Abacus Property : FY21 Annual General Meeting Addresses and Presentation

For personal use only

in conjunction with the meetings of the members of:

• • Abacus Trust,
  • Abacus Income Trust, and
  • Abacus Storage Property Trust.
• If we encounter any technical issues resulting in securityholders being unable to reasonably participate in this meeting, I will adjourn for 30 minutes, after which time the meeting will be reconvened.
• If the technical issues continue, we will adjourn the meeting to a future time, and outline the next steps via an announcement to the ASX.
• I will now outline the procedural matters for this meeting.
• You are entitled to ask a question or speak to a resolution if you are a securityholder or the representative of a securityholder. Via the LUMI AGM platform, securityholders and proxyholders can vote on the resolutions by clicking the VOTING tab at the top of the screen on the navigation bar.
• To ask a question, you can do this in one of two ways. Simply dial the number displayed on the LUMI platform and follow the instructions, or press the speech bubble icon where there is a section for you to type and submit your questions. Questions may be submitted at any time from the start of the meeting, although questions that relate to a resolution contained in the Notice of Meeting will be answered as each resolution is presented.
• Questions may be submitted now and I will answer them at the appropriate point in the meeting, or you may ask questions during the business of the meeting.
• Turning now to the business of the meeting, I will explain the voting procedure.
• The poll on all resolutions will be opened at the same time, to give you a chance to cast your votes at any time during the meeting.
• I will then identify each resolution and open the item for discussion.
• Once questions have concluded, I will ask you to cast your votes if you haven't already done so and the Meeting will be brought to a close.
• Voting on all resolutions will be conducted by a Poll.
• All valid open proxies directed to the Chair will be voted in favour of the resolution.
• Since our 2020 AGM, we have continued to navigate our path through this ongoing COVID-19 pandemic with our primary focus being on ensuring safe and healthy environments and supporting our people and customers. In June, when Greater Sydney and our office were placed under lockdown restrictions, we were again fortunately able to seamlessly adapt our business to remote working.
• I would like to take this moment to thank our many stakeholders who were both accommodating and collaborative as we adapted to a remote way of conducting business. Together we were able

For personal use only

to continue to execute on our strategy to invest capital in targeted real estate opportunities that deliver long-term sustainable outcomes through active management.

• Our vision to create exceptional long-term value, together with our embedded values of being entrepreneurial, responsible, and accountable were and continue to be our guiding principles as we navigate this challenging environment.
• Abacus has emerged as a strong asset back annuity style investment house with $4.3 billion of total assets, of which 97% are deployed in the Commercial and Self Storage sectors.
• Focusing on the activities of the past year, and despite the challenging conditions it was satisfying to see $1 billion1 of capital successfully deployed into assets in our strategically identified sectors that provide potential for enhanced income growth and ultimately value creation.
• This was achieved through a series of acquisitions and joint ventures which were funded by a combination of non-core asset disposals, debt and other initiatives, including completion of an Accelerated Non-Renounceable Pro Rata Entitlement Offer, raising $402 million in December 2020.
• The Board periodically reviews the Group's levels of liquidity and gearing, to ensure it is appropriately capitalised to support all future growth opportunities. In August, Abacus thought it prudent to strengthen its balance sheet, by increasing its banking facilities by $500 million on favourable terms. As at 30 September 2021, gearing is at 30.4% and sitting within our target range of up to 35%.

FINANCIAL RESULTS

• Turning now to our FY21 results that clearly demonstrate the benefits of our diversified portfolio.
• • The Group delivered a statutory profit of $369.4 million, up 336% compared to FY20. This was achieved primarily as a result of an increase in the fair value of our Self Storage portfolio and increased rental income arising from acquisitions made during the year and the full ownership of prior year acquisitions.
  • Funds from Operations (FFO) was $136.4 million, up 9.5% on FY20, equating to 18.4 cents per security and with a 95% payout ratio, the full year distribution was 17.5 cents2.
  • Net tangible assets (NTA) per stapled security of $3.43, up 3.3% on FY20, which was also positively impacted by the increase in fair value of our Self Storage portfolio.
• We were pleased with the strong and resilient result in a COVID-19 context and would especially like to note that Abacus has not applied for or received any funds from the Australian Government's JobKeeper scheme.
• Steven will elaborate on the operating performance of our business shortly.

SUSTAINABILITY

• The Board and team at Abacus are proud of our commitment to Sustainability.

For personal use only

• Sustainable practices and enhancements continue to be embedded into how we conduct business and as part of our strategic repositioning, Abacus has made a considerable reinvestment in people, culture, processes, and systems.
• During FY21 the Board set clear sustainability targets to improve our environmental performance, transparency and accountability. Our targets are focused on energy, emissions, water and waste across our property portfolio and were developed in conjunction with our asset management team.
• To achieve these targets, we have developed a Sustainability Strategy and improvement pathways for our assets which are aligned with our operational and capital works upgrades.
• Solid progress has been made across our sustainability targets areas and this year we recorded a 25% reduction in greenhouse gas emission intensity across our operations compared to the 2019 baseline, noting the impact from lower usage due to COVID-19. Pleasingly our office portfolio has achieved 4.6 stars for NABERS Energy and 4.0 stars for NABERS Water.
• I encourage you to refer to our 2021 Sustainability Report for more detail on the progress we are making.
• The Abacus Board renewal process has now been completed with the appointment of Mark Bloom during the year. Abacus is proud to have a strong Board comprising 43% female representation and a Non-Executive Director cohort with a diverse range of skills, expertise and backgrounds.
• The Abacus Board is focused on ensuring the Group delivers long-term value to securityholders, and together with the appropriate governance structures and a highly capable executive team, believe we are well placed to take advantage of business opportunities as they arise.
• I would like to thank Steven and the Abacus team including my Board colleagues, for their dedication and commitment as we continue to navigate these challenging times and deliver on our strategic objectives.
• Before handing over to Steven, I would also like to thank all our securityholders for their continued support.