LENDLEASE GROUP — Interim / Quarterly Report 2021

Feb 21, 2021

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22 February 2021
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Lendlease Trust 2021 Half Year Consolidated Financial Report

Attached is the Lendlease Trust Half Year Consolidated Financial Report for the half year ended 31 December 2020.

ENDS

For further information, please contact:

Investors: Justin McCarthy Mob: +61 422 800 321

Media: Stephen Ellaway Mob: +61 417 851 287

Authorised for lodgement by the Lendlease Group Disclosure Committee

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

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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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Lendlease
Trust Half Year
Consolidated
Financial
Report
December 2020
ARSN 128 052 595
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Table of Contents

Table of Contents
Directors’ Report	2
Statement of Comprehensive Income	4
Statement of Financial Position	4
Statement of Changes in Equity	5
Statement of Cash Flows	5
Notes to the Consolidated Financial Statements	6

Notes Index

Section A: Performance	Section A: Performance	7
1.	Distributions	7
2.	Earningsper Unit	7
3.	Other Income	7
4.	Finance Revenue and Finance Costs	7
5.	Share of Loss of EquityAccounted Investments	8
6.	Events Subsequent to Balance Date	8
Section B: Investment		8
7.	Other Financial Assets	8
8.	EquityAccounted Investments	9
Section C: Liquidity and Working Capital		11
9.	Issued Capital	11
Section D: Other Notes		12
10.	Fair Value Measurement	12
11.	Contingent Liabilities	12
12.	Consolidated Entities	12
Directors’ Declaration		13

Lendlease Responsible Entity Limited ABN 72 122 883 185 AFSL No. 308983 is the responsible entity of the Lendlease Trust ARSN 128 052 595. Lendlease Trust (LLT or the Trust) is domiciled in Australia. The consolidated financial report of LLT for the half year ended 31 December 2020 comprises LLT including its controlled entities (together referred to as the Consolidated Entity). The Consolidated Entity is a for-profit entity. Further information about the Consolidated Entity’s primary activities is included in the Directors’ Report.

Shares in Lendlease Corporation Limited (the Company) and units in LLT are traded as one security under the name of Lendlease Group on the Australian Securities Exchange (ASX).

The consolidated financial report for the half year ended 31 December 2020 was authorised for issue by the Directors on 22 February 2021.

Lendlease Trust Half Year Consolidated Financial Report December 2020 Directors’ Report

2

Directors’ Report

The Directors of Lendlease Responsible Entity Limited (ABN 72 122 883 185), the Responsible Entity of Lendlease Trust (the Trust), present their Report together with the Half Year Consolidated Financial Report of the Trust, for the six months ended 31 December 2020 and the Auditor’s Report thereon.

The Responsible Entity is a wholly owned subsidiary of Lendlease Corporation Limited (the Company) and forms part of the consolidated Lendlease Group (the Group). The registered office and principal place of business of the Responsible Entity is Level 14, Tower Three, International Towers Sydney, Exchange Place, 300 Barangaroo Avenue, Barangaroo NSW 2000.

1. Governance

a. Board/Directors

The name of each person who has been a Director of the Responsible Entity between 1 July 2020 and the date of this Report are:

M J Ullmer, AO	Director since 2011 and Chairman since 2018
S B McCann	Group Chief Executive Ofcer since 2008 & Managing Director since 2009
P M Cofey	Director since 2017
D P Craig	Director since 2016
J S Hemstritch	Director since 2011
E M Proust, AO	Director since 2018
N M Wakefeld Evans	Director since 2013
R F Welanetz	Director since March 2020
The names of Directors of the Responsible Entity who retired between 1 July 2020 and the date of this Report are:
C B Carter, AM	Director since 2012 (retired 20 November 2020)
M A Ford, OBE	Director since March 2020 (retired 18 August 2020)

2. Review and Results of Operations

For the six months ended 31 December 2020, the Trust reported a profit after tax of $24,782,000 (December 2019: $31,511,000).

Key transactions during the period include:

• Further investment of $3,200,000 relating to Carlton Connect Initiative.

