Property for Industry Limited, Annual Meeting 2025

9 October 2025

Property For Industry Ltd (PFI)

The company will hold its Annual Shareholders Meeting at 11.00am Tuesday 21 October 2025.

The location is Tuhono Room, Ground Floor Lobby, HSBC Tower, 188 Quay Street, Auckland.

You can also join the meeting online at this link.

Company Overview

The company owns a portfolio of 91 primarily industrial properties with 126 tenants across New Zealand with 87% in Auckland. The portfolio is valued at $2.17 billion and has an occupancy of 99.9% and a WALT (weighted average lease term) of 5.47 years. The company has a comprehensive environmental sustainability approach, partly led by customer demand for high quality ‘green’ buildings.

Anthony Beverley the former Chair who has served since July 2001 will retire at the ASM.

Current Strategy

The company is a professional landlord in the industrial sector. It aims to invest in quality industrial property in prime locations.

Previous Year Shareholder Meeting

NZSA recorded the following key items at last year’s annual shareholder meeting:

1. The company has three key development sites in progress.
2. Revenue increased 3% to $114.8 million.
3. Tenants want 5 Star buildings and will pay an increase rent for them.

The meeting report is available at this link.

Disclaimer

To the maximum extent permitted by law, New Zealand Shareholders Association Inc. (NZSA) will not be liable, whether in tort (including negligence) or otherwise, to you or any other person in relation to this document, including any error in it.

Forward looking statements are inherently fallible.

Information on www.nzshareholders.co.nz and in this document may contain forward-looking statements and projections. For any number of reasons, the future could be different – potentially materially different. For example, assumptions may be wrong, risks may crystallise, unexpected things may happen. We give no warranty or representation as to any future financial performance or any other future matter. We may not update our website and related materials for changes.

There is no offer or financial advice in our documents/website.

Information included on www.nzshareholders.co.nz and in this document is for information purposes only. It is not an offer of financial products, or a proposal or invitation to make any such offer. It is not financial advice and does not take into account any person’s individual circumstances or objectives. Prior to making any investment decision, NZSA recommends that you seek professional advice from a licensed financial advice provider.

There are no representations as to accuracy or completeness.

The information, calculations and any opinions on www.nzshareholders.co.nz and in this document are based upon sources believed reliable. The NZSA, its officers and directors make no representations as to their accuracy or completeness. All opinions reflect our judgement on the date of communication and are subject to change without notice.

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Key

The following sections calculate an objective rating against criteria contained within NZSA policies.

Governance

NZSA assessment against its key policy criteria are summarised below.

Directors Fees:  The company does not have a Director Fee Pool. It seeks approval from shareholders for the Fees for the Chair, Non-Executive Directors, and Fees for Committees.

The “approved fees” allows a special exertion payment of $350 per hour to Directors. NZSA recognises the benefit of such payments in certain circumstances. This payment is capped at $50,000 per annum. No payments were made in FY25.

Director Share Ownership:  Directors are not required to own shares.

CEO Remuneration:  The company discloses its remuneration policy on its website, which includes an overview of the remuneration philosophy applicable to the company. The People Committee is responsible for implementing the policy.

Incentives: The CEO is paid a short-term incentive (STI) in cash and a long-term incentive (LTI) by way of Performance Share Rights.

NZSA encourages fulsome disclosure in relation to any incentive payments made to the CEO, including disclosure of measures (or measure ‘groups’), weightings, targets, and the level of achievement versus target for each component associated with any awards. This methodology is supported by the new NZX Remuneration Reporting Template.

The STI is approximately 24% of the Total Target Remuneration. The measures, weightings, and level of achievement against each component are well-disclosed, with the overall STI award being made at 100% of target.

Performance rights are awarded under the LTI at between 18% and 21% of the Total Target Remuneration. Vesting then occurs after a three-year performance assessment period. The measure is total shareholder returns which is favoured by NZSA. The award for FY25 was 51% of target.

NZSA prefers the total incentive weighting to be on the LTI to ensure the CEO is aligned with long-term shareholders’ interests.

The company does not disclose the gender pay gap and CEO/employee remuneration ratio.

Golden Parachutes: In the interests of transparency, NZSA believes there should be explicit disclosure around the severance terms and notice periods associated with the CEO, including whether specific termination payments are offered.

We appreciate the clear statement in The Annual Report. “There is no commitment to making a severance payment and no sign-on benefits or compensation for loss of previous benefits from a previous employer, were payable to the Chief Executive Officer upon his appointment.”

Director Independence:  All Directors are independent.

Board Composition:  The Annual Report includes a collective skills matrix. NZSA prefers the matrix to attribute skill sets to individual Directors to demonstrate how they contribute to the governance of the company.

