INGENIA COMMUNITIES GROUP — Interim / Quarterly Report 2015

Feb 23, 2015

P a g e 1 A p p e n d i x 4 D H a l f Y e a r R e p o r t H a l f Y e a r e n d e d 3 1 D e c e m b e r 2 0 1 4

APPENDIX 4D Half year Financial Report

Half Year ended 31 December 2014

Name of Entity: Ingenia Communities Holdings Limited (“INA”), a stapled entity comprising Ingenia Communities Holdings Limited ACN 154 444 925, Ingenia Communities Fund ARSN 107 459 576, and Ingenia Communities Management Trust ARSN 122 928 410.

Current period: 1 July 2014 – 31 December 2014 Previous corresponding period: 1 July 2013 – 31 December 2013

Results for announcement to the market

Results for announcement to the market
	31 Dec 2014	31 Dec 2013	change
	$'000	$'000	%
Revenues from Continuing operations	28,660	19,311	48%
Profit/(loss) from ordinary activities after tax attributable to members	(987)	4,306	Refer note1
Net profit/(loss) for the period attributable to members	(987)	4,306	Refer note1
Underlying profit from continuing operations	6,017	4,018	50%
Underlying profit	6,677	3,603	85%
Distributions - current period (cents) FY14 Final Distribution (paid) 1H15 Interim Distribution (declared)	0.65 0.65
Distributions - previous period (cents) FY13 Final Distribution (paid) 1H14 Interim Distribution (declared)		0.50 0.50
Record date for determining entitlement to the Final Distribution	5.00pm, 3 March 2015
The Dividend and Distribution Reinvestment Plan is operational for	this distribution
	31 Dec 2014	30 Jun 2014	change
Net asset value per security (cents)	36.5	35.5	3%

1. The variances that would otherwise be shown are not meaningful because the current year number is negative.

P a g e 2 A p p e n d i x 4 D H a l f Y e a r R e p o r t H a l f Y e a r e n d e d 3 1 D e c e m b e r 2 0 1 4

Results for announcement to the market

This information should be read in conjunction with the 2014 Annual Financial Report of Ingenia Communities and any public announcements made in the period in accordance with the continuous disclosure requirements of the Corporations Act 2001 and ASX Listing Rules

Details of entities over which control has been gained or lost during the period:

Control gained: None Control Lost: Noyea Pty Ltd and Noyea Operations Pty Ltd

Details of any associates and joint venture entities required to be disclosed: None

Audit status

This report is based on the consolidated 2015 Half Year Report of Ingenia Communities, which has been reviewed by EY. The Auditor’s Independence Declaration provided by EY is included in the 31 December 2014 Half Year Financial Report.

.

Other significant information and commentary on results

See attached ASX announcement and materials referred to below.

Additional Appendix 4D disclosure requirements can be found in the Directors’ Report and the 31 December 2014 half year financial statements.

For all other information required by Appendix 4D, including a results commentary, please refer to the following documents:

• Directors’ report

• Reviewed Half Year Financial Report

• Results presentation and media release

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Tania Betts Company Secretary

24 February 2015

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INGENIA COMMUNITIES HOLDINGS LIMITED A.C.N. 154 444 925

INTERIM REPORT

FOR THE HALF-YEAR ENDED 31 DECEMBER 2014

www.ingeniacommunities.com.au

Registered Office: Level 5, 151 Castlereagh Street, Sydney NSW 2000

Ingenia Communities Holdings Limited Interim Financial Report Half-year ended 31 December 2014

Contents

Contents
	Page
Directors’ report	2
Auditor’s independence declaration	11
Financial report
Consolidated Statement of Comprehensive Income	12
Consolidated Balance Sheet	14
Consolidated Cash Flow Statement	15
Statement of Changes in Equity	16
Note 1 Summary of significant accounting policies	17
Note 2 Accounting estimates and judgements	21
Note 3 Segment information	23
Note 4 Earnings per security	25
Note 5 Revenue	25
Note 6 Discontinued operations	26
Note 7 Cash and cash equivalents	28
Note 8 Inventories	28
Note 9 Investment properties	28
Note 10 Trade and other payables	34
Note 11 Borrowings	34
Note 12 Retirement village resident loans	35
Note 13 Issued securities	36
Note 14 Share based payments	37
Note 15 Financial instruments	38
Note 16 Fair value measurement	40
Note 17 Distributions	41
Note 18 Subsequent events	42
Directors’ declaration	43
Auditors report	44

Page 2

Ingenia Communities Holdings Limited Directors’ report Half-year ended 31 December 2014

The directors of Ingenia Communities Holdings Limited (“ICH” or the “Company”) present their report together with the Company’s financial report for the half-year ended 31 December 2014 (the “current period”) and the Independent Auditor’s Report thereon. The Company’s financial report comprises the consolidated financial report of the Company and its controlled entities, including the Ingenia Communities Fund (“ICF” or the “Fund”) and the Ingenia Communities Management Trust (“ICMT”) (together, the “Trusts”).

The shares of the Company are “stapled” with the units of the Trusts and trade on the Australian Securities Exchange (“ASX”) effectively as one security. Ingenia Communities RE Limited (“ICRE” or “Responsible Entity”), a wholly owned subsidiary of the Company is the responsible entity of the Trusts. In this report, the Company and the Trusts are referred to collectively as the Group.

In accordance with Accounting Standard AASB 3 “ Business Combinations” , the stapling of the Company and the Trusts is regarded as a business combination. The Company has been identified as the parent for preparing consolidated financial reports.

1. DIRECTORS

The directors of the Company at any time during or since the end of half-year were:

Non-executive directors

Jim Hazel (Chairman) Philip Clark AM Amanda Heyworth Robert Morrison Norah Barlow ONZM

Executive director

Simon Owen (Managing Director and CEO)

2. OPERATING AND FINANCIAL REVIEW

a) Ingenia Communities Overview

The Group owns, manages and develops a diversified portfolio of seniors living communities across Australia. Its real estate assets at 31 December 2014 are valued at $322 million[1] and comprises 58 lifestyle parks, rental villages, and deferred management fee (DMF) villages. The Group is included in the ASX 300 with a market capitalization of approximately $369 million.

The Group’s vision is to be a leading Australia provider of affordable seniors living and short term rental accommodation. The Board is committed to delivering long-term earnings and security price growth to securityholders and providing an affordable and supportive community environment to both its permanent and short term residents.

b) Strategy

The Group’s strategy is to further grow its Australian rental portfolio, primarily within the lifestyle parks sector. Using a disciplined framework, the Group remains focused on completing the deployment of the $89.1m of equity raised in October 2014 and accelerating the build out of its development pipeline.

Pleasingly, the Group finalised its strategic exit from the non-core New Zealand Students portfolio in December 2014. The Group is continuing to focus on reducing its investment in DMF assets with the divestment of one asset completed in July 2014.

1 Real estate assets value is determined as the net of carrying value of investment properties, retirement village resident loans and finance lease liabilities.

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Ingenia Communities Holdings Limited Directors’ report Half-year ended 31 December 2014

In February 2015, the Group completed a debt refinance increasing its facility limit from $129.5m to $175m, expanding is lenders, providing enhanced flexibility and reducing pricing. This facility, combined with proceeds remaining from the recent equity raising as well as capital recycling and stock monetization positions the Group well for significant further investment in its growing lifestyle parks business.

A disciplined investment approach, stringent capital management and continually exploring opportunities for operational efficiencies remains of critical importance. The Group remains committed to maintaining a loan to value ratio (“LVR”) within a target range of 30-35%.

The key immediate business priorities of the Group are:

• Increasing sales and settlement rates for new homes within the Active Lifestyle Estates development pipeline;

• Finalising the deployment of funds from the recent $89.1m equity raising;

• Growing occupancy rates both within the Garden Villages portfolio and the Active Lifestyle Estates short term accommodation; and

• Continuing sell down of completed homes within the Settlers portfolio whilst advancing the divestment of the eight remaining communities.

c) 1H15 Financial results

1H15 has been a period of significant investment in the Active Lifestyle Estate portfolio, with the focus on establishing the necessary sales and development platforms to deliver the forecast returns from the growing development pipeline. At the same time, there has been a continuing focus on increasing earnings from the Garden Villages portfolio through occupancy growth and increasing rents as well as continuing to sell down available stock within the Settlers portfolio.

Overall 1H15 has delivered an underlying profit of $6.7m and a statutory loss of $1.0m. The underlying profit is an 85% increase on the prior period whilst the statutory loss is a reflection of transaction costs, including stamp duty, being written off on the significant number of lifestyle parks acquired over the last year.

Operating cashflow for the period was $4.6m, up 50% on the prior period. The improvement in operating cashflow reflects an increasing contribution from the rental element of the lifestyle parks business partially offset by further investment in manufactured home inventories to deliver settlements during the second half.

In October 2014, the Group raised $45.3m from an institutional placement and $43.8m from a rights issue. Using a mix of debt and the equity raised, this has provided capacity to invest c$120m into the lifestyle parks sector. So far, one asset has settled and several others are either contracted or under due diligence or advanced price discovery.

The Group is currently positioned significantly below its target LVR range of 30-35% following the temporary application of the equity raised against debt until fully deployed. The all in cost of debt on a fully deployed basis at half year was 4.65%. The cost of debt has subsequently reduced further following the new Australian multilateral debt facility coming into effect this month.

The Group announced on 24 February 2015 an interim distribution of 0.65 cents, and the dividend reinvestment plan will be available. This distribution is a 30% increase on the prior period and in line with the FY14 final distribution. The Board reaffirms its commitment to further growth in securityholder returns over the medium term.

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Ingenia Communities Holdings Limited Directors’ report Half-year ended 31 December 2014

d) Key Metrics

• Interim distribution of 0.65 cent per security, up 30% on prior period.

• Underlying profit was $6.7m, up 85% from 1H14.

• Underlying profit per security was 0.9 cents, up 50% from 1H14.

• Net asset value grew by 1.0 cent per security to 36.5 cents .

• Statutory loss of $1.0m, down from a profit of $4.3m in the prior period reflecting write off of

• transaction costs, principally stamp duty, on nine lifestyle park acquisitions completed during FY14.

• Statutory loss per security was 0.1 cents.

These results are reflective of execution of divestment of the majority of the overseas operations, and deployment of capital into the Australia market to generate strong returns for securityholders.

Underlying profit for the half-year is calculated as follows:

	2015	2014
	$’000	$’000
EBIT – continuing operations	6,020	4,901
Net interest expense	(2,326)	(1,661)
Tax benefit associated to underlying profit	2,323	778
Underlying profit – continuing operations	6,017	4,018
Underlying profit – discontinued operations	660	(415)
Underlying profit	6,677	3,603
Net foreign exchange gain/(loss)	(940)	348
Net loss on disposal of investment properties	(323)	-
Net gain/(loss) on change in fair value of :
Investment properties	(9,309)	1,226
Derivatives	98	(8)
Retirement village resident loans	(86)	60
Gain on revaluation of newly constructed retirement villages	(1,144)	(1,271)
Release of foreign currency reserve on disposal of foreign operations	2,374	-
Discontinued operations (below underlying profit) net of income tax	(1,937)	121
Tax benefit associated with items below underlying profit	3,603	227
Statutory (loss)/profit	(987)	4,306

Underlying Profit is a non-IFRS measure designed to present, in the opinion of the Directors, the results from the on-going operating activities in a way that appropriately reflects underlying performance. Underlying profit excludes items such as unrealised fair value gains/(losses) and adjustments arising from the effect of revaluing assets/liabilities (such as derivatives and investment properties). These items are required to be included in Statutory Profit in accordance with Australian Accounting Standards.

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Ingenia Communities Holdings Limited Directors’ report Half-year ended 31 December 2014

e) Segment Performance and Priorities

Active Lifestyle Estates

Active Lifestyle Estates now comprises sixteen communities making Ingenia the largest owner, operator and developer of lifestyle parks in New South Wales. The business is the primary focus of growth for the Group as it provides an affordable, yield focused housing alternative for seniors and short term residents with a capital light, low risk development model. The net carrying value of these assets at 31 December 2014 is $144.4m.

i. Performance

i. Performance
1H15	1H14 Variance
New and refurbished home settlements # 8 Development income $m $0.8m Residential rental income $m $3.8m Short-term rental income $m $4.6m EBIT$m $2.0m	5 60% $0.5m 76% $1.3m 188% $1.6m 197% $1.3m 52%

Active Lifestyle Estates delivered a contribution of $2.0m in 1H15 (1H14: $1.3m) of which $0.8m was attributable to development profit in new manufactured homes. Master planning and infrastructure work is well under way across numerous projects and a growing number of homes are being delivered. This will deliver a strong second half skew from both settlement volumes and earnings. The rental accommodation earnings of this segment have grown strongly through acquisitions. This has been partly offset by the establishment of a sales and development framework for new homes.

ii. Strategic priorities

The key strategic priorities for this business are building further momentum in sales and settlement volumes, securing remaining approvals required to deliver FY16 and longer term settlements, repositioning parks to grow both short term and permanent rental returns and leveraging scale efficiencies across a larger portfolio. As at the date of this report the Group had 61 new homes being built or installed which is likely to drive 2H15 and FY16 sales volumes and earnings.

The Group is working towards investing the remaining funds from the equity raising with available debt into both the NSW and Southeast Queensland markets over the coming months.

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Ingenia Communities Holdings Limited Directors’ report Half-year ended 31 December 2014

Garden Villages

Garden Villages is comprised of 34 rental villages located across the eastern seaboard and Western Australia. These villages accommodate more than 1,800 residents, and generate $12.1 million in gross rental income per annum. The carrying value of these assets at 31 December 2014 is $116.8m.

i. Performance

1H15	FY14 Variance
Occupancy % 85.7%	84.6% +1.3%
1H15	1H14
Rental income $m $12.1m Catering income $m $1.7m EBIT$m $5.4m	$10.0m +21% $1.5m +13% $4.9m +10%

The Garden Villages segment delivers a consistent stream of recurring cash income for the Group. The results are up $0.4m on the corresponding prior period due to growing occupancy levels, up 1.1% from June 14.

The Ingenia Care Assist program continues to be a strong contributor to the growing occupancy levels across this portfolio. This program enables residents to live independently for longer in the villages and is proving to be a key selling feature for residents moving into the villages.

ii. Strategic priorities

The key strategic priorities of this business continue to be growing village occupancy toward the mid term target of 92%, improving cash operating margins in lower performing villages, ensuring residents are actively engaged and maintaining affordability whilst leveraging scale efficiencies across the portfolio. Beyond continuing maintenance reinvestment in existing villages it is unlikely further growth capital will be deployed in the Garden Villages portfolio.

Settlers Lifestyle

Settlers Lifestyle is comprised of eight deferred management fee villages, including those in the process of being converted from the rental to deferred management fee model. These villages are located Queensland, New South Wales and Western Australia and accommodate more than 800 residents whilst generating income from accrued deferred management fees, rental income where villages are not yet fully converted and development income from unit conversions and village expansion. The carrying value of these assets at 31 December 2014, net of resident loans and lease liabilities is $65.6m. The Group continues to explore opportunities to reduce its exposure to this portfolio following the first divestment in July 2014, when the Settlers Lifestyle Noyea Park village settled for an adjusted sales price of $5.4m.

i. Performance

1H15	FY14 Variance
Occupancy % 93%	92% +1.0%
1H15	1H14 Variance
New settlements # 21 Development income $m $1.1m Accrued DMF income $m $2.7m EBIT$m $2.7m	21 - $1.3m -10% $2.7m - $1.7m +59%

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Ingenia Communities Holdings Limited Directors’ report Half-year ended 31 December 2014

The Settlers Lifestyle business delivered a higher result than the prior period due to gradual winding down of sales and marketing efforts on several projects nearing completion. The Hunter Valley residential market continues to be weak, which has meant incoming residents are requiring longer to sell their existing home in order to settle their new unit purchase within our Cessnock and Ridge Estate villages.

ii. Strategic priorities

The key strategic priorities of this business over the coming six months are the continued sell down of stock at Ridge Estate, Forest Lake, Cessnock and Rockhampton and further exploration of divestment opportunities.

f) Discontinued operations

The Group completed its exit from the New Zealand Students accommodation portfolio in December 2014.

g) Capital Management

The Group adopts a prudent and considered approach to capital management. During the period, the Group strengthened its capital position by undertaking a $89.1m capital raising. In February 2015 the Group negotiated a new $175m Australian multilateral debt facility, an increase of $45.5m from the previous bilateral facility.

As at 31 December 2014, the current LVR is 14.4%. The Group is working to deploy proceeds from the capital raising and debt into further Active Lifestyle Estate acquisitions, and anticipates being at or close to its target LVR of 30-35% by 30 June 2015.

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Ingenia Communities Holdings Limited Directors’ report Half-year ended 31 December 2014

h) Financial Position

The following table provides a summary of the Group’s financial position as at 31 December 2014:

$’000 31 Dec 2014	30 Jun 2014 Change %
Cash and cash equivalents 24,618 Inventories 6,437 Investment properties 520,184 Assets of discontinued operations - Other assets 16,794	12,894 +90.9% 2,208 +191.5% 498,863 +4.3% 47,657 N/A 13,302 +26.3%
Total assets 568,033	574,924 -1.2%
Borrowings 25,557 Retirement village resident loans 193,411 Liabilities from discontinued operations - Other liabilities 28,462	98,356 -74.0% 190,122 +1.7% 30,449 N/A 15,820 +79.9%
Total Liabilities 247,430	334,747 -26.1%
Net assets/equity 320,603	240,177 +33.5%

Inventories increased by $4.2m reflecting the Group’s growing investment in the manufactured home estates sector. The Group’s strategy includes development of new manufactured homes, which are classified as inventory until they are sold to new residents. This element of the Group’s balance sheet will continue to grow as the number of active development projects increases.

Investment properties increased by $21.3m largely due to the acquisition of White Albatross

Holiday Park.

Assets and liabilities of discontinued operations decreased to nil reflecting the disposal of New Zealand operations in December 2014, in line with the divestment strategy.

