Goodman Property Trust [NZX: GMT], New Zealand's largest property investor by market value, lifted annual earnings 10 percent as rental income came on stream from new acquisitions, and flagged asset sales to fund future developments.
Distributable earnings after tax, a measure of profit that strips out valuation movements, rose to $92.9 million, or 7.45 cents a unit, in the year ended March 31, from $84.1 million, or 7.8 cents, a year earlier, the Auckland-based trust's manager said in a statement. Net profit jumped 72 percent to $134.1 million as fair value gains accounted for a $23.8 million boost.
Total revenue rose 25 percent to $127.8 million, as earlier acquisitions, including its 100 percent ownership of Auckland's Highbrook Business Park, came online and an increase in rents started to contribute, Andy Eakin, chief financial officer, told investors on a teleconference.
Goodman Property paid an $8.7 million management fee to manager Goodman (NZ), up from $7.5 million a year earlier, though it didn't have to pay a performance fee. It also paid total management, development management and other fees of $9.9 million to related party Goodman Property Services (NZ), up from $7.8 million a year earlier.
The trust started 15 new projects in the latest year at a cost of $165.7 million, the highest level of development in the past five years. Goodman disposed its Gateside Industry Park for $37.2 million and said it would fund its developments through asset sales rather than equity, suspending its distribution reinvestment plan from June.
"Refinements to the management and governance structures together with a more active capital management strategy are positive new initiatives that will enhance the trust's investment performance," chairman Kevin Smith said.
The company expects to sell between $100 million and-$150 million worth of assets in the coming year. Since the balance date it sold SMEC House in Auckland for $26.2 million.
The trust will pay a final dividend of 1.56 cents per unit, payable on June 19, taking the total return to shareholders to 6.25 cents. It expects to pay 6.45 cents per unit in 2015. It expected distributable earnings before tax to be around 9.1 cents as lack of rental supply drove rental growth.
Units in the trust rose 2 percent to $1.025, and have gained about the same amount this year.