• An interim distribution of $26,428,000 (December 2019: $44,681,000) has been approved by the directors and will be paid on 17 March 2021.

3. Events Subsequent to Balance Date

On 10 February 2021, the Group announced that Steve McCann will retire as Group CEO and Managing Director on 31 May 2021. There were no other material events subsequent to the end of the financial period.

4. Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001

The Lead Auditor’s Independence Declaration is set out at the end of this report and forms part of the Directors’ Report for the six months ended 31 December 2020.

5. Rounding Off

Lendlease Trust is a Trust of the kind referred to in the ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191, and in accordance with the Instrument, amounts in the financial statements and Directors’ Report have been rounded off to the nearest thousand dollars, or, where the amount is $500 or less, zero, unless specifically stated otherwise.

This report is made in accordance with a resolution of the Board of Directors and is signed for and on behalf of the Directors.

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M J Ullmer, AO

Chairman

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S B McCann

Chief Executive Officer and Managing Director

Sydney, 22 February 2021

Lendlease Trust Half Year Consolidated Financial Report December 2020 Directors’ Report

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Directors’ Report continued

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Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001

To the Directors of Lendlease Responsible Entity Limited (the responsible entity of Lendlease Trust)

I declare that, to the best of my knowledge and belief, in relation to the review of Lendlease Trust for the half year ended 31 December 2020 there have been:

• i. no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the review; and

• ii. no contraventions of any applicable code of professional conduct in relation to the review.

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KPMG
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D M McLennan
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Partner

Sydney

22 February 2021

KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and logo are Liability limited by a scheme trademarks used under license by the independent member firms of approved under Professional the KPMG global organisation. Standards Legislation.

Lendlease Trust Half Year Consolidated Financial Report December 2020 Financial Statements 4

Consolidated Financial Statements

Statement of Comprehensive Income

Half Year Ended 31 December 2020

		6 months	6 months
		December 2020	December 20191
	Note	$’000	$’000
Other income	3	20,554	37,891
Other expenses		(823)	(1,088)
Results from operating activities		19,731	36,803
Share of loss of equity accounted investments	5	(1,421)	(9,649)
Finance revenue	4	6,472	4,357
Proft before tax		24,782	31,511
Income tax expense		-	-
Proft after tax		24,782	31,511
Other comprehensive income net of tax		-	-
Items that may be reclassifed subsequently to proft or loss
Movements in foreign currency translation reserve		(10,385)	(2,877)
Total items that may be reclassifed subsequently to proft or loss		(10,385)	(2,877)
Total comprehensive income after tax		14,397	28,634
Basic/diluted earnings per unit (cents)	2	3.60	5.36

1. As required under AASB 133 Earnings per Share , the 31 December 2019 weighted average number of units has been updated to reflect the new stapled securities issued via the institutional placement and Security Purchase Plan during the 30 June 2020 year. The Basic/Diluted EPU has been restated to reflect this change.

Statement of Financial Position

As at 31 December 2020

Statement of Financial Position As at 31 December 2020
		December 2020	June 2020
	Note	$’000	$’000
Current Assets
Cash and cash equivalents		18,824	19,475
Loans and receivables		821,838	820,177
Total current assets		840,662	839,652
Non Current Assets
Equity accounted investments	8	233,296	250,122
Other fnancial assets	7	697,165	689,168
Total non current assets		930,461	939,290
Total assets		1,771,123	1,778,942
Current Liabilities
Trade and other payables		59	65
Distributions payable	1	26,428	22,412
Total current liabilities		26,487	22,477
Non Current Liabilities
Borrowings and fnancing arrangements		-	-
Total non current liabilities		-	-
Total liabilities		26,487	22,477
Net assets		1,744,636	1,756,465
Equity
Issued capital	9	1,536,216	1,536,014
Buyback reserve		(67,149)	(67,149)
Foreign currency translation reserve		(15,406)	(5,021)
Retained Earnings		290,975	292,621
Total equity attributable to unitholders		1,744,636	1,756,465

The accompanying notes form part of these consolidated financial statements.

