PEET LIMITED — Annual Report 2016

Aug 24, 2016

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FY16 RESULTS PRESENTATION

FY16 RESULTS OVERVIEW

Continued strong momentum

• » FY16 operating profit[1] after tax of $42.6m, up 11%

• » EPS of 8.7 cents per share – up 5% FY14 ResultFY14

• » Underlying business performance Result

• Revenue[2] of $285m with 2,865 lots settled

• EBITDA[3] down 3% to $89.8m

• EBITDA[3] margin increased to 32% - up 6%

• ROCE[4] of 13.2%

• Record contracts on hand[5] of 2,426 lots valued at $546m up 18% & 24%, respectively

• » Fully franked final dividend of 2.75cps, bringing total FY16 dividend to 4.5cps, fully franked

Notes:

1. Operating profit is a non-IFRS measure that is determined to present the ongoing activities of the Group in a way that reflects its operating performance. Operating profit includes the effects of non-cash movements in investments in associates and joint ventures. Operating profit excludes unrealised fair value gains/(losses) arising from the effect of revaluing assets and liabilities and adjustments for realised transactions outside the core ongoing business activities

2. Includes share of net profits from associates and joint ventures

3. Includes effects of non-cash movements in investments in associates and joint ventures

4. EBITDA / (average net debt + average total equity)

5. Includes equivalent lots. Excludes Arena englobo sale

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 2

KEY HIGHLIGHTS FOR FY16

Focused strategy delivering strong results

• » Diversified pipeline of over 48,000 lots with a low cost base and an on-completion value of approximately $12 billion strategically weighted (60% of total lots) to the eastern states

GROWTH AND AND FY14 ResultFY14 POSITIONING Result » POSITIONING

• » Selective acquisitions of land holdings to restock pipeline:

• −Acquisition strategy to focus on eastern states

• −Secured three new projects comprising approximately 3,700 lots/dwellings with GDV[1 ] of circa

  • $930m

  • » Whole Green (VIC), Redbank Plains (QLD), Tonsley (SA)

  • » Introduction of new wholesale/institutional partner

• −Entered into a conditional agreement with University of Canberra for the proposed residential development of approximately 3,300 dwellings with an expected GDV[1 ] of $1.7 billion

• » Sale of Greenvale for $93.1m in August 2015, significantly above market value NTA per share

• −Redeployment of funds into lower cost base acquisitions

Notes: 1. Gross Development Value

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 3

KEY HIGHLIGHTS FOR FY16 (CONTINUED)

GROWTH

AND

• » Flagstone (QLD) project successfully launched in April 2016

• −Solid pre-sales achieved since launch, including a retail shopping centre site

• −Strong sales enquiry building momentum into FY17

POSITIONING FY14 ResultFY14 » Result

• » New $25m Werribee (VIC) retail land syndication successfully completed (oversubscribed)

• −Significant increase in applications from new investors, predominantly from eastern states, further strengthening the Group’s retail investor base

CAPITAL

• » Business generating solid operating cash flows

MANAGEMENT

• −FY16 net operating cash flow (before land acquisitions) of $67m

• −Cash interest cover up strongly to 4.3x

• » Completed $100m Bond issue to refinance convertible notes, diversify the Group’s debt capital structure and to support growth objectives

» Senior debt facility extended to October 2019

• » Gearing[1 ] of 28.8%

• −Within target range of 20% - 30%

• −Total net debt of $194m – increased due to Whole Green acquisition

• −Cost of debt lower due to repayment of convertible notes and expiry of hedges

• −Focused strategy on reducing gearing to lower end of target range

Notes:

1. (Total interest bearing liabilities (including land vendor liabilities) less cash) / (Total assets adjusted for market value of inventory less cash, less intangible assets). Excluding syndicates consolidated under AASB10

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 4

KEY HIGHLIGHTS FOR FY16 (CONTINUED)

STRATEGIC

PRIORITIES

» Acquisition strategy continued to be selective with a focus on the eastern states

• −Focus on securing low cost projects to ensure delivery of affordable product

• » Maintained geographic diversity

FY14 ResultFY14 » Result

• » Continued to grow and diversify Funds Management/JV business

• −Acquisition of new projects to be predominantly through funds platform

• −Developing relationships with potential new wholesale/institutional partners

» Strengthened balance sheet position with diversified funding sources

» Maintained focus on cost and debt reduction

» Actively managing land bank with a focus on increasing ROCE[1]

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Notes: 1. EBITDA / (average net debt + average total equity)

FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 5

Results overview

GROUP FINANCIAL SUMMARY

»	Operating profit2after tax of $42.6m - up 11%
»	Group EBITDA2of $89.8m – down 3% due to major completed projects in FY15
	− Quayside apartments (ACT) and The Chimes
	(WA)
»	Group EBITDA2margin increased to 32%
	− Higher price growth from VIC and ACT/NSW
	projects
	− Further cost-outs from operations
»	Operating EPS of 8.7 cents – up 5%
»	ROCE5at 13.2% − Impacted in the short term by the acquisition of Whole Green (VIC) project in December 2015
»	Market adjusted NTA6per share of $1.14
	− Does not include value for Funds Management business
	− Does not include value uplift on co-investment
	stakes in funds and JVs
	− Reflects low point of current WA cycle and
	Gladstone (QLD) market

KEY PERFORMANCE STATISTICS FY16 FY15 VAR (%)	KEY PERFORMANCE STATISTICS FY16 FY15 VAR (%)	KEY PERFORMANCE STATISTICS FY16 FY15 VAR (%)	KEY PERFORMANCE STATISTICS FY16 FY15 VAR (%)
Lot sales	3,253	3,229 1%
Lot settlements	2,865	3,266	(12%)
Revenue1	$284.8m	$360.9m	(21%)
EBITDA2	$89.8m $92.4m		(3%)
EBITDA2 margin	32%	26% 6%
Operating profit after tax2,3	$42.6m	$38.5m	11%
KEY METRICS	FY16	FY15	VAR (%)
EPS (operating)	8.7c	8.3c	5%
DPS4	4.5c	4.5c	-
ROCE5	13.2%	13.8%	(0.6%)
	JUN 16	JUN 15	VAR (%)
Book NTApershare	$1.09	$1.04	5%
Market adjustedNTA6pershare	$1.14	$1.17 (3%)

− Reflects low point of current WA cycle and Gladstone (QLD) market	− Reflects low point of current WA cycle and Gladstone (QLD) market
Notes:
1	Includes share of net profits from associates and joint ventures
2	Includes effects of non-cash movements in investments in associates and joint ventures
3	Attributable to owners of Peet Limited
4	FY16 fully franked
5	EBITDA / (average net debt + average total equity)
6	Market adjusted NTA is based on independent bank-instructed mortgage valuations, adjusted for development costs and settlements post valuation date

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 7

IMPROVING FINANCIAL PERFORMANCE

Growth in earnings driven by our focused strategy, market conditions and new projects

• » Solid operating profit growth - 3 year CAGR[1] of 32.5%

• »

• EBITDA[2 ] in FY15 includes the settlement of Quayside apartment project 1,990

• » Ongoing EBITDA[2 ] margin improvement driven by improved gross margin through net price growth, cost efficiencies and greater impact of high margin projects

OPERATING PROFIT[2] AFTER TAX ($M)

EBITDA[2] ($M)

EBITDA[2] MARGIN

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32%
42.6 92.4 89.8
26%
38.5
25%
73.7
31.6 22%
53.0
18.3
FY13 FY14 FY15 FY16 FY13 FY14 FY15 FY16 FY13 FY14 FY15 FY16
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Notes:

• 1 CAGR = Compound Annual Growth Rate

• 2 Includes effects of non-cash movements in investments in associates and joint ventures

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 8

FOCUS ON DRIVING SHAREHOLDER RETURNS

• » 3 year EPS CAGR[1 ] of 17%

• » FY16 DPS of 4.5cps, fully franked

• Target payout ratio of 50% going forward maintained

• » Book NTA per share increased by 5%

• Does not include value uplift on co-investment stakes in funds and JVs

• Does not include value for Funds Management business

• » Market adjusted NTA reflects current low point of WA market cycle and the Gladstone (QLD) market

OPERATING EPS (CPS)

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8.7
8.3
7.3
5.4
FY13 FY14 FY15 FY16
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DPS (CPS)

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4.5 4.5
3.5
FY13 FY14 FY15 FY16
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NTA PER SHARE ($)
Book NTA Market adjusted NTA [2]
1.18 1.17 1.14
1.00
1.09
1.04
1.00
0.89
FY13 FY14 FY15 FY16
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Notes:

• 1 CAGR = Compound Annual Growth Rate

• 2 Market adjusted NTA is based on independent bank-instructed mortgage valuations, adjusted for development costs and settlements post valuation date

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 9

CAPITAL MANAGEMENT

Further improvement in capital position

• » ROCE[1] of 13.2%

• −Impacted in short-term 2,184 due to acquisition of Whole Green (VIC) project in 1H16

• » Gearing[2] of 28.8%

• −Impacted by 1H16 acquisition and due to delay of Whole Green settlements of $15m into early July 2016

