LENDLEASE GROUP - Interim / Quarterly Report 2017

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27 February 2017
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2017 Half Year Results Lendlease Group

Further to Lendlease Group’s earlier announcement today, attached are the following documents:

ASX Announcement
Lendlease Group Financial Results Presentation and Appendix

ENDS

FOR FURTHER INFORMATION, PLEASE CONTACT:

Investors: Justin McCarthy Tel: 02 9236 6464 Mob: 0422 800 321

Media: Natalie Campbell Tel: 02 9236 6865 Mob: 0410 838 914

Lend Lease Corporation Limited ABN 32 000 226 228 and Lend Lease Responsible Entity Limited ABN 72 122 883 185 AFS Licence 308983 as responsible entity for Lend Lease Trust ABN 39 944 184 773 ARSN 128 052 595

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Level 14, Tower Three, International Towers Sydney Exchange Place, 300 Barangaroo Avenue Barangaroo NSW 2000 Australia

Telephone +61 2 9236 6111 Facsimile +61 2 9252 2192 lendlease.com

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27 February 2017
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Lendlease delivers double digit earnings growth, continued execution excellence

27 February 2017

For the half year ended 31 December 2016[1] :

Profit after Tax of $394.8 million, up 12 per cent and earnings per stapled security of 67.8 cents, up 11 per cent
Return on equity of 13.7 per cent[2] , upper end of the 10 – 14 per cent target range
Interim unfranked distribution of 33 cents per stapled security
Capital solutions secured across four office developments
Total residential presales of $5.7 billion
Engineering activity accelerating, on track for larger earnings contribution
Funds Under Management (FUM) of $24.7 billion, up 12 per cent
Strong balance sheet with gearing of 5.1 per cent[3] and available liquidity of $3.3 billion

Lendlease Group Chief Executive Officer and Managing Director, Steve McCann, said “Lendlease produced a strong result for the half year ended 31 December 2016.”

“We had success in converting our pipeline into delivery with the forward sale of three office buildings, in addition to the creation of a capital solution for the Circular Quay Tower.

Commercial development, in particular the Australian office sector, was a highlight of the first half result. At Barangaroo South, Tower 1 reached practical completion with all three office towers now operational,” said Mr McCann.

Lendlease now has a total of 13 major commercial buildings across the globe in delivery with a combined estimated end value of around $7 billion. These projects in delivery provide future secured FUM of around $3 billion.

1 Comparative period the half year ended 31 December 2015 (the prior corresponding period).

2 Return on equity is calculated on an annualised basis, using the half year profit after tax divided by the arithmetic average of beginning and half year end securityholders’ equity.

3 Net debt to total tangible assets less cash.

Telephone +61 2 9236 6111 Facsimile +61 2 9252 2192 lendlease.com

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Lendlease Corporation Limited ABN 32 000 226 228 and Lendlease Responsible Entity Limited ABN 72 122 883 185 AFS Licence 308983 as responsible entity for Lendlease Trust ABN 39 944 184 773 ARSN 128 052 595

Level 14, Tower Three, International Towers Sydney Exchange Place, 300 Barangaroo Avenue Barangaroo NSW 2000 Australia

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27 February 2017
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“We also have an estimated $9 billion of additional commercial development end value remaining in our secured pipeline. Importantly, the conversion of that pipeline will underpin future earnings across all three segments of our integrated model,” said Mr McCann.

Total residential pre-sales of $5.7 billion also provides good future earnings visibility.

The Construction margin improved by 70 bps to 2.7 per cent and in conjunction with higher revenue generated a strong lift in Construction EBITDA.

The Investments segment, representing 40 per cent of operating EBITDA, continues to deliver solid recurring style earnings.

The Group maintains an unwavering commitment to safety. The Group achieved a 17 percent decline in the lost time injury frequency rate on the prior corresponding period[4] .

Group Financials

Group Chief Financial Officer, Tarun Gupta said “the double digit EBITDA growth in all three operating segments was a highlight for the half year and underpinned EBIT growth of 26 per cent.”

Financial returns were strong in the period with Development ROIC[5] of 12.7 per cent and Investments ROIC[5] of 13.4 per cent, both above their respective target range.

Mr Gupta said “the Group continued to maintain a conservative financial setting which provides the flexibility to continue to explore new pipeline opportunities in line with our strategy.”

At 31 December 2016, Lendlease held a cash balance of $1.0 billion and undrawn debt facilities of $2.3 billion, providing substantial financial flexibility.

Gearing ended the period at 5.1 per cent[6] , and the interest coverage ratio was 10.8 times.

Outlook

Mr McCann said, “We remain well placed for future success given earnings visibility and a targeted and disciplined approach to delivering on our strategy. We have made further progress in implementing our integrated business model in target gateway cities.

4 Comparative period the half year ended 31 December 2015 (the prior corresponding period).

5 Return on Invested Capital (annualised measure).

6 Net debt to total tangible assets less cash.

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Level 14, Tower Three, International Towers Sydney Exchange Place, 300 Barangaroo Avenue Barangaroo NSW 2000 Australia

Telephone +61 2 9236 6111 Facsimile +61 2 9252 2192 lendlease.com

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27 February 2017
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The Development pipeline of $49.0 billion will help drive earnings over an extended time horizon.

Construction backlog revenue stands at $20.5 billion with further work of approximately $7 billion in preferred bidder status.

The Investments platform has FUM of $24.7 billion with approximately $3 billion[7 ] of additional secured FUM across the Group’s urbanisation projects in delivery.

“We have had substantial origination success post balance date. We have been recommended as preferred bidder[8] on the estimated GBP2 billion mixed use urbanisation project in Haringey, London, in addition to securing a number of significant construction contracts,” said Mr McCann.

These wins will contribute strongly to our continuing growth momentum.

Further information regarding Lendlease’s results is set out in the Group’s financial results presentation for the half year ended 31 December 2016 and is available on www.lendlease.com.

ENDS

FOR FURTHER INFORMATION, PLEASE CONTACT:

Investors: Media: Justin McCarthy Natalie Campbell Tel: 02 9236 6464 Tel: 02 9236 6865 Mob: 0422 800 321 Mob: 0410 838 914

2017 Key Dates for Investors
Interim distribution declared	27 February
Securities quoted ex-dividend on the Australian Securities Exchange	2 March
Interim distribution record date	3 March
Interim distribution payable	24 March
FY17 results released to market/final distribution declared	28 August
Annual General Meeting	17 November

7 Represents secured future FUM increase from funds with development projects in delivery. 8 Remains subject to contractual close.

Telephone +61 2 9236 6111 Facsimile +61 2 9252 2192 lendlease.com

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Level 14, Tower Three, International Towers Sydney Exchange Place, 300 Barangaroo Avenue Barangaroo NSW 2000 Australia

Lendlease 2017 Half Year Results

27 February 2017

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LENDLEASE – HY17 FINANCIAL RESULTS

Indigenous engagement and reconciliation

Lendlease’s vision for Reconciliation is one in which all our employees acknowledge and celebrate the proud heritage of Australia’s First Peoples and promote opportunities for career development, sustainable business growth and economic participation of Aboriginal and Torres Strait Islander Australians within our sector

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LENDLEASE – HY17 FINANCIAL RESULTS

Topic	Speaker	Slide
Group Performance and Results Highlights	Steve McCann Group Chief Executive Officer and Managing Director	4
Financials	Tarun Gupta Group Chief Financial Officer	9
Operational Update	Steve McCann Group Chief Executive Officer and Managing Director	15
Outlook	Steve McCann Group Chief Executive Officer and Managing Director	19

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Section 1 Group Performance and Results Highlights Steve McCann Group Chief Executive Officer and Managing Director

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Image: Barangaroo South, Sydney

LENDLEASE – HY17 FINANCIAL RESULTS

Vision: to create the best places

Strategic framework

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Competitive advantage

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Business model

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Pillars of value

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HY17 Safety

1.62 (1.95 in HY16) Lost Time Injury Frequency Rate in the last 6 months

1.20 (1.64 in HY16) Critical Incident Frequency Rate in the last 6 months

LENDLEASE – HY17 FINANCIAL RESULTS

Double digit earnings growth, continued execution excellence

Securityholder returns[1]

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Profit after Tax of $394.8 million, up 12%, and earnings per stapled security of 67.8 cents, up 11%
Interim distribution of 33 cents per security, representing a dividend payout ratio of 49%
Return on equity of 13.7%[2] , at the upper end of our 10% – 14% target range

Performance highlights[1]

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Capital solutions secured across 4 office developments
Total residential presales of $5.7 billion
Construction margin up 70 bps to 2.7%
Engineering activity accelerating, on track for larger earnings contribution
Investments segment continues to deliver solid recurring style earnings, representing 40% of operating EBITDA
Growth in Funds Under Management (FUM) of 12% to $24.7 billion
Gearing of 5.1%[3] and liquidity of $3.3 billion, including cash and cash equivalents of $1.0 billion
Operating and Investing cash flow of $243.0 million, 62% of Profit after Tax
Comparative period the half year ended 31 December 2015 (the prior corresponding period)

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Return on equity is calculated on an annualised basis using the half year profit after tax divided by the arithmetic average of beginning and half year end securityholders’ equity
Net debt to total tangible assets less cash

LENDLEASE – HY17 FINANCIAL RESULTS

Commercial success highlights resilience of business model

Commercial completion profile[1] (‘000s sqm)

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2
55
47
44
37 38
34
31
28
26 26 26
15
7
Intl. House Darling Square Intl. Quarter Intl. Quarter Darling Square PLQ Office PLQ Office PLQ Office PLQ Retail Melb. Quarter Victoria Brisbane Circular Quay
Sydney Office Office London Office London Office Hotel No. 1 No. 2 No. 3 Office Harbour Office Showgrounds Office
No. 1 No. 2 Office
H2 FY17 FY18 FY19 FY21
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Competitive advantage generated by the integrated model critical to commercial development success