Borrowings decreased by $72.8 million due to the temporary application of proceeds from the October rights issue against debt until funds are gradually deployed, and extinguishment of New Zealand debt associated with the New Zealand divestment. This ensures finance costs are minimised during this intervening period.

i) Cashflow

$’000 1H15	1H14 Variance
Operating cashflows 4,609 Investing cashflows 26,963 Financing cashflows (21,672) Net change in cash and cash equivalents 9,900 Effects of exchange rate fluctuations on cash held 167	3,070 1,539 (67,429) 94,392 47,811 (69,483) (16,548) 26,448 18 149
Cash at the end of the period 24,618	21,020 3,598

Operating cash flow for the Group was strong at $4.6m, up $1.5m from prior year. The improvement in operating cash flow reflects increasing contribution from the recurring rental income streams of both the Active Lifestyle Estates and Garden Villages portfolios offset by increased costs associated with the purchase of manufactured homes.

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Ingenia Communities Holdings Limited Directors’ report Half-year ended 31 December 2014

Investing cash flows reflect the divestment of New Zealand operations and Noyea for $49.6 million along with capital refurbishment works of $6.3 million.

Financing cash flows include net proceeds of $86.5m from the October institutional placement and rights issue, net repayment of borrowings of $102.9 million, and payment of distributions to security holders of $4.4 million.

j) Distributions

The following distribution was made during or in respect of the period:

• On 26 August 2014 the directors declared a final distribution for 2014 of 0.65 cents per security (“cps”) (2013: 0.5 cps) amounting to $4,407,379 which was paid on 17 September 2014.

The distributions are 100% tax deferred and the dividend reinvestment plan will apply to the interim distribution.

The Group is committed to continuing to grow distributions in the near term.

k) Outlook

The Group is well positioned to continue growing its lifestyle parks business with a strong an accretive acquisition pipeline in place for deploying the remaining proceeds from the October equity raising. The volume of new manufactured home settlements will start to grow as gathering sales momentum converts into settlements and further projects are launched. This will result in performance building into earnings in the second half of FY15, and into FY16.

At the same time, the Group will continue to regularly assess the performance of its existing assets, continue exploring opportunities for divestment of the Settlers portfolio and recycle capital into other opportunities delivering superior returns.

3. SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS

Changes in the state of affairs during the half year are set out in the various reports in this Interim Financial Report. Refer to note 6 of the accompanying financial statements for discontinued operations and assets held for sale, note 9 for investment properties acquired or disposed of during the period, note 11 for details of Australian debt refinanced and note 13 for issued securities.

4. EVENTS SUBSEQUENT TO REPORTING DATE

• On 27 January 2015, the Group announced it had exchanged conditional contracts for the acquisition of Sydney Hills Holiday Park in Dural, NSW. The acquisition price is approximately $12m (excluding acquisition costs) subject to due diligence and Board approval and will be funded from the proceeds of the capital raising in October 2014.

• On 13 February 2015, the Group completed refinancing its debt and now has a $175m Australian multilateral banking facility in place. The facility, is split between a three year and a five year maturity profile.

• On 18 February 2015, the Group settled Big 4 Bougainvillia Holiday Park, a lifestyle park, located in Tewantin, QLD. The purchase price of $12.5m was funded from the proceeds of capital raising in October 2014.

• On 24 February 2015 the directors resolved to declare an interim distribution of 0.65 cps (2014: 0.5cps) amounting to $5,712,537 to be paid on 18 March 2015. The distributions are 100% tax deferred and the dividend reinvestment plan will apply to the interim distribution.

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Ingenia Communities Holdings Limited Directors’ report Half-year ended 31 December 2014

5. NON-IFRS FINANCIAL INFORMATION

Alternative profit measure (i.e. underlying profit) shown in this report has not been reviewed or audited in accordance with Australian Auditing Standards.

6. 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 11.

7. INDEMNITIES

The Group has purchased various insurance policies to cover a range of risks (subject to specified exclusions) for directors, officers and employees of the Group serving in their respective capacities. Key insurance policies include: directors and officers insurance, professional indemnity insurance and management liability insurance.

To the extent permitted by law, the Company has agreed to indemnify its auditors, Ernst & Young, as part of the terms of its audit engagement agreement against claims by third parties arising from the audit (for an unspecified amount). No payment has been made to indemnify Ernst & Young during or since the financial year.

8. ROUNDING OF AMOUNTS

The Group is an entity of the kind referred to in ASIC Class Order 98/100, and in accordance with that Class Order, amounts in the financial report and directors’ report have been rounded to the nearest thousand dollars, unless otherwise stated.

Signed in accordance with a resolution of the directors.

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Jim Hazel Chairman Sydney 24 February 2015

Ernst & Young 680 George Street Sydney NSW 2000 Australia GPO Box 2646 Sydney NSW 2001

Tel: +61 2 9248 5555 Fax: +61 2 9248 5959 ey.com/au

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Auditor’s Independence Declaration to the Directors of Ingenia Communities Holdings Limited

In relation to our review of the financial report of Ingenia Communities Holdings Limited and its controlled entities for the half-year ended 31 December 2014, to the best of my knowledge and belief, there have been no contraventions of the auditor independence requirements of the Corporations Act 2001 or any applicable code of professional conduct.

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Ernst & Young

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Chris Lawton Partner 24 February 2015

A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

Page 12

Ingenia Communities Holdings Limited Consolidated Statement of Comprehensive Income for the Half-year ended 31 December 2014

Note	2014 $’000 2013 $’000
Continuing operations Revenue Rental income 5 Accrued deferred management fee income Manufactured home sales Catering income Other property income 5 Interest income	20,849 13,390 2,735 2,745 1,930 1,105 1,768 1,562 1,271 320 107 189
Property expenses Employee expenses Administrative expenses Operational, marketing and selling expenses Cost of manufactured homes Finance expenses Net foreign exchange gain/(loss) Net gain/(loss) on disposal of investment properties Net gain/(loss) on change in fair value of: Investment properties Derivatives Retirement village resident loans Depreciation and amortisation expense	28,660 19,311 (8,022) (4,826) (10,054) (6,690) (2,411) (1,846) (1,935) (1,411) (1,102) (632) (2,433) (1,850) 57 348 (323) - (9,309) 1,226 98 (8) (86) 60 (153) (87)
Profit/(loss) from continuing operations before income tax Income tax benefit	(7,013) 3,595 5,926 1,005
Profit/(loss) from continuing operations Profit/(loss) from discontinued operations 6	(1,087) 4,600 100 (294)
Net profit/(loss) for the half-year	(987) 4,306
Other comprehensive income, net of income tax Items that may be reclassified subsequently to profit or loss: Foreign currency translation differences arising during the period Release of foreign currency translation reserve on disposal of foreignoperations	1,339 752 (2,374) -
Total comprehensive income for the half-year, net of income tax	(2,022) 5,058
Profit/(loss) attributable to securityholders of: Ingenia Communities Holdings Limited Ingenia Communities Fund Ingenia Communities Fund Management Trust	160 (1,411) 9,412 6,775 (10,559) (1,058)
	(987) 4,306
Total comprehensive income attributable to securityholders of: Ingenia Communities Holdings Limited Ingenia Communities Fund Ingenia Communities Fund Management Trust	160 (1,411) 5,685 7,495 (7,867) (1,026)
	(2,022) 5,058

Page 13

Ingenia Communities Holdings Limited Consolidated Statement of Comprehensive Income for the Half-year ended 31 December 2014

	2014	2013
	Cents	Cents
Distributions per security(1)	0.65	0.50
Earnings per security:
Basic earnings from continuing operations
Per security	(0.1)	0.7
Per security attributable to parent	0.0	(0.2)
Basic earnings
Per security	(0.1)	0.7
Per security attributable to parent	0.0	(0.2)
Diluted earnings from continuing operations
Per security	(0.1)	0.7
Per security attributable to parent	0.0	(0.2)
Diluted earnings
Per security	(0.1)	0.7
Per security attributable to parent	0.0	(0.2)

(1) Distributions relate to the final distribution paid for the prior reporting period. An interim distribution for the current reporting period was declared for 0.65 cents on 24 February 2015, to be paid to securityholders on 18 March 2015.

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Ingenia Communities Holdings Limited Consolidated Balance Sheet as at 31 December 2014

31 Dec 2014 $’000	30 Jun 2014 $’000
Current assets Cash and cash equivalents 7 24,618 Trade and other receivables 6,064 Inventories 8 6,437 Income tax receivable 241 Assets held for sale - Assets of discontinued operations -	12,894 3,745 2,208 960 5,439 47,657
Total current assets 37,360	72,903
Non-current assets Trade and other receivables 2,481 Investment properties 9 520,184 Plant and equipment 860 Intangible assets 1,483 Deferred tax assets 5,665	2,168 498,863 615 375 -
Total non-current assets 530,673	502,021
Total assets 568,033	574,924
Current liabilities Trade and other payables 10 16,776 Borrowings 11 21,226 Retirement village resident loans 12 193,411 Provisions 835 Derivatives 70 Liabilities of discontinued operations -	10,409 283 190,122 718 84 30,449
Total current liabilities 232,318	232,065
Non-current liabilities Trade and other payables 10 10,500 Borrowings 11 4,331 Provisions 281 Derivatives - Deferred tax liabilities -	4,000 98,073 249 84 276
Total non-current liabilities 15,112	102,682
Total liabilities 247,430	334,747
Net assets 320,603	240,177
Equity Issued securities 13 655,640 Reserves 1,319 Accumulated losses (336,356)	569,116 2,023 (330,962)
Total equity 320,603	240,177
Attributable to securityholders of: Ingenia Communities Holdings Limited Issued securities 8,874 Reserves 1,319 Retained earnings/(Accumulated losses) (2,499)	7,377 988 (2,659)
7,694 Ingenia Communities Fund 295,872 Ingenia Communities Management Trust 17,037	5,706 224,254 10,217
320,603	240,177
Net asset value per security (cents) 36.5	35.5

Page 15

Ingenia Communities Holdings Limited Consolidated Cash Flow Statement for the Half-year ended 31 December 2014

		2014	2013
	Note	$’000	$’000
Cash flows from operating activities
Rental and other property income		29,466	17,929
Property and other expenses		(25,001)	(15,903)
Proceeds from resident loans		10,773	10,607
Repayment of resident loans		(6,221)	(6,717)
Proceeds from sale of manufactured homes		3,486	1,267
Purchase of manufactured homes		(5,678)	(1,180)
Interest received		99	224
Borrowing costs paid		(3,105)	(3,022)
Income tax (paid)/received		790	(135)
		4,609	3,070
Cash flows from investing activities
Purchase and additions of plant and equipment		(280)	(71)
Purchase and additions of intangible assets		(1,049)	-
Payments for investment properties		(15,205)	(61,104)
Additions to investment properties		(6,259)	(12,524)
Proceeds/(costs) from sale of investment properties		49,588	1,256
Proceeds from sale of equity accounted investments		-	5,117
Amounts received from/(advanced to) villages		168	(23)
Payments for lease arrangements		-	(80)
		26,963	(67,429)
Cash flows from financing activities
Proceeds from issue of stapled securities		90,394	61,707
Payments for security issue costs		(3,941)	(2,719)
Finance lease payments		(50)	(42)
Payments for derivatives		(444)	-
Distributions to securityholders		(4,402)	(2,507)
Proceeds from borrowings		22,305	58,970
Repayment of borrowings		(125,197)	(67,500)
Payments for debt issue costs		(337)	(98)
		(21,672)	47,811
Net increase/(decrease) in cash and cash equivalents		9,900	(16,548)
Cash and cash equivalents at the beginning of the year		14,551	37,550
Effects of exchange rate fluctuation on cash held		167	18
Cash and cash equivalents at the end of the half-year	7	24,618	21,020

Page 16

Ingenia Communities Holdings Limited Statement of Changes in Equity for the Half-year ended 31 December 2014

Note	ATTRIBUTABLE TO SECURITYHOLDERS	ATTRIBUTABLE TO SECURITYHOLDERS
	INGENIA COMMUNITIES HOLDINGS LIMITED	ICF & ICMT Total equity $’000 $’000
	Issued capital Reserves Retained earnings Total $’000 $’000 $’000 $’000
Carrying amount at 1 July 2013 Net profit/(loss) for the period Other comprehensive income	6,078 308 77 6,463 - - (1,411) (1,411) - - - -	168,189 174,652 5,717 4,306 752 752
Total Comprehensive income for the period	- - (1,411) (1,411)	6,469 5,058
Transactions with security holders in their capacity as security holders: Issue of securities 13 Share-based payment transactions Distributions paid or payable 17	1,300 - - 1,300 - 350 - 350 - - - -	57,677 58,977 - 350 (2,536) (2,536)
Carrying amount at 31 December 2013	7,378 658 (1,334) 6,702	229,799 236,501
Carrying amount at 1 July 2014 Net profit/(loss) for the period Other comprehensive income	7,377 988 (2,659) 5,706 - - 160 160 - - - -	234,471 240,177 (1,147) (987) (1,035) (1,035)
Total Comprehensive income for the period	- - 160 160	(2,182) (2,022)
Transactions with security holders in their capacity as security holders: Issue of securities 13 Share-based payment transactions Distributions paid or payable 17	1,497 - - 1,497 - 331 - 331 - - - -	85,027 86,524 - 331 (4,407) (4,407)
Carrying amount at 31 December 2014	8,874 1,319 (2,499) 7,694	312,909 320,603

Page 17

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

1. Summary of significant accounting policies

(a) The Group

The financial report of Ingenia Communities Holdings Limited (the “Company”) comprises the consolidated interim financial report of the Company and its controlled entities, including Ingenia Communities Fund (“ICF” or the “Fund”) and Ingenia Communities Management Trust (“ICMT”) (collectively, the “Trusts”). The shares of the Company are “stapled” with the units of the Trusts and trade on the Australian Securities Exchange (“ASX”) effectively as one security. Ingenia Communities RE Limited (“ICRE”), a wholly owned subsidiary of the Company is the Responsible Entity of the Trusts. In this report, the Company and the Trusts are referred to collectively as the Group.

The constitutions of the Company and the Trusts require that, for as long as they remain jointly quoted on the ASX, the number of shares in the Company and units in each trust shall remain equal and those shareholders in the Company and unitholders in each trust shall be identical.

The stapling structure will cease to operate on the first to occur of:

• the Company or either of the Trusts resolving by special resolution in accordance with its constitution to terminate the stapling provisions; or

• the commencement of the winding up of the Company or either of the Trusts.

(b) Basis of preparation

The interim financial report is a general purpose financial report which has been prepared in accordance with AASB 134 ‘Interim financial reporting’ and the Corporations Act 2001 .

The interim financial report does not include all of the information required for a full annual financial report, and should be read in conjunction with the Group’s annual financial report for the year ended 30 June 2014.

The financial report is presented in Australian dollars and all values are rounded to the nearest thousand dollars ($’000) unless otherwise stated.

The accounting policies and methods of computation adopted in the preparation of the half-year financial report are consistent with those adopted and disclosed in the Group’s 2014 annual report with the exception of new amended standards and interpretations which have been applied as required. Where necessary comparative figures have been adjusted to conform with changes in presentation in the current period.

As at 31 December 2014, the Group recorded a net current asset deficiency of $194,958,000. This deficiency includes retirement village resident loans of $193,411,000. Resident loan obligations of the Group are classified as current liabilities due to the demand feature of these obligations despite the unlikely possibility that the majority of the loans will be settled within the next 12 months. Furthermore, if required, the proceeds from new resident loans could be used by the Group to settle existing loan obligations should those incumbent residents vacate their units. On 13 February 2015, the Group completed refinancing its debt and now has a $175m Australian Multilateral banking facility in place. The facility, is split between a three year and a five year maturity profile. Had the debt facility been renegotiated prior to 31 December 2014 the Group would have the debt facility of $21 million classified as non-current and shown a net current asset position of $19,453,000 (excluding the retirement village resident loans).

Accordingly, there are reasonable grounds to believe that the Group will be able to pay its debts as and when they become due and payable; and the financial report of the Group has been prepared on a going concern basis.

Page 18

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

1. Summary of significant accounting policies (continued)

(c) New or revised Accounting Standards and Interpretations that are first effective in the current reporting period

The Group has adopted all of the new and revised standards and interpretations issued by the Australian Accounting Standards Board (AASB) that are relevant to its operations and effective for the current period. The following standards were most relevant to the Group:

• AASB 132 ‘ Financial Instruments: Presentation ’ and AASB 2012-3 ‘Amendments to

• Australian Accounting Standards – Offsetting Financial Assets and Financial Liabilities’ ;

• AASB 136 ‘ Impairment of Assets ’ and AASB 2013-3 ‘Amendments to AASB 136 –

• Recoverable Amount Disclosures for Non-Financial Assets’ ;

• AASB 2 ‘ Share Based Payments’ , AASB 3 ‘ Business Combinations’ , AASB 8

• ‘ Segment Reporting’ and AASB 2014-1 Part A – Annual Improvements 2010-2012 Cycle

The impact of application of each Standard is as follows:

Accounting
Standard	Impact on the Group
AASB 132 and	AASB 2012-3_Amendments to Australian Accounting Standards – Offsetting Financial_
AASB 2012-3	Assets and Financial Liabilities_makes amendments to AASB 132_Financial
	_Instruments: Presentation_as a result of issuance of International Financial Reporting
	Standard_Offsetting Financial Assets and Financial Liabilities_and provides application
	guidance to certain criteria mentioned in AASB 132.
	The application of the standard does not have any impact on the results of the Group
	as retirement village resident loans are already offset as there is a current legally
	enforceable right and there is an intention to settle on a net basis.
AASB 136 and	AASB 2013-3 amends the disclosure requirements of AASB 136_Impairment of_
AASB 2013-3	_Assets_to require disclosure of additional information about the fair value
	measurement when the recoverable amount of impaired assets is based on fair value
	less costs of disposal.
	The application of the standard did not have any impact on the results of the Group.

Page 19

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

1. Summary of significant accounting policies (continued)

Accounting Standard Impact on the Group

AASB 2, AASB 2014-1 Amendments to Australian Accounting Standards makes amendments AASB 3, to the following AASB’s as part of the Annual Improvement Cycle AASB 8, and AASB 2014-1 - AASB 2: This statement clarifies the Definition of ‘vesting conditions’ and separately defines ‘performance condition’ and ‘service condition’. The amendment applies to any share based payment transactions for which the grant date is on or after 1 July 2014. Application of this amendment did not have any impact on the results of the Group.

• AASB 3: The standard clarifies that judgement is needed to determine whether an acquisition of investment property is solely the acquisition of an investment property or whether it is an acquisition of a group of assets or a business combination within the scope of AASB 3 Business Combinations that includes an investment property. The Group makes an assessment about this classification for each investment property acquired. Therefore no impact except for additional disclosures regarding judgements and estimates.

