
flow)5
115% conversion
against EBITDA
1,659
1,254913
316
762
1,0551,202 1,245
867
(90)
FY16 FY17 FY18 FY19 FY20
1,269
860
1,547
1,228 4,9044,279
Operatingcash flow
Interest andtax paid
Netinvestment
intodevelopment
inventory
Adjustmentfrom investing
cash flow
Underlyingoperatingcash flow
EBITDA
Lendlease FY20 Financial Results 13
FY20 underlying operating cash flow1
1. Balances include cash flows relating to
both continuing and discontinued
operations.
Overview
Summary of adjustments
$m Statutory Adjustments Underlying
Cash Flows from Operating Activities
Cash receipts in the course of operations 13,488 - 13,488
Cash payments in the course of operations (13,313) 1741 (13,139)
Dividends/distributions received 146 - 146
Deconsolidation of development entities - 1362 136
Realised gains on sale of assets - 1313 131
Interest received 16 (16) -
Interest paid in relation to other corporations (164) 164 -
Interest in relation to lease liabilities (25) 25 -
Income tax paid in respect of operations (11) 11 -
Net cash provided by operating activities 137 625 762
Cash Flows from Investing Activities
Sale/redemption of investments 448 (131)3 317
Acquisition of investments (709) - (709)
Acquisition of/capital expenditure on investment
properties(57) - (57)
Net loan drawdowns from associates and joint
ventures(9) - (9)
Disposal of consolidated entities (net of cash
disposed and transaction costs)136 (136)2 -
Disposal of property, plant and equipment 11 - 11
Acquisition of property, plant and equipment (112) - (112)
Acquisition of intangible assets (77) - (77)
Net increase in development inventory - (174)1 (174)
Net cash used in investing activities (369) (441) (810)
1. Net increase in development inventory
During the period there was an increase in
development inventories, net of deferred
land payments, which has been reclassified
as an investing activity
2. Cash proceeds from sell down of
development entities
The proceeds on sale of deconsolidated
development entities is reclassified as an
operating activity, to align with the treatment
of cash flows prior to deconsolidation
3. Realised gains on sale of assets
Lendlease is an active investment manager,
with revaluations included in EBITDA.
Accordingly, gains on disposal (including
crystallised revaluations) are reclassified as
an operating activity
• Underlying operating cash flow is
derived by adjusting statutory cash flows to
better reflect operating cash generated by
the Group from its operating model prior to:
– Payment of interest and tax
– Reinvestment in the Group’s pipeline
In FY20 Lendlease delivered underlying operating cash flow of $762m
Lendlease FY20 Financial Results 14
Segment financial metrics
1. Return on Invested Capital (ROIC) is
calculated using the annual Profit after
Tax divided by the arithmetic average
of beginning, half and year end
invested capital.
2. FY16 inputs include the Engineering
and Services businesses.
Operating Profit after Tax ($m) Operating EBITDA ($m)
ROIC1 (Development and Investments), EBITDA margin (Construction)
Invested capital(Development and Investments) ($b)
554
368
141
233
10442
Development Investments Construction
FY19 FY20793
489
211
322
140101
Development Investments Construction
FY19 FY20
4.8
3.6
4.8
3.7
Development Investments
FY19 FY20
11.6%10.8%
2.2%
4.7%
2.8%
1.3%
10.4%5 year average
10.2%5 year average
2.4%5 year average2
Development ROIC Investments ROIC ConstructionEBITDA margin
FY19 FY20
Lendlease FY20 Financial Results 15
Segment financial metrics
1. Comprises Group Services and Group
Treasury costs. FY20 EBITDA: Group
Services ($129m) and Group Treasury
($29m). FY19 EBITDA: Group Services
($140m) and Group Treasury ($25m).