The company does not participate in the IoD’s Future Director programme designed to develop and mentor the next generation of Directors. NZSA expect NZX50 companies to participate as part of a responsibility to develop and mentor the next generation of Directors.

Director Tenure:  NZSA looks for evidence of ongoing succession or ‘staggered’ appointment dates that reduce the risks associated with effective knowledge transfer in the event of succession. We also prefer a term maximum of 9-12 years, unless there are exceptional circumstances that may apply.

Apart from Anthony Beverley, the other Directors were appointed between 2018 and 2024 indicating a clear commitment to succession planning.

ASM Format: Property For Industry Ltd is holding a ‘hybrid’ meeting, (i.e., physical, and virtual), a format preferred by NZSA as a way of promoting shareholder engagement while maximising participation.

Independent Advice for the Board & Risk Management:  NZSA looks for evidence, through disclosures, that a Board has access to appropriate internal and external expertise to support board assurance activities. We also look to see Boards are across their risk management responsibilities. 

PFI has noted in previous discussions with NZSA that it attempts to balance governance standards with the relatively small size of the company in terms of employees. 

The Board Charter states the Company Secretary is appointed by the Board and that Directors can access additional information from the CEO, CFO, and senior executives. Directors also have unfettered access to the external Auditors and with the Chairs approval can seek external independent advice at the expense of the company.

The Annual Report sets out the key risks and how these are governed and managed.

Audit

NZSA assessment against its key policy criteria are summarised below.

Audit Independence:  Good disclosure.

Audit Rotation:  The company ensures the Lead Audit Partner is rotated at 5 years as required by the NZX Listing Rules. The Lead Audit Partner was appointed in 2024 and the Audit Firm PwC in 2014. Whilst NZSA prefers a rotation of the Audit Firm at 10 years we understand the constraints around this so expect to see the process used to tender the Audit from time to time to test the market.

Environmental Sustainability

Overall approach: PFI’s FY2025 disclosures demonstrate progression under the New Zealand Climate Standards, with reduced adoption provisions compared to earlier cycles. This reflects growing capability and improved data quality. The reporting indicates that climate considerations are being increasingly integrated into the business, rather than being treated as a compliance exercise. Beyond the core requirements, PFI highlights resilience and resource use as long-term priorities to 2030, and continues to apply a Sustainable Refurbishment Framework to reduce waste and improve efficiency. Overall, the disclosures suggest a steady shift toward integrating sustainability more deeply into strategy and operations.

Sustainability Governance: The company provides a clear outline of its governance structures. The board and Audit & Risk Committee maintain oversight of climate risks, while the Senior Leadership Team, supported by the Head of Sustainability, manages implementation. The board skills matrix explicitly recognises sustainability and climate capability as part of director competencies, assuring that the board is equipped to govern these issues.

Strategy and Impact: The company presents a clear transition plan that integrates climate considerations into core property decisions. The FY2025 disclosure represents an improvement over prior cycles, providing more detail on how climate risks impact capital allocation, refurbishment strategies, and investment in new builds. PFI also outlines the pathways for meeting its near-term targets, embedding these within the wider business strategy.

Risk and Opportunity: Climate-related risks and opportunities are disclosed. Both transition and physical risks are analysed, and corresponding mitigations such as Green Star certification, solar installations, and resilience frameworks are detailed. The integration of these risks into the overall risk register demonstrates that climate is embedded in wider risk governance.

Metrics and Targets: PFI discloses its greenhouse gas emissions across Scopes 1 and 2, and provides partial disclosure of Scope 3 emissions. It publishes multi-year data and intensity measures, and reports progress against FY2025 milestones, some of which were achieved ahead of schedule. Targets include renewable energy generation, energy efficiency measures, and building certifications, giving investors measurable benchmarks. Sustainability objectives are also tied to executive incentives, with short-term remuneration metrics that include climate-related goals, weighted at 10%. This integration reinforces accountability.

Assurance: PFI has obtained limited assurance over Scope 1 and 2 emissions from PwC in FY2025. However, Scope 3 emissions remain outside the scope of assurance, and other climate disclosures are not yet verified. This leaves investors with only partial confidence in the reliability of the reported data, and the NZSA encourages broader assurance coverage in future reporting cycles.

Ethical and Social

NZSA assessment against its key policy criteria are summarised below.

Whistleblowing: Good disclosure.

Political Donations:  The company discloses its donations in the Annual Report along with the following statement “The Company did not undertake any direct lobbying activities during FY25.” If the policy is not to make political donations, we would ask that a statement is includes in each year’s Annual Report.

Financial & Performance

Property for Industry’s share price rose from $2.31 to $2.49 (as of 16^th September 2025) over the last 12 months – an 8% increase. This compares favourably with the NZX 50 which rose 4% in the same period. The capitalisation of PFI is $1.3b placing it 28^th out of 115 companies on the NZX by size and makes it a large company.

