Lendlease Annual Report 2021

Group funding and debt facilities 1. $451 million of cash and cash equivalents was classified as Disposal Group assets held for sale at FY20. A working capital cash balance of $411 million transferred on the completion of the sale of the Engineering business. 2. EBITDA has been adjusted to exclude one-off items related to the Engineering business. 3. Values are shown at amortised cost. 4. Values are shown at gross facility value. FY20 FY21 Var. Net debt1 $m 833 695 (17%) Borrowings to total equity plus borrowings % 25.7 25.3 (2%) Net debt to total tangible assets less cash1 % 5.7 5.0 (12%) Interest cover2 times 2.8 6.4 129% Average cost of debt % 3.4 3.6 6% Average debt maturity years 4.2 4.9 17% Average debt mix fixed: floating ratio 56:44 87:13 Undrawn facilities $m 4,226 3,268 (23%) Net debt and gearing declined with gearing holding below the bottom end of the target range. The Group is in a strong liquidity position with $1.7 billion of cash and cash equivalents and $3.2 billion in available undrawn debt. Interest cover has improved in conjunction with a recovery in EBITDA and lower interest expense. UK Bond Issue Syndicated cash advance facility Syndi- cated loan facility Club Revolving Credit Facility Asia Loan Facility CNY bank facility US$ Reg. S notes S$ Reg. S notes Green Bond A$500 million A$ medium term notes Green Bond A$300 million 555 1,800 235 741 531 531 296 296 478 478 298 298 555 180 113 79 79 – – – – 300 Debt Facilities3 ($m)  Drawn   Facility Debt Maturity Profile4 ($m) Operating and investing cash flow The Group measures underlying cash flow to enable an assessment of cash conversion. The measures are derived by adjusting statutory cash flows, with the largest adjustment relating to the impact on cash flows from investments in development. Underlying operating cash outflow was $469 million. The establishment of separate development joint ventures to deliver two residential towers at One Sydney Harbour resulted in an approximate $900 million decrease in the underlying operating cash flow and an equivalent increase in underlying investing cash flow. Net underlying operating cash inflow was solid across a range of other development projects. There was also an approximate $200 million operating cash outflow from the Non core segment. The cash conversion ratio to operating EBITDA over the five years to FY21 was 73 per cent. Underlying investing cash inflow was $948 million. Proceeds from strategic divestments in the year, combined with the One Sydney Harbour cash inflows, more than offset additional capital commitments across the Development and Investments segments. The largest sources of inflow were from the further 25 per cent sale of the Retirement Living business and several strategic divestments, although the proceeds from the sale of the Engineering business were more than offset by the working capital cash balance transfer. Financing cash flow Net cash outflow from financing activities was $146 million with the repayment of borrowings and distribution payments exceeding the proceeds from borrowings. The Group continued to diversify its sources of financing with the issue of two green bond offers, a first for the Group, including a $500 million green bond representing the largest issued by an Australian non financial corporate. The Group remains in a strong financial position with $4.9 billion of liquidity. Cash movements ($m) Interest and tax paid Underlying operating cash ow Net nancing and other adjustments Underlying investing cash ow FY20 closing cash FY21 closing cash 1,562 1,662 (469) (227) 948 (152) 556 900 300 714 235 900 180 533 741 FY22 FY23 FY24 FY25 80 FY28 FY27 FY26 300 500 297 FY31 FY30 FY29  UK Bond Issue  Syndicated cash advance facility  Syndicated loan facility  Club Revolving Credit Facility  Asia Loan Facility  CNY bank facility  US$ Reg. S notes  S$ Reg. S notes  Green Bond A$500 million  A$ medium term notes  Green Bond A$300 million  Undrawn Financial position and cash flowmovements 69 A sense of place 68 Lendlease Annual Report 2021 Performance and Outlook