By segment
Revenue ($m) EBITDA ($m) Profit after Tax ($m) Invested capital ($b)
FY19 FY20 FY19 FY20 FY19 FY20 FY19 FY20
Development 3,355 2,344 793 322 554 233 4.8 4.8
Investments 348 390 489 140 368 104 3.6 3.7
Construction 9,680 7,627 211 101 141 42
Corporate1 31 44 (165) (158) (259) (283)
Total Core Segments 13,414 10,405 1,328 405 804 96
Non Core 3,141 2,884 (461) (495) (337) (406)
Total Group 16,555 13,289 867 (90) 467 (310)
Lendlease FY20 Financial Results 16
Revenue / EBITDA by segment
Operating EBITDA by segment ($m)
Operating EBITDA by region ($m)
$m Revenue EBITDA
FY19 FY20 FY19 FY20
Development
Australia 2,712 1,198 556 174
Asia 18 13 121 34
Europe 544 969 37 116
Americas 81 164 79 (2)
Total Development 3,355 2,344 793 322
Construction
Australia 4,052 3,217 126 97
Asia 401 255 (1) (11)
Europe 941 782 40 (9)
Americas 4,286 3,373 46 24
Core Construction 9,680 7,627 211 101
Non Core 3,141 2,884 (461) (495)
Total Construction 12,821 10,511 (250) (394)
Investments
Australia 210 172 330 35
Asia 63 134 50 67
Europe 13 16 9 (10)
Americas 62 68 100 48
Total Investments 348 390 489 140
Total Operating
Australia 6,974 4,587 1,012 306
Asia 482 402 170 90
Europe 1,498 1,767 86 97
Americas 4,429 3,605 225 70
Core Operating 13,383 10,361 1,493 563
Non Core 3,141 2,884 (461) (495)
793
211
489
(461)
322
101 140(495)
Development Construction Investments Non Core
FY19 FY20
1,012
17086
225
(461)
306
90 97 70(495)
Australia Asia Europe Americas Non Core
FY19 FY20
Lendlease FY20 Financial Results 17
Revenue /EBITDA by segment, local currency
1. Major currency in region.
Operating EBITDA, local currency (m)Asia
SGDm¹ Revenue EBITDA
FY19 FY20 FY19 FY20
Development 17 12 117 32
Construction 390 237 (1) (10)
Investments 61 125 49 62
Total Operating 468 374 165 84
Europe
£m1 Revenue EBITDA
FY19 FY20 FY19 FY20
Development 299 515 20 61
Construction 518 414 22 (5)
Investments 7 8 5 (5)
Total Operating 824 937 47 51
Americas
US$m Revenue EBITDA
FY19 FY20 FY19 FY20
Development 58 110 56 (1)
Construction 3,043 2,259 33 16
Investments 44 46 71 32
Total Operating 3,145 2,415 160 47
117
(1)
49
165
32(10)
6284
Development Construction Investments Total Operating
FY19 FY20
5633
71
160
(1)16
3247
Development Construction Investments Total Operating
FY19 FY20
20 22
5
4761
(5) (5)
51
Development Construction Investments Total Operating
FY19 FY20
Lendlease FY20 Financial Results 18
Exchange rates
1. Average foreign exchange rate for the
full year 2019.
2. Average foreign exchange rate for the
full year 2020.
3. Spot foreign exchange rate at 30 June
2019.
4. Spot foreign exchange rate at 30 June
2020.
Income Statement
Local Foreign FY191 FY202
AUD USD 0.71 0.67
AUD GBP 0.55 0.53
AUD EUR 0.63 0.61
AUD SGD 0.97 0.93
Statement of Financial Position
Local Foreign FY193 FY204
AUD USD 0.70 0.69
AUD GBP 0.55 0.56
AUD EUR 0.62 0.61
AUD SGD 0.95 0.96
FX sensitivity
USD GBP EUR SGD
FY20 Core Business Profit
+10% average FX rate (strengthening AUD) 0.74 0.58 0.67 1.02
Change as % of Core Business Profit % (5.21%) - (3.13%) (4.17%)
-10% average FX rate (weakening AUD) 0.60 0.48 0.55 0.84
Change as % of Core Business Profit % 4.17% - 4.17% 6.25%
FY20 Statement of Financial Position
+10% spot FX rate (strengthening AUD) 0.76 0.62 0.67 1.06
Change as % of Group Net Assets % (1.38%) (1.50%) (0.40%) (0.85%)