• AASB 8: The standard amends disclosure of the judgements made by management in aggregating operating segments. This includes a description of the segments which have been aggregated and the economic indicators which have been assessed in determining that the aggregated segments share similar economic characteristics. The standard requires a reconciliation of segment assets to the entity’s assets when segment assets are reported. Application of this amendment did not have any impact on the results of the Group.

Page 20

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

1. Summary of significant accounting policies (continued)

(d) Pending accounting standards

Certain new accounting standards and interpretations have been published that are not mandatory for the current reporting period. The Group’s assessment of the impact of these new standards and interpretations is set out below.

Accounting
Standard	Impact on the Group
AASB 9	AASB 9_Financial Instruments_is applicable to reporting periods beginning on or after 1 January 2018. The Group has not early adopted this standard. This
	standard provides requirements for the classification and measurement of
	financial assets and accounting for financial liabilities. These requirements seek
	to improve and simplify the requirements listed in AASB 139_Financial_
	Instruments: Recognition and Measurement.
	The Group is continuing to evaluate the impact of this standard, however no
	material impactis expected.
AASB 15	AASB 15_Revenue from Contracts with Customers_is applicable to reporting periods beginning on or after 1 January 2017. This will replace IAS 18, which
	covers contracts for goods and services and IAS 11, which covers construction
	contracts. The Group has not early adopted the standard. The new standard
	provides that an entity recognizes revenue in line with contractual performance
	obligations, where the determined contract price which is allocated against those
	performance obligations. The new standard is based on the principal that revenue
	is recognised when control of the good or service transfers to the customer, so
	the notion of control replaces the existing notion of risks and rewards.
	The Group is continuing to evaluate the impact of this standard, however no
	material impactis expected.

Other new accounting standards, amendments to accounting standards and interpretations have been published that are not mandatory for the current reporting period. These are not expected to have any material impact on the Group’s financial reporting in future reporting periods.

(e) Accounting policies applied for the first time in the current period

(i) Intangible Assets

An intangible asset arising from development expenditure related to software is recognised only when the Group can demonstrate the technical feasibility of completing the intangible asset so that it will be available for use, how the asset will generate future economic benefits, the availability of resources to complete the asset and the ability to measure reliably the expenditure during its development. Costs capitalised include external direct costs of materials and service, and direct payroll and payroll related costs of employees’ time spent on the project.

Following the initial recognition of the expenditure, the asset is carried at cost less any accumulated amortisation and accumulated impairment losses. Amortisation of the asset begins when the development is complete and the asset is available for use. Amortisation is over the period of expected future benefit.

Page 21

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

1. Summary of significant accounting policies (continued)

(e) Accounting policies applied for the first time in the current period (continued)

A summary of the policy applied to capitalised development costs is as follows:

Software and associated development costs (assets in use)

• Useful life: Finite Amortisation method using 7 years on a straight-line basis.

• Impairment test: Amortisation method reviewed at each financial year end; closing carrying value reviewed annually for indicators of impairment.

Subsequent expenditure on capitalised intangible assets is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure is expensed as incurred. Gains or losses arising from de-recognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in profit or loss when the asset is de-recognised.

2. Accounting estimates and judgements

The preparation of financial statements requires the use of certain critical accounting estimates. It also requires the Group to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed below.

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

(a) Critical accounting estimates and assumptions

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates, by definition, will seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

(i) Valuation of investment property

The Group has investment properties with a carrying amount of $520,184,000 (June 2014:$498,863,000) (refer note 9), and retirement village residents’ loans with a carrying amount of $193,411,000 (June 2014: $190,122,000) (refer note 12), which together represent the estimated fair value of the Group’s continuing interest in retirement villages.

These carrying amounts reflect certain assumptions about expected future rentals, rent-free periods, operating costs and appropriate discount and capitalisation rates. The valuation assumptions for deferred management fee villages reflect assumptions relating to average length of stay, unit market values, estimates of capital expenditure, contract terms with residents, discount rates and projected property growth rates.

In forming these assumptions, the Responsible Entity considered information about current and recent sales activity, current market rents, and discount and capitalisation rates, for properties similar to those owned by the Group, as well as independent valuations of the Group’s property.

Page 22

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

2. Accounting estimates and judgements (continued)

(ii) Valuation of Inventories

The Group has inventory in the form of manufactured homes, which it carries at the lower of cost or net realisable value. Estimates of net realisable value are based on the most reliable evidence available at the time the estimates are made, of the amount the inventories are expected to realise and the estimate of costs to complete. Key assumptions require the use of management judgement, which are continually reviewed.

(iii) Fair value of derivatives

The fair value of derivative assets and liabilities is based on assumptions of future events and involves significant estimates. Given the complex nature of these instruments and various assumptions that are used in calculating mark-to-market values, the Group relies on counterparty valuations for derivative values. The counterparty valuations are usually based on mid-market rates and calculated using the main variables including the forward market curve, time and volatility.

(iv) Valuation of share-based payments

Valuation of share-based payment transactions is performed using judgements around the fair value of equity instruments on the date at which they are granted. The fair value is determined using a Monte Carlo based simulation method for long term incentive performance rights and the security price at grant date of short term incentive performance rights. Refer note 14 for assumptions used in determining the fair value.

(v) Valuation of assets acquired in business combinations

Upon recognising an acquisition, management uses estimations and assumptions of the fair value of assets and liabilities assumed at the date of acquisition, including judgements related to valuation of investment property as discussed above.

(vi) Valuation of retirement village resident loans

The fair value of the retirement village resident loans is calculated by reference to the initial loan amount and the resident’s share of any capital gains in accordance with their contracts less any deferred management fee income earned to date by the Group as operator. The key assumptions for calculating the capital gain and deferred management fee income components is the value of the dwelling being occupied by the resident. This value is determined by reference to the valuation of investment property as referred to above.

(b) Critical judgements in applying the entity’s accounting policies

There were no judgements, apart from those involving estimations, that management has made in the process of applying the entity’s accounting policies that had a significant effect on the amounts recognised in the financial report.

Page 23

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

3. Segment information

(a) Description of segments

The Group invests in seniors living properties located in Australia with three reportable segments:

• Garden Villages – rental villages;

• Settlers Lifestyle – deferred management fee villages; and

• Active Lifestyle Estates – comprising permanent and short stay rentals within lifestyle parks and the sale of manufactured homes.

The Group has identified its operating segments based on the internal reports that are reviewed and used by the chief operating decision maker in assessing performance and in determining the allocation of resources. Other parts of the Group are neither an operating segment nor part of an operating segment. Assets that do not belong to an operating segment are described below as “unallocated”.

(b) 31 December 2014

(b) 31 December 2014
	Active	Settlers	Garden	Corporate/	Total
	Lifestyle		Villages	Unallocated
	Estates
	$’000	$’000	$’000	$’000	$’000
(i) Segment revenue
External segment revenue	10,915	4,661	13,962	159	29,697
Interest income	-	-	-	107	107
Reclassification of gain on revaluation of newly	-	(1,144)	-	-	(1,144)
constructedvillages
Total revenue	10,915	3,517	13,962	266	28,660
(ii) Segment underlying profit
External segment revenue	10,915	4,661	13,962	159	29,697
Interest income	-	-	-	107	107
Property expenses	(2,961)	(680)	(4,174)	(207)	(8,022)
Employee expenses	(3,656)	(887)	(3,725)	(1,786)	(10,054)
Administration expenses	(532)	(155)	(300)	(1,424)	(2,411)
Operational, marketing and selling expenses	(705)	(224)	(373)	(633)	(1,935)
Manufactured home cost of sales	(1,102)	-	-	-	(1,102)
Depreciation and amortisation expense	(6)	-	(32)	(115)	(153)
Finance expense	-	-	-	(2,433)	(2,433)
Income tax benefit	-	-	-	2,323	2,323
Underlying profit/(loss) – continuing operations	1,953	2,715	5,358	(4,009)	6,017
Reconciliation of underlying profit to profit from	continuing	operations:
Net foreign exchange gain	-	-	-	57	57
Net loss on disposal of investment property	-	(316)	-	(7)	(323)
Net gain/(loss) on change in fair value of:
Investment properties	(8,670)	(2,401)	1,762	-	(9,309)
Derivatives	-	-	-	98	98
Retirement village resident loans	-	(86)	-	-	(86)
Gain on revaluation of newly constructed
villages	-	(1,144)	-	-	(1,144)
Income tax benefit associated with reconciliation
items	-	-	-	3,603	3,603
Profit/(loss) from continuing operations per
the Consolidated Statement of	(6,717)	(1,232)	7,120	(258)	(1,087)
Comprehensive Income
(iii) Segment assets
Segment assets	153,715	217,312	161,466	35,540	568,033
Discontinued operations					-
Total assets					568,033

Page 24

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

3. Segment information (continued)

(c) 31 December 2013
	Active	Settlers	Garden	Corporate/	Total
	Lifestyle		Villages	Unallocated
	Estates
	$’000	$’000	$’000	$’000	$’000
(i) Segment revenue
External segment revenue	4,192	4,651	11,550	-	20,393
Interest income	-	-	-	189	189
Reclassification of gain on revaluation of newly
constructed villages	-	(1,271)	-	-	(1,271)
Total revenue	4,192	3,380	11,550	189	19,311
(ii) Segment underlying profit
External segment revenue	4,192	4,651	11,550	-	20,393
Interest income	-	-	-	189	189
Property expenses	(775)	(897)	(3,001)	(153)	(4,826)
Employee expenses	(1,290)	(1,167)	(2,804)	(1,429)	(6,690)
Administration expenses	(142)	(155)	(425)	(1,124)	(1,846)
Operational, marketing and selling expenses	(68)	(720)	(431)	(192)	(1,411)
Manufactured home cost of sales	(632)	-	-	-	(632)
Depreciation and amortisation expense	-	-	-	(87)	(87)
Finance expense	-	-	-	(1,850)	(1,850)
Income tax benefit	-	-	-	778	778
Underlying profit/(loss) – continuing
operations	1,285	1,712	4,889	(3,868)	4,018
Reconciliation of underlying profit to profit from	continuing	operations:
Net foreign exchange gain	-	-	-	348	348
Net gain/(loss) on change in fair value of:
Investment properties	(493)	383	1,336	-	1,226
Derivatives	-	-	-	(8)	(8)
Retirement village resident loans	-	60	-	-	60
Gain on revaluation of newly constructed
villages	-	(1,271)	-	-	(1,271)
Income tax benefit associated with reconciliation
items	-	-	-	227	227
Profit from continuing operations per the
Consolidated Statement of Comprehensive
Income	792	884	6,225	(3,301)	4,600
(iii) Segment assets
Segment assets	80,035	259,164	103,267	25,243	467,709
Discontinued operations					46,630
Total assets					514,339

(d) Impact of seasonality on segment results

The results of the Group are affected by the seasonal impact of Active Lifestyle Estate investments. Occupancy rates of short term cabins are higher in the period December through to March each year due to their geographic location and summer holiday months increasing demand for holiday bookings.

Page 25

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

4. Earnings per security

4. Earnings per security
	2014	2013
(a) Per security
Profit/(loss) attributable to securityholders ($’000)	(987)	4,306
Profit/(loss) from continuing operations ($’000)	(1,087)	4,600
Profit/(loss) from discontinued operations ($000)	100	(294)
Weighted average number of securities outstanding (thousands)
Issued securities	763,190	617,384
Dilutive securities
Performance quantum rights	7,558	4,710
Retention quantum rights	-	1,818
Weighted average number of issued and dilutive potential securities
outstanding (thousands)	770,748	623,912
Basic earnings per security from continuing operations (cents)	(0.1)	0.7
Basic earnings per security from discontinued operations (cents)	0.0	0.7
Basic earnings per security (cents)	(0.1)	(0.0)
Dilutive earnings per security from continuing operations (cents)	(0.1)	0.7
Dilutive earnings per security from discontinued operations (cents)	0.0	0.7
Dilutive earnings per security (cents)	(0.1)	(0.0)
(b) Per security attributable to parent
Profit/(loss) attributable to securityholders ($’000)	160	(1,411)
Weighted average number of securities outstanding (thousands)
Issued securities	763,190	617,384
Dilutive securities
Performance quantum rights	7,558	4,710
Retention quantum rights	-	1,818
Weighted average number of issued and dilutive potential securities
outstanding (thousands)	770,748	623,912
Basic earnings per security (cents)	0.0	(0.2)
Dilutive earnings per security (cents)	0.0	(0.2)

5. Revenue

5. Revenue
	2014	2013
	$’000	$’000
Residential rental income – Garden Villages	12,088	9,988
Residential rental income – Settlers Lifestyle	384	543
Residential rental income – Active Lifestyle Estates	3,762	1,306
Short-term rental income – Active Lifestyle Estates	4,615	1,553
Total rental income	20,849	13,390
Government incentives	70	50
Commissions and administrative fees	375	72
Linen fees	79	-
Sundry income	398	121
Utility recoveries	349	77
Total other property income	1,271	320

Sundry Income includes ancillary service, laundry and other property income amounts.

Page 26

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

6. Discontinued operations

(a) Assets Held for Sale

Noyea Riverside Village (‘Noyea’) was classified as an asset held for sale at 30 June 2014. Noyea was included within the Settlers Lifestyle segment. On 31 July 2014 settlement of this asset occurred for an adjusted sales price of $5.4 million resulting in $nil gain or loss recognised upon completion.

(b) Discontinued operations

(i) Details of discontinued operations

The Group’s investment in its New Zealand Students business was classified as a discontinued operation since 30 June 2011, consistent with the previously announced strategy to focus on transitioning to an actively managed Australian seniors living business. The Group held a 100% interest in three facilities in Wellington, New Zealand that were primarily leased for 15 years to Victoria University of Wellington and Wellington Institute of Technology. The Group completed the sale of these assets in December 2014. Funds still remain in New Zealand to facilitate the final stages of exit.

(ii) Financial performance

The financial performance of components of the Group disposed of or classified as discontinued operations at 31 December 2014 was:

	2014	2013
	$’000	$’000
Revenue	2,182	1,041
Net gain/(loss) on change in fair value of investment properties	-	(335)
Unrealised net foreign exchange gain/(loss)	(997)	630
Interest income	2	41
Expenses	(715)	(784)
Interest expense	(799)	(702)
Disposal costs associated with overseas investments	-	(143)
Profit/(loss) from operating activities before income tax	(327)	(252)
Income tax expenses	(10)	(10)
Profit/(loss) from operating activities	(337)	(262)
Gain/(loss) on sale of discontinued operations (net of tax)	(1,937)	(32)
Release of foreign currency translation reserve on disposal of foreign operations	2,374	-
Profit/(loss) from discontinued operations for the half-year	100	(294)

Profit/(loss) from discontinued operations attributable to the Company for periods ending 31 December 2014 and 31 December 2013 is $nil.

Page 27

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

6. Discontinued operations (continued)

(iii) Cash Flows

The cash flows of components of the Group disposed of or classified as discontinued operations were:

	2014	2013
	$’000	$’000
Net cash flow from operating activities	179	(371)
Net cash flow from investing activities:
(Payments)/proceeds on sale of discontinued operations	44,247	(65)
Additions to investment properties	-	(7,738)
Payments for lease arrangements	(4)	(80)
Other	-	308
Net cash flow from financing activities	(30,345)	10,161
Transfer to continuing operations	(15,738)	-
Net cash flows from discontinued operations	(1,661)	2,215

(iv) Assets and liabilities

The assets and liabilities of components of the Group classified as disposal groups at each reporting date were:

	31 Dec 2014	30 Jun 2014
	$’000	$’000
Assets
Cash and cash equivalents	-	1,657
Trade and other receivables	-	98
Investment properties	-	45,902
Total assets	-	47,657
Liabilities
Bank overdraft	-	-
Payables	-	368
Borrowings	-	30,081
Total liabilities	-	30,449
Net assets of disposal groups	-	17,208

(v) Capitalisation rate

The weighted average capitalisation rate of the New Zealand Students internal valuation within discontinued operations at 30 June 2014 was 8.6%.