• −Focused strategy on reducing gearing to lower end of target range

• » Improving cash interest coverage[3] to 4.3x

• −Cost of debt decreased to 6.7% - down 1%

TOTAL ASSETS ($M)[4] AND ROCE[1]

NET DEBT ($M) AND COVENANT GEARING[2]

INTEREST COVER[3 ] AND CASH COST OF DEBT[5]

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Funds Management Net Debt Covenant gearing Interest Cover Weighted Cost of Debt
Development Projects 13.8% 13.2%
ROCE 34% 8.3%
11.0% 30% 29% 7.7% 7.7% 6.7%
8.7% 883 24%
729 749 775 4.3x
397 285 4.0x
257
303 325 367
194 2.8x
177
426 424 408 486 1.7x
FY13 FY14 FY15 FY16 FY13 FY14 FY15 FY16 FY13 FY14 FY15 FY16
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Notes:

• 1 EBITDA / (average net debt + average total equity)

• 2 (Total interest bearing liabilities (including land vendor liabilities) less cash) / (Total assets adjusted for market value of inventory less cash, less intangible assets). Excluding syndicates consolidated under AASB10 3 EBIT / Total interest cost (including capitalised interest). Excludes syndicates consolidated under AASB10

• 4 Development projects and Funds Management/JV only 5 Includes bonds/convertible notes

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 10

FUNDS MANAGEMENT

FUNDS & JVs EBITDA[1 ] ($m)

FUNDS MANAGEMENT & JOINT VENTURE GDV[2] ($bn)

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70
60
50
40
30
20
10
0
FY12 FY13 FY14 FY15 FY16
Co-Investment Profits Funds Management/Joint Venture EBITDA
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10
9 9.3
8.9
8 8.7
7 7.5
6
6.2
5
4
3
2
1
0
FY12 FY13 FY14 FY15 FY16
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» Funds Management strategy delivering strong results

• Wholesale/institutional co-investment strategy delivering emerging profits

• A number of wholesale/institutional ventures commencing development which will contribute to FM/JV growth in next 3 years+

• Introduction of a new wholesale/capital partner

• » GDV trend steadily improving over past 5 years - $9.3 billion at year end, representing almost 80% of the total GDV[2]

• » Fee income growing as FM sales growth increases

• » Future fee income from FM business not reflected in NTA

Notes:

• 1 Includes effects of non-cash movements in investments in associates and joint ventures 2 Gross Development Value

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 11

Operating performance

GROUP OPERATING PERFORMANCE

• » Peet’s diversified portfolio of projects has allowed it to capitalise on the eastern states’ strength

• » Contribution from eastern states projects increased to 82% of EBITDA[1 ] (FY15: 68%)

• Higher contribution driven by Victoria

• » WA market at or close to low point of current cycle

• Market conditions expected to remain at current levels through FY17 and into FY18

• » Funds Management/Joint Venture business provided solid earnings base representing circa 60% of Group EBITDA[1]

• » Eastern states EBITDA[1 ] contributions continue to offset WA and NT weakness

• Flagstone (QLD), Whole Green (VIC) & Redbank Plains (QLD) projects to contribute to FY17 earnings

EBITDA[1] COMPOSITION BY BUSINESS TYPE (%)

EBITDA[1] COMPOSITION BY GEOGRAPHY (%)

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100%
22%
29%
33%
80%
30%
60%
30%
36%
40%
48%
20% 41%
31%
0%
FY14 FY15 FY16
Development Funds Management JVs
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100%
7% 6% 8%
6% 5%
16%
80% 12% 16%
2%
10% 7%
60%
26%
34%
56%
40%
20% 39%
32%
18%
0%
FY14 FY15 FY16
WA VIC QLD NSW/ACT NT SA
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Notes:

1 Includes effects of non-cash movements in investments in associates and joint ventures

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 13

GROUP SALES ACTIVITY

• » Group sales for FY16 of 3,253 lots

• » Strong sales from eastern states projects

• Flagstone (QLD) to make full year contribution to eastern states sales in FY17

• » WA and NT sales volumes reflect challenging market conditions, however solid demand remains for affordably priced lots

• » Seven new projects commenced selling in FY16:

• Botanic Village (VIC) 783 lots

• Haven (VIC) 300 lots

• Hilbert Park (WA) 997 lots

• Flagstone City (QLD) 12,000 lots

SALES COMPOSITION BY GEOGRAPHY (LOTS)

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4000
3,525
3500
3,229 3,253
3000
2500
2000
1500
1000
500
0
FY14 FY15 FY16
WA VIC QLD NSW/ACT NT SA
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• Greenlea (WA) 503 lots