-10% spot FX rate (weakening AUD) 0.62 0.50 0.55 0.86
Change as % of Group Net Assets % 1.69% 1.83% 0.48% 1.04%
Lendlease FY20 Financial Results 19
FY20 regional EBITDA to PAT reconciliation
1. Depreciation and amortisation.
$m EBITDA Net interest D&A1 PBT Tax PAT
Australia
Development 174 (3) (7) 164 (46) 118
Construction 97 - (8) 89 (27) 62
Investments 35 - (5) 30 - 30
Total Australia 306 (3) (20) 283 (73) 210
Asia
Development 34 - (2) 32 (14) 18
Construction (11) (1) (3) (15) 1 (14)
Investments 67 - (2) 65 (3) 62
Total Asia 90 (1) (7) 82 (16) 66
Europe
Development 116 4 (8) 112 (19) 93
Construction (9) (1) (3) (13) 2 (11)
Investments (10) - (1) (11) 2 (9)
Total Europe 97 3 (12) 88 (15) 73
Americas
Development (2) - (6) (8) 12 4
Construction 24 (4) (14) 6 (1) 5
Investments 48 (6) (9) 33 (12) 21
Total Americas 70 (10) (29) 31 (1) 30
Corporate
Group Services (129) (15) (92) (236) 69 (167)
Group Treasury (29) (127) - (156) 40 (116)
Total Corporate (158) (142) (92) (392) 109 (283)
Total Core Business 405 (153) (160) 92 4 96
Non Core (495) 5 (84) (574) 168 (406)
Total Group (90) (148) (244) (482) 172 (310)
Lendlease FY20 Financial Results 20
Debt metrics
1. FY20 includes $451m million of cash
and cash equivalents which have been
classified as Disposal Group assets
held for sale.
2. EBITDA plus interest income, divided
by interest finance costs, including
capitalised finance costs. EBITDA has
been adjusted to exclude one off items
related to the Engineering business
(FY19: $500m; FY20: $525m).
FY19 FY20
Net debt1 $m 1,425 833
Borrowings to total equity plus borrowings % 29.9 25.7
Net debt to total tangible assets, less cash1 % 9.9 5.7
Interest cover2 times 8.8 2.8
Average cost of debt % 4.0 3.4
Average debt maturity years 4.8 4.2
Average debt mix fixed: floating ratio 52:48 56:44
Undrawn facilities $m 2,631 4,226
Lendlease FY20 Financial Results 21
Debt facilities and maturity profile
1. Values are shown at amortised cost.
2. Values are shown at gross facility
value.
Debt facilities1 ($m)
Debt maturity profile2 ($m)
134
535
- - -
725
29
575
31179
536 535
1,800
800 714
960
179
575
31179
Euro CPprogramme
UK BondIssue
Syndicatedcash advance
facility
Syndicatedloan facility
ClubRevolving
Credit Facility
Asia LoanFacility
CNY871million bank
facility
US$ Reg. Snotes
S$ Reg. Snotes
A$ mediumterm notes
Drawn Facility
536 536
900
900
800
714
960179 580
313 80
FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 FY29
Euro CP programme UK Bond Issue Syndicated cash advance facility Syndicated loan facility
Club Revolving Credit Facility Asia Loan Facility CNY871 million bank facility US$ Reg. S notes
S$ Reg. S notes A$ medium term notes Undrawn
Lendlease FY20 Financial Results 22
Key dates for investors
Date
FY20 results released to market / final distribution declared 17 August 2020
Securities quoted ex distribution on the Australian Securities Exchange 21 August 2020
Final distribution record date 24 August 2020
Strategy Market Briefing 31 August 2020
Final distribution payable 15 September 2020
Annual General Meetings 20 November 2020
Development
Segment
San Francisco Bay Area project
Artist's impression
Image subject to change and further design development and planning approval
Lendlease FY20 Financial Results 24
Urbanisation
21 major projects in
9 gateway cities
Communities
17 projects
Telco
Infrastructure
Infrastructure
Development
Military
Housing
Apartments Commercial Communities US Telco Towers
Australian
Infrastructure
Development
US Military
Housing
Portfolio
Target2
1,000 - 2,000
settlements
per annum
Target2
2 - 3 buildings
commenced
per annum
Target
3,000 - 4,000
settlements
per annum
Development
marginOrigination fees Development fees
56,225 units
$69.0b1
2,415,000 sqm
$29.8b1
47,372 lots
$13.9b1 354 tower pipelinePeriodic bids for
PPP projects
Additional scope
on existing
projects and
periodic bids for
new projects
Earnings drivers - Development
1. Remaining estimated development end value. Total includes $0.3b of Infrastructure pipeline. 2. Targets under review.
ROIC target 10-13%; Invested capital $4.8b; Pipeline1 $113.0b
Bu
sin
ess
Re
turn
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an
d m
etr
ics
Pip
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Lendlease FY20 Financial Results 25
Development FY20
1. Comparative period the year ended 30
June 2019.
