LENDLEASE GROUP — Investor Presentation 2017

Sep 13, 2017

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14 September 2017
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Lendlease Presentation at CLSA Investors’ Forum

Attached is the presentation to be given by Lendlease Group Chief Executive Officer and Managing Director, Steve McCann at today’s CLSA Investors’ Forum in Hong Kong.

ENDS

FOR FURTHER INFORMATION, PLEASE CONTACT:

Investors: Media: Justin McCarthy Stephen Ellaway Mob: 0422 800 321 Mob: 0417 851 287

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

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

2017 CLSA Investors’ Forum

Steve McCann Chief Executive Officer and Managing Director Lendlease

14 September 2017

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LENDLEASE – PRESENTATION TO CLSA INVESTORS’ FORUM

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 – PRESENTATION TO CLSA INVESTORS’ FORUM

Global trends influencing our strategy

Lendlease leadership

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Urbanisation

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

• $34.6b[2] Urbanisation pipeline

• • 13 major urbanisation projects[3] across 8 gateway cities

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Infrastructure

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

• A leading tier 1 Engineering business in Australia

• • $4b+ PPPs secured in last 6 years[5]

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Funds growth

Global assets under management are 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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Technology

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

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

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1. World Urbanization Prospects: The 2014 Revision, United Nations 2. As at 30 June 2017

2. Urbanisation development projects with end value >$1b

3. Capital project and infrastructure spending outlook to 2025, PwC 2015 5. Cumulative data from FY12 – FY17

4. Asset Management 2020: A Brave New World, PwC 2014

5. Preqin Ltd; represents period 2009 to 2015

6. UN-HABITAT’s Global Report on Human Settlements 2011

7. Global Real Estate Sustainability Benchmark (GRESB) 2016 survey; 5 funds achieved no.1 ranking in respective global or regional category

8. World Population Prospects: The 2015 Revision, United Nations 11. CB Insights: Real Estate Tech Start-ups Funding Overview 2016

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LENDLEASE – PRESENTATION TO CLSA INVESTORS’ FORUM

Globally diverse pipeline provides long term earnings visibility[1]

Europe

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Americas
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$4.3b Development pipeline $7.8b Construction backlog revenue $0.1b Investments

$8.0b Development pipeline $0.8b Construction backlog revenue $1.4b FUM

Asia

$6.1b Development pipeline

$0.8b Construction backlog revenue $5.4b FUM

$0.3b Investments

Australia

$30.9b Development pipeline

$11.2b Construction backlog revenue $19.3b FUM $2.9b Investments

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1. All data as at 30 June 2017

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LENDLEASE – PRESENTATION TO CLSA INVESTORS’ FORUM

Portfolio Management Framework

EBITDA mix

Invested capital

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By segment

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24%
52%
$1.4b [1] 48% $6.3b [2]
40%
36%
Development Construction Investments Development Investments
Target
weighting (35 – 45%) (20 – 30%) (30 – 40%) (40 – 60%) (40 – 60%)
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By region

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10%
12%
8%
$6.7b [3]
70%
Australia Asia Europe Americas
(50 – 70%) (5 – 20%) (5 – 20%) (5 – 20%)
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Returns

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Development – ROIC[4]

Investments – ROIC[4]

Construction – EBITDA margin

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Target 9 – 12% [5] Target 8 – 11% [5] Target 3 – 4%
13.7% 11.2% 11.7%
11.7%
2.4% 2.7%
FY16 FY17 FY16 FY17 FY16 FY17
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1. Operating EBITDA

2. Invested capital for Development and Investments

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1. Invested capital for Australia, Asia, Europe and the Americas. Total Lendlease invested capital as at 30 June 2017 was $7.0 billion ($0.3 billion Corporate) 4. Return on Invested Capital (ROIC) is calculated using the annual operating profit after tax divided by the arithmetic average of beginning, half year and year end invested capital. FY16 Investments ROIC restated reflecting inclusion of half year end invested capital in calculation

2. Through-cycle target based on rolling 3-5 year timeline

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LENDLEASE – PRESENTATION TO CLSA INVESTORS’ FORUM

FY17 Achievements

Execution excellence across our portfolio

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• Residential apartment unit completions – significant increase in delivery, more than double the prior year