Page 28

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

7. Cash and cash equivalents

	31 Dec 2014	30 Jun 2014
	$’000	$’000
Cash at bank and in hand	24,618	12,894
	31 Dec 2014	31 Dec 2013
Reconciliation to statements of cash flows	$’000	$’000
Cash and cash equivalents attributable to:
Continuing operations - cash at bank	24,618	19,784
Discontinued operations - cash at bank	-	1,236
Cash at the end of half-year as per cash flow statement	24,618	21,020

8. Inventories

Inventories
	31 Dec 2014	30 Jun 2014
	$’000	$’000
Current assets
Manufactured homes	6,437	2,208

9. Investment properties

(a) Summary of carrying amounts

(a) Summary of carrying amounts
	31 Dec 2014	30 Jun 2014
	$’000	$’000
Completed properties	504,478	482,618
Properties to be developed	15,706	16,245
	520,184	498,863

Page 29

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

9. Investment properties (continued)

(b) Individual valuations and carrying amounts

Property	Location	Date of	Cost to	Latest external	Valuation	Carrying	amount	Capitalisation	rate
		purchase	date	valuation date
						31 Dec	30 Jun	31 Dec	30 Jun
						2014	2014	2014	2013
			$’000		$’000	$’000	$’000	%	%
Completed properties
Garden Villages
Yakamia Gardens	Yakamia, WA	Jun 04	5,474	Dec 14	3,200	3,200	2,730	12.3%	10.0%
Mardross Gardens	Albury, NSW	Jun 04	5,659	Jun 14	2,400	2,350	2,400	10.0%	10.0%
Seville Grove Gardens	Seville Grove, WA	Jun 04	4,575	Dec 14	3,200	3,200	3,390	12.0%	10.5%
Hertford Gardens	Sebastopol, VIC	Jun 04	4,145	Jun 14	3,770	3,850	3,770	10.8%	10.8%
Carey Park Gardens	Bunbury, WA	Jun 04	4,959	Dec 14	3,300	3,300	3,520	12.1%	11.0%
Jefferis Gardens	Bundaberg North, QLD	Jun 04	5,003	Dec 13	2,600	3,920	3,480	12.5%	11.0%
Claremont Gardens	Claremont, TAS	Jun 04	4,306	Dec 13	3,320	3,510	3,230	11.8%	10.5%
Taloumbi Gardens	Coffs Harbour, NSW	Jun 04	5,093	Dec 14	4,300	4,300	4,170	11.8%	10.5%
Devonport Gardens	Devonport, TAS	Jun 04	4,033	Dec 14	1,700	1,700	2,100	11.1%	9.0%
Wheelers Gardens	Dubbo, NSW	Jun 04	4,375	Dec 13	3,800	4,580	4,300	11.3%	10.0%
Elphinwood Gardens	Launceston, TAS	Jun 04	4,505	Dec 14	3,200	3,200	2,910	12.1%	10.5%
Glenorchy Gardens	Glenorchy, TAS	Jun 05	4,179	Dec 13	3,250	3,630	3,370	11.5%	10.5%
Chatsbury Gardens	Goulburn, NSW	Jun 04	4,836	Dec 13	2,940	3,710	3,430	11.8%	10.5%
Grovedale Gardens	Grovedale, VIC	Jun 05	4,986	Dec 14	4,100	4,100	4,010	12.6%	10.5%
Horsham Gardens	Horsham, VIC	Jun 04	4,479	Jun 14	3,300	3,290	3,300	11.8%	10.8%
Sea Scape Gardens	Erskine, WA	Jun 04	4,590	Dec 14	4,000	4,000	4,170	11.6%	11.0%
Marsden Gardens	Marsden, QLD	Jun 05	10,389	Dec 14	8,500	8,500	8,380	11.7%	12.5%
Coburns Gardens	Brookfield, VIC	Jun 04	4,368	Dec 14	3,300	3,300	3,290	11.7%	10.5%
Brooklyn Gardens	Brookfield, VIC	Jun 04	4,205	Dec 14	3,200	3,200	3,270	11.8%	10.5%
Oxley Gardens	Port Macquarie, NSW	Jun 04	4,438	Dec 14	3,000	3,000	3,120	13.0%	10.5%
Townsend Gardens	St Albans Park, VIC	Jun 04	4,826	Jun 14	3,800	3,780	3,800	11.5%	11.0%
St Albans Park Gardens	St Albans Park, VIC	Jun 04	5,122	Jun 14	4,140	4,300	4,140	11.5%	11.0%
Swan View Gardens	Swan View, WA	Jan 06	7,921	Dec 14	6,000	6,000	5,990	11.5%	11.5%

Page 30

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

9. Investment properties (continued)

(b) Individual valuations and carrying amounts (continued)

Property Location Date of purchase Cost to date Latest external valuation date Valuation Carrying amount	Capitalisation rate
31 Dec 2014 30 Jun 2014 $’000 $’000 $’000 $’000	31 Dec 2014 30 Jun 2014 % %
Completed properties (continued) Garden Villages (continued) Taree Gardens Taree, NSW Dec 04 4,651 Dec 14 2,300 2,300 2,320 Dubbo Gardens Dubbo, NSW Dec 12 2,711 Dec 13 3,290 3,010 2,670 Ocean Grove Gardens Mandurah, WA Feb 13 3,159 Dec 13 3,280 3,380 3,100 Peel River Gardens Tamworth, NSW Mar 13 3,626 Dec 13 2,970 2,440 2,040 Sovereign Gardens Ballarat, VIC Jun 13 3,390 Jun 14 3,100 3,140 3,100 Wagga Gardens Wagga Wagga, NSW Jun 13 4,075 Jun 14 3,930 4,040 3,930 Bathurst Gardens Bathurst, NSW Jan 14 2,428 Jun 14 2,580 2,520 2,580 Launceston Gardens Launceston, TAS Jan 14 2,458 Jun 14 2,510 2,450 2,510 Shepparton Gardens Shepparton, VIC Jan 14 1,735 Jun 14 1,780 1,720 1,780 Murray River Gardens Mildura, VIC Jan 14 2,326 Jun 14 2,170 2,110 2,170 Warrnambool Gardens Warrnambool, VIC Jan 14 1,974 Jun 14 1,800 1,740 1,800	13.8% 9.0% 11.0% 10.3% 11.3% 10.8% 12.0% 9.0% 10.5% 10.5% 12.0% 12.0% 9.0% 9.0% 9.0% 9.0% 8.0% 8.0% 7.5% 7.5% 8.0% 8.0%
148,999 114,030 116,770 114,270
Settlers Lifestyle Forest Lake Forest Lake, QLD Nov 05 14,435 Jun 13 12,662 15,250 14,194 South Gladstone South Gladstone, QLD Nov 05 8,223 Jun 13 12,093 11,802 12,534 South Gladstone - Land South Gladstone, QLD Nov 05 199 Jun 13 750 750 750 Rockhampton Rockhampton, QLD Nov 05 10,798 Dec 13 13,900 14,680 14,314 Cessnock Cessnock, NSW Jun 04 7,495 Dec 14 5,631 5,631 6,009 Lakeside Ravenswood, WA Apr 07 71,326 Dec 14 75,672 75,672 77,242 Meadow Springs Mandurah, WA Apr 07 18,423 Jun 13 17,066 16,476 16,510 Meadow Springs - Land Mandurah, WA Apr 07 2,470 Jun 13 2,455 2,455 2,455 Ridgewood Rise Ridgewood, WA Apr 07 85,383 Jun 13 105,104 102,928 103,552 Ridge Estate Gillieston Heights, NSW Jul 12 11,910 Dec14 13,349 13,349 11,765	Discount rate
	16.0% 16.7% 15.5% 15.0% - - 15.5% 17.9% 20.0% 19.0% 15.0% 14.2% 15.0% 14.0% - - 14.3% 14.3% 16.5% 20.0%
230,662 258,682 258,993 259,325

Page 31

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

9. Investment properties (continued)

(b) Individual valuations and carrying amounts (continued)

Property	Location	Date of	Cost to	Latest external	Valuation	Carrying	amount	Capitalisation rate	Capitalisation rate
		purchase	date	valuation date
						31 Dec	30 Jun	31 Dec	30 Jun
						2014	2014	2014	2014
			$’000		$’000	$’000	$’000	$’000	$’000
Completed properties (continued)
Active Lifestyle Estates
The Grange Village	Morisset, NSW	Mar 13	12,024	Dec 13	9,400	10,763	10,761	9.1%	9.1%
Ettalong Beach Village1	Ettalong Beach, NSW	Apr 13	6,369	Dec 13	2,200	4,146	5,811	16.0%	21.0%
Albury Citygate Holiday Park	Albury, NSW	Aug 13	2,460	Jun 14	1,725	1,725	1,510	12.1%	10.5%
Nepean River Holiday Village	Penrith, NSW	Aug 13	10,967	Jun 14	11,000	11,040	11,000	10.5%	10.4%
Mudgee Valley Tourist Park	Mudgee, NSW	Sep 13	4,132	Jun 14	4,250	4,250	3,710	10.5%	10.5%
Mudgee Tourist and Van Resort	Mudgee, NSW	Oct 13	7,190	Jun 14	6,393	6,393	6,403	10.5%	8.8%
Drifters Holiday Village	Kingscliff, NSW	Nov 13	11,069	Dec 14	10,500	10,500	10,991	9.7%	-4
Lake Macquarie Village	Morisset, NSW	Nov 13	6,278	Dec 14	5,010	5,010	5,693	8.8%	-4
One Mile Beach Holiday Park2	Anna Bay, NSW	Dec 13	12,093	Dec 14	10,500	11,872	13,349	13.0%	-4
Big4 Valley Vineyard Tourist Park	Cessnock, NSW	Feb 14	8,494	Dec 14	7,500	7,500	8,282	8.8%	-4
Cessnock Wine Country Caravan	Cessnock, NSW	Feb 14	1,122	Dec 14	1,000	1,000	1,109	10.3%	-4
Park
Sun Country Holiday Village	Mulwala, NSW	Apr 14	7,036	Dec 14	6,610	6,610	6,858	10.7%	-4
Stoney Creek Estate (formerly Town	Marsden Park, NSW	May 14	16,148	Dec 14	14,740	14,740	16,184	9.0%	-4
and Country Estate)
Rouse Hill Lifestyle Park	Rouse Hill, NSW	Jun 14	7,442	Dec 14	8,400	8,400	7,362	9.2%	-4
White Albatross Holiday Park3	Nambucca Heads, NSW	Dec 14	24,766	-	-	24,766	-	-	-
			137,590		99,228	128,715	109,023
Total completed properties			517,251		471,940	504,478	482,618

Page 32

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

9. Investment properties (continued)

(b) Individual valuations and carrying amounts (continued)

Property		Date of	Cost to	Latest external	Valuation	Carrying amount	Carrying amount
		purchase	date	valuation date
						31 Dec 2014	30 Jun 2014
			$’000		$’000	$’000	$’000
Properties to be developed
Active Lifestyle Estates
The Grange Village	Morisset, NSW	Mar 13	1,387	-	-	1,387	1,387
Ettalong Beach Village1	Ettalong Beach, NSW	Apr 13	310	-	-	116	310
Albury Citygate Holiday Park	Albury, NSW	Aug 13	490	-	-	490	490
Nepean River Holiday Village	Penrith, NSW	Aug 13	-	-	-	-	-
Mudgee Valley Tourist Park	Mudgee, NSW	Sep 13	540	-	-	540	540
Mudgee Tourist and Van Resort	Mudgee, NSW	Oct 13	794	-	-	797	797
Drifters Holiday Village	Kingscliff, NSW	Nov 13	517	-	-	520	520
Lake Macquarie Village	Morisset, NSW	Nov 13	1,990	-	-	1,990	1,990
Macquarie Lakeside Village	Chain Valley Bay, NSW	Dec 13	4,262	-	-	3,700	4,045
One Mile Beach Holiday Park2	Anna Bay, NSW	Dec 13	-	-	-	-	-
Big4 Valley Vineyard Tourist Park	Cessnock, NSW	Feb 14	1,500	-	-	1,500	1,500
Cessnock Wine Country Caravan	Cessnock, NSW
Park		Feb 14	556	-	-	556	556
Sun Country Holiday Village	Mulwala, NSW	Apr 14	850	-	-	850	850
Stoney Creek Estate (formerly	Marsden Park, NSW
Town and Country Estate)		May 14	3,260	-	-	3,260	3,260
Rouse Hill Lifestyle Park	Rouse Hill, NSW	Jun 14	-	-	-	-	-
White Albatross Holiday Park3	Nambucca Heads, NSW	Dec14	-	-	-	-	-
Properties to be developed			16,456		-	15,706	16,245
Total Investment Properties			533,707		471,940	520,184	498,863

(1) Ettalong Beach Holiday Village land component is leased from the Gosford City Council and is recognised as investment property with an associated finance lease.

(2) One Mile Beach land component is leased from the Crown under 40 year and perpetual leases and is recognised as investment property with an associated finance lease. (3) Acquired during the period ended 31 December 2014 and carried at cost at balance date. Cost to date is deemed to represent fair value at the end of the period. (4) Acquired during the period ended 30 June 2014 and carried at cost at balance date. Cost to date is deemed to represent fair value at the end of the period.

Page 33

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

9. Investment properties (continued)

Investment property that has not been valued by external valuers at reporting date is carried at the Responsible Entity’s estimate of fair value in accordance with the accounting policy. Properties acquired during the half year are held at cost, which is reflective of the estimate of fair value.

Valuations of retirement villages are provided net of residents’ loans (after deducting any accrued deferred management fees). For presentation in this note, the external valuations shown are stated before deducting this liability to reflect its separate balance sheet presentation. The carrying amounts include the fair value of units completed since the date of the external valuation.

Select Settlers Lifestyle villages continue to be in the process of converting from a rental to a deferred management fee model. The discount rate reflects a combination of development risk on vacant units and DMF from both occupied and vacant units. Over time, these properties’ discount rates will likely revert downwards as project risk diminishes.

(c) Movements in Carrying amounts

31 Dec 2014 $’000	30 Jun 2014 $’000
Carrying amount at beginning of period 498,863 Acquisitions 24,749 Expenditure capitalised 5,881 Sale of unit – Strata title - Transferred from plant and equipment - Transferred to inventory - Net gain/(loss) on change in fair value (9,309)	370,931 118,303 10,336 (492) 320 (194) (341)
Carrying amount at the end of the period 520,184	498,863

The net change in fair value are recognised in profit or loss as net gain/(loss) on change in fair value of investment properties.

Fair value hierarchy disclosures for investment properties have been provided in note 15.

(d) Reconciliation of fair value

(d) Reconciliation of fair value
Garden Villages Settlers Lifestyle $’000 $’000	Active Lifestyle Estates Total $’000 $’000
Carrying amount at 1 July 2014 114,270 259,325 Acquisitions - - Expenditure capitalised 738 2,069 Netgain/(loss)on change in fair value 1,762 (2,401)	125,268 498,863 24,749 24,749 3,074 5,881 (8,670) (9,309)
Carrying amount at 31 December 2014 116,770 258,993	144,421 520,184

Page 34

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

10. Trade and other payables

0. Trade and other payables
	31 Dec 2014	30 Jun 2014
	$’000	$’000
Current liabilities
Trade and other payables	9,854	8,814
Deposits and other unearned income	3,422	1,595
Deferred landpayment	3,500	-
Total current liabilities	16,776	10,409
Non-current liabilities
Deferred land payment	10,500	4,000

11. Borrowings

11. Borrowings
		31 Dec	30 Jun
		2014	2014
	Note	$’000	$’000
Current liabilities
Bank debt	(a)	21,000	-
Prepaid borrowing costs		(60)	-
Finance leases		286	283
		21,226	283
Non-current liabilities
Bank debt	(a)	-	94,000
Prepaid borrowing costs		-	(312)
Finance leases		4,331	4,385
**Total non-current borrowings **		4,331	98,073

(a) Bank debt

(i) Current debt facility

This facility expires on 30 September 2015 and has the following principal financial covenants:

• Loan to value ratio (“LVR”) is less than or equal to 50%;

• Total leverage ratio does not exceed 50%; and

• Interest cover ratio (as defined) of at least 1.50x in financial year ending 2014 increasing to at least 1.75x in FY2015.

As at 31 December 2014, the facility has been drawn to $21,000,000 (30 June 2014: $94,000,000). The carrying value of investment property net of resident liabilities at reporting date for the Group’s Australian properties pledged as security is $314,181,000 (30 June 2014: $290,375,000).

(ii) Australian multilateral debt facility

On 13 February 2015, the Group completed refinancing its debt and now has a $175 m Australian Multilateral banking facility in place. The facility, is split between a three year and a five year maturity profile.

Page 35

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

11. Borrowings (continued)

(b) Bank guarantees

The Group has the ability to utilise a portion of this $129.5 million bank facility to provide bank guarantees. Bank guarantees at 31 December 2014 were $24.3 million (30 June 2014: $4.4 million).

12. Retirement village resident loans

(a) Summary of carrying amounts

(a) Summary of carrying amounts
	31 Dec	30 Jun
	2014	2014
	$’000	$’000
Gross resident loans	223,357	218,639
Accrued deferred management fee	(29,946)	(28,517)
Net resident loans	193,411	190,122

(b) Movement in carrying amounts

	31 Dec	30 Jun
	2014	2014
	$’000	$’000
Carrying amount at beginning of period	190,122	175,703
Net (gain)/loss on change in fair value of resident loans	86	616
Accrued deferred management fee income	(2,735)	(5,333)
Deferred management fee cash collected	1,308	1,811
Proceeds from resident loans	10,773	22,021
Repayment of resident loans	(6,221)	(10,361)
Transfer to assets held for sale	-	5,439
Other	78	226
Carrying amount at end ofperiod	193,411	190,122

Fair value hierarchy disclosures for retirement village resident loans have been provided in note 15.

Page 36

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

13. Issued Securities

• (a) Carrying values

	31 Dec	30 Jun
	2014	2014
	$’000	$’000
At beginning of period	569,116	510,141
Issued during the period:
Dividend Reinvestment Plan issue	1,310	-
Institutional placement	45,315	-
Rights issue	43,769	61,707
Institutional placement and rights issue costs	(3,870)	(2,732)
At end of period	655,640	569,116
The closing balance is attributable to the securityholders of:
Ingenia Communities Holding Limited	8,874	7,377
Ingenia Communities Fund	617,982	547,642
Ingenia Communities Management Trust	28,784	14,097
	655,640	569,116

(b) Number of securities issued

	31 Dec	30 Jun
	2014	2014
	Thousands	Thousands
At beginning of period	676,240	507,179
Issued during the year:
Retention Quantum Rights	1,818	-
Dividend Reinvestment Plan	2,826	-
Institutional Placement and Rights Issue	197,968	169,061
At end ofperiod	878,852	676,240

(c) Terms of securities

All securities are fully paid and rank equally with each other for all purposes. Each security entitles the holder to one vote, in person or by proxy, at a meeting of securityholders.

Page 37

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

14. Share based payments

(a) Long term incentive plan

The Group has established a Rights Plan (‘the Plan’), which provides for the grant of conditional rights to receive securities in the Group. The intention of the Plan is to align long-term securityholder returns with the ‘at-risk’ compensation potentially payable to executive level employees and to reward managers who remain in employment and perform at the required levels of performance.

The Plan encompasses one type of security rights (Rights). Rights vest on completion of a period of service, with the number of rights vesting based on the Group’s performance, as measured by total securityholder returns (TSR). On vesting, each Right entitles the employee to receive one security of the Group for no consideration.

During the period, 982,974 Rights were granted to senior executives of the Group under the Plan. The number of Rights that will vest under the Plan depends on the TSR achieved and is also conditional on the individual being in employment of the Group on the vesting date (30 September 2017). The measurement period for the Rights is 1 October 2014 to 30 September 2017 and full rights vest based on TSR growth relative to growth in the ASX 300 Industrials Index. A sliding scale applies for lower TSRs with the number of Rights vesting being nil for a TSR at or below 1%. One Right equates to one security in the Group.

(a) Long term incentive plan (continued)

The fair value of the PQRs issued during the year was estimated using a Monte Carlo Simulation model. Assumptions made in determining these fair value, and the results of these assumptions, are:

Grant Date	24 October	12 November
	2014	2014
Price of stapled securities at grant date	$0.445	$0.455
Volatility of security price	30.0%	30.0%
Distribution yield	2.24%	2.28%
Risk-free rate at grant date	2.53%	2.56%
Expected remaining life at grant date	2.9 years	2.9 years
Fair value of each right	$0.243	$0.253

The fair value of the rights is recognised as an employee benefit expense with a corresponding increase in reserves. The fair value is expensed on a straight-line basis over the vesting period. The expense recognised for the half year was $288,000 (2013: $353,000).

