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 Level 4, 30 The Bond Telephone +61 2 9236 6111 30 Hickson Road Facsimile +61 2 9252 2192 Millers Point NSW 2000 www.lendlease.com Australia
1
ASX Announcement Half Year Financial Report – Lend Lease Trust 18 February 2013 Attached is the Half Year Financial Report for the period ended 31 December 2012 for the Lend Lease Trust. ENDS Investor Relations and Media Sally Cameron Vivienne Bower Group Executive - Investor Relations Group Head of Corporate Affairs and
Investor Relations Tel: 02 9236 6464 Tel: 02 9277 2174 Mob: 0448 129 022 Mob: 0431 487 025
Half Year Financial Report December 2012
Lend Lease Trust
Lend Lease Trust
Half Year Financial Report
December 2012
Lead Lease Responsible Entity Limited ABN 72 122 883 185 AFSL No. 308983 is the responsible entity of the
Lend Lease Trust ARSN 128 052 595
Table of Contents
Directors’ Report 1
Lead Auditors Independence Declaration under
Section 307C of the Corporations Act 2001 2
Financial Statements 3
Statement of Comprehensive Income 3
Statement of Financial Position 3
Statement of Changes in Equity 4
Statement of Cash Flows 4
Notes to the Financial Statements 5
1. Significant Accounting Policies 5
2. Distributions 7
3. Earnings per Unit 7
4. Equity Accounted Investments 7
5. Issued Capital 7
6. Contingent Liabilities 8
7. Events Subsequent to Balance Date 8
Directors’ Declaration 9
Half Year Financial Report December 2012
Lend Lease Trust
Directors’ Report
1
The Directors of Lend Lease Responsible Entity Limited, the Responsible Entity for the Lend Lease Trust (‘the Trust’), present their
Report together with the Half Year Financial Report of the Trust, for the six months ended 31 December 2012 and the Auditor’s
Report thereon.
The Responsible Entity is a wholly owned subsidiary of Lend Lease Corporation Limited (‘the Company’) and forms part of the
consolidated Lend Lease Group (‘the Group’). The registered office and principal place of business of the Responsible Entity is
Level 4, 30 The Bond, 30 Hickson Road, Millers Point NSW 2000.
1. Directors
The name of each person who has been a Director of the Responsible Entity between 1 July 2012 and the date of this Report are:
D A Crawford, AO Chairman and Director since 2009
S B McCann Group Chief Executive Officer & Managing Director since 2009
C B Carter, AM Appointed April 2012
P M Colebatch Director since 2009
G G Edington, CBE Director since 2009
P C Goldmark Director since 2009
J S Hemstritch Director since 2011
J A Hill Retired November 2012
D J Ryan, AO Director since 2009
M J Ullmer Director since 2011
2. Review of Operations and Results
For the six months ended 31 December 2012 the Trust reported a profit after tax of A$3,338,450 (December 2011: Loss
A$45,223).
3. Events Subsequent to Balance Date
There are no material events subsequent to the end of the financial period.
4. Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001
The Lead Auditor’s Independence Declaration is set out on page 2 and forms part of the Directors’ Report for the six months
ended 31 December 2012.
This report is made in accordance with a resolution of the Board of Directors and is signed for and on behalf of the Directors.