Lendlease Trust Half Year Consolidated Financial Report December 2020 Financial Statements 5

Consolidated Financial Statements

Statement of Changes in Equity

Half Year Ended 31 December 2020

Half Year Ended 31 December 2020
			Foreign
		Buyback	Currency	Retained
	Issued Capital	Reserve	Translation	Earnings	Total Equity
	$’000	$’000	Reserve$’000	$’000	$’000
Balance as at 1 July 2019	921,228	(67,149)	-	327,745	1,181,824
Total Comprehensive Income
Proft for the period	-	-	-	31,511	31,511
Other comprehensive income (net of tax)	-	-	-	-	-
Efect of foreign exchange movement	-	-	(2,877)	-	(2,877)
Total comprehensive income	-	-	(2,877)	31,511	28,634
Transactions with Owners of the Trust
Distribution reinvestment plan (DRP)	1,087	-	-	-	1,087
Distributionprovided for	-	-	-	(44,681)	(44,681)
Total other movements	1,087	-	-	(44,681)	(43,594)
Balance as at 31 December 2019	922,315	(67,149)	(2,877)	314,575	1,166,864
Balance as at 1 July 2020	1,536,014	(67,149)	(5,021)	292,621	1,756,465
Total Comprehensive Income
Proft for the period	-	-	-	24,782	24,782
Other comprehensive income (net of tax)	-	-	-	-	-
Efect of foreign exchange movement	-	-	(10,385)	-	(10,385)
Total comprehensive income	-	-	(10,385)	24,782	14,397
Transactions with Owners of the Trust
Distribution reinvestment plan (DRP)	202	-	-	-	202
Distributionprovided for	-	-	-	(26,428)	(26,428)
Total other movements	202	-	-	(26,428)	(26,226)
Balance as at 31 December 2020	1,536,216	(67,149)	(15,406)	290,975	1,744,636

Statement of Cash Flows

Half Year Ended 31 December 2020

	6 months	6 months
	December 2020	December 2019
	$’000	$’000
Cash Flows from Operating Activities
Cash receipts in the course of operations	3,056	1,866
Cash payments in the course of operations	(498)	(2,049)
Interest received	3,052	3,936
Distributions received	19,149	17,444
Net cashprovided by operating activities	24,759	21,197
Cash Flows from Investing Activities
Acquisition of investments	(3,200)	(268,785)
Proceeds from sale of fair value throughproft or loss investments	-	89,095
Net cash used in by investing activities	(3,200)	(179,690)
Cash Flows from Financing Activities
Loan repayment by related party	-	275,915
Distributionspaid	(22,210)	(114,536)
Net cash used in fnancing activities	(22,210)	161,379
Net (decrease)/increase in cash and cash equivalents	(651)	2,886
Cash and cash equivalents at beginningof fnancialperiod	19,475	14,289
Cash and cash equivalents at end of fnancialperiod	18,824	17,175

The accompanying notes form part of these consolidated financial statements.

Lendlease Trust Half Year Consolidated Financial Report December 2020 Financial Statements

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Notes to the Financial Statements

Basis of Preparation

The half year consolidated 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 ;

• Complies with the recognition and measurement requirements of the International Financial Reporting Standards (IFRSs) and Interpretations adopted by the International Accounting Standards Board;

• Should be read in conjunction with the 30 June 2020 annual financial report and any public announcements by the Consolidated Entity during the half year in accordance with continuous disclosure obligations arising under the Corporations Act 2001 . The half year consolidated financial report does not contain all the information required for a full financial report;

• Is presented in Australian dollars, with all values rounded off to the nearest thousand dollars unless otherwise indicated, in accordance with ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191; and

• Is prepared under the historical cost basis except for the following assets, which are stated at their fair value: fair value through profit or loss investments.

The preparation of an interim report that complies with AASB 134 requires management to make judgements, estimates and assumptions.

• This can affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

• Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised prospectively.

• The accounting policies have been consistently applied by the Consolidated Entity and are consistent with those applied in the 30 June 2020 annual financial statements.

• These significant accounting estimates and judgements have been considered in the context of the COVID-19 pandemic and the impact of the current economic conditions.

