Property for Industry hikes annual earnings guidance on strong leasing

The portfolio of 92 properties has increased in value.

Property for Industry raised annual earnings guidance as the industrial real estate investor benefited from stronger leasing since its half-year result.

The Auckland-based company expects distributable profit of 8 cents per share in the year ending March 31, up from already increased guidance of 7.7-to-7.9 cents, and up from 7.58 cents a year earlier, it said in a statement.

"The second half of 2017 has delivered strong leasing outcomes, continuing the trend we reported on in our interim results announcement in August," chair Peter Masfen said. "A series of important strategic initiatives have also been completed during the year, with the internalisation of management, portfolio acquisition, rights offer and bond offer all contributing to a successful year."

The real estate investor raised $100 million in a bond offer last month to repay existing bank debt, with the listed debt market continuing to offer attractive funding relative to bank loans. That followed a $69.5 million acquisition of nine properties which was paid for through a rights issue.

PFI today said the 92 properties in its portfolio increased 3.8 percent in value to $1.21 billion from a year earlier, including the recent acquisition and some capital spending.

"A key driver of this valuation outcome was the successful leasing of nearly 88,000 square metres - representing circa 12 percent of PFI's existing portfolio - during the year to date," it said.

The company affirmed dividend guidance of 7.45 cents per share.

The stock was unchanged at $1.635, having increased 4.2 percent so far this year.

(BusinessDesk)