D A Crawford AO S B McCann
Chairman Chief Executive Office and Managing Director
Sydney, 18 February 2013
Half Year Financial Report December 2012
Lend Lease Trust
Financial Statements
The accompanying notes form part of these financial statements. 3
Statement of Comprehensive Income Half year ended 31 December 2012
Note
6 months
December
2012
A$
6 months
December
2011
A$
Revenue
Finance revenue
External parties 1,165,890 10,836
Total revenue 1,165,890 10,836
Expenses
Cost recharges – related party
113,879 56,059
Other expenses 165,021
Total expenses 278,900 56,059
Share of profit of equity accounted investments 4 2,451,460 –
Profit/(loss) before tax
3,338,450 (45,223)
Income tax expense
Profit/(loss) after tax
3,338,450 (45,223)
Other comprehensive income net of tax
Total comprehensive income after tax 3,338,450 (45,223)
Basic/diluted earnings per unit (cents) 3 0.58 –
Statement of Financial Position As at 31 December 2012
Note
December
2012
A$
June
2012
A$
Current Assets
Cash and cash equivalents 454,895,186 412,397
Loans and receivables – related parties 371,439 626
Total current assets 455,266,625 413,023
Non Current Assets
Investments accounted for using equity method 4 48,951,410
Total non current assets 48,951,410 –
Total assets 504,218,035 413,023
Current Liabilities
Trade and other payables 1,051,990
Total current liabilities 1,051,990 –
Net assets 503,166,045 413,023
Equity
Issued capital 5 500,874,352 572,790
Retained earnings 2,291,693 (159,767)
Total equity attributable to unitholders 503,166,045 413,023
Half Year Financial Report December 2012
Lend Lease Trust
Financial Statements continued
The accompanying notes form part of these financial statements. 4
Statement of Changes in Equity Half year ended 31 December 2012
Note
6 months
December
2012
A$
6 months
December
2011
A$
Issued Capital
Opening balance at beginning of financial period 572,790 570,916
Recapitalisation of Lend Lease Trust 500,300,000
Unit issue through dividend reinvestment plan (DRP) 1,562 888
Closing balance at end of financial period 5 500,874,352 571,804
Retained Earnings
Opening balance at the beginning of financial period (159,767) (78,338)
Profit/(loss) after tax 3,338,450 (45,223)
Distributions provided for 2 (886,990)
Closing balance at end of financial period 2,291,693 (123,561)
Statement of Cash Flows Half year ended 31 December 2012
6 months
December
2012
A$
6 months
December
2011
A$
Cash Flows from Operating Activities
Cash payments in the course of operations (114,181) (56,059)
Interest received 795,358 10,836
Net cash provided by/(used in) operating activities 681,176 (45,223)
Cash flows from investing activities
Investment in associates (46,499,950)
Net cash provided by/(used in) investing activities (46,499,950) –
Cash Flows from Financing Activities
Recapitalisation 500,300,000
Net proceeds from equity issue 1,562 6,245
Net cash provided by/(used in) financing activities 500,301,562 6,245
Net increase/(decrease) in cash and cash equivalents 454,482,789 (38,978)
Cash and cash equivalents at beginning of financial period 412,397 487,221
Cash and cash equivalents at end of financial period 454,895,186 448,243
Half Year Financial Report December 2012
Lend Lease Trust
Notes to the Financial Statements continued
5
1. Significant Accounting Policies
The Trust is domiciled in Australia.
Lend Lease Corporation Limited (‘the Company’) acquired 100% of the Trust on 2 October 2009. Following shareholders’
approval on 12 November 2009, the units in the Trust were distributed as an ‘in specie’ dividend to the shareholders. The
shares of the Company and the units in the Trust were combined as stapled securities and from 13 November 2009 have
been traded as one security under the name of Lend Lease Group on the Australian Securities Exchange (‘ASX’).
Following stapled securityholders’ approval on 15 November 2012, the Company has reallocated capital to LLT by reducing the
Company’s share capital by A$500.3 million and applying that amount as additional capital to LLT. This capital reallocation did
not affect the number of shares on issue nor the number of units held by each securityholder and did not result in any cash
distribution to members.
The half year financial report was authorised for issue by the Directors on 18 February 2013.
1.1 Statement of Compliance
The half year 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. The half year financial report of the Trust also complies with
the recognition and measurement requirements of the International Financial Reporting Standards (IFRS) and Interpretations
adopted by the International Accounting Standards Board.