Page 38

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

14. Share based payments (continued)

(b) Short term incentive plan

The Group has established a short-term incentive plan (“STIP”), which provides for the award of short term incentives based on agreed STIP performance conditions. The STIP comprises two components, a cash payment, and grant of conditional rights to receive securities in the Group. The intention of the STIP is to align short-term securityholder returns with the ‘at-risk’ portion of compensation potentially payable to executive level employees and to reward managers who remain in employment and perform at the required levels of performance to sustain earnings growth. The deferred expense for conditional rights recognised for the half year was $43,000 (2013: nil).

The total value of STIP rights is conditional based on KMPs meeting pre-agreed Key Performance Indicators (KPIs) and is subject to adjustment through to 1 October 2015 once the full year audited result is known and the KPIs can be reliably measured. An estimate based on the current period performance and KMP performance against these KPIs has been recognised at 31 December 2014 however the total number of Rights to be issued will be determined by 1 October 2015.

The rights are subject to a one year deferral period and are eligible to vest on the date that is twelve months following the issue date. The STIP allows for certain lapsing conditions within the deferral period, should certain conditions occur.

15. Financial Instruments

The Group uses the following fair value measurement hierarchy:

Level 1: fair value is calculated using quoted prices in active markets for identical assets or liabilities;

• Level 2: fair value is calculated using inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices); and

• Level 3: fair value is calculated using inputs for the asset or liability that are not based on observable market data.

Quoted market price represent the fair value determined based on quoted prices on active markets as at the reporting date without deduction for transaction costs.

Page 39

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

15. Financial Instruments (continued)

The following table represents the Group’s financial instruments that were measured and recognised at fair value at reporting date:

Financial assets/ financial liabilities Valuation technique(s) and key inputs Significant Unobservable Inputs	Relationship of unobservable inputs to fair value
Retirement village resident loans Loans measured as the ingoing resident’s contribution plus the resident’s share of capital appreciation to reporting date, less DMF accrued to reportingdate Long-term capital appreciation rates for residential property between 0-4%. Estimated length of stay of residents based on life tables	The higher the appreciation, the higher the value of resident loans. The longer the length of stay, the lower the value of resident loans
Deferred management fee accrued DMF measured using the initial property price, estimated length of stay, various contract terms and projected property price at time of re-leasing Estimated length of stay of residents based on life table	The longer the length of stay, the higher the DMF accrued, capped at a predetermined period of time
Derivative interest rate swaps Net present value of future cash flows discounted at market rates adjusted for the Group’s credit risk N/A	N/A

There has been no movement from Level 3 to Level 2 during the current period. Changes in the Group’s retirement village resident loans which are Level 3 instruments are presented in note 12.

The carrying amount of the Groups’ other financial instruments approximate their fair values.

Page 40

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

16. Fair value measurement

The following table provides the fair value measurement hierarchy of the Group’s assets and liabilities:

(a) Assets measured at fair value

31 December 2014 Date of valuation Total $’000	FAIR VALUE MEASUREMENT USING
	Prices quoted in active markets (Level 1) $’000 Significant observable inputs (Level 2) $’000 Significant unobservable inputs (Level 3) $’000
Assets Investment properties 31 December 2014 Refer to note 9 520,184	- - 520,184

30 June 2014 Date of valuation Total $’000	FAIR VALUE MEASUREMENTUSING
	Prices quoted in active markets (Level 1) $’000 Significant observable inputs (Level 2) $’000 Significant unobservable inputs (Level 3) $’000
Assets Investment properties 30 June 2014 Refer to note 9 498,863 Discontinued operations- investment properties 30 June 2014 Refer to note 6 45,902 Assets held for sale – deferred management fee receivable 30 June 2014 Refertonote12 5,439	- - 498,863 - - 45,902 - - 5,439

Page 41

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

16. Fair value measurement (continued)

(b) Liabilities measured at fair value

(b) Liabilities measured at fair value
31 December 2014 Date of valuation Total $’000	FAIR VALUE MEASUREMENT USING
	Prices quoted in active markets (Level 1) $’000 Significant observable inputs (Level 2) $’000 Significant unobservable inputs (Level 3) $’000
Liabilities Retirement village resident loans 31 December 2014 Refer to note 12 193,411 Derivatives 31 December 2014 70	- - 193,411 - 70 -
30 June 2014 Date of valuation Total $’000	FAIR VALUE MEASUREMENT USING
	Prices quoted in active markets (Level 1) $’000 Significant observable inputs (Level 2) $’000 Significant unobservable inputs (Level 3) $’000
Liabilities Retirement village resident loans 30 June 2014 Refer to note 12 190,122 Derivatives 30 June2014 168	- - 190,122 - 168 -

There have been no transfers between Level 2 and Level 3 during the period.

17. Distributions

Dividends and distributions declared and paid for the half-year are detailed below.

	31 Dec	31 Dec
	2014	2013
	$’000	$’000
Recognised Distribution
Cents per security	0.65	0.50
Total amount ($’000)	4,407	2,536
Payment date	17 Sep 2014	20 Sep 2013
Unrecogised Distribution
Cents per security	0.65	0.50
Total amount ($’000)	5,713	3,381
Payment date	18 Mar 2015	21 Mar 2014

All distributions are made by ICF and are 100% tax deferred.

Page 42

Ingenia Communities Holdings Limited Notes to the financial statements for the Half-year ended 31 December 2014

18. Subsequent events

On 27 January 2015, the Group announced it had exchanged conditional contracts for the acquisition of Sydney Hills Holiday Park in Dural, NSW. The acquisition price is approximately $12m (excluding acquisition costs) subject to due diligence and Board approval and will be funded from the proceeds of the capital raising in October 2014.

On 13 February 2015, the Group completed refinancing its debt and now has a $175m Australian Multilateral banking facility in place. The facility, is split between a three year and a five year maturity profile.

On 18 February 2015, the Group settled Big 4 Bougainvillia Holiday Park, a lifestyle park, located in Tewantin, QLD. The purchase price of $12.5m was funded from the proceeds of the capital raising in October 2014.

On 24 February 2015, the directors resolved to declare an interim distribution of 0.65cps (2014: 0.5cps) amounting to $5,712,537 to be paid on 18 March 2015. The distributions are 100% tax deferred and the dividend reinvestment plan will apply to the interim distribution.

Page 43

Ingenia Communities Holdings Limited Directors’ declaration Half-year ended 31 December 2014

In accordance with a resolution of the directors of Ingenia Communities Holdings Limited, I state that:

1. In the opinion of the directors:

2. (a) the financial statements and notes of Ingenia Communities Holdings Limited for the halfyear ended 31 December 2014 are in accordance with the Corporations Act 2001 , including:

   • (i) giving a true and fair view of its financial position as at 31 December 2014 and of its performance for the half-year ended on that date; and

   • (ii) complying with Accounting Standards (including Australian Accounting Interpretations) and Corporations Regulations 2001 ; and

3. (b) there are reasonable grounds to believe that Ingenia Communities Holdings Limited will be able to pay its debts as and when they become due and payable.

On behalf of the Board

==> picture [141 x 50] intentionally omitted <==

Jim Hazel Chairman 24 February 2015

Ernst & Young 680 George Street Sydney NSW 2000 Australia GPO Box 2646 Sydney NSW 2001

Tel: +61 2 9248 5555 Fax: +61 2 9248 5959 ey.com/au

==> picture [71 x 81] intentionally omitted <==

To the unitholders of Ingenia Communities Holdings Limited

Report on the Half-year Financial Report

We have reviewed the accompanying half-year financial report of Ingenia Communities Holdings Limited, which comprise the consolidated statement of financial position as at 31 December 2014, the consolidated statement of profit and loss and other comprehensive income, the statement of changes in equity and the consolidated cash flow statement for the half year then ended, notes comprising a summary of significant accounting policies and other explanatory information, and the directors’ declaration of the consolidated entity comprising the company and the entities it controlled at the half-year or from time to time during the half-year.

Directors’ Responsibility for the Half-year Financial Report

The directors of Ingenia Communities Holdings Limited are responsible for the preparation of the half-year financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal controls as the directors determine are necessary to enable the preparation of the half-year financial report that is free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express a conclusion on the half-year financial report based on our review. We conducted our review in accordance with Auditing Standard on Review Engagements ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity , in order to state whether, on the basis of the procedures described, we have become aware of any matter that makes us believe that the financial report is not in accordance with the Corporations Act 2001 including: giving a true and fair view of the consolidated entity’s financial position as at 31 December 2014 and its performance for the halfyear ended on that date; and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 . As the auditor of Ingenia Communities Holdings Limited and the entities it controlled during the period, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

A review of a half-year financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Independence

In conducting our review, we have complied with the independence requirements of the Corporations Act 2001 . We have given to the directors of the Responsible Entity a written Auditor’s Independence Declaration, a copy of which is included in the Directors’ Report.

A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

2

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Conclusion

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half-year financial report of Ingenia Communities Holdings Limited is not in accordance with the Corporations Act 2001 , including:

• a) giving a true and fair view of the consolidated entity’s financial position as at 31 December 2014 and of its performance for the half-year ended on that date; and

• b) complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 .

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Ernst & Young

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Chris Lawton Partner Sydney 24 February 2015

A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

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INGENIA COMMUNITIES FUND AND INGENIA COMMUNITIES MANAGEMENT TRUST

INTERIM REPORT

FOR THE HALF-YEAR ENDED 31 DECEMBER 2014

www.ingeniacommunities.com.au

Registered Office: Level 5, 151 Castlereagh Street, Sydney NSW 2000

Ingenia Communities Fund & Ingenia Communities Management Trust Directors’ report Half-year ended 31 December 2014

Contents

ontents
		Page
Directors’ report		2
Auditor’s independence declaration		6
Financial report
Consolidated Statements of Comprehensive Income		7
Consolidated Balance Sheets		9
Consolidated Cash Flow Statements		10
Statements of Changes in Unitholders’ Interest		11
Note 1	Summary of significant accounting policies	13
Note 2	Accounting estimates and judgements	17
Note 3	Segment information	19
Note 4	Earnings per unit	23
Note 5	Discontinued operations	23
Note 6	Cash and cash equivalents	26
Note 7	Inventories	26
Note 8	Investment properties	27
Note 9	Trade and other payables	28
Note 10	Borrowings	28
Note 11	Retirement village resident loans	29
Note 12	Issued units	30
Note 13	Financial instruments	31
Note 14	Fair value measurement	32
Note 15	Distributions	34
Note 16	Subsequent events	34
Directors’	declaration	35
Auditors report		36

Page 2

Ingenia Communities Fund & Ingenia Communities Management Trust Directors’ report Half-year ended 31 December 2014

The Ingenia Communities Fund (“ICF” or the “Fund”) (ARSN 107 459 576) and the Ingenia Communities Management Trust (“ICMT”) (ARSN 122 928 410) (together the “Trusts”) are Australian registered schemes. Ingenia Communities RE Limited (ACN 154 464 990; Australian Financial Services Licence number 415862), the Responsible Entity of the Trusts, is incorporated and domiciled in Australia.

The parent company of Ingenia Communities RE Limited (“ICRE” or “Responsible Entity”) is Ingenia Communities Holdings Limited (the “Company”). The shares of the Company and the units of the Trusts are “stapled” and trade on the Australian Securities Exchange (“ASX”) as a single security. The Company and the Trusts along with their subsidiaries are collectively referred to as the Group in this report.

The directors’ report is a combined directors’ report that covers the Trusts for the half year ended 31 December 2014 (the “current period”).

1. DIRECTORS

The directors of the Ingenia Communities RE Limited at any time during or since the end of the half-year were:

Non-executive directors

Jim Hazel (Chairman) Philip Clark AM Amanda Heyworth Robert Morrison Norah Barlow ONZM

Executive director

Simon Owen (Managing Director and CEO)

2. OPERATING AND FINANCIAL REVIEW

a) ICF and ICMT Overview

ICF and ICMT are two of the entities forming part of Ingenia Communities Group, which is a triple stapled structure, traded on the ASX.

The Group owns, manages and develops a diversified portfolio of seniors living communities across Australia. Its real estate assets at 31 December 2014 are valued at $322 million[1] and comprises 58 lifestyle parks, rental villages, and deferred management fee (DMF) villages. The Group is included in the ASX 300 with a market capitalisation of approximately $369 million.

The Group’s vision is to be a leading Australia provider of affordable seniors living and short term rental accommodation. The Board is committed to delivering long-term earnings and security price growth to securityholders and providing an affordable and supportive community environment to both its permanent and short term residents.

b) Strategy

The strategy of ICF and ICMT is aligned with the Group’s strategy to further grow its Australian rental portfolio, primarily within the lifestyle parks sector. Using a disciplined framework, the Group remains focused on completing the deployment of the $89.1m of equity raised in October 2014 and ramping up the build out of its development pipeline.

1 Real estate assets value is determined as the net of carrying value of investment properties, retirement village resident loans and finance lease liabilities.

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Ingenia Communities Fund & Ingenia Communities Management Trust Directors’ report Half-year ended 31 December 2014

Pleasingly, the Group finalised its strategic exit from the non-core New Zealand Students portfolio in December 2014. The Group is continuing to focus on reducing its investment in DMF assets with the divestment of one asset completed in July 2014.

In February 2015, the Group completed a debt refinance and now has a $175m Australian multilateral banking facility in place which positions the Group well for further investment in lifestyle parks via capital recycling, efficient inventory management and monetisation of stock.

A disciplined investment approach, stringent capital management and exploring opportunities for operational efficiencies remains paramount. The Group remains committed to maintaining a loan to value ratio (“LVR”) within a target range of 30-35%.

The key immediate business priorities of the Group are:

• Finalising deployment of funds from recent $89.1m equity raising;

• Increasing sales and settlement rates for new homes within the Active Lifestyle Estates development pipeline;

• Growing occupancy rates both within the Garden Villages portfolio and the Active Lifestyle Estates short term accommodation; and

• Continuing sale of completed homes within the Settlers portfolio and exploring opportunities for divestment.

c) 1H15 Financial results

1H15 has been a period of investment in the Active Lifestyle Estate portfolio, with the focus on establishing the necessary sales and development platforms to deliver the returns from the Active Lifestyle Estates development pipeline. At the same time, there has been a focus on increasing earnings from the Garden Villages portfolio through occupancy growth and continuing to sell down available stock within the Settlers portfolio.

Other key milestones during the period include:

• Renegotiation of the Australian debt facility to $175m;

• Acquisition of White Albatross Holiday Park in NSW completed;

• Divestment of Settlers Lifestyle Noyea Park village in July 2014; and

• Exit from the New Zealand Students portfolio completed in December 2014.

d) Key Metrics

• Net profit for the year of $9.4m for ICF and a loss of $10.6m for ICMT.

• Interim distribution of 0.65 cents per unit by ICF, nil for ICMT.

• Statutory profit for ICF was $9.4 million, up 33.8% from 1H14.

• Statutory loss for ICMT was $10.6 million, down from a $1.3 million loss in 1H14.

These results are reflective of execution of divestment of the majority of the overseas operations, and deployment of capital into the Australia market to generate strong returns for unitholders.

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Ingenia Communities Fund & Ingenia Communities Management Trust Directors’ report Half-year ended 31 December 2014

e) Discontinued operations

ICF and ICMT completed their exit from the New Zealand Students accommodation portfolio in December 2014.

f) Capital Management

The Group adopts a prudent and considered approach to capital management. During the period, the Group strengthened its capital position by undertaking a $89.1m capital raising and in February 2015 the Group negotiated a new $175m Australian multilateral debt facility an increase of $45.5m from the previous bilateral facility.

As at 31 December 2014, the current LVR is 14.4%, however with the Group looking to deploy proceeds from capital raising and debt into further Active Lifestyle Estate acquisitions, the Group anticipates being at its target LVR of 30-35% by 30 June 2015.

g) Distributions

ICF made the following distribution during or in respect of the period:

• On 26 August 2014 the directors declared a final distribution for 2014 of 0.65 cents per unit (“cpu”) (2013: 0.5 cpu) amounting to $4,407,379 which was paid on 17 September 2014.

The distributions are 100% tax deferred and the dividend reinvestment plan will apply to the interim distribution.

The Trusts are committed to continuing to grow distributions in the near future.

h) Outlook

The Trust’s are well positioned to continue growing their lifestyle parks business with a strong acquisition pipeline in place for deploying the remaining proceeds from the October equity raising. The volume of new manufactured home settlements will start to grow as gathering sales momentum converts into settlements and further projects are launched. This will result in performance building into earnings in the second half of FY15, and into FY16.

At the same time, the Trust’s will continue to regularly assess the performance of its existing assets, continue exploring opportunities for divestment of the Settlers portfolio and recycle capital into other opportunities delivering superior returns.

3. SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS

Changes in the state of affairs during the financial year are set out in the various reports in this Interim Financial Report. Refer to note 5 of the accompanying financial statements for discontinued operations and assets held for sale, note 8 for investment properties acquired or disposed of during the period, note 10 for details of Australian debt refinanced and note 12 for issued units.

4. EVENTS SUBSEQUENT TO REPORTING DATE

• On 27 January 2015, the Group announced it had exchanged conditional contracts for the acquisition of Sydney Hills Holiday Park in Dural, NSW. The acquisition price is approximately $12m (excluding acquisition costs) subject to due diligence and Board approval and will be funded from the proceeds of the capital raising in October 2014.

• On 13 February 2015, the Group completed refinancing its debt and now has a $175 m Australian Multilateral banking facility in place. The facility, is split between a three year and a five year maturity profile.

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Ingenia Communities Fund & Ingenia Communities Management Trust Directors’ report Half-year ended 31 December 2014

• On 18 February 2015, the Group settled Big 4 Bougainvillia Holiday Park, a lifestyle park, located in Tewantin, QLD. The purchase price of $12.5m was funded from the proceeds of the capital raising in October 2014.

• On 24 February 2015 the directors resolved to declare an interim distribution of 0.65 cpu (2014: 0.5cpu) amounting to $5,712,537 to be paid on 18 March 2015. The distribution will be paid from ICF and will be 100% tax deferred and the dividend reinvestment plan will apply to the interim distribution.

5. INDEMNITIES

The Group has purchased various insurance policies to cover a range of risks (subject to specified exclusions) for directors, officers and employees of the Group serving in their respective capacities. Key insurance policies include: directors and officers insurance, professional indemnity insurance and management liability insurance.