Barangaroo South office T1 reached practical completion. All three towers now operational
c.85,000 sqm of new commercial leasing[3 ]
4 new buildings commenced delivery in HY17 representing an end value of c.$2.5 billion[2]
13 major commercial buildings in delivery with total end value of c.$7 billion[4] or 414,000 sqm
Buildings in delivery to provide additional secured FUM of c.$3 billion[5]
Further $9.2 billion or 762,000 sqm of commercial development already secured in remaining development pipeline
Based on expected completion date of major commercial projects only, subject to change in delivery program. Not indicative of cash or profit recognition 2. Circular Quay Tower construction start remains subject to certain preconditions

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Includes Agreements for Lease and Heads of Terms
Remaining end value to be delivered as at 31 December 2016 of $5.7 billion
Represents secured future FUM increase from funds with development projects in delivery

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Section 2 Financials

Tarun Gupta Group Chief Financial Officer

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Image: 432 Park Avenue, New York

LENDLEASE – HY17 FINANCIAL RESULTS

Financial performance

$ million	HY16	HY17	Change
Development	236.2	260.2	10%	•	Strong Australian commercial result, investing in offshore regions
Construction	117.3	170.2	45%	•	Rebound in the Americas margin, Engineering activity increasing
Investments	243.0	288.4	19%	•	Both ownership and operating earnings growth
Operating EBITDA	596.5	718.8	21%
Corporate costs	(84.5)	(79.2)	(6%)	•	HY17 comprises Group Services costs of $69.1 million1, down 4.0%
Group EBITDA	512.0	639.6	25%
Depreciation and amortisation	(40.8)	(47.8)	17%	•	Higher amortisation on investment in systems
EBIT	471.2	591.8	26%
Net finance costs	(45.7)	(49.6)	9%	•	Lower interest revenue in HY17 given discount unwind benefit in HY162
PBT	425.5	542.2	27%
Income tax expense	(71.9)	(147.7)	105%	•	Effective tax rate of 27.2%, up 10.3 percentage points
External non-controlling interests	0.2	0.3	n/a
NPAT	353.8	394.8	12%
Weighted avg. securities	580.9	582.7	-
EPS cents	60.9	67.8	11%

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Remaining HY17 corporate costs represent Group Treasury of $10.1 million 2. Relates to the Military Housing Privatisation Initiative business

LENDLEASE – HY17 FINANCIAL RESULTS

Cash flow movements ($b)[1]

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Denotes major movements
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Barangaroo Commercial +$0.8b, other Urbanisation +$0.4b, PLLACes +$0.2b, Communities +$0.3b

Urbanisation ($1.4b), Communities ($0.3b), other operating payments ($0.2b)

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Equity contribution to LLOneITST [3]
1.8 ($0.1b), Retirement properties ($0.1b)
(1.9)
Net repayment of GBP
Club Revolving Credit
Facility ($0.2b)
(0.3)
0.6
(0.2)4
Circular Quay Tower +$0.3b, NZ
1.0 Retirement disposal [2] +$0.2b 1.0
FY16 closing cash Operating inflow Operating outflow Investing inflow Investing outflow Net financing and HY17 closing cash
other adjustments
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Represents an indicative analysis of operating cash inflows and outflows. Note, operating cash inflows and outflows relating to Construction have been included as a net position in the above chart

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Late in FY16, the Group divested the New Zealand Retirement business, with proceeds subsequently received in HY17
Lendlease One International Towers Sydney Trust (Barangaroo South T1)
Includes the impact of fx movements on opening cash

LENDLEASE – HY17 FINANCIAL RESULTS

Financial position

$ million	31 Dec 15	30 Jun 16	31 Dec 16
Assets				Key areas of capital employed
Cash and cash equivalents	570.0	1,008.4	1,020.8	•	Development inventories of $4.1 billion
Inventories	4,639.6	4,602.9	4,963.6	•	Investments of $3.3 billion including:
Equity accounted investments Investment properties1	1,275.2 6,312.7	1,152.6 5,940.7	744.0 6,439.5		−Co-Investments of $1.5 billion
Other assets (including financial)	6,286.4	5,888.3	5,738.6		−Retirement Ownership of $1.7 billion
Total assets	19,083.9	18,592.9	18,906.5		−Infrastructure of $0.1 billion

Liabilities				Funding and liquidity
Borrowings and financing arrangements	2,592.5	2,031.3	1,844.9	•	$1.0 billion of cash and $2.3 billion in undrawn
Other liabilities (including financial)1	11,117.2	10,946.9	11,114.4		debt facilities
Total liabilities	13,709.7	12,978.2	12,959.3	•	Interest coverage of 10.8 times
				•	Gearing of 5.1%2
Net assets	5,374.2	5,614.7	5,947.2	•	Prudent debt maturity profile, no material
					concentrations
Gearing2	12.1%	6.5%	5.1%

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Investment properties includes retirement properties of $6,236.6 million. Other liabilities includes retirement resident liabilities of $4,444.1 million 2. Net debt to total tangible assets less cash

LENDLEASE – HY17 FINANCIAL RESULTS

Portfolio Management Framework

EBITDA mix

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36%
40%
$718.8m [1]
24%
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Development Construction Investments Target (35 – 45%) (20 – 30%) (30 – 40%) weighting

Invested capital

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By segment
$6.0b [2] 47%
53%
Development Investments
(40 – 60%) (40 – 60%)
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By region 9%[6%] 8% $6.4b[3] 77% Australia Asia Europe Americas (50 – 70%) (5 – 20%) (5 – 20%) (5 – 20%)

Returns

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Development – ROIC[4]

Investments – ROIC[4]

Construction – EBITDA margin

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Target 3 – 4%
Target 9 – 12% [5]
Target 8 – 11% [5]
13.4%
12.7%
12.2%
11.3%
2.7%
2.0%
HY16 HY17 HY16 HY17 HY16 HY17
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Operating EBITDA
Invested capital for Development and Investments. Total Lendlease invested capital as at 31 December 2016 was $6.8 billion

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Invested capital for Australia, Asia, Europe and the Americas. Total Lendlease invested capital as at 31 December 2016 was $6.8 billion ($0.4 billion, Corporate) 4. Return on Invested Capital (ROIC) definition: Operating Profit after Tax / Average Invested Capital (Annualised measure)
Through-cycle target based on rolling 3-5 year timeline

LENDLEASE – HY17 FINANCIAL RESULTS

Portfolio Management Framework

Return on equity (ROE)[1]

Distributions

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2 cents
18.2% Target 10 – 14%
80 70%
3 70 Target 40 – 60% 60%
13.5% 13.6% 13.7%
12.4% 13.0% 60
50%
50 2
49 30
40 27 40%
30 20
22 30%
20
27 30 33 20%
10 22 22
16
0 10%
FY12 FY13 FY14 FY15 FY16 HY17 FY12 FY13 FY14 FY15 FY16 HY17
Interim distribution (LHS) Final distribution (LHS)
[[4]] Payout ratio (RHS)
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Gearing[[4]]

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10.5%
Target 10 – 15%
6.5%
5.5% 5.4% 5.7% 5.1%
FY12 FY13 FY14 FY15 FY16 HY17
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Full year ROE is calculated using the annual profit after tax divided by the arithmetic average of beginning, half and year end securityholders’ equity 2. FY14 includes Bluewater sale

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Half year ROE is calculated on an annualised basis, using the half year profit after tax divided by the arithmetic average of beginning and half year end securityholders’ equity
Net debt to total tangible assets less cash

Section 3 Operational Update

Steve McCann Group Chief Executive Officer and Managing Director

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Artist impression: Paya Lebar Quarter, Singapore

LENDLEASE – HY17 FINANCIAL RESULTS

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36%
of operating
Commercial building completion profile [5] ($b) EBITDA
By estimated total end value
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Development

Performance highlights[1]

ROIC of 12.7%[2] above our target range
Forward sale of 3 office buildings

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Paya Lebar Quarter Office and Retail,
International Quarter London
Brisbane Showgrounds, Melbourne
and Darling Square Office and Quarter and Victoria Harbour
Hotel
International House Circular Quay Tower [6]
Sydney
3.3
1.8 1.5-1.7
0.1
H2 FY17 FY18 FY19 FY20 FY21
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Capital solution secured for Circular Quay Tower
Barangaroo South T1 reached practical completion. All three towers now operational
Barangaroo South – T1 > 70% let[3] and International House 100% let[3]
Commercial development in delivery with combined end value of c.$7 billion

Residential presales[7] ($b)

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Residential settlements of 2,037 units:

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Aus Communities Aus Apartments Europe Apartments
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Communities 1,338 units

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5.9
8 5.7
5.4 (0.7) 0.6 (0.1)
1.3 1.2
1.7
3.9 3.7
3.0
0.7 0.7 0.8
HY16 FY16 Settlements Sales Other HY17
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Apartments 628 units[4] . Default rate
< 1.0%
Residential presales of $5.7 billion
c.950 apartment units in delivery in the US

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Comparative period the half year ended 31 December 2015 (the prior corresponding period)
Half year returns have been annualised
Including agreed Heads of Terms
Profit recognised on practical completion
Based on expected completion date of underlying buildings, subject to change in delivery program. Not indicative of cash or profit recognition
Circular Quay Tower construction start remains subject to certain preconditions 7. Excludes retirement and Americas development. Includes 100% of revenue from joint venture projects
Includes fx impact

LENDLEASE – HY17 FINANCIAL RESULTS

Construction

Performance highlights[1]

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Global EBITDA margin up 70 bps to 2.7%, continuing an upward trend towards the Group’s target range of 3 – 4%
Earnings for Australia broadly in line with the prior corresponding period, with increased Engineering activity offset by softer Building margins
Execution excellence with the completion of 4 major Building projects in excess of c.$4 billion
Increased Engineering activity driven by North Connex M1/M2 Tunnel, Gateway Upgrade North and Caulfield to Dandenong Level Crossing Removal
Americas margin boosted by successful project close outs
Asia and Europe impacted by challenging market conditions, however continue to be supported by internal pipeline
Backlog revenue of $20.5 billion diversified across multiple sectors and clients
New work secured of $6.3 billion with an increased contribution from Asia and the Americas
c.$7 billion of further work in preferred bidder status