The half year financial report should be read in conjunction with the 30 June 2012 annual financial report and any public
announcements by the Trust during the half year in accordance with continuous disclosure obligations arising under the
Corporations Act 2001. The half year financial report does not include all of the information required for a full financial report.
1.2 Basis of Preparation
The half year financial report is presented in Australian Dollars 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 and investment property.
The preparation of an interim report that complies with AASB 134 requires management to make judgements, estimates and
assumptions that affect the application of policies and reported amounts of assets and liabilities and income and expenses.
These estimates and associated assumptions are based on historical experience and various other factors that are believed
to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying
values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these
estimates.
The accounting policies are consistent with those applied in the 30 June 2012 annual financial report with the exception of
the addition of the new significant accounting policy at Note 1.3.
1.3 Equity Accounted Investments (Associates and Joint Venture Entities)
Investments in associates and joint venture entities are accounted for using the equity method. Associates (including
partnerships) are entities in which the Trust, as a result of its voting rights, has significant influence, but not control, over
financial and operating policies. A joint venture entity is an entity which has a contractual arrangement whereby two or more
parties undertake an economic activity which is subject to joint control.
The financial statements include the Trust’s share of the total recognised gains or losses of associates and joint venture
entities on an equity accounted basis. For associates, this is from the date that significant influence commences until the
date that significant influence ceases, and for joint venture entities, this is from the date joint control commences until the
date joint control ceases. Other movements in associates’ and joint venture entities’ reserves are recognised directly in
reserves. Investments in associates and joint venture entities are carried at the lower of the equity accounted carrying
amount and the recoverable amount.
When the Trust’s share of losses exceeds the carrying amount of the equity accounted investment (including assets that
form part of the net investment in the associate or joint venture entity), the carrying amount is reduced to nil and recognition
of further losses is discontinued except to the extent that the Group has incurred obligations in respect of the associate or
joint venture entity. Dividends from associates and joint venture entities represent a return on the Trust’s investment and as
such are applied as a reduction to the carrying value of the investment. Unrealised gains arising from transactions with equity
accounted investments are eliminated against the investment in the associate or joint venture entity to the extent of the
Trust’s interest in the entity. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that
there is no evidence of impairment.
Half Year Financial Report December 2012
Lend Lease Trust
Notes to the Financial Statements continued
6
1. Significant Accounting Policies continued
1.4 New Accounting Standards and Interpretations Not Yet Adopted
Certain new accounting standards and interpretations have been published that are not mandatory for this reporting period.
− AASB 9 Financial Instruments, AASB 2009-11 Amendments to Australian Accounting Standards arising from AASB 9,
AASB 2010-7 Amendments to Australian Accounting Standards arising from AASB 9 (December 2010) and AASB 2012-6
Amendments to Australian Accounting Standards – Mandatory Effective Date of AASB 9 and Transition Disclosures (September 2012). These standards address the classification, measurement and derecognition of financial assets and
financial liabilities. The potential effect of this standard is yet to be determined.
− AASB 10 Consolidated Financial Statements introduces a new definition of control and addresses whether an entity should
be included within the consolidated financial statements of the parent entity.
− AASB 11 Joint Arrangements establishes principles for financial reporting by parties to a joint arrangement.
The impact of changes for Accounting Standards AASB 10 and AASB 11 are still being fully assessed. Initial assessments
performed in the context of various investees, based on guidance issued to date, indicates however that the application of
these standards is unlikely to have a significant impact on the composition of the Trust’s financial position and performance.
− AASB 12 Disclosure of Interests in Other Entities relates to disclosure requirements for all forms of interests in other
entities, including subsidiaries, joint arrangements, associates and unconsolidated structured entities. Application of this
standard will not affect amounts recognised in the financial statements, however it will impact the type of information
disclosed in relation to the Trust’s investments.
− AASB 13 Fair Value Measurements and AASB 2011-8 Amendments to Australian Accounting Standards arising from AASB 13 introduce new guidance on fair value measurement and disclosure requirements when fair value is permitted by accounting
standards. The potential effect of this standard is yet to be determined.