• Movida (WA) 1,072 lots

• Whole Green (VIC) 1,752 lots

• » Four new projects to commence development/sales in FY17

• Werribee (VIC) 944 lots

• Tonsley (SA) 850 lots

• Redbank Plains (QLD) 1,100 lots

• Byford (WA) 259 lots

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 14

CONTRACTS ON HAND

• » Record contracts on hand[1] of 2,426 lots since 30 June 2015 – up 18%

• Increase driven by Victorian market as well as stable and improving eastern states market conditions

• Value of contracts on hand increased by 24% to $546m providing solid momentum into FY17

• » Victorian contracts on hand have remained solid since 30 June 2016 as a result of continued strong market conditions

CONTRACTS ON HAND BY GEOGRAPHY (LOTS)[1]

CONTRACTS ON HAND BY GEOGRAPHY (VALUE)[1]

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3000 600
$546m
2500 2,426 500
$462m $468m
$441m
2,061
2000 1,956 1,990 400
1500
300
1000
200
500
100
0
0
FY13 FY14 FY15 FY16
FY13 FY14 FY15 FY16
Notes:
1. Includes equivalent lots. Excludes Arena englobo sale WA VIC QLD NSW/ACT NT SA
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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 15

FM OPERATING PERFORMANCE

• » FY16 fee revenue increased to $41.8m – up 8% on FY15

• EBITDA[1] margin 68%, in line with FY15

• » Funds Management business provided solid earnings base representing 30% of Group’s EBITDA[1]

• EBITDA[1] up 4% to $29.6m

• » Contracts on hand[2] up 31% to 1,510 lots with a gross value of $315m

KEY PERFORMANCE STATISTICS FY16 FY15 VAR (%)	KEY PERFORMANCE STATISTICS FY16 FY15 VAR (%)	KEY PERFORMANCE STATISTICS FY16 FY15 VAR (%)	KEY PERFORMANCE STATISTICS FY16 FY15 VAR (%)
Lot sales	1,978	1,768 12%
Lot settlements	1,508	1,718	(12%)
Revenue	$41.8m	$38.6m 8%
Share of net profit ofequity accountedinvestments	$1.6m	$2.8m	(43%)
EBITDA1	$29.6m	$28.4m	4%
EBITDA1margin	68%	69%	(1%)
	JUN 16	**JUN 15 **	VAR (%)
Contracts on hand2	1,510	1,150	31%

FM SALES[2] COMPOSITION BY GEOGRAPHY (LOTS)

FM EBITDA[1] COMPOSITION BY GEOGRAPHY

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100% 5% 4% 5% 100% 5% 2%
1% 10%
2% 10%
19% 19%
20%
80% 80% 19%
25%
60% 30% 37% 60% 31% 58%
51% 26%
40% 40%
46%
20% 38% 20% 39% 43%
30%
25%
0% 0%
FY14 FY15 FY16 FY14 FY15 FY16
Notes:
Includes effects of non-cash movements in investments in associates WA VIC QLD NSW/ACT SA
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Notes:

• 1 Includes effects of non-cash movements in investments in associates 2 Includes equivalent lots

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 16

JV OPERATING PERFORMANCE

• » EBITDA[1 ] of $28.3m up 32%

• » Contribution from JVs (before equity share of profits) down 23% to $12.9m due to NT and WA market conditions

• » Equity accounted profits up 228% during the year to $15.4m predominantly due to Googong (NSW) and Lightsview (SA)

• » Contracts on hand[2 ] down 36% to 428 lots with a total value of $115m

KEY PERFORMANCE STATISTICS FY16 FY15 VAR (%)	KEY PERFORMANCE STATISTICS FY16 FY15 VAR (%)	KEY PERFORMANCE STATISTICS FY16 FY15 VAR (%)	KEY PERFORMANCE STATISTICS FY16 FY15 VAR (%)
Lot sales	712	883 (19%)
Lot settlements	940	951	(1%)
Revenue	$55.1m	$100.9m (45%)
Share of net profit ofequity accountedinvestments	$15.4m	$4.7m	228%
EBITDA1	$28.3m	$21.4m	32%
EBITDA1margin	40%	20%	100%
	JUN 16	**JUN 15 **	VAR (%)
Contracts on hand2	428	666	(36%)

JV SALES BY GEOGRAPHY (LOTS)[2]