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24%
of operating
EBITDA ($m) EBITDA
HY16 HY17 170
117
105
97
70
15
0 (1) (3) 4
Australia 2 Asia Europe Americas Total
EBITDA Margin (%)
HY16 3.6% 0.1% (0.4%) 0.7% 2.0%
HY17 3.0% (0.5%) 0.6% 3.2% 2.7%
Backlog ($b)
6.3 (6.3)
20.7 (0.2) 20.5
18.6
3
HY16 FY16 New work Revenue Other HY17
secured realised
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Comparative period the half year ended 31 December 2015 (the prior corresponding period) 2. Values have been rounded down to the nearest million 3. Includes fx

LENDLEASE – HY17 FINANCIAL RESULTS

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40%
of operating
EBITDA
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Investments

Investments EBITDA by activity ($m)

Performance highlights[1]

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ROIC of 13.4%[2] , above our target range, driven by improved performance in Australia and Asia

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HY16 HY17
226
201
62
42
Ownership interest Operating earnings
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Australian result supported by a strong Retirement result with an average 8.6% uplift in unit pricing on resales. We continue to explore the introduction of capital partners over the medium term
Higher investment income, including co-investment in Lendlease International Towers Sydney Trust
Restoration of profitability in Asia driven by solid investment income contribution

FUM ($b)

Strong uplift in operating earnings driven by higher FUM and military housing fee income

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1.0 (0.1) 0.5 (0.3)
24.7
23.6
22.0
4
HY16 FY16 Acquired Divested Net revals Other HY17
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FUM of $24.7 billion, up 12% on the prior corresponding period with c.$3 billion[3] of additional secured FUM across the Group’s urbanisation projects
New equity raised of $0.8 billion mainly attributable to the Circular Quay Tower development
Comparative period the half year ended 31 December 2015 (the prior corresponding period)

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Half year returns have been annualised
Represents secured future FUM increase from funds with development projects in delivery 4. Includes fx

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Section 4 Outlook

Steve McCann Group Chief Executive Officer and Managing Director

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Artist impression: International Quarter London

LENDLEASE – HY17 FINANCIAL RESULTS

Outlook

We are well placed for future success given:
Earnings visibility from the growing pipeline across our business segments
Competitive advantage via integrated capabilities across the property and infrastructure value chain
Resilient business model with diversity across segments, sectors and geographies
Financial strength – low gearing, high levels of liquidity and access to third party capital
Significant origination success post balance sheet date:
Recommended preferred bidder on Haringey urbanisation project, London – c.GBP2.0 billion development end value[1]
Progress made on entry into US telco infrastructure
A number of significant construction contracts including Javits Convention Centre in New York[1]
Focussed on execution excellence through:
Strong risk management framework to manage individual projects, property cycles and sovereign risk
Unwavering commitment to health, safety and sustainability
Disciplined approach to origination

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Remains subject to contractual close

LENDLEASE – HY17 FINANCIAL RESULTS

Earnings visibility from strong pipeline across all segments

Development pipeline of $49.0 billion

Construction backlog revenue of $20.5 billion

FUM of $24.7 billion

Development pipeline 60 ($b)

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50
40
30
20
10
0
FY12 FY13 FY14 FY15 FY16 HY17
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Construction backlog revenue
22 ($b)
20
18
16
14
12
FY12 FY13 FY14 FY15 FY16 HY17
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Funds under management ($b)

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25
20
15
10
5
0
FY12 FY13 FY14 FY15 FY16 HY17
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Section 5 Q&A

Steve McCann Group Chief Executive Officer and Managing Director

Tarun Gupta Group Chief Financial Officer

Dan Labbad

Chief Executive Officer, International Operations

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Image: Fulton Street Transit, New York

Appendices

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Artist impression: The Darling Exchange, Sydney

Group

LENDLEASE – HY17 FINANCIAL RESULTS

Our business model

Our business model is how we generate earnings. The model is integrated when more than one segment is engaged on a single project

DEVELOPMENT

Core Financial Returns:

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The Development segment is involved in the development of communities, inner city mixed use developments, apartments, retirement, retail, commercial assets and social and economic infrastructure

Development margins
Development management fees received from external co-investors
Origination fees for infrastructure PPPs

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CONSTRUCTION

The Construction segment provides a project management, design, and construction service, predominantly in the infrastructure, defence, mixed use, commercial and residential sectors

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Core Financial Returns:

Project management and construction management fees
Construction margin

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INVESTMENTS

The Investments segment includes a leading wholesale investment management platform and also includes the Group’s ownership interests in property and infrastructure co-investments, Retirement and US Military Housing

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Core Financial Returns:

Fund, asset and property management fees
Investment yields and capital growth on coinvestments, and returns from the Group’s Retirement portfolio and US Military Housing business

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LENDLEASE – HY17 FINANCIAL RESULTS

Income Statement

Income Statement ($m)	Dec-15	Dec-16
Revenue	7,340.0	7,945.3
Cost of sales	(6,522.7)	(7,077.3)
Grossprofit	817.3	868.0
Other income	85.1	139.0
Other expenses	(552.6)	(458.9)
Results from operating activities	349.8	548.1
Finance revenue	14.8	5.5
Finance costs	(60.5)	(55.1)
Net finance costs	(45.7)	(49.6)
Share ofprofit of equityaccounted investments	121.4	43.7
Profit before Tax	425.5	542.2
Income tax expense	(71.9)	(147.7)
Profit after Tax	353.6	394.5
Profit after Tax attributable to:
Members of Lendlease Corporation Limited	257.7	338.6
Unitholders of Lendlease Trust	96.1	56.2
Profit after Tax attributable to securityholders	353.8	394.8
External non controllinginterests	(0.2)	(0.3)
Profit after Tax	353.6	394.5
Basic/Diluted EPS per Lendlease Group Stapled Security(cents)	60.9	67.8

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LENDLEASE – HY17 FINANCIAL RESULTS

Statement of Financial Position

Statement of Financial Position ($m)	Dec-15	Jun-16	Dec-16
Current Assets
Cash and cash equivalents	570.0	1,008.4	1,020.8
Loans and receivables	3,110.9	2,785.0	2,057.4
Inventories	2,016.4	1,923.0	2,488.2
Current tax assets	18.4	21.6	-
Other financial assets	43.4	50.7	65.0
Other assets	74.2	69.2	94.0
Total current assets	5,833.3	5,857.9	5,725.4
Non Current Assets
Loans and receivables	296.0	285.4	259.4
Inventories	2,623.2	2,679.9	2,475.4
Equity accounted investments	1,275.2	1,152.6	744.0
Investment properties	6,312.7	5,940.7	6,439.5
Other financial assets	632.3	628.8	1,230.4
Deferred tax assets	207.7	109.5	116.2
Property, plant and equipment	360.9	432.3	413.1
Intangible assets	1,470.9	1,446.8	1,433.7
Defined benefit plan asset	8.3	7.5	6.5
Other assets	63.4	51.5	62.9
Total non current assets	13,250.6	12,735.0	13,181.1
Total assets	19,083.9	18,592.9	18,906.5

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Statement of Financial Position ($m)		Dec-15	Jun-16	Dec-16
Current Liabilities
Trade and other payables		4,642.3	4,328.8	4,353.5
Resident liabilities		4,291.3	4,119.5	4,444.1
Provisions		321.0	292.4	321.8
Borrowings and financing arrangements		220.4	-	297.8
Current tax liabilities		-	-	38.5
Other financial liabilities		30.1	83.6	23.5
Total current liabilities		9,505.1	8,824.3	9,479.2
Non Current Liabilities
Trade and other payables		1,590.1	1,909.4	1,702.9
Provisions		43.2	70.6	49.2
Borrowings and financing arrangements		2,372.1	2,031.3	1,547.1
Defined benefit plan liability		65.9	3.4	9.7
Other financial liabilities		21.1	9.7	1.7
Deferred tax liabilities		112.2	129.5	169.5
Total non current liabilities		4,204.6	4,153.9	3,480.1
Total liabilities		13,709.7	12,978.2	12,959.3
Net assets		5,374.2	5,614.7	5,947.2
Equity
Issued capital		1,264.4	1,276.3	1,283.9
Treasury shares		(95.4)	(99.5)	(43.7)
Reserves		113.9	98.0	65.9
Retained earnings		3,071.1	3,289.6	3,552.3
Total equity attributable to equity holders Lendlease Corporation Limited	of	4,354.0	4,564.4	4,858.4
Total equity attributable to unitholders of LLT	1	1,018.8	1,048.6	1,087.4
Total equity attributable to securityholders		5,372.8	5,613.0	5,945.8
External non controlling interests		1.4	1.7	1.4
Total equity		5,374.2	5,614.7	5,947.2

Lendlease Trust

LENDLEASE – HY17 FINANCIAL RESULTS

Statement of Cash Flows

Statement of Cash Flows ($m)	Dec-15	Dec-16
Cash Flows from Operating Activities
Cash receipts in the course of operations	8,079.0	8,561.0
Cash payments in the course of operations	(7,826.5)	(8,515.1)
Interest received	5.9	4.8
Interest paid	(87.5)	(77.2)
Dividends/distributions received	28.0	33.5
Income tax received/(paid)in respect of operations	1.8	(77.4)
Net cashprovided by/(used in) operating activities	200.7	(70.4)
Cash Flows from Investing Activities
Sale/redemption of investments	75.4	67.4
Acquisition of investments	(323.9)	(155.7)
Acquisition of/capital expenditure on investment properties	(7.1)	(58.9)
Net loans to associates and joint ventures	(51.5)	6.0
Disposal of consolidated entities (net of cash disposed and transaction costs)	-	521.0
Disposal of property, plant and equipment	10.3	3.6
Acquisition of property, plant and equipment	(47.2)	(66.4)
Net acquisition / disposal of intangible assets	(25.5)	(3.6)
Net cashprovided by/(used in) investing activities	(369.5)	313.4
Cash Flows from Financing Activities
Proceeds from borrowings	1,978.5	1,624.3
Repayment of borrowings	(1,847.4)	(1,802.7)
Dividends/distributions paid	(139.9)	(157.7)
Proceeds from the sale of treasury securities	-	106.5
Other financingactivities	(4.8)	(9.9)
Net cash used in financing activities	(13.6)	(239.5)
Other Cash Flow Items
Effect of foreign exchange rate movements on cash and cash equivalents	2.3	8.9
Net increase/(decrease) in cash and cash equivalents	(180.1)	12.4
Cash and cash equivalents at beginning of financialyear	750.1	1,008.4
Cash and cash equivalents at end of financialyear	570.0	1,020.8