To the extent permitted by law, the Company has agreed to indemnify its auditors, Ernst & Young, as part of the terms of its audit engagement agreement against claims by third parties arising from the audit (for an unspecified amount). No payment has been made to indemnify Ernst & Young during or since the financial year.

6. NON-IFRS FINANCIAL INFORMATION

Alternative profit measure (i.e. underlying profit) shown in this report has not been reviewed or audited in accordance with Australian Auditing Standards.

7. 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 6.

8. ROUNDING OF AMOUNTS

The Group is an entity of the kind referred to in ASIC Class Order 98/100, and in accordance with that Class Order, amounts in the financial report and directors’ report have been rounded to the nearest thousand dollars, unless otherwise stated.

Signed in accordance with a resolution of the directors of the Responsible Entity.

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Jim Hazel Chairman Sydney 24 February 2015

Ernst & Young 680 George Street Sydney NSW 2000 Australia GPO Box 2646 Sydney NSW 2001

Tel: +61 2 9248 5555 Fax: +61 2 9248 5959 ey.com/au

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Auditor’s Independence Declaration to the Directors of Ingenia Communities RE Limited as Responsible Entity for Ingenia Communities Fund and Ingenia Communities Management Trust

In relation to our review of the financial reports of Ingenia Communities Fund and its controlled entities and Ingenia Communities Management Trust and its controlled entities for the half-year ended 31 December 2014, to the best of my knowledge and belief, there have been no contraventions of the auditor independence requirements of the Corporations Act 2001 or any applicable code of professional conduct.

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Ernst & Young

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Chris Lawton Partner 24 February 2015

A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

Page 7

Ingenia Communities Fund & Ingenia Communities Management Trust Consolidated Statements of Comprehensive Income Half-year ended 31 December 2014

INGENIA COMMUNITIES FUND	INGENIA COMMUNITIES MANAGEMENT TRUST
Note 2014 $’000 2013 $’000	2014 $’000 2013 $’000
Continuing operations Revenue Rental income 4,860 4,546 Accrued deferred management fee income - - Manufactured home sales - - Catering income - - Other property income - - Interest income 6,852 4,236	20,849 13,390 2,735 2,745 1,930 1,105 1,768 1,526 1,112 356 5 3
11,712 8,782 Property expenses (206) (133) Employee expenses - - Administrative expenses (288) (183) Operational, marketing and selling expenses (556) (207) Cost of manufactured homes - - Finance expenses (1,975) (1,681) Net foreign exchange gain/(loss) 2,060 324 Net gain/(loss) on disposal of investment properties (2,013) - Net gain/(loss) on change in fair value of: Investment properties 1,525 770 Derivatives 98 (8) Retirement village resident loans - - Depreciation and amortisation expense (67) (42) Responsible Entity’s fees and expenses (878) (586)	28,399 19,125 (12,676) (9,220) (7,880) (4,549) (1,329) (854) (1,301) (1,218) (1,102) (632) (6,957) (4,095) (2,005) 24 1,697 - (10,834) 455 - 60 (86) - (56) (24) (1,101) (753)
Profit/(loss) from continuing operations before income tax 9,412 7,036 Income tax benefit - -	(15,231) (1,681) 5,663 657
Profit/(loss) from continuing operations 9,412 7,036 Profit/(loss) from discontinued operations 5 - (1)	(9,568) (1,024) (991) (294)
Net profit/(loss) for the half-year 9,412 7,035	(10,559) (1,318)
Other comprehensive income, net of income tax Items that may be reclassified subsequently to profit or loss: Foreign currency translation differences arising during the period 1,846 430 Release of foreign currency translation reserve on disposal of foreign operations (1,620) -	(507) 322 338 -
Total comprehensive income for the half-year, net of income tax 9,638 7,465	(10,728) (996)
Profit/(loss) attributable to unitholders of: Ingenia Communities Fund 9,412 7,035 Ingenia Communities Management Trust - -	(2,861) (260) (7,698) (1,058)
9,412 7,035	(10,559) (1,318)
Total comprehensive income attributable to unitholders of: Ingenia Communities Fund 9,638 7,465 Ingenia Communities Fund Management Trust - -	(2,861) 73 (7,867) (1,069)
9,638 7,465	(10,728) (996)

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Ingenia Communities Fund & Ingenia Communities Management Trust Consolidated Statements of Comprehensive Income Half-year ended 31 December 2014

	INGENIA COMMUNITIES	INGENIA COMMUNITIES	INGENIA COMMUNITIES	INGENIA COMMUNITIES
	FUND		MANAGEMENT	TRUST
	2014	2013	2014	2013
	Cents	Cents	Cents	Cents
Distributions per unit(1)	0.65	0.50	-	-
Earnings per unit:
Basic earnings from continuing operations	1.2	1.1	(1.3)	(0.2)
Basic earnings	1.2	1.1	(1.4)	(0.2)
Diluted earnings from continuing operations	1.2	1.1	(1.2)	(0.2)
Diluted earnings	1.2	1.1	(1.4)	(0.2)

(1) Distributions relate to the final distribution paid for the prior reporting period. An interim distribution for the current reporting period was declared for 0.65 cents on 24 February 2015, to be paid to securityholders on 18 March 2015.

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Ingenia Communities Fund & Ingenia Communities Management Trust Consolidated Balance Sheets Half-year ended 31 December 2014

INGENIA COMMUNITIES FUND	INGENIA COMMUNITIES MANAGEMENT TRUST
Note Dec 2014 $’000 Jun 2014 $’000	Dec 2014 $’000 Jun 2014 $’000
Current assets Cash and cash equivalents 6 8,000 2,658 Trade and other receivables 3,458 4,280 Inventories 7 - - Income tax receivable 177 975 Assets held for sale 5 - - Assets of discontinued operations 5 - 3,874	16,543 3,893 5,386 3,131 6,437 2,208 48 - - 5,439 - 47,657
Total current assets 11,635 11,787	28,414 62,328
Non-current assets Trade and other receivables 30,708 39,334 Receivable from related party 133,305 135,805 Investment properties 8 144,153 134,488 Plant and equipment 174 239 Investments 3,874 - Intangible assets - - Deferred tax asset - -	103 40 - - 376,031 364,375 482 180 - - 1,483 - 4,250 -
Total non-current assets 312,214 309,866	382,349 364,595
Total Assets 323,849 321,653	410,763 426,923
Current Liabilities Trade and other payables 9 681 1,210 Borrowings 10 20,940 - Retirement village resident loans 11 - - Provisions - - Derivatives 70 84 Provision for income tax - - Payable to related party - - Liabilities of discontinued operations 5 - -	14,883 8,480 3,465 3,461 193,411 190,122 656 590 - - - 29 137,971 133,249 - 30,449
Total current liabilities 21,691 1,294	350,386 366,380
Non-current liabilities Trade and other payables 9 - - Borrowings 10 - 93,688 Provisions - - Derivatives - 84 Deferred tax liabilities - -	10,500 4,000 32,659 41,883 281 249 - - - 1,433
Total non-current liabilities - 93,772	43,440 47,565
Total liabilities 21,691 95,066	393,826 413,945
Net assets 302,158 226,587	16,937 12,978
Equity Issued units 12 617,982 547,642 Reserves - (226) Accumulated losses (315,824) (320,829)	28,784 14,097 - 169 (11,747) (4,049)
Unitholders’ interest 302,158 226,587 Non-controllinginterest - -	17,037 10,217 (100) 2,761
Total equity 302,158 226,587	16,937 12,978
Attributable to unitholders of: Ingenia Communities Fund 302,158 226,587 Ingenia Communities Management Trust - -	(100) 2,761 17,037 10,217
302,158 226,587	16,937 12,978

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Ingenia Communities Fund & Ingenia Communities Management Trust Consolidated Cash Flow Statements Half-year ended 31 December 2014

		INGENIA COMMUNITIES	INGENIA COMMUNITIES	INGENIA COMMUNITIES	INGENIA COMMUNITIES
		FUND		MANAGEMENT	TRUST
		2014	2013	2014	2013
	Note	$’000	$’000	$’000	$’000
Cash flows from operating activities
Rental and other property income		-	-	29,465	17,982
Payment of management fees		-	-	-	(13)
Property and other expenses		(124)	(653)	(22,832)	(13,148)
Proceeds from resident loans		-	-	10,773	10,607
Repayment of resident loans		-	-	(6,221)	(6,717)
Proceeds from sale of manufactured homes		-	-	3,486	1,267
Purchase of manufactured homes		-	-	(5,678)	(1,180)
Interest received		97	154	2	3
Borrowing costs paid		(1,975)	(2,197)	(1,130)	(825)
Income tax received/(paid)		790	(121)	-	-
		(1,212)	(2,817)	7,865	7,976
Cash flows from investing activities
Purchase and additions of plant and equipment		-	(2)	(260)	(24)
Purchase and additions of intangible assets		-	-	(1,049)	-
Payments for investment properties		-	(987)	(15,205)	(60,118)
Additions to investment properties		(483)	(2)	(5,776)	(12,520)
Proceeds/(costs) from sale of investment properties		-	(26)	49,588	1,282
Proceeds from sale of equity accounted investments		-	5,016	-	102
Amounts received from/(advanced to) villages		-	-	-	(23)
Payments for lease arrangements		-	-	-	(80)
		(483)	3,999	27,298	(71,381)
Cash flows from financing activities
Proceeds from issue of stapled securities		73,483	51,985	15,343	8,364
Payments for security issue costs		(3,468)	(2,528)	(473)	(190)
Payments for derivatives		-	-	(444)	-
Finance lease payments		-	-	(50)	(44)
Distributions to securityholders		(3,091)	(2,507)	(1,311)	-
Proceeds from borrowings		28,840	50,005	305	59,108
Repayment of borrowings		(88,730)	(117,638)	(37,367)	(1,023)
Payments for debt issue costs		(53)	-	(284)	(98)
		6,981	(20,683)	(24,281)	66,117
Net increase/(decrease) in cash and cash equivalents		5,286	(19,501)	10,882	2,712
Cash and cash equivalents at the beginning of the year		2,658	31,014	5,550	249
Effects of exchange rate fluctuation on cash held		56	43	111	(15)
Cash and cash equivalents at the end of the half-year	6	8,000	11,556	16,543	2,946

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Ingenia Communities Fund & Ingenia Communities Management Trust Statements of Changes in Unitholders’ Interest Half-year ended 31 December 2014

Note	INGENIA COMMUNITIES FUND	INGENIA COMMUNITIES FUND
	ATTRIBUTABLE TO UNITHOLDERS Non- controlling interest Total equity Issued capital Reserves Retained earnings Total $’000 $’000 $’000 $’000 $’000 $’000
Carrying amount at 1 July 2013 Net profit/(loss) for the period Other comprehensive income	497,956 - (330,334) 167,622 - - 7,035 7,035 - 430 - 430	- 167,622 - 7,035 - 430
Total comprehensive income for the period	- 430 7,035 7,465	- 7,465
Transactions with unitholders in their capacity as unitholders: Issue of units 12 Distributions paid or payable 15	49,688 - - 49,688 - - (2,536) (2,536)	- 49,688 - (2,536)
Carrying amount at 31 December 2013	547,644 430 (325,835) 222,239	- 222,239
Carrying amount at 1 July 2014 Net profit/(loss) for the period Other comprehensive income	547,642 (226) (320,829) 226,587 - - 9,412 9,412 - 226 - 226	- 226,587 - 9,412 - 226
Total comprehensive income for the period	- 226 9,412 9,638	- 9,638
Transactions with unitholders in their capacity as unitholders: Issue of units 12 Distributions paid or payable 15	70,340 - - 70,340 - 70,340 - - (4,407) (4,407) - (4,407)
Carrying amount at 31 December 2014	617,982 - (315,824) 302,158 - 302,158

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Ingenia Communities Fund & Ingenia Communities Management Trust Statements of Changes in Unitholders’ Interest Half-year ended 31 December 2014

Note	INGENIA COMMUNITIES MANAGEMENT	TRUST
	ATTRIBUTABLE TO UNITHOLDERS	Non-controlling interest(1) Total equity $’000 $’000
	Issued capital Reserves Retained earnings Total $’000 $’000 $’000 $’000
Carrying amount at 1 July 2013 Net profit/(loss) for the period Other comprehensive income	6,106 120 (2,990) 3,236 - - (1,058) (1,058) - (11) - (11)	2,426 5,662 (260) (1,318) 333 322
Total comprehensive income for the period	- (11) (1,058) (1,069)	73 (996)
Transactions with unitholders in their capacity as unit holders: Issue of units 12 Distributions paid or payable 15	7,998 - - 7,988 - - - -	- 7,988 - -
Carrying amount at 31 December 2013	14,094 109 (4,048) 10,155	2,499 12,654
Carrying amount at 1 July 2014 Net profit/(loss) for the period Other comprehensive income	14,097 169 (4,049) 10,217 - - (7,698) (7,698) - (169) - (169)	2,761 12,978 (2,861) (10,559) - (169)
Total comprehensive income for the period	- (169) (7,698) (7,867)	(2,861) (10,728)
Transactions with unitholders in their capacity as unitholders: Issue of units 12 Distributions paid or payable 15	14,687 - - 14,687 - - - -	- 14,687 - -
Carrying amount at 31 December 2014	28,784 - (11,747) 17,037	(100) 16,937

(1) Non-controlling interest relates to the portion in which ICF owns subsidiaries consolidated within ICMT.

Page 13

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

1. Summary of significant accounting policies

(a) The Trusts

The Ingenia Communities Fund (“ICF” or the “Fund”) (ARSN 107 459 576) and the Ingenia Communities Management Trust (“ICMT”) (ARSN 122 928 410) (together the “Trusts”) are Australian registered schemes. Ingenia Communities RE Limited (ACN 154 464 990) Australian Financial Services Licence number 415862, the Responsible Entity of the Trusts, is incorporated and domiciled in Australia.

The parent company of Ingenia Communities RE Limited is Ingenia Communities Holdings Limited (the “Company”). The shares of the Company and the units of the Trust are “stapled” and trade on the Australian Securities Exchange (“ASX”) as a single security. The Company and the Trust along with their subsidiaries are collectively referred to as the Group in this report.

The stapling structure will cease to operate on the first to occur of:

• the Company or either of the Trusts resolving by special resolution in accordance with its constitution to terminate the stapling provisions; or

• the commencement of the winding up of the Company or either of the Trusts.

(b) Basis of preparation

The financial report is a general purpose financial report which has been prepared in accordance with AASB 134 ‘Interim financial reporting’ and the Corporations Act 2001 .

The interim financial report does not include all of the information required for a full annual financial report, and should be read in conjunction with both the Ingenia Communities Fund and Ingenia Communities Management Trust annual financial reports for the year ended 30 June 2014.

As permitted by Class Order 05/642, issued by the Australian Securities and Investments Commission (“ASIC”), this financial report is a combined financial report that presents the financial statements and accompanying notes of both the ICF and ICMT.

The financial report is presented in Australian dollars and all values are rounded to the nearest thousand dollars ($’000) unless otherwise stated.

The accounting policies and methods of computation adopted in the preparation of the half-year financial report are consistent with those adopted and disclosed in the Group’s 2014 Annual Report with the exception of new mandatorily amended standards and interpretations which have been applied as required. Where necessary comparative figures have been adjusted to conform with changes in presentation in the current period.

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Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

1. Summary of significant accounting policies (continued)

(b) Basis of preparation (continued)

As at 31 December 2014, the Ingenia Communities Management Trust (ICMT) recorded a net current asset deficiency of $321,972,000. This deficiency includes retirement village resident loans of $193,411,000 and payables to other entities within the Group of $137,971,000. Resident loan obligations of ICMT are classified as current liabilities due to the demand feature of these obligations despite the unlikely possibility that the majority of the loans will be settled within the next 12 months. Furthermore, if required, the proceeds from new resident loans could be used by the Group to settle existing loan obligations should those incumbent residents vacate their units. Intercompany loan balances are payable on demand, however ICF has undertaken not to call its loan receivable from ICMT within the next 12 months of the date of this report, if calling the loan would result in ICMT being unable to pays its debts as and when they are due. Accordingly, there are reasonable grounds to believe that the ICMT will be able to pay its debts as and when they become due and payable; and the interim financial report of ICMT has been prepared on a going concern basis.

(c) New or revised Accounting Standards and Interpretations that are first effective in the current reporting period

The Group has adopted all of the new and revised standards and interpretations issued by the Australian Accounting Standards Board (AASB) that are relevant to its operations and effective for the current period. The following standards were most relevant to the Group:

• AASB 132 ‘ Financial Instruments: Presentation ’ and AASB 2012-3 ‘Amendments to

• Australian Accounting Standards – Offsetting Financial Assets and Financial Liabilities ’;

• AASB 136 ‘ Impairment of Assets ’ and AASB 2013-3 ‘Amendments to AASB 136 –

• Recoverable Amount Disclosures for Non-Financial Assets’ ;

• AASB 2 ‘ Share Based Payments’ , AASB 3 ‘ Business Combinations’ , AASB 8

• ‘ Segment Reporting’ and AASB 2014-1 Part A – Annual Improvements 2010-2012 Cycle

The impact of application of each Standard is as follows:

Accounting
Standard	Impact on the Group
AASB 132 and	AASB 2012-3_Amendments to Australian Accounting Standards – Offsetting Financial_
AASB 2012-3	Assets and Financial Liabilities_makes amendments to AASB 132_Financial
	_Instruments: Presentation_as a result of issuance of International Financial Reporting
	Standard_Offsetting Financial Assets and Financial Liabilities_and provides application
	guidance to certain criteria mentioned in AASB 132.
	The application of the standard does not have any impact on the results of the Group
	as retirement village resident loans are already offset as there is a current legally
	enforceable right and there is an intention to settle on a net basis.
AASB 136 and	AASB 2013-3 amends the disclosure requirements of AASB 136_Impairment of_
AASB 2013-3	_Assets_to require disclosure of additional information about the fair value
	measurement when the recoverable amount of impaired assets is based on fair value
	less costs of disposal.
	The application of the standard did not have any impact on the results of the Group.