JV EBITDA[1] COMPOSITION BY GEOGRAPHY

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100% 100%
21% 20% 19%
28% 25%
32%
80% 80%
10%
5% 19% 23%
9%
60% 60%
37% 16% 53%
40% 36% 49% 40% 38%
20% 20% 42%
32%
23%
18% 23% 22%
0%
0%
FY14 FY15 FY16
FY14 FY15 FY16
Notes:
1 Includes effects of non-cash movements in investments in joint ventures WA NSW/ACT NT SA
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• 1 Includes effects of non-cash movements in investments in joint ventures 2 Includes equivalent lots

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 17

DEVELOPMENT OPERATING PERFORMANCE

• » Revenue of $154.7m

• FY16 settlements down due to Quayside apartment project (ACT) and The Chimes (WA), substantially completed in FY15

• » Weighted exposure to better performing Melbourne market from both a sales and EBITDA perspective

• » EBITDA of $40.3m

• EBITDA margins increased to 26% from 25%

• » Contracts on hand[2 ] of 488 lots, an increase of 99% with a gross value of $116m

KEY PERFORMANCE STATISTICS FY16 FY15 VAR (%)	KEY PERFORMANCE STATISTICS FY16 FY15 VAR (%)	KEY PERFORMANCE STATISTICS FY16 FY15 VAR (%)	KEY PERFORMANCE STATISTICS FY16 FY15 VAR (%)
Lot sales1	563	578 (3%)
Lot settlements
Retail	415	594	(30%)
Super lots	2 3		(33%)
Revenue	$154.7m	$186m (17%)
EBITDA	$40.3m	$45.7m	(12%)
EBITDA margin	26%	25%	1%
	JUN 16	JUN 15	VAR (%)
Contracts on hand2	488 245		99%

DEVELOPMENT SALES[1] COMPOSITION BY GEOGRAPHY (LOTS)

DEVELOPMENT EBITDA COMPOSITION BY GEOGRAPHY[1]

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100% 10% 2% 2% 100% 1%3% 1%1%1%
5% 8%
3% 1% 27%
80% 80%
43% 2%
60% 49% 60%
70%
91%
74%
51%
40% 40%
53%
20% 38% 20%
23% 20%
15%
7%
0% 0%
FY14 FY15 FY16 FY14 FY15 FY16
Notes:
1 Includes super lots WA VIC QLD NSW/ACT SA
2 Includes equivalent lots. Excludes Arena englobo sale
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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 18

Market overview & project pipeline

RESIDENTIAL MARKET OVERVIEW

Melbourne

• » Ongoing population growth, relative affordability and solid economy to support dwelling demand

• Metropolitan Melbourne growth expected to remain strong

• Volumes beginning to stabilise near current high levels with moderate price growth

Brisbane

• » Market demand continues to remain steady supported by affordability and improving economic fundamentals

• Brisbane land market continues to experience supply constraints and as a result is seeing moderate price growth

• Price growth continues to lag VIC & NSW to date

• Increased purchaser demand via a recovery in interstate migration should see improved price growth

Sydney / Canberra

• » Demand remains solid supported by pent-up demand and improved economy

• NSW population growth has accelerated over the past few years

• Undersupply of dwellings relative to demand is expected to continue in the near term

• Price growth expected to moderate

Perth

• » Subdued economic conditions continue to impact the market

• Sales volumes at or close to low point of current market cycle

• Demand for affordable product is being supported by policy incentives such as low interest rates and First Home Buyers’ grants

• Moderate decline in prices expected as production levels are adjusted to reflect current market conditions

• Current market conditions are expected to continue through FY17 and into FY18 as economy continues to transition

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 20

NATIONAL REACH

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$12.0bn
48,000
END-VALUE
LOTS
62 1 projectsnationally
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Notes: 1 Not all projects are shown on map

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 21

OVERVIEW OF PEET’S LAND BANK

• » Diversified land bank across all mainland states and territories

• Pipeline of over 48,000 lots with an on completion value of approximately $12 billion

• FM and JV projects account for more than 70% of the Group’s land bank

• » Eastern states exposure and acquisition activity reducing impact of WA exposure at this stage of the market cycle

• » WA exposure weighted toward FM and JV, with relatively lower proportion of development projects located in WA

• » QLD land bank provides significant exposure to an improving market cycle

LANDBANK COMPOSITION BY BUSINESS TYPE AND GEOGRAPHY (LOTS[1] )

LANDBANK COMPOSITION BY GEOGRAPHY AND BUSINESS TYPE (LOTS[1] )