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LENDLEASE – HY17 FINANCIAL RESULTS

Securityholder returns

Return on equity (ROE)[1]

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Distributions

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2 cents
18.2%
80 70%
3 70 60%
13.5% 13.6% 13.7%
13.0%
12.4% 60
50%
50 2
49
30
40 27 40%
20
30
22 30%
20
33
30
27 20%
10 22 22
16
0 10%
FY12 FY13 FY14 FY15 FY16 HY17 FY12 FY13 FY14 FY15 FY16 HY17
Interim distribution (LHS) Final distribution (LHS)
Payout ratio (RHS)
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Full year ROE is calculated using the annual profit after tax divided by the arithmetic average of beginning, half and year end securityholders’ equity 2. FY14 includes Bluewater sale
Half year ROE is calculated on an annualised basis, using the half year profit after tax divided by the arithmetic average of beginning and half year end securityholders’ equity

LENDLEASE – HY17 FINANCIAL RESULTS

Segment financial metrics

Operating Profit after Tax ($m)

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HY16 HY17

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215
203
183 182
107
77
Development Investments Construction
ROIC [1,2] (Development and Investments),
EBITDA margin (Construction)
ROIC HY16 HY17 EBITDA margin
13.4%
2.7%
12.7%
12.2% 2.0%
11.3%
Development Investments Construction
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EBITDA ($m)

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HY16 HY17
288
260
236 243
170
117
Development Investments Construction
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Invested Capital[3] (Development and Investments) ($b)

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HY16 HY17
3.5
3.2 3.2
2.8
Development Investments
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Return on Invested Capital (ROIC) definition: Operating Profit after Tax / Average Invested Capital (Annualised measure) 2. ROIC has been calculated on an annualised basis
Total Lendlease Invested Capital at 31 December 2016 was $6.8 billion. Development, Investments and Construction Invested Capital totalled $6.4 billion, with remaining Invested Capital representing Corporate ($0.4 billion)

LENDLEASE – HY17 FINANCIAL RESULTS

Segment and region financial metrics

By segment

	Revenue ($m)	Revenue ($m)	EBITDA ($m)		Profit After Tax ($m)	Profit After Tax ($m)	Invested Capital ($b)	Invested Capital ($b)
	HY16	HY17	HY16	HY17	HY16	HY17	HY16	FY16	HY17
Development	1,115	1,331	236	260	183	182	3.2	2.9	2.8
Investments	272	305	243	288	203	215	3.5	3.2	3.2
Construction	5,961	6,306	117	170	78	107
Corporate	7	9	(84)	(78)1	(110)	(109)
Group	7,355	7,951	512	640	354	395
By region
	Revenue ($m)		EBITDA ($m)		Profit After Tax ($m)		Invested Capital ($b)
	HY16	HY17	HY16	HY17	HY16	HY17	HY16	FY16	HY17
Australia	4,140	4,796	5181	632	386	451	5.4	4.8	4.9
Asia	167	297	(32)	8	(28)	5	0.5	0.5	0.5
Europe	774	660	81	11	73	6	0.9	0.8	0.6
Americas	2,267	2,189	29	67	33	42	0.2	0.4	0.4
Corporate	7	9	(84)	(78)1	(110)	(109)
Group	7,355	7,951	512	640	354	395

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Rounded down to the nearest million

LENDLEASE – HY17 FINANCIAL RESULTS

Recurring income

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100%
90%
80%
70% 58% 60%
63%
69%
60%
50%
40%
30%
20% 42% 40%
37%
31%
10%
0%
FY14 FY15 FY16 HY17
Investments income Other Group earnings
Operating EBITDA
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Targeting 60% - 70% of earnings from residential, commercial, infrastructure and retail development activities and from construction / services margin

Targeting 30% - 40% of earnings from the Investments segment delivering recurring income

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LENDLEASE – HY17 FINANCIAL RESULTS

Revenue and EBITDA by segment and geography

($m)	Revenue		EBITDA
	HY16	HY17	HY16	HY17
Development Australia	1,024.9	1,277.9	191.8	290.1
Asia	7.2	7.2	(13.3)	(7.2)
Europe	70.0	44.9	65.3	6.3
Americas	13.0	0.8	(7.6)	(29.0)
Total Development	1,115.1	1,330.8	236.2	260.2
Construction
Australia	2,914.4	3,271.7	105.4	97.9
Asia	138.6	265.3	0.2	(1.4)
Europe	689.6	612.2	(2.8)	3.9
Americas	2,218.7	2,156.7	14.5	69.8
Total Construction	5,961.3	6,305.9	117.3	170.2
Investments
Australia	200.7	246.3	221.3	244.2
Asia	21.1	23.5	(18.5)	16.9
Europe	14.0	3.2	18.6	1.2
Americas	35.3	31.8	21.6	26.1
Total Investments	271.1	304.8	243.0	288.4
Total Operating Australia	4,140.0	4,795.9	518.5	632.2
Asia	166.9	296.0	(31.6)	8.3
Europe	773.6	660.3	81.1	11.4
Americas	2,267.0	2,189.3	28.5	66.9
Group Total Operating	7,347.5	7,941.5	596.5	718.8

EBITDA by segment ($m)

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- 100 200 300 400 500 600 700 800	HY16 HY17
	Development Construction Investments Total

EBITDA by geography ($m)

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800 HY16 HY17
700
600
500
400
300
200
100
-
Australia Asia Europe Americas Total
(100)
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LENDLEASE – HY17 FINANCIAL RESULTS

Revenue and EBITDA by segment and geography, local currency

Europe

EBITDA, local currency (m)

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(5) 5 15 25 35 45 Local currency Revenue EBITDA HY16 HY17 HY16 HY17 Europe, GBPm Development 32.9 26.5 30.7 3.7 Construction 324.1 361.2 (1.3) 2.3 Investments 6.6 1.9 8.7 0.7 Total operating 363.6 389.6 38.1 6.7 Local currency Revenue EBITDA Americas	Development Construction Investments Total HY16 HY17
	HY16 HY17
Local currency Revenue EBITDA
(5 15 35 55 HY16 HY17 HY16 HY17 Americas, USDm Development 9.4 0.6 (5.5) (21.8) Construction 1,597.5 1,617.5 10.4 52.4 Investments 25.4 23.9 15.6 19.6 Total operating 1,632.2 1,642.0 20.5 50.2

Americas					(5)
Local currency	Revenue		EBITDA
	HY16	HY17	HY16	HY17	55
Americas, USDm					35
Development	9.4	0.6	(5.5)	(21.8)
Construction	1,597.5	1,617.5	10.4	52.4	15
Investments	25.4	23.9	15.6	19.6	(5

Total operating	1,632.2	1,642.0	20.5	50.2

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(5)

(25)

Asia

Development Construction Investments Total

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Local currency	Revenue		EBITDA
	HY16	HY17	HY16	HY17	50
Asia, SGDm					30
Development	7.3	7.5	(13.4)	(7.5)	10
Construction Investments	140.0 21.3	275.9 24.4	0.2 (18.7)	(1.5) 17.6	(10
Total operating	168.6	307.8	(31.9)	8.6	(30

HY16 HY17

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(10) (30) (50)

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Development Construction Investments

Total

LENDLEASE – HY17 FINANCIAL RESULTS

Exchange rates

	Income Statement	Income Statement				Statement	of Financial Position	of Financial Position
Local	Foreign	HY161	FY162	HY173	Local	Foreign	HY164	FY165	HY176
AUD	USD	0.72	0.73	0.75	AUD	USD	0.73	0.75	0.72
AUD	GBP	0.47	0.50	0.59	AUD	GBP	0.49	0.56	0.58
AUD	SGD	1.01	1.01	1.04	AUD	SGD	1.03	1.00	1.04

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Average foreign exchange rate for the half year 2016
Average foreign exchange rate for the full year 2016 3. Average foreign exchange rate for the half year 2017
At spot foreign exchange rate 31 December 2015 5. At spot foreign exchange rate 30 June 2016 6. At spot foreign exchange rate 31 December 2016

LENDLEASE – HY17 FINANCIAL RESULTS

Regional EBITDA to PAT reconciliation

HY17 EBITDA to PAT Reconciliation

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Region	EBITDA	Net Interest	D&A1	PBT	Tax	Non Cont. Int.2	PAT
Australia
Development	290.1	0.6	(0.6)	290.1	(86.7)	-	203.4
Construction	97.9	0.4	(12.8)	85.5	(22.6)	-	62.9
Investments	244.2	-	(3.7)	240.5	(55.8)	-	184.7
Total Australia	632.2	1.0	(17.1)	616.1	(165.1)	-	451.0
Asia
Development	(7.2)	(0.1)	(0.4)	(7.7)	1.0	0.3	(6.4)
Construction	(1.4)	-	(0.5)	(1.9)	0.3	-	(1.6)
Investments	16.9	-	-	16.9	(3.4)	-	13.5
Total Asia	8.3	(0.1)	(0.9)	7.3	(2.1)	0.3	5.5
Europe
Development	6.3	-	(1.4)	4.9	(3.1)	-	1.8
Construction	3.9	(0.4)	(0.5)	3.0	0.6	-	3.6
Investments	1.2	-	-	1.2	(0.8)	-	0.4
Total Europe	11.4	(0.4)	(1.9)	9.1	(3.3)	-	5.8
Americas
Development	(29.0)	-	(0.1)	(29.1)	11.8	-	(17.3)
Construction	69.8	-	(2.3)	67.5	(25.2)	-	42.3
Investments	26.1	0.6	-	26.7	(9.9)	-	16.8
Total Americas	66.9	0.6	(2.4)	65.1	(23.3)	-	41.8
Corporate
Group Services	(69.1)	(0.1)	(25.5)	(94.7)	25.8	-	(68.9)
GroupTreasury	(10.1)	(50.6)	-	(60.7)	20.3	-	(40.4)
Total Corporate	(79.2)	(50.7)	(25.5)	(155.4)	46.1	-	(109.3)
Total	639.6	(49.6)	(47.8)	542.2	(147.7)	0.3	394.8

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Depreciation and Amortisation 2. Non Controlling Interests