¹ per share figures based off actual shares at balance date (not weighted average)

Financial metrics last year were for a six-month period as during 2024 the company changed their balance date from 31 December to 30^th June. As a result, many comparisons made with that period have little meaning.

Revenues rose, and if adjusting for the prior year six-month period, increased to $127m. A positive Gross Profit was also generated on the back of a positive change in the fair value of the portfolio. A solid, NPAT of $118.3m was achieved. This provides EPS of $0.211 and places PFI on a low P/E of 12

Every year the property portfolio is valued by a third-party and the difference in valuation between this year and last is included as a revenue item. This will normally have a large bearing on revenue and profit, be it positive or negative. This line item does not affect cashflows or operational performance.

Operating cashflows were robust at $60.7m and as previously stated are sufficiently large to meet commitments as they fall due. The company is in a sound financial position with a low debt-equity ratio of 0.54 with total debt of $703m. As at balance date, $100m of borrowings were listed as current. Debt is a mixture of bank debt and bonds.

NTA per share rose 5% to $2.84 (undoubtedly helped by the fair value gain on Assets of $70.7m), and shares trade at a 12% discount to NTA.  Dividends of $0.086 were declared and dividends are fully imputed.

PFI has not provided FY 26 earnings guidance but in an investor presentation released to market said on page 16 that they expect “FY26 dividend guidance of at least 8.90 cps, an expected increase of at least 3.5% on FY25 dividends”.

Shares are widely held with the top 20 holders owning a combined 62.91% stake in PFI. The top 20 holders are mainly made up of institutional investors with ACC number 2 on the list with an 8.84% holding.

Resolutions

Angela Bull was appointed to the Board in February 2023 and was last elected in March 2023. She is currently a director of Vital Healthcare Property Trust, Channel Infrastructure NZ Limited, Foodstuffs South Island, Fulton Hogan, and Bayleys Corporation. Angela was previously the Chief Executive of Tramco Group, a director of the Real Estate Institute of New Zealand, realestate.co.nz, and a Board member of the Property Council of New Zealand. Angela also held a number of senior positions over a 10-year period with Foodstuffs Auckland and Foodstuffs North Island, most recently being General Manager, Property Development for Foodstuffs North Island. Angela is also a qualified lawyer with significant expertise in environment and property law.

We will vote undirected proxies IN FAVOUR of this resolution.

Carolyn Steele was appointed to the Board in August 2022. She is currently a director of WEL Networks, Vulcan Steel, and ANZ Bank New Zealand Limited. Carolyn is also an investment committee member at Oriens Capital and a Trustee of the Halberg Foundation. Carolyn previously served on the boards of Green Cross Health, Tuatahi First Fibre, Metlifecare and Datacom. She has a background in investment management, capital markets and mergers and acquisitions, having spent six years as a portfolio manager at the Guardians of New Zealand Superannuation, and ten years prior to that in investment banking at Forsyth Barr and First NZ Capital / Credit Suisse.

We will vote undirected proxies IN FAVOUR of this resolution.

Dean Bracewell was appointed to the Board in 2019 and is the Chair. He is currently a Director of Air New Zealand Limited, Port of Tauranga Limited, and Northport Group Limited, and is a member of the Executive Board of the Halberg Foundation. Dean was employed by Freightways Limited for over 30 years and was the Managing Director from 1999 to 2017. During that time, he led the company through its successful initial public offering in 2003 and as it diversified its business and extended its geographical footprint throughout Australia. Dean has previously served on the Boards of the public policy think tank The NZ Initiative and its predecessor The NZ Business Roundtable, and Tainui Group Holdings Limited.

We will vote undirected proxies IN FAVOUR of this resolution.

This is an administrative resolution.

We will vote undirected proxies IN FAVOUR of this resolution.

PFI does not operate a Directors Fee Pool instead it sets fees for each Board role. The Board reviews fees every two years. The last increase was approved by shareholders in March 2023. The Board has commissioned EY to prepare an independent Report and a link to this is includes in the Notice of Meeting.

The Report includes appropriate comparator company data. The proposed increase is around 4%. The proposed fees are at the median of the comparator group. NZSA has reviewed both the Report and its own data base and believes the fees are appropriate.

We will vote undirected proxies IN FAVOUR of this resolution.

Proxies

You can vote online or appoint a proxy at https://www.investorvote.com.au/

Instructions are on the Proxy/voting paper sent to you.

Voting and proxy appointments close 11.00am Sunday 19 October 2025.

Please note you can appoint the Association as your proxy. We will have a representative attending the meeting.

The Team at NZSA