Impact of New and Revised Accounting Standards

New Accounting Standards and Interpretations Not Yet Adopted

Accounting Standard	Requirement
AASB 2014-10	AASB 2014-10 amends AASB 10 and AASB
Amendments to Australian Accounting	128 to clarify the requirements for recording
Standards – Sale or Contribution of Assets	the sale or contribution of assets between an
between an Investor and its Associate or	investor and its associate or joint venture.
_Joint Venture_and consequential amendments	The amendment becomes mandatory for the June 2023 fnancial year and will be applied
	prospectively.

Impact on Financial Statements Based on preliminary analysis performed, the amendments are not expected to have a material impact on the Consolidated Entity.

Lendlease Trust Half Year Consolidated Financial Report December 2020 Financial Statements

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Notes to the Financial Statements continued

Section A: Performance

Profit After Tax (PAT) is the key measure used to assess the Trust’s performance. This section of the Financial Report focuses on disclosure that enhances a user’s understanding of PAT. The key line items of the Statement of Comprehensive Income along with their components provide detail behind the reported balances. The Trust’s performance will also impact the earnings per unit and distribution payout, therefore disclosure on these items has been included in this section. Further information and analysis on performance can be found in the Review and Results of Operations, which forms part of the Directors’ Report.

1. Distributions

		6 months	6 months
	Cents	December 2020	December 2019
Lendlease Trust Interim Distribution	Per Unit	$’000	$’000
December 2020 – provided for and payable 17 March 2021	3.8	26,428	-
December 2019 – paid 17 March 2020	7.9	-	44,681
Total		26,428	44,681
		6 months	6 months
	Cents	June 2020	June 2019
Lendlease Trust Final Distribution	Per Unit	$’000	$’000
June 2020 – paid 15 September 2020	3.3	22,412	-
June 2019 – paid 16 September 2019	20.5	-	115,623
Total		22,412	115,623

2. Earnings per Unit

2. Earnings per Unit
	6 months	6 months
Basic/Diluted Earnings Per Unit (EPU)	December 2020	December 20191
Proft after tax	$’000 24,782	31,511
Weighted average number of units	’000 688,309	587,981
Basic/Diluted EPU	cents 3.60	5.36

1. As required under AASB 133 Earnings per Share , the 31 December 2019 weighted average number of units has been updated to reflect the new stapled securities issued via the institutional placement and Security Purchase Plan during the 30 June 2020 year. The Basic/Diluted EPU has been restated to reflect this change.

3. Other Income

	6 months	6 months
	December 2020	December 2019
	$’000	$’000
Distribution income	12,702	13,752
Net gain on fair value remeasurement of fair value through proft or loss assets	4,797	20,335
Net gain on sale of fnancial assets at fair value	-	1,938
Other income – related parties	3,055	1,866
Total other income	20,544	37,891

4. Finance Revenue

	6 months	6 months
	December 2020	December 2019
Finance Revenue	$’000	$’000
Finance revenue – external parties	-	86
Finance revenue – related parties	6,472	4,271
Total finance revenue	6,472	4,357

Lendlease Trust Half Year Consolidated Financial Report December 2020 Financial Statements

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Notes to the Financial Statements continued

Section A: Performance continued

5. Share of Loss of Equity Accounted Investments

5. Share of Loss of Equity Accounted Investments Section A: Performance continued
		6 months	6 months
		December 2020	December 2019
	Note	$’000	$’000
Associates1
Share of loss	8	(1,421)	(9,649)
Total share of loss of equity accounted investments		(1,421)	(9,649)

1. Reflects the contribution to the Consolidated Entity’s profit, and is after tax paid by the equity accounted investment vehicles themselves, where relevant.

6. Events Subsequent to Balance Date

There were no material events subsequent to the end of the financial period.

Section B: Investment

This section includes disclosures for indirect property assets such as Equity Accounted Investments in associates and Other Financial Assets contained within the Statement of Financial Position. The measurement basis of Other Financial Assets is fair value. Refer to Note 10 ‘Fair Value Measurement’ for details on basis of determining fair value and valuation technique.