LENDLEASE – HY17 FINANCIAL RESULTS

Debt metrics

	Dec-15 Jun-16 Dec-16
Net debt $ million 2,063 1,052 844
Borrowings to total equity plus borrowings % 32.5 26.6 23.7
Net debt to total tangible assets, less cash % 12.1 6.5 5.1
Interest coverage1 times 7.7 8.0 10.8
Average cost of debt including margins % 4.8 4.6 4.8
Average debt duration years 3.8 5.3 4.9
Debt mix fixed : floating ratio 54 : 46 91 : 9 100 : 0
Undrawn debt facilities $ million 1,424 2,173 2,313

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EBITDA plus interest income, divided by interest finance costs, including capitalised finance costs

LENDLEASE – HY17 FINANCIAL RESULTS

Debt facilities and maturity profile

Debt facilities ($m)[1]

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Drawn Facility
1,500
690
513 513 550 550 476 476
263 263
0 0 35 35
Syndicated Multi- UK Bond Issue Club Revolving US $ Reg. S Notes US Private Singapore Bond Australian Medium
Option Facility Credit Facility Placement Term Notes
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Debt maturity profile ($m)[2]

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225
250
900
600 690 517 556
0 264
35
FY17 FY18 FY19 FY20 FY21 FY22 FY26
Syndicated Multi-Option Facility UK Bond Issue Club Revolving Credit Facility
Australian Medium Term Notes US Private Placement Singapore Bond
US $ Reg. S Notes Undrawn
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Syndicated Multi-Option Facility Australian Medium Term Notes US $ Reg. S Notes

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Values are shown at amortised cost 2. Values are shown at gross facility value

LENDLEASE – HY17 FINANCIAL RESULTS

Key dates for investors

	Date
HY17 results released to market / interim distribution declared	27 February 2017
Securities quoted ex-dividend on the Australian Securities Exchange	2 March 2017
Interim distribution record date	3 March 2017
Interim distribution payable	24 March 2017
FY17 results released to market / final distribution declared	28 August 2017
Annual General Meeting	17 November 2017

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Development

LENDLEASE – HY17 FINANCIAL RESULTS

Development HY17

Overview

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Involved in the development of communities, inner city mixed use developments, apartments, retirement, retail, commercial assets and social and economic infrastructure
Financial returns are generated via Development margins, Development management fees from external co-investors and origination fees for the facilitation of infrastructure PPP transactions

Performance

Performance


	HY16	HY17
% Operating EBITDA	40	36
ROIC (%)	11.3	12.7
Invested Capital ($b)	3.2	2.8

Drivers

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Forward sale of 839 Collins St, Victoria Harbour:
38,000 sqm office
End development value $400-450 million, est completion FY19
Forward sale of One Melbourne Quarter:
26,000 sqm office
End development value $200-250 million, est completion FY19
LLC indirect ownership via holding in APPF Commercial
Capital solution secured for Circular Quay Tower[1] subject to preconditions:
c.55,000 sqm office
End development value $1.5-1.7 billion, est completion FY21
- LLC 20% co-investment
Barangaroo South T1 – T3 profit release on converting to operational phase
3,500 sqm of additional leasing at Barangaroo South T1 (AFL)[2]
Residential settlements of 2,037 units, down 8.6%:
Communities settlements of 1,338 units, down 8.7%
Retirement settlements of 71, down from 100

Outlook

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  - Residential presales of 8,864 units, $5.7 billion:

     - Record Communities presales of 3,351 units, $844 million

     - Apartment presales of 5,513 units, $4,829 million

  - Barangaroo South leasing – HoTs[3] on 23,800 sqm at T1 that will take occupancy to c.75% and 6,700 sqm at International House, 100% of building

  - PLQ – 42,000 sqft retail leasing secured. Retail and 3 office towers due FY19

  - Forward sale of 5 King St, Brisbane: 15,000 sqm office, end development value $100-150 million, est completion FY19

  - US residential development execution underway – c.950 apartments in delivery, 736 of which are residential for rent

  - Future pipeline secured post balance sheet date:

     - Haringey urbanisation project, London GBP2.0 billion estimated end value[4]

     - Entry into US telco development

  - Total pipeline $49.0 billion, including c.$35 billion in urbanisation, of which c.$25 billion remains yet to be put into delivery

Apartment settlements of 628 units, down 5.1%
$66.2 million gain on sale, $16.7 million revaluation gain on retained equity

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Agreement for Lease
Heads of Terms
Remains subject to contractual close

LENDLEASE – HY17 FINANCIAL RESULTS

Development earnings / pipeline

EBITDA by geography ($m)

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Development pipeline by geography ($b)

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HY16 HY17 HY16 HY17 49.0
46.6
30.9
290.1 26.0
260.2
236.2
191.8
11.5
8.7
65.3 5.7 5.7
3.4 3.7
6.3
(13.3) (7.2) (7.6)(29.0) Australia Asia Europe Americas Total
Australia Asia Europe Americas Total
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Urbanisation pipeline by geography HY17 ($b)

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Historical development pipeline ($b)

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3.7
Australia
Asia
8.7
$35.0b 16.9 Europe
Americas
5.7
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Communities Pipeline

Urbanisation Pipeline

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----- Start of picture text -----

48.8 49.0
44.9
37.2 37.4 37.7 11.5 14.0
12.1
15.9 14.3 12.7
32.8 37.3 35.0
21.3 23.1 25.0
FY12 FY13 FY14 FY15 FY16 HY17
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LENDLEASE – HY17 FINANCIAL RESULTS

Residential development

Communities and Retirement (settlements by state)[1]

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	HY16		HY17
	Units	$m	Units	$m
Communities
QLD	583	96	589	114
NSW2	430	157	202	68
VIC	305	53	407	83
SA	81	13	75	10
WA	67	16	65	17
Retirement
Australia Total	100 1,566	45 380	71 1,409	34 326

Communities and Retirement (sales by state)

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	HY16		HY17
	Units	$m	Units	$m
Communities
QLD	718	141	820	166
NSW2	536	201	249	96
VIC	580	114	744	159
SA	157	20	38	6
WA	69	16	44	12
Retirement
Australia	100	45	71	34
Total	2,160	537	1,966	473

HY17 Apartment settlements[3]

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	Units	$m
Australia
Victoria Harbour – 888 Collins	440	284
Other	12	14
Total	452	298
Europe
IQL4 – Glasshouse Gardens	114	84
E&C5 – South Gardens6	61	23
Other	1	1
Total	176	108

Total settlements	628	406

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Retirement metrics reflect sales / settlements in the development business and not resales in investment portfolio 2. NSW includes the Australian Capital Territory
As at 24 February 2017, 86% total apartment settlements across Australia and Europe were cash settled. Profit recognised on practical completion
International Quarter London 5. Elephant & Castle 6. Affordable apartments

LENDLEASE – HY17 FINANCIAL RESULTS

Apartment and Communities – presales[1 ]

Apartments presales

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By units $m
Australia Europe
5,914 144 5,247 105 (298)
5,392 83 (452) 5,513 4,732 94 (211) 4,829
(176) 1,373 (108)
1,635 1,148
1,542 1,667
1,797
3,874 3,681
4,279
3,971 3,065
3,595
HY16 FY16 Sales Settlements HY17 HY16 FY16 Sales Impact of fxSettlements HY17
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Communities presales

By units

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$m
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(1,338)
1,895 (292)
439
3,351 844
2,732 2,794 655 697
HY16 FY16 Sales Settlements HY17 HY16 FY16 Sales Settlements HY17
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Excludes retirement and Americas development and includes 100% of revenue from joint venture projects

LENDLEASE – HY17 FINANCIAL RESULTS

Apartment presales – by location and customer

Presales in delivery (by value, as at 31 December 2016)[1]

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Run-off profile by location[2]

By customer

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44%
30%
H2 FY17 FY18 FY19
23%
Other offshore
31%
20%
14%
11%
10% 10%
21%
7% China
6%
5%
4% 3%
0% 0%
Sydney Brisbane Melbourne London
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56%
Local
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Apartment projects in delivery reflecting total presales of $4.3 billion, including 100% of revenue from joint venture projects 2. Based on expected completion date of underlying buildings, subject to change in delivery program

LENDLEASE – HY17 FINANCIAL RESULTS

Development pipeline provides long term earnings visibility[1] Record secured pipeline of $49.0b controlled by invested capital of $2.8b

Apartments

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20 major apartment buildings presold and in delivery, estimated completion FY17 – FY19

Estimated annual turnover[5]

4,570 units presold[2] 19,405 units remaining $4.3 billion presold[2] $15.8 billion remaining

23,975 units

$20.1 billion

~1,000 - 2,000 settlements

Commercial

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13 major buildings in delivery, estimated completion FY17 – FY21

414,000 sqm in delivery 762,000 sqm remaining $5.7 billion in delivery[3] $9.2 billion remaining

1,176,000 sqm ~2 - 3 buildings commenced

$14.9 billion

Communities and Retirement

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3,351 lots presold 54,511 lots remaining[4]

57,862 lots[3] ~3,500 - 4,500 settlements

$0.8 billion presold $13.2 billion remaining

$14.0 billion

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All data as at 31 December 2016
Represents presales balance on buildings in delivery only
Total end value of c.$7.0 billion, with c.$1.3 billion delivered to date
Includes built-form units to be sold with land lots
Subject to market conditions

$49.0 billion

Total pipeline end value

LENDLEASE – HY17 FINANCIAL RESULTS

Major project summary

Project	Project secured	Delivery commenced	Expected completion date1	Residential units backlog	Commercial sqm backlog ‘000s	Total remaining end value $b2
Barangaroo South, Sydney 2009 2012 2023 775 80 3.7
Darling Square, Sydney 2013 2013 2019 1,507 70 1.9
Victoria Harbour, Melbourne 2001 2004 2025 2,500 46 2.1
Melbourne Quarter, Melbourne 2013 2016 2022 1,683 129 1.1
Brisbane Showgrounds, Brisbane 2009 2011 2029 2,579 85 1.6
Waterbank, Perth 2013 - - 1,225 17 1.1
Tun Razak Exchange, Kuala Lumpur 2014 - - 2,400 246 2.7
Paya Lebar Quarter, Singapore 2015 2016 2019 429 137 3.0
Elephant and Castle, London 2010 2012 2025 2,410 18 3.5
International Quarter, London 2010 2014 2026 210 273 3.4
The Wharves, Deptford, London 2014 2016 2022 1,130 7 1.1
Riverline, Chicago 2014 2016 2025 3,750 1 2.0
Other Urbanisation Projects3 3,377 67 7.8
Total Urbanisation 23,975 1,176 35.0

