ALE Property Group (LEP)



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General Information
Company Name: ALE Property Group
Stock Code: LEP
Website: www.alegroup.com.au
GICS Sub-Industry: Diversified Real Estate Investment Trusts
Market Cap ($M): 650
Equiv. Shares (M): 196

Current Price Data+
Current Price Open High Low Last Close Volume Price Movement
 $ 3.320 $ 3.260 $ 3.320 $ 3.260 $ 3.270 49,890 $ 0.050  1.529 %

Current Broker Consensus Recommendation more
Recommendation: Sell (4)
Recommendation Date: 18th Dec 2014
Brokers Surveyed: 2

Company Overview

Business Description:
ALE Property Group (LEP) is a property investment and property fund management company which owns a property portfolio of 87 pubs across five mainland states of Australia. LEP comprises of Australian Leisure and Entertainment Property Trust and its controlled entities including ALE Direct Property Trust, ALE Finance Company PTY Limited and Australian Leisure and Entertainment Property Management Limited as the responsible entity of the trust.

Strategy Analysis:
ALE is a passive owner and operator of pub properties. Each property is leased to Australian Leisure and Hospitality, a Woolworths subsidiary, for an initial term of 25 years to 2028 with four 10-year options to renew. Annual rent reviews are linked to CPI. ALE is seeking to acquire additional high quality properties that complement its existing portfolio. 2010 was a period of consolidation with 12 properties sold and debt reduced to more conservative levels. ALE Property Group reported a net loss of $3.73m for the half-year ended 31 December 2012. Revenues from ordinary activities were $26.39m, up 2.9% from last year. Basic and Diluted EPS was (2.2) cents compared to 0.23 cents last year. Net operating cash flow was $18.14m compared to $10.68m last year. The interim dividend declared was 8 cents, compared with 8 cents last year.


Financial Summary
Year to Jun NPAT EPS EPS chg (%) PER DPS Yield (%) Franking (%)
2016  F 26.4 13.5 6.2 24.2 17.1 5.2 0.0
2015  F 24.9 12.7 -10.4 25.7 16.8 5.1 0.0
2014  A 27.7 14.2 1.7 19.7 16.5 5.9 0.0
Source: Morningstar analyst estimates.

Peer Comparison
EPS Growth (%) P/E (%) Dividend Yield (%)
Company Mkt Cap 2014 A 2015 F 2016 F 2014 A 2015 F 2016 F 2014 A 2015 F 2016 F
Dexus Property (DXS) $6,366 M -0.2674 0.0766 0.0146 14.7225 13.6744 13.4778 5.34 5.80 6.08
Goodman Gp (GMG) $9,949 M 0.0702 0.0752 0.0599 16.6229 15.4597 14.5855 3.63 3.92 4.21
Investa Office Fund (IOF) $2,235 M 0.4908 -0.3066 0.0335 10.8559 15.6559 15.1477 5.08 5.25 5.47
ALE Property (LEP) $640 M -0.3299 0.5043 0.0492 35.0858 23.3238 22.2298 5.03 5.14 5.26
Novion Property (NVN) $6,619 M -0.0071 0.1070 0.0233 17.4578 15.7703 15.4119 6.27 6.35 6.45

Market Comparison
Earnings P/E Ratio P/B Ratio P/E Growth
LEP 2.35 28.8 1.72 1.12
Market 0.90 15.0 1.19 1.94
Sector 1.52 14.0 1.14 3.26

Directors
Name Position Start Date
Mr James T McNally Executive Director 26 June 2003
Mr Andrew Frederick Osborne Wilkinson Managing Director 16 November 2004
Mr Peter Hastings Warne Non-Executive Chairman,Non-Executive Director 08 September 2003
Ms Helen I Wright Non-Executive Director 08 September 2003
Ms Phillipa (Pippa) Downes Non-Executive Director 26 November 2013
Mr Paul Say Non-Executive Director 24 September 2014

Management
Name Position
D J Shipway Asset Manager
A J Slade Capital Manager
Brendan Howell Company Secretary
M J Clarke Finance Manager

Substantial Shareholders
Holding Name
17,076,936 (8.79%) WoolWorths Limited and Associates
17,612,586 (19.36%) Caledonia (Private) Investments Pty Limited & its Associates
20,743,121 (13.01%) Allan Gray Australia Pty Ltd

Calendar of Events
Date Event
25 September 2015 Report (Annual)
05 August 2015 Report (Prelim)
05 August 2015 Report (Annual)
05 March 2015 Div Pay Date
22 January 2015 Report (Interim)
31 December 2014 Books Close
29 December 2014 Div Ex Date
© 2011 Morningstar, Inc. All rights reserved. The data and content contained herein are not guaranteed to be accurate, complete or timely. Neither Morningstar, nor its affiliates nor their content providers will have any liability for use or distribution of any of this information. To the extent that any of the content above constitutes advice, it is general advice that has been prepared by Morningstar Australasia Pty Ltd ABN: 95 090 665 544, AFSL: 240892 (a subsidiary of Morningstar, Inc.), without reference to your objectives, financial situation or needs. Before acting on any advice, you should consider the appropriateness of the advice and we recommend you obtain financial, legal and taxation advice before making any financial investment decision. If applicable investors should obtain the relevant product disclosure statement and consider it before making any decision to invest. Some material is copyright and published under licence from ASX Operations Pty Limited ACN 004 523 782 ("ASXO"). DISCLOSURE: Employees may have an interest in the securities discussed in this report. Please refer to our Financial Services Guide (FSG) for more information at www.morningstar.com.au/fsg.asp.

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