7. Other Financial Assets

Fair Value Level1 December 2020 $’000	June 2020 $’000
Non Current Measured at Fair Value Fair Value Through Proft or Loss – Designated at Initial Recognition Lendlease International Towers Sydney Trust Level 3 154,320 Lendlease One International Towers Sydney Trust Level 3 52,961 Australian Prime Property Fund – Industrial Level 3 97,533	153,022 53,372 95,637
Australian Prime Property Fund – Commercial Level 3 365,858 Australian Prime Property Fund – Retail Level 3 21,398 Carlton Connect Initiative Level 3 5,095	363,425 21,534 2,178
Total non current other fnancial assets 697,165	689,168

1. Refer to Note 10 Fair Value Measurement for details on basis of determining fair value and valuation technique.

a. Fair Value Reconciliation

Reconciliation of the carrying amount for Level 3 financial instruments is set out as follows.

a. Fair Value Reconciliation Reconciliation of the carrying amount for Level 3 fnancial instruments is set out as	follows.
	December 2020	June 2020
	Unlisted Equity	Unlisted Equity
	Investments	Investments
	$’000	$’000
Carrying amount at beginning of fnancial period	689,168	772,122
Additions	3,200	2,223
Disposals	-	(87,157)
Gains recognised in Statement of Comprehensive Income – other income	4,797	1,980
Carrying amount at end of fnancial period	697,165	689,168

The potential effect of using reasonably possible alternative assumptions for valuation inputs would not have a material impact on the Consolidated Entity.

Lendlease Trust Half Year Consolidated Financial Report December 2020 Financial Statements

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Notes to the Financial Statements continued

Section B: Investment continued

8. Equity Accounted Investments

8. Equity Accounted Investments
	INTEREST December 2020 % June 2020 %	SHARE OF PROFIT	NET BOOK VALUE
			December 2020 $’000 June 2020 $’000
a. Associates Asia Investments Lendlease Global Commercial REIT			233,296 250,122
	24.1% 24.2%	(1,421) (9,649)
Total Asia		(1,421) (9,649)	233,396 250,122
Total Less: Impairment		(1,421) (9,649)	233,296 250,122 - -
Total associates		(1,421) (9,649)	233,296 250,122

b. Material Associates Summarised Financial Information

Material associates are determined by comparing individual investment carrying value and share of profit with the total equity accounted investment carrying value and share of profit, along with consideration of relevant qualitative factors.

Income Statement1	LENDLEASE GLOBAL COMMERCIAL REIT
	6 months December 2020 $’000 2 October to 31 December 2019 $’000
Other income Cost of sales Other expenses Unrealised fair value losses Finance costs Income tax expense	42,073 22,792 (11,327) (5,565) (20,219) 2,737 - (52,167) (5,158) (2,562) - -
Proft/(loss) for the period Other comprehensive income/(loss)	5,369 (34,765) 14,950 (5,356)
Total comprehensive income/(loss) Consolidated Entity’s ownership interest Consolidated Entity’s total share of: Proft/(loss) for the period Other adjustments	20,319 (40,121) 24.1% 24.3% 1,294 (8,455) (2,715) (1,194)
Total loss for the period Other comprehensive loss	(1,421) (9,649) (10,384) (2,877)
Total comprehensive loss	(11,805) (12,526)

1. The presentation of the material associates has been reclassified to separately present Cost of sales, Unrealised fair value gains/(losses) and Finance costs.