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Based on expected completion date of underlying buildings, subject to change in delivery program
Reflects the remaining estimated total project end development value. Values for any project can vary and are subject to change 3. Includes Toorak Park, Clippership and Circular Quay Tower

LENDLEASE – HY17 FINANCIAL RESULTS

Apartment projects in delivery – settlement profile[3]

Project		Delivery2	Delivery2	Delivery2
	H2	FY17	FY18	FY19
Australia
Darling Square Wirth House, St Leon and Darling One 539 100% ~585 Darling North, Harbour Place and Trinity House 577 100% ~810 DarlingRise,Barker House and Arena 391 100% ~490


Victoria Harbour 889 Collins 536 98% ~360 883 Collins 528 96% ~350 Collins Wharf 1 321 83% ~245


Brisbane Showgrounds North Yard and South Yard 401 98% ~210
Toorak Park Park,East,North and Terrace Homes 468 87% ~390
Total Australia 3,761 ~3,440
Europe
Elephant and Castle South Gardens 299 85% ~220 West Grove(Buildings 1 and 2) 593 76% ~420

International Quarter London4 Glasshouse Gardens(Buildings 1 and 2) 219 100% ~175
Wandsworth Victoria Drive 110 34% ~40
Total Europe 1,221 ~855
Sub-total 4,982 ~4,295
Americas
5th Avenue5 281 5th Avenue 130 - -
Clippership Buildings 1 and 2 2846 - - Building3 80 - -

Riverline7 BuildingD 4526 - -
Total Americas 946 -
Total 5,928 ~4,295

= Indicates expected timing of building completion and profit recognition

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Closing presales balance as at 31 December 2016
Based on expected completion date of underlying buildings, subject to change in delivery program
Excludes settlements recognised in HY17
Lendlease ownership interest 50%
Lendlease ownership interest 40%
Residential rental product 7. Lendlease ownership interest 60%

LENDLEASE – HY17 FINANCIAL RESULTS

Major commercial development pipeline Commercial building completion profile[1]

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Project	Capital model	sqm ('000)	Building	H2	FY172	FY18	FY19	FY20	FY21
International Quarter London Fund through3 73 Office (2 buildings)
Paya Lebar Quarter Joint venture 93 Office (3 buildings) 44 Retail

Darling Square Fund through3 26 Office 37 Hotel

Barangaroo South Fund through3 7 International House Sydney
Melbourne Quarter Fund through3 26 One Melbourne Quarter
Victoria Harbour Fund through3 38 Office
Circular Quay Tower4 Fund through3 55 Office
Brisbane Showgrounds Fund through3 15 Office
Total 414

= Indicates expected building completion date subject to change in delivery program

Indicative conversion timing of secured commercial pipeline to FY21 (sqm ‘000)[5]

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Project	# Buildings	Sector	sqm ('000)	H2 FY17	FY18	FY19	FY20	FY21
Melbourne Quarter 2 Office 97 Brisbane Showgrounds 2 Office 35 International Quarter London 6 Office 196 Tun Razak Exchange6 1 Retail 204 Total 11 532 Targeting 2-3 building commencements p.a.

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Not indicative of cash or profit recognition. Based on expected completion 4. date of underlying buildings, subject to change in delivery program 5. 2. Excludes buildings completed in HY17
A funding model structured through a forward sale to a capital partner 6. resulting in staged payments prior to building completion

Circular Quay Tower construction start remains subject to certain preconditions Indicative project execution timing, subject to tenant pre-commitment, planning and other conditions

Subject to unconditional contract close

LENDLEASE – HY17 FINANCIAL RESULTS

Communities and Retirement projects

Communities				Residential	Residential	Commercial
Include Horizon in this …. Project	Location	Ownership Interest	Estimated Completion Date1	Backlog Land Units2	Backlog Built-Form Units2	Backlog sqm / 000s3
Bingara Gorge	NSW	Land management	2025	1,170	-	38
Calderwood Valley	NSW	Land management	2035	4,565	-	56
St Marys – Jordan Springs	NSW	Owned	2023	1,075	20	491
The New Rouse Hill	NSW	Land management	2018	25	430	-
Fernbrooke Ridge	QLD	Land management	2018	195	-	-
Elliot Springs (formerly Rocky Springs)	QLD	Land management	2058	10,675	-	1,037
Springfield Lakes	QLD	Land Management	2026	4,340	315	47
Yarrabilba	QLD	Staged acquisition	2043	13,255	1,190	2,097
Blakes Crossing	SA	Staged acquisition	2019	525	-	9
Atherstone	VIC	Land management	2033	3,950	-	80
Aurora	VIC	Owned	2025	2,700	-	189
Harpley	VIC	Land management	2024	3,190	-	313
Mayfield	VIC	Owned	2017	25	-	-
Alkimos	WA	Land management	2024	1,500	15	55
The Assembly at Coolbellup	WA	Land management	2017	15	-	-
Horizon Uptown	Americas	Owned	2033	3,860	-	371
Sub-total				51,065	1,970	4,783
Retirement				-	4,827	-
Total				51,065	6,797	4,783

Estimated completion date represents the expected financial year in which the last unit will be settled as at 31 December 2016, subject to change

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Represents estimated backlog and includes the total number of units in Group owned, joint venture and managed projects. The actual number of units for any particular project can vary as planning approvals are obtained
Represents the net developable land in relation to master-planned urban communities. The actual land area for any particular project can vary as planning approvals are obtained

LENDLEASE – HY17 FINANCIAL RESULTS

Development deal structuring tailored to local market

	Communities / Retirement	Urbanisation	Urbanisation	Urbanisation
		Apartments (Australia, Europe)	Commercial Forward Sale	JV Structure / LP-GP1
Project examples	• Jordan Springs, Sydney • Yarrabilba, Brisbane	• Darling Square, Sydney • Elephant & Castle, London	• Barangaroo (ITS), Sydney • Phase 1 International Quarter, London	• Paya Lebar Quarter, Singapore • Phase 1 Riverline, Chicago
Land funding2	• Land ownership • Land management • Staged payments	• Land management • Staged payments	• Land management • Staged payments	• Land ownership via JV (including project financing)
Production funding2	• 100% on-balance sheet	• Largely 100% on-balance sheet	• Capital partner progress or staged payments	• Funded via JV (including project financing)
P&L returns	• Development profit on settlement • Construction margin on infrastructure delivery	• Development profit on practical completion • Construction margin on practical completion3	• Development profit typically upfront at time of sale • Development management fees, Construction margin4 and Investment Management fees4 during delivery	• Development profit tied to equity interests • Development management fees, Construction margin4 and Investment Management fees4 (including performance fees) during delivery
Cash returns (Development only)	• On settlement	• On settlement	• Over life of project during delivery	• Linked to cash equity returns or sell down of investment typically post practical completion

Limited Partnership / General Partnership
Reflects typical funding models used across segment examples

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Based on apartment projects delivered 100% on-balance sheet
Only where Construction and / or Investments segments are engaged to play a role in the project

Construction

LENDLEASE – HY17 FINANCIAL RESULTS

Construction HY17

Overview

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Provides a project management, design, and construction service, predominantly in the infrastructure, defence, mixed-use, commercial and residential sectors
Financial returns are generated via project management and construction management fees, in addition to construction margin

Drivers

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 Australia

Earnings broadly in line with prior corresponding period due to increased Engineering activity offset by softer Building margins
Execution excellence with the completion of 4 major Building projects in excess of c.$4 billion
Engineering contributors included NorthConnex M1/M2 Tunnel, Gateway Upgrade North and Caulfield to Dandenong Level Crossing Removal

 Asia

Breakeven result as construction works ramp up on Paya Lebar Quarter, Singapore

 Europe

Internal pipeline continues to support the business
Region has avoided bidding in highly competitive markets in recent years

 Americas

Successful close out on a number of projects positively impacted overall result

Performance

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	HY16	HY17
% Operating EBITDA	20	24
EBITDA margin (%)	2.0	2.7
New Work Secured ($b)	6.1	6.3
Backlog Revenue ($b)	18.6	20.5

Outlook

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Trajectory towards target margin of 3 – 4%
Diversity by region, client and sector
c.$7 billion of further work in preferred bidder status

 Australia

New work secured of $2.8 billion including Sunshine Plaza Redevelopment and Western Sydney Stadium
Pursuing a number of large transport projects including Western Distributor and Melbourne Metro

 Asia

Backlog revenue higher from internal pipeline

 Europe

Recent project wins to assist in achieving scale to restore margins in future periods with $1.5 billion in preferred bidder status

 Americas

HY17 lift in margin expected to normalise
New work secured of $2.5 billion, $4.2 billion in preferred bidder status
- Post balance sheet date awarded c.US$1.5 billion expansion of the Jacob K. Javits Convention Center (50% JV in New York)

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LENDLEASE – HY17 FINANCIAL RESULTS

Construction earnings

EBITDA ($m)

EBITDA margins (%)

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HY16 HY17 HY16 HY17
170.2 4% 3.6%
3.2%
3.0%
117.3 3% 2.7%
105.4
97.9 2.0%
69.8 2%
1% 0.6% 0.7%
14.5
0.2 (1.4) (2.8) 3.9 0.1%
0%
Australia Asia Europe Americas Total
(0.5%) (0.4%)
(1%)
Australia Asia Europe Americas Total
EBITDA Europe (GBPm) EBITDA Americas (USDm)
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EBITDA Europe (GBPm)

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2.3
(1.3)
HY16 HY17
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52.4
10.4
HY16 HY17
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LENDLEASE – HY17 FINANCIAL RESULTS

Construction backlog

Backlog revenue ($b)

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Backlog revenue by region ($b)[1]