Page 15

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

1. Summary of significant accounting policies (continued)

Accounting
Standard	Impact on the Group
AASB 2,	AASB 2014-1_Amendments to Australian Accounting Standards_makes amendments
AASB 3,	to	the following AASB’s as part of the Annual Improvement Cycle
AASB 8, and
AASB 2014-1	-	AASB 2: This standard clarifies the Definition of ‘vesting conditions’ and
		separately defines ‘performance condition’ and ‘service condition’. The
		amendment applies to any share based payment transactions for which the grant
		date is on or after 1 July 2014. Application of this amendment did not have any
		impact on the results of the Group.
	-	AASB 3: The standard clarifies that judgement is needed to determine whether
		an acquisition of investment property is solely the acquisition of an investment
		property or whether it is an acquisition of a group of assets or a business
		combination within the scope of AASB 3_Business Combinations_that includes an
		investment property. The Group makes an assessment about this classification
		for each investment property acquired. Therefore no impact except for additional
		disclosures regarding judgements and estimates.
	-	AASB 8: The standard amends disclosure of the judgements made by
		management in aggregating operating segments. This includes a description of
		the segments which have been aggregated and the economic indicators which
		have been assessed in determining that the aggregated segments share similar
		economic characteristics. The standard requires a reconciliation of segment
		assets to the entity’s assets when segment assets are reported. Application of
		this amendment did not have any impact on the results of the Group.

Page 16

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

1. Summary of significant accounting policies (continued)

(d) Pending accounting standards

Certain new accounting standards and interpretations have been published that are not mandatory for the current reporting period. The Group’s assessment of the impact of these new standards and interpretations is set out below.

Accounting
Standard	Impact on the Trust
AASB 9	AASB 9_Financial Instruments_is applicable to reporting periods beginning on or after 1 January 2018. The Group has not early adopted this standard. This
	standard provides requirements for the classification and measurement of
	financial assets and accounting for financial liabilities. These requirements seek
	to improve and simplify the requirements listed in AASB 139_Financial_
	Instruments: Recognition and Measurement.
	The Group is continuing to evaluate the impact of this standard, however no
	material impactis expected.
IFRS 15	AASB 15_Revenue from Contracts with Customers_is applicable to reporting periods beginning on or after 1 January 2017. This will replace IAS 18, which
	covers contracts for goods and services and IAS 11, which covers construction
	contracts. The Group has not early adopted the standard. The new standard
	provides that an entity recognizes revenue in line with contractual performance
	obligations, where the determined contract price which is allocated against those
	performance obligations. The new standard is based on the principal that revenue
	is recognised when control of the good or service transfers to the customer, so
	the notion of control replaces the existing notion of risks and rewards.
	The Group is continuing to evaluate the impact of this standard, however no
	material impactis expected.

Other new accounting standards, amendments to accounting standards and interpretations have been published that are not mandatory for the current reporting period. These are not expected to have any material impact on the Group’s financial reporting future reporting periods.

(e) Accounting policies applied for the first time in the current period

(i) Intangible Assets

An intangible asset arising from development expenditure related to software is recognised only when the Group can demonstrate the technical feasibility of completing the intangible asset so that it will be available for use, how the asset will generate future economic benefits, the availability of resources to complete the asset and the ability to measure reliably the expenditure during its development. Costs capitalised include external direct costs of materials and service, and direct payroll and payroll related costs of employees’ time spent on the project.

Following the initial recognition of the expenditure, the asset is carried at cost less any accumulated amortisation and accumulated impairment losses. Amortisation of the asset begins when development is complete and the asset is available for use. Amortisation is over the period of expected future benefit.

Page 17

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

1. Summary of significant accounting policies (continued)

(e) Accounting policies applied for the first time in the current period (continued)

A summary of the policy applied to capitalised development costs is as follows:

Software and associated development costs (assets in use)

• Useful life: Finite Amortisation method using 7 years on a straight-line basis.

• Impairment test: Amortisation method reviewed at each financial year end; closing carrying value reviewed annually for indicators of impairment.

Subsequent expenditure on capitalised intangible assets is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure is expensed as incurred. Gains or losses arising from de-recognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in profit or loss when the asset is de-recognised.

2. Accounting estimates and judgements

The preparation of financial statements requires the use of certain critical accounting estimates. It also requires the Responsible Entity to exercise its judgement in the process of applying the Trusts’ accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed below.

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

(a) Critical accounting estimates and assumptions

The Trusts make estimates and assumptions concerning the future. The resulting accounting estimates, by definition, will seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

(i) Valuation of investment property

The Trusts have investment properties with a carrying amount of $520,184,000 (June 2014: $498,863,000) (refer note 8), and retirement village residents’ loans with a carrying amount of $193,411,000 (June 2014: $190,122,000) (refer note 11), which together represent the estimated fair value of the Trusts continuing interest in retirement villages.

These carrying amounts reflect certain assumptions about expected future rentals, rent-free periods, operating costs and appropriate discount and capitalisation rates. The valuation assumptions for deferred management fee villages reflect assumptions relating to average length of stay, unit market values, estimates of capital expenditure, contract terms with residents, discount rates and projected property growth rates.

In forming these assumptions, the Responsible Entity considered information about current and recent sales activity, current market rents, and discount and capitalisation rates, for properties similar to those owned by the Trusts, as well as independent valuations of the Trust’s property.

Page 18

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

2. Accounting estimates and judgements (continued)

(a) Critical accounting estimates and assumptions (continued)

(ii) Valuation of Inventories

The Trust has inventory in the form of manufactured homes, which it carries at the lower of cost or net realisable value. Estimates of net realisable value are based on the most reliable evidence available at the time the estimates are made, of the amount the inventories are expected to realise and the estimate of costs to complete. Key assumptions require the use of judgement, which are continually reviewed.

(iii) Fair value of derivatives

The fair value of derivative assets and liabilities is based on assumptions of future events and involves significant estimates. Given the complex nature of these instruments and various assumptions that are used in calculating mark-to-market values, the Trusts rely on counterparty valuations for derivative values. The counterparty valuations are usually based on mid-market rates and calculated using the main variables including the forward market curve, time and volatility.

(iv) Valuation of assets acquired in business combinations

Upon recognising the acquisition, management uses estimations and assumptions of the fair value of assets and liabilities assumed at the date of acquisition, including judgements related to valuation of investment property as discussed above.

(v) Valuation of retirement village resident loans

The fair value of the retirement village resident loans is calculated by reference to the initial loan amount and the resident’s share of any capital gains in accordance with their contracts less any deferred management fee income earned to date by the Trusts as operator. The key assumption include calculating the capital gain and deferred management fee income components is the value of the dwelling being occupied by the resident. This value is determined by reference to the valuation of investment property as referred to above.

(b) Critical judgements in applying the entity’s accounting policies

There were no judgements, apart from those involving estimations, that management has made in the process of applying the entity’s accounting policies that had a significant effect on the amounts recognised in the financial report.

Page 19

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

3. Segment information

(a) Description of segments

The Group invests in seniors living properties located in Australia with three reportable segments:

• Garden Villages – rental villages;

• Settlers Lifestyle – deferred management fee villages; and

• Active Lifestyle Estates – comprising permanent and short stay rentals within lifestyle parks and the sale of manufactured homes.

The Group has identified its operating segments based on the internal reports that are reviewed and used by the chief operating decision maker in assessing performance and in determining the allocation of resources. Other parts of the Group are neither an operating segment nor part of an operating segment. Assets that do not belong to an operating segment are described below as “unallocated”.

(b) Ingenia Communities Fund - 31 December 2014

	Active	Settlers	Garden	Corporate/	Total
	Lifestyle		Villages	Unallocated
	Estates
	$’000	$’000	$’000	$’000	$’000
(i) Segment revenue
External segment revenue	192	-	4,668	-	4,860
Interest income	-	-	-	6,852	6,852
Total revenue	192	-	4,668	6,852	11,712
(ii) Segment underlying profit
External segment revenue	192	-	4,668	-	4,860
Interest income	-	-	-	6,852	6,852
Property expenses	-	-	-	(206)	(206)
Administration expenses	-	-	-	(288)	(288)
Operational, marketing and selling expenses	-	-	-	(556)	(556)
Depreciation and amortisation expense	-	-	-	(67)	(67)
Finance expense	-	-	-	(1,975)	(1,975)
Underlying profit/(loss) – continuing operations	192	-	4,668	3,760	8,620
Reconciliation of underlying profit to profit from continuing		operations:
Net foreign exchange loss	-	-	-	2,060	2,060
Net loss on disposal of investment property	-	(2,013)	-	-	(2,013)
Net gain/(loss) on change in fair value of:
Investment properties	(214)	(5)	1,744	-	1,525
Derivatives	-	-	-	98	98
Responsible Entity fees	-	-	-	(878)	(878)
Profit from continuing operations per the
Consolidated Statement of Comprehensive	(22)	(2,018)	6,412	5,040	9,412
Income
(iii) Segment assets
Segment assets	6,878	48,912	116,798	151,261	323,849
Total assets					323,849

Page 20

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

3. Segment information (continued)

(c) Ingenia Communities Fund – 31 December 2013

	Active	Settlers	Garden	Corporate/	Total
	Lifestyle		Villages	Unallocated
	Estates
	$’000	$’000	$’000	$’000	$’000
(i) Segment revenue
External segment revenue	192	-	4,354	-	4,546
Interest income	-	1,660	-	2,576	4,236
Total revenue	192	1,660	4,354	2,576	8,782
(ii) Segment underlying profit
External segment revenue	192	-	4,354	-	4,546
Interest income	-	1,660	-	2,576	4,236
Property expenses	-	-	-	(133)	(133)
Administration expenses	-	-	-	(183)	(183)
Operational, marketing and selling expenses	-	-	-	(207)	(207)
Depreciation and amortisation expense	-	-	-	(42)	(42)
Finance expense	-	-	-	(1,681)	(1,681)
Underlying profit/(loss) – continuing operations	192	1,660	4,354	330	6,536
Reconciliation of underlying profit to profit from continuing		operations:
Net foreign exchange loss	-	-	-	324	324
Net gain/(loss) on change in fair value of:
Investment properties	(565)	-	1,335	-	770
Derivatives	-	-	-	(8)	(8)
Responsible Entity fees	-	-	-	(586)	(586)
Profit from continuing operations per the
Consolidated Statement of Comprehensive Income	(373)	1,660	5,689	60	7,036
(iii) Segment assets
Segment assets	7,154	54,009	99,699	72,086	232,948
Discontinued operations					3,874
Total assets					236,822

Page 21

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

3. Segment information (continued)

(d) Ingenia Communities Management Trust – 31 December 2014

	Active	Settlers	Garden	Corporate/	Total
	Lifestyle		Villages	Unallocated
	Estates
	$’000	$’000	$’000	$’000	$’000
(i) Segment revenue
External segment revenue	10,911	4,658	13,969	-	29,538
Interest Income	-	-	-	5	5
Reclassification of gain on revaluation of newly	-	(1,144)	-	-	(1,144)
constructedvillages
Total revenue	10,911	3,514	13,969	5	28,399
(ii) Segment underlying profit
External segment revenue	10,911	4,658	13,969	-	29,538
Interest income	-	-	-	5	5
Property expenses	(3,140)	(673)	(8,863)	-	(12,676)
Employee expenses	(2,752)	(399)	(4,704)	(25)	(7,880)
Administration expenses	(328)	(32)	(625)	(344)	(1,329)
Operational, marketing and selling expenses	(471)	(45)	(785)	-	(1,301)
Manufactured home cost of sales	(1,102)	-	-	-	(1,102)
Depreciation and amortisation expense	-	-	-	(56)	(56)
Finance expense	-	-	-	(6,957)	(6,957)
Income tax benefit	-	-	-	2,199	2,199
Underlying profit/(loss) – continuing operations	3,118	3,509	(1,008)	(5,178)	441
Reconciliation of underlying profit to profit from	continuing	operations:
Net foreign exchange gain	-	-	-	(2,005)	(2,005)
Net gain on disposal of investment property	-	1,697	-	-	1,697
Net gain/(loss) on change in fair value of:
Investment properties	(8,456)	(2,396)	18	-	(10,834)
Retirement village resident loans	-	(86)	-	-	(86)
Gain on revaluation of newly constructed
villages	-	(1,144)	-	-	(1,144)
Responsible Entity fees	-	-	-	(1,101)	(1,101)
Income tax benefit associated with reconciliation
items	-	-	-	3,464	3,464
Profit from continuing operations per the
Consolidated Statement of Comprehensive	(5,338)	1,580	(990)	(4,820)	(9,568)
Income
(iii) Segment assets
Segment assets	146,217	240,992	1,465	22,089	410,763
Total assets					410,763

Page 22

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

3. Segment information (continued)

(e) Ingenia Communities Management Trust – 31 December 2013

	Active	Settlers	Garden	Corporate/	Total
	Lifestyle		Villages	Unallocated
	Estates
	$’000	$’000	$’000	$’000	$’000
(i) Segment revenue
External segment revenue	4,192	5,902	11,480	-	21,574
Interest income	-	-	3	-	3
Reclassification of gain on revaluation of newly
constructed villages	-	(2,452)	-	-	(2,452)
Total revenue	4,192	3,450	11,483	-	19,125
(ii) Segment underlying profit
External segment revenue	4,192	5,902	11,480	-	21,574
Interest income	-	-	3	-	3
Property expenses	(926)	(479)	(7,815)	-	(9,220)
Employee expenses	(555)	(295)	(3,699)	-	(4,549)
Administration expenses	(108)	(31)	(582)	(133)	(854)
Operational, marketing and selling expenses	(101)	(13)	(1,104)	-	(1,218)
Manufactured home cost of sales	(632)	-	-	-	(632)
Depreciation and amortisation expense	-	-	-	(24)	(24)
Finance expense	-		-	(4,095)	(4,095)
Income tax benefit	-	-	-	430	430
Underlying profit/(loss) – continuing operations	1,870	5,084	(1,717)	(3,822)	1,415
Reconciliation of underlying profit to profit from	continuing	operations:
Net foreign exchange gain	-	-	-	24	24
Net gain/(loss) on change in fair value of:
Investment properties	72	383	-	-	455
Retirement village resident loans	-	60	-	-	60
Gain on revaluation of newly constructed
villages	-	(2,452)	-	-	(2,452)
Responsible Entity fees	-	-	-	(753)	(753)
Income tax benefit associated with reconciliation
items	-	-	-	227	227
Profit from continuing operations per the
Consolidated Statement of Comprehensive	1,942	3,075	(1,717)	(4,324)	(1,024)
Income
(iii) Segment assets
Segment assets	73,234	245,835	1,735	105	320,909
Assets held for sale					46,630
Total assets					367,539

(f) Impact of seasonality on segment results

The results of the Group are affected by the seasonal impact of Active Lifestyle Estate investments. Occupancy rates of short term cabins are higher in the period December through to March each year due to their geographic location and summer holiday months increasing demand for holiday bookings.

Page 23

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

4. Earnings per unit

	INGENIA COMMUNITIES FUND INGENIA COMMUNITIES **MANAGEMENT TRUST **	INGENIA COMMUNITIES FUND INGENIA COMMUNITIES **MANAGEMENT TRUST **
(a) Per unit Profit/(loss) attributable to unitholders ($’000) Profit/(loss) from continuing operations ($’000) Profit/(loss) from discontinued operations ($’000) Weighted average number of units outstanding (thousands) Issued units Dilutive units Performance quantum rights Retention quantum rights	2014	2013 2014 2013
	9,412 9,412 - 763,190 7,558 -	7,035 (10,559) (1,318) 7,036 (9,568) (1,024) (1) (991) (294) 617,384 763,190 617,384 4,710 7,558 4,710 1,818 - 1,818
Weighted average number of issued and dilutive potential securities outstanding (thousands)	770,748	623,912 770,748 623,912
Basic earnings per unit from continuing operations (cents) Basic earnings per unit from discontinued operations (cents) Basic earnings per unit (cents) Dilutive earnings per unit from continuing operations (cents) Dilutive earnings per unit from discontinued operations (cents) Dilutive earnings per unit (cents)	1.2 - 1.2 1.2 - 1.2	1.1 (1.3) (0.2) - (0.1) - 1.1 (1.4) (0.2) 1.1 (1.2) (0.2) - (0.1) - 1.1 (1.4) (0.2)

5. Discontinued operations

(a) Assets Held for Sale

(i) Details of assets held for sale

Noyea Riverside Village (‘Noyea’) was classified as an asset held for sale at 30 June 2014. Noyea was included within the Settlers Lifestyle segment. On 31 July 2014 settlement of this asset occurred for an adjusted sales price of $5.4 million resulting in $nil gain or loss recognised upon completion.

(b) Discontinued operations

(i) Details of discontinued operations

The Group’s investment in its New Zealand Students business was classified as a discontinued operation since 30 June 2011, consistent with the previously announced strategy to focus on transitioning to an actively managed Australian seniors living business. The Group held a 100% interest in three facilities in Wellington, New Zealand that were primarily leased for 15 years to Victoria University of Wellington and Wellington Institute of Technology. The Group completed the sale of these assets in December 2014. Funds still remain in New Zealand to facilitate the final stages of exit.

Page 24

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

5. Discontinued operations (continued)

(ii) Financial performance

The financial performance of components of the Trusts disposed of or classified as discontinued operations at 31 December 2014 was:

(ii) Financial performance The financial performance of components of the Trusts operations at 31 December 2014 was:	disposed of or classified as discontinued
	INGENIA COMMUNITIES FUND INGENIA COMMUNITIES MANAGEMENT TRUST
Revenue Net gain/(loss) on change in fair value of investment properties Unrealised net foreign exchange gain/(loss) Interest income Expenses Interest expense Disposal costs associated with overseas investments Share of netprofit of equityaccounted investments	2014 2013 2014 2013 $’000 $’000 $’000 $’000
	- - 2,182 1,041 - - - (335) - - (2,088) 630 - 36 2 5 - (1) (715) (784) - - (799) (702) - - - (143) - (32) - -
Profit/(loss) from operating activities before income tax Income tax expenses	- 3 (1,418) (288) - (4) (10) (6)
Profit/(loss) from operating activities - (1) (1,428) (294) Gain/(loss) on sale of discontinued operations (net of tax) - - (1,937) - Release of foreign currency translation reserve on disposal of foreign operations - - 2,374 -
Profit/(loss) from discontinued operations for the half-year - (1) (991) (294)

Page 25

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

5. Discontinued operations (continued)

(b) Discontinued operations (continued)

(iii) Cash flows

The cash flows of components of the Trusts disposed of or classified as discontinued operations were:

	INGENIA COMMUNITIES FUND INGENIA COMMUNITIES MANAGEMENT TRUST
Net cash flow from operating activities Net cash flow from investing activities (Payments)/proceeds on sale of discontinued operations Additions to investment properties Payments for lease arrangements Other Net cash flow from financing activities Transfer to continuing operations	2014 2013 2014 2013 $’000 $’000 $’000 $’000
	- - 179 (371) - - 44,247 (65) - - - (7,738) - - (4) (80) - - - 308 - - (30,345) 10,161 - - (15,738) -
Net cash flows from discontinued operations - - (1,661) 2,215

(iv) Assets and liabilities

The assets and liabilities of components of the Trusts classified as disposal groups at each reporting date were:

date were:
	INGENIA COMMUNITIES FUND INGENIA COMMUNITIES MANAGEMENT TRUST
Assets Cash and cash equivalents Trade and other receivables Investment properties Plant and equipment Equity accounted investments	Dec 2014 Jun 2014 Dec 2014 Jun 2014 $’000 $’000 $’000 $’000
	- - - 1,657 - - - 98 - - - 45,902 - - - - - 3,874 - -
Total assets	- 3,874 - 47,657
Liabilities Bank overdraft Payables Borrowings Deferred tax liabilities	- - - - - - - 368 - - - 30,081 - - - -
Total liabilities	- - - 30,449
Net assets of disposal groups	- 3,874 - 17,208

(v) Capitalisation rate

The weighted average capitalisation rate of the New Zealand Students internal valuation within discontinued operations at 30 June 2014 was 8.6%.