Lendlease Trust Half Year Consolidated Financial Report December 2020 Financial Statements 10

Notes to the Financial Statements continued

Section B: Investment continued

8. Equity Accounted Investments continued

b. Material Associates Summarised Financial Information continued

b. Material Associates Summarised Financial Informationcontinued
Statement of Financial Position	LENDLEASE GLOBAL COMMERCIAL REIT
	December 2020 $’000 June 2020 $’000
Current assets Cash and cash equivalents Other current assets	45,547 87,309 15,019 13,968
Total current assets	60,566 101,277
Non current assets Investment properties Other non current assets	1,429,868 1,506,431 58,118 15,611
Total non current assets	1,487,986 1,522,042
Current liabilities Other current liabilities	22,728 22,197
Total current liabilities	22,728 22,197
Non current liabilities Financial liabilities (excluding trade payables) Other non current liabilities	535,764 551,951 12,761 12,627
Total non current liabilities	548,525 564,578
Net assets	977,299 1,036,544
Reconciliation to Carrying Amounts Opening net assets 1 July Acquisition/contributions Distributions Total comprehensive income for the period Foreign currency translation for the period	1,036,544 - 91 1,076,828 (20,833) (16,408) 20,319 7,663 (58,822) (31,539)
Closing net assets	977,299 1,036,544
% ownership	24.1% 24.2%
Consolidated Entity’s share of net assets Other adjustments	235,529 250,844 (2,233) (722)
Carrying amount at end of period	233,296 250,122

There were no immaterial associates for the period ended 31 December 2020.

Lendlease Trust Half Year Consolidated Financial Report December 2020 Financial Statements

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Notes to the Financial Statements continued

Section C: Liquidity and Working Capital

The ability of the Consolidated Entity to fund the continued investment in new opportunities and meet current commitments is dependent on available cash and access to third party capital. This section contains disclosure on the financial assets, financial liabilities, cash flows and equity that are required to finance the Consolidated Entity’s activities, including existing commitments and the liquidity risk exposure associated with financial liabilities. The section also contains disclosures for the Consolidated Entity’s trading assets, and the trading liabilities incurred as a result of trading activities used to generate the Consolidated Entity’s performance.

9. Issued Capital

9. Issued Capital
	December 2020	December 2020	June 2020	June 2020
	No of units ’000s	$’000	No of units ’000s	$’000
Issued capital at beginning of fnancial period, net of prior
period share buyback	688,268	1,536,014	564,131	921,228
Distribution reinvestment plan (DRP)	70	202	662	2,080
Share issue via institutional placement (net of transaction costs)	-	-	96,939	478,470
Share issue via Security Purchase Plan (net of transaction costs)	-	-	26,536	134,236
Issued capital at end of fnancial period	688,338	1,536,216	688,268	1,536,014

a. Issuance of Securities

As at 31 December 2020, Lendlease Trust had 688,338,445 units on issue, equivalent to the number of Lendlease Corporation shares on issue. The issued units of the Trust and shares on issue by Lendlease Corporation Limited are stapled securities.

b. Security Accumulation Plans

The Distribution Reinvestment Plan (DRP) was reactivated in February 2011. The last date for receipt of an election notice for participation in the DRP is 2 March 2021. The issue price is the arithmetic average of the daily volume weighted average price of Lendlease Group stapled securities traded (on the Australian Securities Exchange) for the period of five consecutive business days immediately following the record date, commencing on 2 March 2021, for determining entitlements to distribution. If that price is less than 50 cents, the issue price will be 50 cents. Stapled securities issued under the DRP rank equally with all other stapled securities on issue.

c. Terms and Conditions

A stapled security represents one share in the Company stapled to one unit in the Trust.

Stapled securityholders have the right to receive declared dividends from the Company and distributions from the Trust and are entitled to one vote per stapled security at securityholders’ meetings. Ordinary stapled securityholders rank after all creditors in repayment of capital.

Lendlease Trust Half Year Consolidated Financial Report December 2020 Financial Statements 12

Notes to the Financial Statements continued

Section D: Other Notes

10. Fair Value Measurement

a. Basis of Determining Fair Value

The fair value of unlisted equity investments, including investments in property funds, is determined based on an assessment of the underlying net assets which may include periodic independent and Directors’ valuations, future maintainable earnings, and any special circumstances pertaining to the particular investment. Fair value of unlisted equity investments has also taken the COVID-19 pandemic into consideration to determine fair value at 31 December 2020. This includes valuations of underlying investment properties at balance date.

b. Fair Value Measurements

The different levels of valuation method have been defined as follows:

• Level 1: The fair value is determined using the unadjusted quoted price for an identical asset or liability in an active market for identical assets or liabilities;

• Level 2: The fair value is calculated using predominantly observable market data other than unadjusted quoted prices for an identical asset or liability; and

• Level 3: The fair value is calculated using inputs that are not based on observable market data.