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20.7 20.5
16.2 16.2 17.3
15.1
FY12 FY13 FY14 FY15 FY16 HY17
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Aus Services Asia
Europe
1.5 0.9 1.1
Aus Engineering
3.3
$20.5b
6.9 Americas
6.8
Aus Building
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Backlog revenue by client[1,2]

Backlog revenue by sector[1,2]

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Other
Transport
9%
19%
Commercial
14%
16% Residential
Defence 32%
10%
Hotel /
Entertainment
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Lendlease
18%
Corporate
44%
38% Government
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As at 31 December 2016 2. Includes all Construction projects greater than $100 million, which represents 78% ($16.0 billion) of secured backlog

LENDLEASE – HY17 FINANCIAL RESULTS

Construction new work secured / backlog

New work secured revenue

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($m)	Australia	Asia	Europe	Americas	Total
Dec-15 Dec-16 Dec-15 Dec-16 Dec-15 Dec-16 Dec-15 Dec-16 Dec-15 Dec-16
New work secured revenue1
Building 2,052.4 2,331.1 48.0 598.1 623.7 411.7 1,654.0 2,547.7 4,378.1 5,888.6
Engineering 1,145.5 335.1 14.8 22.0 1,160.3 357.1
Services 517.1 99.9 517.1 99.9
Total new work secured revenue 3,715.0 2,766.1 62.8 620.1 623.7 411.7 1,654.0 2,547.7 6,055.5 6,345.6

Backlog revenue

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($m)	Australia	Asia	Europe	Americas	Total
Dec-15 Dec-16 Dec-15 Dec-16 Dec-15 Dec-16 Dec-15 Dec-16 Dec-15 Dec-16
Backlog revenue2 Building 6,393.2 6,843.8 319.2 884.2 1,588.2 1,076.8 5,799.2 6,924.3 14,099.8 15,729.1 Engineering 2,935.8 3,273.5 19.1 4.4 2,954.9 3,277.9 Services 1,517.8 1,523.7 1,517.8 1,523.7
Total backlog revenue 10,846.8 11,641.0 338.3 888.6 1,588.2 1,076.8 5,799.2 6,924.3 18,572.5 20,530.7
Backlog realisation (%)
Year ending June 2017 30 31 60 38 41 63 30 31 31 31
Year ending June 2018 38 42 36 55 51 26 40 42 40 43
Post June 2018 32 27 4 7 8 11 30 27 29 26
Total 100 100 100 100 100 100 100 100 100 100

New work secured revenue is the total revenue to be earned from projects secured during the year

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Current period backlog revenue is the total revenue to be earned from projects in future financial periods, based on projects secured as at 31 December 2016. Although backlog revenue is realised over several periods, the average foreign exchange rate for the current period has been applied to the closing backlog revenue balance in its entirety, as the average rates for later years cannot be predicted

LENDLEASE – HY17 FINANCIAL RESULTS

Construction backlog revenue by region

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Group ($m) Australia ($m)
6,346 (6,306) 2,766 (3,272)
257
(179)
Book to bill [1] : 1:01 Book to bill [1] : 0:85
20,670 20,531 10,847 11,890 11,641
18,573
HY16 FY16 New work Revenue Other HY17 HY16 FY16 New work Revenue Other HY17
secured realised secured realised
Europe ($m) Americas ($m)
2,548 (2,157)
412
(612) (182)
Book to bill [1] : 1:18
(228)
1,588 1,505 Book to bill [1] : 0:67 5,799 6,715 6,924
1,077
HY16 FY16 New work Revenue Other HY17 HY16 FY16 New work Revenue Other HY17
secured realised secured realised
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Ratio calculated as new work secured over revenue realised

LENDLEASE – HY17 FINANCIAL RESULTS

Australian market outlook – Engineering[1]

National major road construction (major project commencements, real terms, $b)[2]

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Forecast
7
6.2
5.9
6 5.7 5.5 5.6
5.2
5 4.6 4.6
4.1 4.2 4.3
3.9
4 3.3
2.7
3 2.6
2 1.6 1.6 1.4 1.3
1
0.0
0
FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23
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National major railways construction (major project commencements, real terms, $b)[2]

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Forecast
10 9.1
9
8
7
6 5.2 5.6 5.3
5
4 3.1
2.8
3 2.5 2.2 2.0 2.3 2.3
1.7
2 1.2 1.4
0.6 0.8
1 0.0 0.0 0.0 0.0
0
FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23
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Source: Estimates based on Lendlease Group Research, ABS 2. Major project = toll road or public project > $500 million (construction activity, not total value)

Investments

LENDLEASE – HY17 FINANCIAL RESULTS

Investments HY17

Overview

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Owns and / or manages investments including a leading wholesale investment management platform and also the Group’s ownership interests in property and infrastructure co-investments, Retirement and US Military Housing
Financial returns include fund and property management fees, yield and capital growth on investment positions, and returns from the Group’s Retirement portfolio and US Military Housing business

Performance

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	HY16	HY17
% Operating EBITDA	41	40
ROIC (%)	12.2	13.4
Invested Capital ($b) Revaluations ($m) Revaluations / Operating EBITDA (%)	3.5 30.0 5.0	3.2 35.7 5.0

Drivers

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FUM of $24.7 billion, up 12.3% on the prior corresponding period
New equity raised of $0.8 billion
Mainly attributable to equity commitments relating to the Circular Quay Tower development in Sydney
Investments managed on behalf of the Group increased to $3.3 billion
Retirement Ownership and Management:
- 453 unit resales at higher average price (+8.6%)
- 30 bps decrease in discount rate to 13.0%
Higher investment income from co-investment in Lendlease International Towers Sydney Trust
Higher investment management fees due to FUM growth
Restoration of profitability in Asia driven by stronger investment income and asset devaluations in the prior corresponding period
Higher asset management fees from the America’s military housing units under management

Outlook

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ROIC leverage from FUM and assets under management
FUM supported by $1.5 billion co-investment
Growing FUM and asset management income
c.$3 billion[1] of additional secured FUM across the Group’s urbanisation projects in delivery
c.$600 million direct exposure to premium grade office at Barangaroo South
Higher investment income from co-investment in Lendlease One International Towers Sydney Trust following practical completion of Barangaroo South T1
736 US residential for rent apartments in delivery provide a source of investment income and potential investment product for capital partners
Explore introduction of capital partners to Retirement over the medium term
Well positioned to deliver future recurring earnings through:
~150 institutional investors
$1.5 billion co-invested in funds
$1.7 billion of capital across 71 retirement villages
53,105 military housing units under management

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Represents secured future FUM increase from funds with development projects in delivery

LENDLEASE – HY17 FINANCIAL RESULTS

Investments earnings / ownership

EBITDA by region ($m)

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EBITDA by activity ($m)

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HY16 HY17
288
244 243
221
17 19 22 26
1
(19)
Australia Asia Europe Americas Total
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HY16 HY17
226
201 -
62
42
Ownership interests1 Operating earnings2
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Investments by product ($b)[3]

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Investments by region ($b)[3]

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3.2 3.0 3.3
1% 4% 4%
53% 50% 51%
46% 46% 45%
HY16 FY16 HY17
Co-Investments Retirement ownership Infrastructure
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3.2 3.0 3.3
4% 4% 3%
3% 2% 2%
16% 11% 10%
83% 85%
77%
HY16 FY16 HY17
Australia Asia Europe Americas
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Earnings derived from co-investments, the Retirement business and equity returns from US Military Housing
Earnings derived from the investment management platform and the management of the US Military Housing business 3. Represents the Group’s assessment of market value

LENDLEASE – HY17 FINANCIAL RESULTS

Funds Under Management (FUM)

Growth in FUM ($b)

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CAGR of 15.0% 24.7
23.6
21.3
-
16.3
15.0
12.3
FY12 FY13 FY14 FY15 FY16 HY17
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FUM by asset class[1]

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FUM by region ($b)[1]

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Industrial
4%
Commercial 42% Retail
52%
2%
Other
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Europe
1.4
Asia
5.4
Australia
$24.7b
17.9
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As at 31 December 2016

LENDLEASE – HY17 FINANCIAL RESULTS

FUM by region

Group ($b)

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Australia ($b)

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0.5
(0.3)
1.0 (0.1) -
1.0 (0.1) 0.5
24.7
17.9
23.6
16.5
22.0 15
HY16 FY16 Acquired Divested Net Impact of fx HY17 HY16 FY16 Acquired Divested Net Impact of fx HY17
revaluations revaluations
Europe ($b) Asia ($b)
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Europe ($b)
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- - -
(0.2)
- - - (0.1)
5.6
1.7 5.3 5.4
1.5 1.4
HY16 FY16 Acquired Divested Net Impact of fx HY17 HY16 FY16 Acquired Divested Net Impact of fx HY17
revaluations revaluations
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LENDLEASE – HY17 FINANCIAL RESULTS

Major fund summary

			Funds Management Platform1	Funds Management Platform1	Funds Management Platform1
	APPFR2	APPFC3	APPFI4	LLITST5	LLOITST6	ARIF7 1 (Somerset)	ARIF7 3 (Jem)	PPPL8	LLRP9
Total assets ($ billion)	5.110	3.010	0.9	3.3	1.8	0.8	1.4	1.2	1.4
Gearing (%)	11.710	7.710	12.9	18.7	11.6	66.0	47.0	40.0	2.3
LLC co-investment (%)	1.0	7.8	10.7	15.0	12.5	10.1	20.1	6.1	4.3
LLC co-investment ($ million)	45	208	79	392	196	27	150	39	62
Region	AUS	AUS	AUS	AUS	AUS	Asia	Asia	Asia	Europe
Asset class	Retail	Office	Industrial	Office	Office	Retail	Retail and Commercial	Retail and Commercial	Retail
Number of assets	12	18	30	411	1	1	1	1	2
Occupancy (%)	98.4	85.812	93.6	79.512	74.712	93.2	99.1	96.0	95.9
Weighted average cap rate (%)	5.6	5.8	7.4	5.3	5.5	5.0	5.0	5.7	4.2

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The above highlights only selected major funds and does not comprise Lendlease’s complete Funds Management Platform
Australian Prime Property Fund Retail
Australian Prime Property Fund Commercial
Australian Prime Property Fund Industrial
Lendlease International Towers Sydney Trust (Barangaroo South T2 and T3)
Lendlease One International Towers Sydney Trust (Barangaroo South T1) 7. Asian Retail Investment Fund
Parkway Parade Partnership Limited
Lendlease Retail LP
Assets and gearing calculated on a look through basis 11. Includes car park asset
Includes Heads of Terms