• Australian office leasing underpinned forward sales/development JV – more than 90,000 square metres of leasing

• Australian social infrastructure completions: International Convention Centre Sydney, Sunshine Coast[1] and Bendigo[1] hospitals

• US high-rise residential construction – strong market position

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International Convention Centre Sydney, New South Wales

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New Bendigo Hospital, Victoria

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Sunshine Coast University Hospital, Queensland

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432 Park Avenue, New York

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North Yard, Brisbane Showgrounds, Queensland[2]

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Toorak Park, Victoria[2]

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1. Sunshine Coast University Hospital, New Bendigo Hospital 2. Artist impression

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LENDLEASE – PRESENTATION TO CLSA INVESTORS’ FORUM

FY17 Achievements

Laying the foundations for future growth

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• Significant progress in converting urbanisation projects in gateway cities:

• Four additional cities with projects in delivery: Chicago, Boston, New York, Kuala Lumpur

• Two new cities with projects secured: Milan, San Francisco

• Consolidated position in London: preferred partner on c.$7 billion Haringey Development Vehicle[1]

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Riverline, Chicago[2]

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Clippership Wharf, Boston[2]

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Milano Santa Giulia, Milan[2]

• Leveraging global trends that guide our strategy:

Infrastructure

• Australian transport – post balance date announced preferred bidder on c.$6 billion Melbourne Metro Tunnel Project[3] and c.$500 million Ballarat Line Upgrade[4]

• US Telecommunications – acquisition of mobile tower portfolio

Funds growth

• More than $3 billion of additional secured funds under management across urbanisation projects in delivery

• Future pipeline opportunities including new sectors for our investment platform – residential for rent, telco infrastructure

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1. Subject to contractual and financial close. Approximate number as at 30 June 2017 based on exchange rate at period end

2. Artist impression

3. One third share and responsibility for financial arrangement of the PPP

4. Joint Venture arrangement

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LENDLEASE – PRESENTATION TO CLSA INVESTORS’ FORUM

Outlook

• Well positioned for future success:

• Earnings visibility from extensive pipeline across our business segments

• Financial strength and resilient business model with diversity across segments, sectors and geographies

• Diversifying capital and earnings through growth in international operations:

• Four additional cities with projects in delivery: Chicago, Boston, New York, Kuala Lumpur

• Two new cities with projects secured: Milan, San Francisco

• Consolidated position in London; preferred partner on c.$7 billion Haringey Development Vehicle[1]

• Strong construction backlog revenue of $20.6 billion:

• Preferred bidder status in construction work globally of c.$10 billion[2]

• Post balance date announced preferred on Melbourne Metro Tunnel Project and Ballarat Line Upgrade

• Focused on execution excellence through strong risk and governance frameworks:

• Unwavering commitment to health and safety

• Disciplined approach to origination

• Managing individual project, property cycle and sovereign risk

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1. Subject to contractual and financial close. Approximate number as at 30 June 2017 based on exchange rate at period end 2. As at 30 June 2017

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LENDLEASE – PRESENTATION TO CLSA INVESTORS’ FORUM

Earnings visibility from strong pipeline across all segments

Development pipeline of $49.3 billion

Construction backlog revenue of $20.6 billion

FUM of $26.1 billion

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Development pipeline
($b)
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60
50
40
30
20
10
0
FY13 FY14 FY15 FY16 FY17
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Construction backlog revenue ($b)

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22
20
18
16
14
12
FY13 FY14 FY15 FY16 FY17
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Funds under management
($b)
25
20
15
10
5
0
FY13 FY14 FY15 FY16 FY17
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LENDLEASE – PRESENTATION TO CLSA INVESTORS’ FORUM

Important notice

This document 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 this document (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 document.

This document 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.

Lendlease Group’s statutory results are prepared in accordance with International Financial Reporting Standards (IFRS). This document also includes material that is not included in Lendlease Group’s statutory results and contains non-IFRS measures. Material that is not included in Lendlease Group’s statutory results has not been subject to audit.

A reference to FY17 refers to the full year period ended 30 June 2017 unless otherwise stated. All figures are in AUD unless otherwise stated.

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Thank you.

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