Page 26

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

6. Cash and cash equivalents

6. Cash and cash equivalents
	INGENIA COMMUNITIES FUND INGENIA COMMUNITIES MANAGEMENT TRUST
Cash at bank and in hand Reconciliation to statements of cash flow Cash and cash equivalents attributable to: Continuing operations – cash at bank Discontinued operations – cash at bank	Dec 2014 $’000 Jun 2014 $’000 Dec 2014 $’000 Jun 2014 $’000
	8,000 2,658 16,543 3,893
	Dec 2014 $’000 Dec 2013 $’000 Dec 2014 $’000 Dec 2013 $’000
	8,000 11,556 16,543 1,711 - - - 1,236

7. Inventories

7. Inventories
	INGENIA COMMUNITIES FUND INGENIA COMMUNITIES MANAGEMENT TRUST
Current assets Manufactured homes	Dec 2014 $’000 Jun 2014 $’000 Dec 2014 $’000 Jun 2014 $’000
	- - 6,437 2,208

Page 27

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

8. Investment properties

(a) Summary of carrying amounts

	INGENIA COMMUNITIES FUND INGENIA COMMUNITIES MANAGEMENT TRUST
Completed properties Properties under development	Dec 2014 $’000 Jun 2014 $’000 Dec 2014 $’000 Jun 2014 $’000
	142,766 1,387 133,101 1,387 361,712 14,319 349,517 14,858
	144,153 134,488 376,031 364,375

(b) Movements in carrying amounts

(b) Movements in carrying amounts
	INGENIA COMMUNITIES FUND INGENIA COMMUNITIES MANAGEMENT TRUST
Carrying amount at beginning of period Acquisitions Expenditure capitalised Transferred from plant and equipment Disposals Sale of unit – Strata title Transferred to inventory Net gain/(loss) on change in fair value	Dec 2014 $’000 Jun 2014 $’000 Dec 2014 $’000 Jun 2014 $’000
	134,488 120,167 364,375 250,764 - 10,616 24,749 108,300 977 2,175 4,904 7,551 - - - 320 7,163 - (7,163) - - - - (495) - - - (194) 1,525 1,530 (10,834) (1,871)
Carrying amount at the end of the period	144,153 134,488 376,031 364,375

The net change in fair value are recognised in profit or loss as a net gain/(loss) on change in fair value of investment properties.

Fair value hierarchy disclosures for investment properties have been provided in note 13.

Page 28

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

9. Trade and other payables

	INGENIA COMMUNITIES	INGENIA COMMUNITIES	INGENIA COMMUNITIES	INGENIA COMMUNITIES
	FUND		MANAGEMENT	TRUST
	31 Dec	30 Jun	31 Dec	30 Jun
	2014	2014	2014	2014
	$’000	$’000	$’000	$’000
Current liabilities
Trade and other payables	681	1,210	7,941	8,480
Deposits and other unearned income	-	-	3,442	-
Deferred landpayment	-	-	3,500	-
Total current liabilities	681	1,210	14,883	8,480
Non-current liabilities
Deferred land payment	-	-	10,500	4,000

10. Borrowings

10. Borrowings
				INGENIA COMMUNITIES
		INGENA COMMUNITIES	FUND	MANAGEMENT TRUST
		31 Dec	30 Jun	31 Dec	30 Jun
		2014	2014	2014	2014
	Note	$’000	$’000	$’000	$’000
Current liabilities
Bank debt	(a)	21,000	-	-	-
Prepaid borrowing costs		(60)	-	-	-
Finance leases		-	-	3,465	3,461
		20,940	-	3,465	3,461
Non-current liabilities
Bank debt	(a)	-	94,000	-	-
Prepaid borrowing costs		-	(312)	-	-
Finance leases		-	-	32,659	41,883
		-	93,688	32,659	41,883

(a) Bank debt

(i) Current debt facility

• This facility expires on 30 September 2015 and has the following principal financial covenants:

• Loan to value ratio (“LVR”) is less than or equal to 50%;

• Total leverage ratio does not exceed 50%; and

• Interest cover ratio (as defined) of at least 1.50x in financial year ending 2014 increasing to at least 1.75x in FY2015.

As at 31 December 2014, the facility has been drawn to $21,000,000 (30 June 2014: $94,000,000). The carrying value of investment property net of resident liabilities at reporting date for the Group’s Australian properties pledged as security is $314,181,000 (30 June 2014: $290,375,000).

(ii) Australian multilateral debt facility

On 13 February 2015, the Group completed refinancing its debt and now has a $175m Australian Multilateral banking facility in place. The facility, is split between a three year and a five year maturity profile.

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Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

10. Borrowings (continued)

(b) Bank guarantees

The Group has the ability to utilise a portion of this $129.5 million bank facility to provide bank guarantees. Bank guarantees at 31 December 2014 were $24.3 million (30 June 2014: $4.4m).

11. Retirement village resident loans

(a) Summary of carrying amounts

(a) Summary of carrying amounts
			INGENIA COMMUNITIES
	INGENA COMMUNITIES	FUND	MANAGEMENT	TRUST
	31 Dec	30 Jun	31 Dec	30 Jun
	2014	2014	2014	2014
	$’000	$’000	$’000	$’000
Gross resident loans	-	-	223,357	218,639
Accrued deferred management fee	-	-	(29,946)	(28,517)
Net resident loans	-	-	193,411	190,122

(b) Movements in Carrying Amounts

			INGENIA COMMUNITIES	INGENIA COMMUNITIES
	INGENA COMMUNITIES	FUND	MANAGEMENT	TRUST
	31 Dec	30 Jun	31 Dec	30 Jun
	2014	2014	2014	2014
	$’000	$’000	$’000	$’000
Carrying amount at beginning of period	-	-	190,122	175,703
Net (gain)/loss on change in fair value of
resident loans	-	-	86	616
Accrued deferred management fee income	-	-	(2,735)	(5,333)
Deferred management fee cash collected	-	-	1,308	1,811
Proceeds from resident loans	-	-	10,773	22,021
Repayment of resident loans	-	-	(6,221)	(10,361)
Transfer to assets held for sale	-	-	-	5,439
Other	-	-	78	226
Carrying amount at end ofperiod	-	-	193,411	190,122

Fair value hierarchy disclosures for retirement village resident loans have been provided in note 13.

Page 30

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

12. Issued units

(a) Carrying amounts

	INGENIA COMMUNITIES	INGENIA COMMUNITIES	INGENIA COMMUNITIES	INGENIA COMMUNITIES
	FUND		MANAGEMENT	TRUST
	31 Dec	30 Jun	31 Dec	30 Jun
	2014	2014	2014	2014
	$’000	$’000	$’000	$’000
At beginning of period	547,642	497,956	14,097	6,106
Dividend reinvestment plan issue	1,070	-	220	-
Institutional placement	36,835	-	7,693	-
Rights issue	35,578	51,985	7,430	8,364
Institutionalplacement and rights issue costs	(3,143)	(2,299)	(656)	(373)
At end ofperiod	617,982	547,642	28,784	14,097
The closing balance is attributable to the unitholders
of:
Ingenia Communities Fund	617,982	547,642	-	-
Ingenia Communities Management Trust	-	-	28,784	14,097
	617,982	547,642	28,784	14,097

(b) Number of issued units

(b) Number of issued units
	INGENIA COMMUNITIES FUND		INGENIA	COMMUNITIES
			MANAGEMENT TRUST
	31 Dec 2014	30 Jun 2014	31 Dec 2014	30 Jun 2014
	‘ 000	‘ 000	‘ 000	‘000
At beginning of period	676,240	507,179	676,240	507,179
Issued during the year:
Retention quantum rights	1,818	-	1,818	-
Dividend reinvestment plan	2,826	-	2,826	-
Institutionalplacement and rights issue	197,968	169,061	197,968	169,061
At end of period	878,852	676,240	878,852	676,240

(c) Terms of units

All units are fully paid and rank equally with each other for all purposes. Each unit entitles the holder to one vote, in person or by proxy, at a meeting of unitholders.

Page 31

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

13. Financial instruments

The Trust’s use the following fair value measurement hierarchy:

• Level 1: fair value is calculated using quoted prices in active markets for identical assets or liabilities;

• Level 2: fair value is calculated using inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices); and

• Level 3: fair value is calculated using inputs for the asset or liability that are not based on observable market data.

Quoted market price represent the fair value determined based on quoted prices on active markets as at the reporting date without deduction for transaction costs.

The following table represents the Trust’s financial instruments that were measured and recognised at fair value at reporting date:

Financial assets/ financial liabilities Valuation technique(s) and key inputs Significant Unobservable Inputs	Relationship of unobservable inputs to fair value
Retirement village resident loans Loans measured as the ingoing resident’s contribution plus the resident’s share of capital appreciation to reporting date, less DMF accrued to reportingdate Long-term capital appreciation rates for residential property between 0-4%. Estimated length of stay of residents based on life tables	The higher the appreciation, the higher the value of resident loans. The longer the length of stay, the lower the value of resident loans
Deferred management fee accrued DMF measured using the initial property price, estimated length of stay, various contract terms and projected property price at time of re-leasing Estimated length of stay of residents based on life table	The longer the length of stay, the higher the DMF accrued, capped at a predetermined period of time.
Derivative interest rate swaps Net present value of future cash flows discounted at market rates adjusted for the Group’s credit risk N/A	N/A

There has been no movement from Level 3 to Level 2 during the current period. Changes in the Trust’s retirement village resident loans which are Level 3 instruments are presented in note 11.

The carrying amount of the Trust’s other financial instruments approximate their fair values.

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Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

14. Fair value measurement

The following table provides the fair value measurement hierarchy of the Trust’s assets and liabilities:

(a) Assets measured at fair value

FAIR VALUE MEASUREMENT USING

			Prices quoted	Significant	Significant
			in active	observable	unobservable
			markets	inputs	inputs
		Total	(Level 1)	(Level 2)	(Level 3)
31 December 2014	Date of valuation	$’000	$’000	$’000	$’000
Assets
Ingenia Communities Fund
Investment properties	31 December 2014 Refer to note 8	144,153	-	-	144,153
Ingenia Communities Management Trust
Investment properties	31 December 2014 Refer to note 8	376,031	-	-	376,031

(b) Liabilities measured at fair value

(b) Liabilities measured at fair value
31 December 2014 Date of valuation Total $’000	FAIR VALUE MEASUREMENT USING
	Prices quoted in active markets (Level 1) $’000 Significant observable inputs (Level 2) $’000 Significant unobservable inputs (Level 3) $’000
Liabilities Ingenia Communities Fund Derivatives 31 December 2014 70 Ingenia Communities Management Trust Retirement village resident loans 31 December 2014 Refertonote11 193,411	- 70 - - - 193,411

There have been no transfers between Level 2 and Level 3 during the period.

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Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

14. Fair value measurement (continued)

(c) Fair value hierarchy for financial instruments measured at fair value as at 30 June 2014

(i) Assets measured at fair value

30 June 2014 Date of valuation Total $’000	FAIR VALUE MEASUREMENTUSING
	Prices quoted in active markets (Level 1) $’000 Significant observable inputs (Level 2) $’000 Significant unobservable inputs (Level 3) $’000
Assets Ingenia Communities Fund Investment properties 30 June 2014 Refer to note 8 134,488 Ingenia Communities Management Trust Investment properties 30 June 2014 Refertonote 8 364,375	- - 134,488 - - 364,375

(ii) Liabilities measured at fair value

(ii) Liabilities measured at fair value
30 June 2014 Date of valuation Total $’000	FAIR VALUE MEASUREMENT USING
	Prices quoted in active markets (Level 1) $’000 Significant observable inputs (Level 2) $’000 Significant unobservable inputs (Level 3) $’000
Liabilities Ingenia Communities Fund Derivatives 30 June 2014 168 Ingenia Communities Management Trust Retirement village resident loans 30 June 2014 Refer to note 11 190,122	- 168 - - - 190,122

Page 34

Ingenia Communities Fund & Ingenia Communities Management Trust Notes to the financial statements Half-year ended 31 December 2014

15. Distributions

Distributions declared and paid for the half-year are detailed below.

	INGENA COMMUNITIES FUND	INGENA COMMUNITIES FUND	INGENIA COMMUNITIES	INGENIA COMMUNITIES
			MANAGEMENT TRUST
	31 Dec	31 Dec	31 Dec	31 Dec
	2014	2013	2014	2013
	$’000	$’000	$’000	$’000
Recognised Distribution
Cents per unit	0.65	0.5	-	-
Total amount ($’000)	4,407	2,536	-	-
Payment date	17 Sep 2014	20 Sep 2013	-	-
Unrecogised Distribution
Cents per unit	0.65	0.5	-	-
Total amount ($’000)	5,713	3,381	-	-
Payment date	18 Mar 2015	21 Mar 2014	-	-

All distributions are made by ICF and are 100% tax deferred.

16. Subsequent events

On 27 January 2015, the Group announced it had exchanged conditional contracts for the acquisition of Sydney Hills Holiday Park in Dural, NSW. The acquisition price is approximately $12m (excluding acquisition costs) subject to due diligence and Board approval and will be funded from the proceeds of the capital raising in October 2014.

On 13 February 2015, the Group completed refinancing its debt and now has a $175 m Australian Multilateral banking facility in place. The facility, is split between a three year and a five year maturity profile.

On 18 February 2015, the Group settled Big 4 Bougainvillia Holiday Park, a lifestyle park, located in Tewantin, QLD. The purchase price of $12.5m was funded from the proceeds of the capital raising in October 2014.

On 24 February 2015 the directors resolved to declare an interim distribution of 0.65 cpu (2014: 0.5cpu) amounting to $5,712,537 to be paid on 18 March 2015. The distribution will be paid from ICF and will be 100% tax deferred and the dividend reinvestment plan will apply to the interim distribution.

Page 35

Ingenia Communities Fund & Ingenia Communities Management Trust Directors’ declaration Half-year ended 31 December 2014

In accordance with a resolution of the directors of Ingenia Communities RE Limited, I state

that:

1. In the opinion of the directors:

2. (a) the financial statements and notes of Ingenia Communities Fund and of Ingenia Communities Management Trust are in accordance with the Corporations Act 2001 , including:

3. (i) giving a true and fair view of each Trust’s financial position as at 31 December 2014 and of their performance for the half-year ended on that date; and

4. (ii) complying with Accounting Standards and Corporations Regulations 2001 ; and

5. (b) there are reasonable grounds to believe that Ingenia Communities Fund and Ingenia Communities Management Trust will be able to pay their debts as and when they become due and payable.

On behalf of the board

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Jim Hazel Chairman 24 February 2015

Ernst & Young 680 George Street Sydney NSW 2000 Australia GPO Box 2646 Sydney NSW 2001

Tel: +61 2 9248 5555 Fax: +61 2 9248 5959 ey.com/au

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To the unitholders of Ingenia Communities Fund and Ingenia Communities Management Trust (“the Trusts”)

Report on the Half-year Financial Reports

We have reviewed the accompanying half-year financial reports which have been prepared in accordance with ASIC class order 05/642 and comprise:

• the consolidated statement of financial position as at 31 December 2014, the consolidated statement of profit and loss and other comprehensive income, the statement of changes in unitholders’ interest and the consolidated statement of cash flow for the half-year then ended, notes comprising a summary of significant accounting policies and other explanatory information, and the directors' declaration of Ingenia Communities Fund, comprising Ingenia Communities Fund and the entities it controlled at half-year end or from time to time during the half-year.

• the consolidated statement of financial position as at 31 December 2014, the consolidated statement of profit and loss and other comprehensive income, the statement of changes in unitholders’ interest and the consolidated statement of cash flow for the half-year then ended, notes comprising a summary of significant accounting policies and other explanatory information, and the directors' declaration of Ingenia Communities Management Trust, comprising Ingenia Communities Management Trust and the entities it controlled at half-year end or from time to time during the halfyear.

Directors’ Responsibility for the Half-year Financial Report

The directors of the Ingenia Communities RE Limited as Responsible Entity of the Trusts are responsible for the preparation of the half-year financial reports that give a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal controls as the directors determine are necessary to enable the preparation of the half-year financial reports that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express a conclusion on the half-year financial reports based on our review. We conducted our review in accordance with Auditing Standard on Review Engagements ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity , in order to state whether, on the basis of the procedures described, we have become aware of any matter that makes us believe that the financial reports are not in accordance with the Corporations Act 2001 including: giving a true and fair view of each consolidated entities’ financial position as at 31 December 2014 and its performance for the half-year ended on that date; and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 . As the auditor of the Trusts and the entities they controlled during the half-year, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

A review of a half-year financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Independence

In conducting our review, we have complied with the independence requirements of the Corporations Act 2001 . We have given to the directors of the Responsible Entity a written Auditor’s Independence Declaration, a copy of which is included in the Directors’ Report.

A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

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Conclusion

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half-year financial reports of the Trusts are not in accordance with the Corporations Act 2001 , including:

• a) giving a true and fair view of each consolidated entity’s financial position as at 31 December 2014 and of its performance for the half-year ended on that date; and

• b) complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 .

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Ernst & Young

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Chris Lawton Partner Sydney 24 February 2015

A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

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