LENDLEASE – HY17 FINANCIAL RESULTS

Retirement summary

Value drivers

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Valuation drivers	HY16	FY16	HY17
Long term growth rate	3.7%	3.7%	3.6%
Discount rate	13.3%	13.3%	13.0%
Average length of stay – ILUs (years)	11	11	11
Number of established units	14,295	13,3841	12,433
Units resold	541	1,038	453

Villages / units

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Location	Number of villages	Units
QLD	12	2,913
NSW	17	3,181
VIC	26	4,057
SA	4	500
WA	10	1,623
ACT	2	159
Total	71	12,433

Investments

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1,672
1,654
1
1,488
HY16 FY16 HY17
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Units by state

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4,057
3,181
2,913
1,623
500
159
VIC NSW QLD WA SA ACT
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In FY16, the Group divested its NZ Retirement business, consisting of 996 units and 5 sites

Lendlease overview

LENDLEASE – HY17 FINANCIAL RESULTS

Vision: to create the best places

Strategic framework

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Competitive advantage

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Business model

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Pillars of value

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LENDLEASE – HY17 FINANCIAL RESULTS

Globally diverse pipeline

Our globally diverse pipeline provides long term earnings visibility[1]

$49.0b $20.5b $24.7b $3.3b Development Construction FUM Investments pipeline backlog revenue

Americas

$3.7b Development pipeline $6.9b Construction backlog revenue $0.1b Investments

Europe $8.7b Development pipeline $1.1b Construction backlog revenue $1.4b FUM

$0.1b Investments

Asia

$5.7b Development pipeline $0.9b Construction backlog revenue $5.4b FUM

$0.3b Investments

Australia

$30.9b Development pipeline $11.6b Construction backlog revenue $17.9b FUM $2.8b Investments

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All data as at 31 December 2016

LENDLEASE – HY17 FINANCIAL RESULTS

Global trends influencing our strategy

By 2014, 54% of the world’s population were estimated to live in Urbanisation urban areas; this will reach 60% by 2030[1]

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Lendlease leadership

$35.0b[2] Urbanisation pipeline 12 major urbanisation projects[3] across 8 Gateway cities

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Worldwide infrastructure spending will grow from US$4 trillion per year Infrastructure in 2012 to more than US$9 trillion by 2025[4]

A leading tier 1 Engineering business in Australia
• $4b+ PPPs secured in last 5 years[5]

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Global assets under management are Funds growth forecast to rise from US$64 trillion in 2012 to US$102 trillion by 2020[6]

Lendlease accounted for ~10% of new equity raised globally for core wholesale mandates since 2009[7]

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Sustainability

Cities occupy 2% of the world’s land mass, but are responsible for up to 70% of harmful greenhouse gases[8]

Recognised by GRESB as an international leader[9]
Development pipeline targeting 98% green certification

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Internationally, people aged 60+ will Ageing grow the most in number between population 2015 and 2050[10]

A market leader in retirement living sector in Australia
Actively seeking to transfer skills offshore

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A pioneer of new delivery technologies e.g. Cross Laminated Timber, pre-fab and modular; a leader in new safety initiatives

Global investment in real estate Technology technology start-ups has grown from $0.2b in 2012 to $1.7b in 2015[11]

World Urbanization Prospects: The 2014 Revision, United Nations
Preqin Ltd; represents period 2009 to 2015
As at 31 December 2016
UN-HABITAT’s Global Report on Human Settlements 2011
Urbanisation development projects with end value >$1b
Global Real Estate Sustainability Benchmark (GRESB) 2016 survey; 5 funds achieved no.1 ranking in respective global or regional category
World Population Prospects: The 2015 Revision, United Nations 11. CB Insights: Real Estate Tech Start-ups Funding Overview 2016
Capital project and infrastructure spending outlook to 2025, PwC 2015 5. Cumulative data from FY12 – FY16
Asset Management 2020: A Brave New World, PwC 2014

LENDLEASE – HY17 FINANCIAL RESULTS

Portfolio Management Framework summary

Business model

Integrated model synergies

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•
Target EBITDA mix:
35-45% Development
30-40% Investments
20-30% Construction
Capital allocation Target returns
2
• •
Focussed on Gateway Cities Group ROE 10-14%
• •
50-70% capital in Australia Development ROIC 9-12% [1]
• 20% max per International region 1 Maximising 3 • Investments ROIC 8-11% [1]
•
long term Construction EBITDA margin 3-4%
securityholder
value
5 4
Distribution policy Capital structure
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•
Payout 40-60% of earnings
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Capital management discipline
Investment grade credit rating
Optimised WACC
Gearing[2] 10-15% (max 20%)

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Through-cycle target based on rolling 3-5 year timeline 2. Gearing definition: Net debt to total tangible assets less cash

LENDLEASE – HY17 FINANCIAL RESULTS

Pillars of value – non-financial

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Health and Safety Our Customers [1,2]
Critical Incident Frequency Group Lost Time Injury
Rate Frequency Rate c.250 MILLION MILITARY HOUSING FOR
1.64 1.95 RETAIL VISITORS c.125,000
1.62 ANNUALLY RESIDENTS IN THE US
1.20
c.16,000 c.150
RETIREMENT GLOBAL
LIVING RESIDENTS INSTITUTIONAL PARTNERS
HY16 HY17 HY16 HY17
Our People Sustainability
Employee engagement Senior Executive positions Total development pipeline achieved
score [3] held by women [4] or targeting green certification
98%
85% 84%
5
19%
LENDLEASE FUNDS
91%
17% TOP-RANKED IN 2016
GRESB SURVEY [5]
FY15 FY16 FY15 FY16 FY15 FY16
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Internal data capture, not audited
As at 30 June 2016
Survey managed by Willis Towers Watson. Employee engagement is a measure of overall employee satisfaction across our business

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Employees who hold a position at Executive level according to the Lendlease Career Job Framework. This generally includes Regional Business Unit Heads, Regional Function Heads and in some cases, direct reports to Global Function Heads
Global Real Estate Sustainability Benchmark (GRESB) 2016 survey; 5 funds achieved no.1 ranking in respective global or regional category

LENDLEASE – HY17 FINANCIAL RESULTS

Important notice

This presentation (including the appendices) has been prepared and is issued by Lendlease Corporation Limited (ACN 000 226 228) ( Lendlease ) in good faith. Neither Lendlease, nor any of its controlled entities including Lendlease Trust (together referred to as the Lendlease Group ) makes any representation or warranty, express or implied, as to the accuracy, completeness, adequacy or reliability of any statements, estimates, opinions or other information contained in the presentation (any of which may change without notice). To the maximum extent permitted by law, Lendlease, the Lendlease Group and their respective directors, officers, employees and agents disclaim all liability and responsibility (including without limitation any liability arising from fault or negligence) for any direct or indirect loss or damage which may be suffered, howsoever arising, through use or reliance on anything contained in or omitted from this presentation.

This presentation has been prepared without regard to the specific investment objectives, financial situation or needs of any recipient of this presentation. Each recipient should consult with, and rely solely upon, their own legal, tax, business and/or financial advisors in connection with any decision made in relation to the information contained in this presentation. Prospective financial information and forward looking statements, if any, have been based on current expectations about future events and are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from the expectations expressed in or implied from such information or statements.

The Lendlease Group’s statutory results are prepared in accordance with International Financial Reporting Standards (IFRS). This presentation also includes certain non-IFRS measures in presenting the Lendlease Group’s results. Certain non-IFRS financial measures have not been subject to audit or review. The Lendlease Group’s auditors, KPMG, performed agreed upon procedures to ensure consistency of the presentation with the Lendlease Group’s financial statements.

A reference to HY17 refers to the half year period ended 31 December 2016 unless otherwise stated. All figures are in AUD unless otherwise stated.

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AI assistant

LENDLEASE GROUP — Interim / Quarterly Report 2017

65243_rns_2017-02-26_b4a37d14-7e3f-41ed-b7d2-763da577798f.pdf

2017 Half Year Results Lendlease Group

ENDS

Lendlease delivers double digit earnings growth, continued execution excellence

Group Financials

Outlook

ENDS

FOR FURTHER INFORMATION, PLEASE CONTACT:

Indigenous engagement and reconciliation

Contents

Vision: to create the best places

Strategic framework

Business model

HY17 Safety

Double digit earnings growth, continued execution excellence

Securityholder returns[1]

Performance highlights[1]

Commercial success highlights resilience of business model

Commercial completion profile[1] (‘000s sqm)

Competitive advantage generated by the integrated model critical to commercial development success

Section 2 Financials

Financial performance

Cash flow movements ($b)[1]

Financial position

Portfolio Management Framework

EBITDA mix

Invested capital

Returns

Development – ROIC[4]

Investments – ROIC[4]

Construction – EBITDA margin

Portfolio Management Framework

Return on equity (ROE)[1]

Distributions

Gearing[[4]]

Section 3 Operational Update

Development

Performance highlights[1]

Residential presales[7] ($b)

Construction

Performance highlights[1]

Investments

Investments EBITDA by activity ($m)

Performance highlights[1]

FUM ($b)

Section 4 Outlook

Outlook

Earnings visibility from strong pipeline across all segments

Funds under management ($b)

Section 5

Q&A

Dan Labbad

Appendices

Our business model

DEVELOPMENT

Core Financial Returns:

CONSTRUCTION

Core Financial Returns:

INVESTMENTS

Core Financial Returns:

Income Statement

Statement of Financial Position

Statement of Cash Flows

Securityholder returns

Return on equity (ROE)[1]

Distributions

Segment financial metrics

Operating Profit after Tax ($m)

EBITDA ($m)

Invested Capital[3] (Development and Investments) ($b)

Segment and region financial metrics

By segment

Recurring income

Revenue and EBITDA by segment and geography

EBITDA by segment ($m)

EBITDA by geography ($m)

Revenue and EBITDA by segment and geography, local currency

Europe

LENDLEASE GROUP Interim / Quarterly Report 2017