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60,000
20,000 18,887
18,000 17,515
50,000 48,493
16,000
14,000
40,000
12,000
29,996
10,000 30,000
8,000
6,716
20,000
6,000
12,855
4,000 2,589
2,339 10,000
5,642
2,000 447
0 0
WA VIC QLD NSW/ACT SA NT Development Funds Management JVs Total
Notes: Development Funds Management JVs WA VIC QLD NSW/ACT NT SA
1 Includes equivalent lots
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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 22

- NEW PROJECTS IN FY17 FY19

Pipeline of approximately 48,000 lots providing visibility of future earnings

• » Up to 8 new projects expected to commence development within the next 2-3 years

• Up to 4 new projects commencing development/sales

• FY14 ResultFY14 in FY17

• − Result Approximately 75% of the lots in these projects sit within the Funds Management business

• Average project duration of circa 6 years providing visibility of future earnings and cash flows

• » Approximately 80% of entire land bank is expected to be in development by end of FY17

FY17 - FY19 PROJECT RELEASE SCHEDULE	FY17 - FY19 PROJECT RELEASE SCHEDULE	FY17 - FY19 PROJECT RELEASE SCHEDULE	FY17 - FY19 PROJECT RELEASE SCHEDULE	FY17 - FY19 PROJECT RELEASE SCHEDULE	FY17 - FY19 PROJECT RELEASE SCHEDULE
Project	State	Segment	First Sales	Lots	Project Life (Years)
Werribee	VIC	Funds	2017	944	7yrs
Redbank Plains	QLD	Funds	2017	1,100	7yrs
Tonsley	SA	JV	2017	850	5yrs
Byford	WA	Funds	2018	259	4yrs
Mundijong	WA	Owned	2018	759	6yrs
Rockbank	VIC	Owned	2019	673	5yrs
EyreKingston	ACT	JV	2019	1511	2yrs
Mundijong	WA	Funds	2019	852	8yrs
Total 5,588 Ave: 6 yrs

• » Land portfolio well balanced across key growth corridors

• » Flagstone (QLD) project successfully launched in April 2016

• Solid pre-sales achieved since launch including a retail shopping centre site

• Strong sales enquiry building momentum into FY17

• Pricing tracking above expectations

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Notes: 1 Apartments

FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 23

Capital management

CAPITAL MANAGEMENT

Strong capital management strategy outcomes

• » Diversified funding sources via a $100m bond raising in June 2016

• » Senior debt facility was extended for a further three years to October 2019

• » Weighted average cash cost of bank debt (excluding bonds/convertible notes) reduced to 5.9%

• » Covenant gearing[1 ] increased to 28.8%

• Gearing reduced since 1H16 but at the higher end of target range due to the acquisition of Whole Green project (VIC) in December 2015

• Focused strategy to reduce covenant gearing to lower end of target range

CAPITAL MANAGEMENT METRICS FY16 FY15	CAPITAL MANAGEMENT METRICS FY16 FY15	CAPITAL MANAGEMENT METRICS FY16 FY15
Cashat bank	$73.4m	$57.7m
Bankdebt	$169.2m	$186.2m
Peet bonds	$100.0m	-
Convertiblenotes	-	$50.0m
Covenant gearing1	28.8%	23.8%
Balance sheet gearing2	31%	28%
Interest cover ratio3	4.3x	4.0x
Weighted average debtmaturity	3.7years	2.0 years
Weighted averagehedgematurity	5.0 years	3.4years
Debtfixed/hedged	84%	51%
Weighted average cashcost ofdebt	6.7%	7.7%
Weighted average cash cost of debt (excluding bonds/convertiblenotes)	5.9%	6.6%

Notes:

• 1 (Total interest bearing liabilities (including land vendor liabilities) less cash) / (Total assets adjusted for market value of inventory less cash, less intangible assets). Excluding syndicates consolidated under AASB10 2 (Total interest bearing liabilities (including land vendor liabilities) less cash) / (Total assets less cash, less intangible assets). Includes syndicates consolidated under AASB10 3 EBIT / Total interest cost (including capitalised interest). Excludes syndicates consolidated under AASB10

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 25

GROUP CASH FLOW SUMMARY

Cash generated from operations applied to deliver production from new and existing projects to meet demand

• » Receipts lower due to the substantial settlement revenue from the Quayside (ACT) apartment project and completion of The Chimes (WA) development during FY15

• » Development expenditure down as a result of increasing number of Funds Management projects commencing production and reduced expenditure across WA and NT due to market conditions

• » Operating cash flow impacted by $15m due to delay of Whole Green settlements into early July 2016