2. Formerly The Timberyard, Deptford.
3. Total estimated development end
value.
4. Remaining estimated development end
value.
Overview
Drivers1 Outlook
• Development of inner city mixed use developments, apartments,
communities, retirement, retail, commercial assets, and social and
economic infrastructure
• Financial returns are generated via development margin,
development management fees and origination fees
• Delay in transactions across urbanisation projects impacted results
• Apartments for sale settlements: 1,366 units, down from 1,623 units
Elephant Park and Deptford Landings2, London; Clippership
Wharf, Boston; Paya Lebar Quarter, Singapore; and Victoria
Harbour and Melbourne Quarter, Melbourne
• Apartments for rent completions: 870 units, up from 452 units
Clippership Wharf, Boston; 845 West Madison, Chicago
• Strong presales:
One Sydney Harbour Tower 1, Barangaroo South, Sydney:
317 total units; c.75% presold
TRX Residences Building 1, Kuala Lumpur: 443 total units;
c.53% presold
• Development joint venture:
Victoria Cross over station development, Sydney: $1.2b3
Milano Santa Giulia, Milan: $4.0b3. First two buildings sold into
Joint Venture
• Next two residential for rent buildings at Elephant Park forward sold
• Completion of Paya Lebar Quarter, Singapore
• Communities:
Settlements 1,898 lots, down 25%
Sales 1,347 lots, down 14%
• US telecommunication towers: 125 completions
• Two new major urbanisation projects secured:
Thamesmead Waterfront, London: $15.1b3
San Francisco Bay Area project: $21.8b3
• Preferred bidder on Birmingham Smithfield: $2.8b3
• $113b development pipeline4
13 major apartment buildings in delivery across six gateway
cities
o One Sydney Harbour, Tower 1 development joint venture
formed post balance date
o 1,418 units presold in delivery: $2.3b
o 1,624 units for rent in delivery: $1.7b3
1,725 communities lots presold: $0.5b
c.376,000 sqm of commercial space in delivery across seven
major buildings: $5.8b3
Remaining secured pipeline not yet in delivery
o 53,183 apartment units: c.$66b
o c.2,039,000 sqm of commercial space: c.$25b
o 32 buildings in various stages of planning and
conversion
o Additional 25+ buildings in pipeline
Performance FY19 FY20
Core business EBITDA mix % 53 57
ROIC % 11.6 4.7
Invested capital $b 4.8 4.8
Lendlease FY20 Financial Results 26
Development earnings / pipeline
1. Remaining estimated development end
value.
2. FY18 onwards excludes Australian
Retirement pipeline which is now
included in the Investments segment
following the Retirement Living
transaction. From FY20, Retirement
product in Asia has been included
within Urbanisation.
3. FY18, FY19 and FY20 include $0.1b,
$0.2b and $0.3b of Infrastructure
pipeline respectively.
EBITDA by region ($m) Pipeline1 by region ($b)
FY20 urbanisation pipeline1 by region Pipeline1 ($b)
Lendlease MSG 1 Europe Investment Partnership Core Office - 0.1
Total Europe 1.5 1.6
Americas FUM Fund type Asset class FY19 ($b) FY20 ($b)
Lendlease Americas Residential Partnership Value Add Residential 0.7 1.0
Total Americas 0.7 1.0
Lendlease FY20 Financial Results 56
Major fund summary1
1. Does not comprise Lendlease’s complete Funds Management Platform. 2. Australian Prime Property Fund Retail. 3. Australian Prime Property Fund Commercial. 4. Australian Prime Property Fund Industrial. 5. Lendlease International Towers
Sydney Trust (Barangaroo South T2 and T3, International House and Towns Place Car Park). 6. Lendlease One International Towers Sydney Trust (Barangaroo South T1). 7. Paya Lebar Quarter. 8. Lendlease Asian Retail Investment Fund. 9.
Parkway Parade Partnership Limited. 10. Lendlease Global Commercial REIT. 11. Lendlease Residential Americas Partnership. Total assets includes six buildings (three buildings are under construction and not yet operational). All other metrics