During the period there were no transfers between Level 1, Level 2 and Level 3 fair value hierarchies.

11. Contingent Liabilities

The Consolidated Entity has identified the following contingent liabilities, being liabilities in respect of which there is the potential for a cash outflow in excess of any provision where the likelihood of payment is not considered probable or cannot be measured reliably at this time:

• In certain circumstances, the Trust, as part of the Group, guarantees the performance of particular Group entities in respect of their obligations. This includes bonding and bank guarantee facilities used primarily by the construction business. These guarantees are provided in respect of activities that occur in the ordinary course of business and any known losses in respect of the relevant contracts have been brought to account.

12. Consolidated Entities

The material entities of the Consolidated Entity listed below were wholly owned during the current period.

PARENT ENTITY Lendlease Trust	AUSTRALIA
	Lendlease LLT Holdings Sub Trust Lendlease SREIT Sub Trust

During the current period, there were no acquisitions or disposals of material consolidated entities.

Lendlease Trust Half Year Consolidated Financial Report December 2020 Financial Statements

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Directors’ Declaration

In the opinion of the Directors of Lendlease Responsible Entity Limited, the responsible entity for the Lendlease Trust (the Trust):

1. The financial statements and notes are in accordance with the Corporations Act 2001 , including:

2. a. Giving a true and fair view of the financial position of the Consolidated Entity as at 31 December 2020 and of its performance for the half year ended on that date; and

3. b. Complying with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 .

4. There are reasonable grounds to believe that the Trust will be able to pay its debts as and when they become due and payable.

Signed in accordance with a resolution of the Directors:

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M J Ullmer, AO

Chairman

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S B McCann

Chief Executive Officer and Managing Director

Sydney, 22 February 2021

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Independent Auditor’s Review Report

To the unitholders of Lendlease Trust

Conclusion

We have reviewed the accompanying Half Year Financial Report of Lendlease Trust (the Trust).

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 Lendlease Trust does not comply with the Corporations Act 2001 , including:

• [giving a true and fair view of the Trust’s ] financial position as at 31 December 2020 and of its performance for the Half Year ended on that date; and

• [complying with ] [Australian Accounting Standard ] AASB 134 Interim Financial Reporting and the Corporations Regulations 2001.

The Half Year Financial Report comprises:

• [Consolidated statement of financial position ] as at 31 December 2020;

• [Consolidated statement of comprehensive ] income, Consolidated statement of changes in equity and Consolidated statement of cash flows for the Half Year ended on that date;

• [Notes 1 to 12 comprising a summary of ] significant accounting policies and other explanatory information; and

• [The Directors’ Declaration. ]

Basis for Conclusion

We conducted our review in accordance with ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity . Our responsibilities are further described in the Auditor’s Responsibilities for the Review of the Financial Report section of our report.

We are independent of the Trust in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the annual financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.

Responsibilities of the Directors for the Half Year Financial Report

The Directors of the Lendlease Responsible Entity Limited, the Responsible Entity for Lendlease Trust, 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

• such internal control as the Directors determine is necessary to enable the preparation of the Half Year Financial Report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.

KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and logo are Liability limited by a scheme trademarks used under license by the independent member firms of approved under Professional the KPMG global organisation. Standards Legislation.

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Auditor’s Responsibilities for the Review of the Half Year Financial Report

Our responsibility is to express a conclusion on the Half Year Financial Report based on our review. ASRE 2410 requires us to conclude whether we have become aware of any matter that makes us believe that the Half Year Financial Report does not comply with the Corporations Act 2001 including giving a true and fair view of the Trust’s financial position as at 31 December 2020 and its performance for the Half Year ended on that date; and complying with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 .

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.

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KPMG

D M McLennan

Partner

Sydney

22 February 2021

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

www.lendlease.com

@lendlease

@lendleasegroup

@lendlease