The standards above become mandatory for the June 2014 financial year, with the exception of AASB 9 which will apply to the
June 2016 financial year. With the exception of AASB 13, which applies prospectively, the standards are to be applied
retrospectively.
Half Year Financial Report December 2012
Lend Lease Trust
Notes to the Financial Statements continued
7
2. Distributions
Distributions of A$886,990 were provided for during the period to 31 December 2012 and will be paid on 27 March 2013
(31 December 2011: A$Nil).
December
2012
December
2011
3. Earnings per Unit
Basic/Diluted Earnings Per Unit (EPU)
Profit/(loss) after tax A$ 3,338,450 (45,223)
Weighted average number of units 573,587,834 571,359,880
Basic/diluted EPU (cents) 0.58 –
December
2012
A$
June
2012
A$
4. Equity Accounted Investments
Joint Ventures
Investment in Joint Ventures 48,951,410 –
Interest Share of Profit/(Loss)
1 Net
Book Value
December
2012
%
June
2012
%
December
2012
A$
December
2011
A$
December
2012
A$
June
2012
A$
Joint Ventures
Lend Lease International Towers Sydney Trust 25.0 2,451,460 48,951,410
1 Reflects the after tax contribution to the Trust’s profit, and is after tax paid by the equity accounted investment vehicles themselves, where relevant.
December 2012
No of
units
December
2012
A$
June 2012
No of
units
June
2012
A$
5. Issued Capital
Issued Capital
Issued capital at beginning of financial period 572,789,827 572,790 570,915,669 570,916
Recapitalisation of Lend Lease Trust 500,300,000
Distribution Reinvestment Plan (DRP) 1,562,056 1,562 1,874,158 1,874
Issued capital at end of financial period 574,351,883 500,874,352 572,789,827 572,790
Issuance of Securities
Following stapled securityholders’ approval on 15 November 2012, the Company has reallocated capital to the Trust by reducing
the Company’s share capital by A$500.3 million and applying that amount as additional capital to LLT. This capital reallocation
did not affect the number of shares on issue nor the number of units held by each securityholder in Lend Lease Group and did
not result in any cash distribution to members.
Security Accumulation Plans
The Distribution Reinvestment Plan (DRP) was reactivated in February 2011. Subject to the rules of the DRP, the issue price
is the arithmetic average of the daily volume weighted average price of Lend Lease stapled securities traded (on the
Australian Securities Exchange) for the period of seven consecutive business days immediately following the record date for
determining entitlements to distribution. Stapled securities issued under the DRP rank equally with all other stapled securities
on issue.
Terms and Conditions
A stapled security represents one share in the Company stapled to one unit in LLT.
Stapled securityholders have the right to receive declared dividends from the Company and distributions from LLT and are entitled to
one vote per stapled security at securityholders’ meetings. Ordinary stapled securityholders rank after all creditors in repayment of
capital.
Half Year Financial Report December 2012
Lend Lease Trust
Notes to the Financial Statements continued
8
6. Contingent Liabilities
The Trust does not have any contingent liabilities.
7. Events Subsequent to Balance Date
There are no material events subsequent to the end of the financial period.
Half Year Financial Report December 2012
Lend Lease Trust
Directors’ Declaration
9
In the opinion of the Directors of Lend Lease Responsible Entity Limited, the responsible entity for the Lend Lease Trust (‘the Trust’):
1. The financial statements and notes are in accordance with the Corporations Act 2001, including:
a. Giving a true and fair view of the financial position of the Trust as at 31 December 2012 and of its performance for
the half year ended on that date; and
b. Complying with Australian Accounting Standard AASB 134 ‘Interim Financial Reporting’ and the Corporations
Regulations 2001.
2. 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:
D A Crawford AO S B McCann
Chairman Chief Executive Officer and Managing Director
Sydney, 18 February 2013