FY16 FY15 CASH FLOWS RELATED TO OPERATING ACTIVITIES $M $M	FY16 FY15 CASH FLOWS RELATED TO OPERATING ACTIVITIES $M $M	FY16 FY15 CASH FLOWS RELATED TO OPERATING ACTIVITIES $M $M
Receiptsfromcustomers	294.9	383.7
Paymentsfordevelopment andinfrastructure	(128.2)	(147.6)
Payments to suppliers and employees	(82.1)	(87.3)
Borrowing costs	(21.1)	(20.4)
Distributions and dividendsfromassociates and jointventures	5.8	9.1
Net taxes paid	(2.2)	(4.3)
Operating cash flow before acquisitions	67.1	133.2
Paymentsfor land acquisitions– Termpayments	(7.9)	(7.5)
Paymentsfor land acquisitions– New land	(42.5)	(12.4)
Net operating cash flow	16.7	113.3

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 26

Outlook

OUTLOOK

Portfolio well positioned for sustainable long-term growth and value creation

• » Outlook generally supported by market fundamentals with sustained low interest rates and modest economic growth

• Conditions across Victoria, New South Wales/ACT and South Australia are expected to remain supportive, while Western Australia and Northern Territory are expected to remain subdued through FY17 and into FY18

• Activity in the Queensland residential market continues to improve due to its relative affordability, which has been a factor in the recovery in interstate migration

• » Peet’s key strategic focus

• Accelerating production where possible and appropriate, and active management of product mix

  • » Delivery of affordable product targeted at the low and middle market segments

• Actively managing land bank with a focus on increasing ROCE[1]

• Development spend to be self-funded through operating cash flows

• Selective acquisition of projects to restock pipeline, predominantly through funds platform

• Maintain strong balance sheet position

• » The Group has moved into FY17 well-positioned to target earnings growth, subject to market conditions and the timing of settlements, with earnings expected to be weighted to 2H17

1 EBITDA / (average net debt + average total equity)

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Notes:

FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 28

Thank you

FY16 annexures

SUMMARY INCOME STATEMENT

SUMMARYINCOME STATEMENT	SUMMARYINCOME STATEMENT	SUMMARYINCOME STATEMENT	SUMMARYINCOME STATEMENT
FY16 $M FY15 $M Var (%)
Funds Management	41.8	38.6	8%
Development	154.7	186.0	(17%)
Joint Venture	55.1	100.9	(45%)
Share of netprofit of equityaccounted investments	16.7	6.4	161%
Other1	16.5	28.9	(43%)
Revenue	284.8	360.8	(21%)
EBITDA	89.8	92.4	(3%)
Finance costs2	(27.7)	(29.8)	(7%)
Depreciation and amortisation	(3.5)	(2.9)	(21%)
NPBT	58.6	59.7	(2%)
Income tax expense	(16.8)	(17.8)	(6%)
Outside equityinterest	0.8	(3.5)	(123%)
NPAT3	42.6	38.5	11%

Notes:

• 1 Includes AASB10 Syndicates, unallocated and elimination entries

• 2 Finance costs includes interest and finance charges amortised through cost of sales 3 Attributable to the owners of Peet Limited

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 31

SUMMARY BALANCE SHEET

SUMMARYBALANCE SHEET	SUMMARYBALANCE SHEET	SUMMARYBALANCE SHEET
FY16 $M FY15 $M
Assets
Cash	73.4	57.7
Receivables	114.5	101.5
Inventories	598.9	520.5
Investments accounted for using the equity method	198.1	181.8
Other	13.8	13.5
Total assets	998.7	875.0
Liabilities
Trade and other payables	81.5	63.3
Land vendor liabilities	89.3	48.2
Interest bearing liabilities	267.0	234.9
Other	59.4	44.7
Total liabilities	497.2	391.1
Net assets	501.5	483.9
Book NTA per share	$1.09	$1.04
Market adjusted NTA1per share	$1.14	$1.17

1 Market adjusted NTA is based on independent bank instructed mortgage valuations, adjusted for development costs and settlements post valuation date

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Notes:

FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 32

– LAND BANK FUNDS MANAGEMENT KEY PROJECTS

LAND BANK–FU	NDS	MAN	AGEMENT KE	Y P	ROJECTS	ROJECTS	ROJECTS	ROJECTS
					PROJECT LIFECYCLE
PROJECT NAME	STATE	GDV	LOTS1 REMAINING		2017 2018 2019 2020
Alkimos	WA	$1,044m	2,341
					Selling
Burns Beach	WA	$303m	515		Selling
Golden Bay	WA	$254m	1,101		Selling
Lakelands	WA	$222m	1,204		Selling
Yanchep Golf Estate	WA	$428m	1,641		Selling
Oakford	WA	$174m	1,064		Selling
Forrestdale	WA	$216m	976		Selling
Midvale	WA	$237m	1,072		Selling
Mundijong	WA	$136m	852		Planning		Start up	Selling
Yanchep (Wholesale)	WA	$171m	888		Planning			Start up
Byford	WA	$47m	259		Start up	Selling
Other	WA	$113m	610		Planning
Flagstone Rise	QLD	$113m	386		Selling
Caboolture	QLD	$211m	1,019		Selling
Warner Springs	QLD	$7m	22		Selling Completion
Flagstone City	QLD	$3,399m	11,569		Selling
Redbank Plains	QLD	$251m	1,100		Selling
Other	QLD	$99m	635		Planning
Tarneit (Leakes Rd) - South	VIC	$15m	101		Selling Completion
Cranbourne Central	VIC	$5m	59		Selling Completion
Cranbourne West	VIC	$11m	94		Selling Completion
Greenvale	VIC	$50m	186		Selling	Completion
Cornerstone	VIC	$196m	944		Selling
Botanic Village	VIC	$117m	508		Selling
Mt Barker	SA	$127m	850		Selling
Total Funds Management $7,946m 29,996

1 Equivalent lots as at 30 June 2016

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Notes:

FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 33

– - LAND BANK COMPANY OWNED KEY PROJECTS

LAND BANK–C	OMPAN	Y-O	WNED KEY PR	OJ	ECTS	ECTS	ECTS	ECTS	ECTS	ECTS
					PROJECT LIFECYCLE
PROJECT NAME	STATE	GDV	LOTS1 REMAINING		2017 2018 2019 2020
Brigadoon	WA $65m		127
					Selling
Chase, Baldivis	WA	$84m	503		Selling
Mundijong	WA	$160m	759		Planning	Start up		Selling
Other	WA	$673m	3,792		Planning
Gladstone	QLD	$84m	339		Selling
Beaudesert	QLD	$246m	1,045		Planning
Flagstone North	QLD	$224m	1,400		Planning
Whole Green	VIC	$414m	1,752		Selling
Aston, Craigieburn	VIC	$408m	1,623		Selling
Tarneit (Leakes Road) – North	VIC	$12m	277		Planning
Rockbank	VIC	$140m	673		Planning	Start up		Selling
Other	VIC	$179m	499		Planning
Bay Ridge	NSW	$1m	2		Selling Completion
Eastern Industrial Estate	ACT	$25m	62		Selling
Lightsview Apartments	SA	$1m	2		Selling Completion
Total Company-Owned $2,716m 12,855

1 Equivalent lots as at 30 June 2016

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Notes:

FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 34

– LAND BANK JOINT VENTURE KEY PROJECTS

LAND BANK–JO	INT V	ENTU	RE KEY PROJ	ECT	S	S	S	S	S
PROJECT NAME	STATE	GDV	LOTS1 REMAINING		PROJECT LIFECYCLE
					2017 2018 2019 2020
Wellard	WA	$223m	1,183		Selling
Googong2	NSW	$557m	2,374		Selling
Eyre Kingston	ACT	$105m	151		Planning	Start up		Selling
The Heights	NT	$121m	447		Selling
Lightsview	SA	$116m	637		Selling Completion
Tonsley	SA	$265m	850		Selling
Total Joint Venture $1,387m 5,642
TOTAL PIPELINE $12,049m 48,493

Notes:

• 1 Equivalent lots as at 30 June 2016 2 Googong represents 50% shareholding of project

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 35

DISCLAIMER

While every effort is made to provide accurate and complete information, Peet does not warrant or represent that the information in this presentation is free from errors or omissions or is suitable for your intended use. This presentation contains forward-looking statements, including statements regarding future earnings and distributions that are based on information and assumptions available to Peet as at the date of this presentation. Actual results performance or achievements could be significantly different from those expressed in, or implied by these forward-looking statements. These forward-looking statements are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond Peet’s control, and which may cause actual results to differ materially from those expressed in the statements contained in the release.

The information provided in this presentation may not be suitable for your specific needs and should not be relied upon by you in substitution of you obtaining independent advice. Subject to any terms implied by law and which cannot be excluded, Peet accepts no responsibility for any loss, damage, cost or expense (whether direct or indirect) incurred by you as a result of any error, omission or misrepresentation in this presentation. All information in this presentation is subject to change without notice.

This presentation is not an offer or an invitation to acquire Peet securities or any other financial products in any jurisdictions, and is not a prospectus, product disclosure statement or other offering document under Australian law or any other law. It is for information purposes only.

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FY16 RESULTS ǀ 25 AUGUST 2016 ǀ PAGE 36