Investore beats prospectus forecast with debut annual profit of $28.5m
Investore Property, the property investor spun out of Stride Property last year, posted an inaugural full-year profit as a listed company that beat its prospectus forecast after recording a stronger-than-expected increase in the value of its property portfolio.
Net profit was $28.5 million in the 12 months ended March 31, from $11.5 million forecast in its prospectus, the Auckland-based property investor said in a statement. It provided six-month figures for the year-earlier period which weren't easily comparable.
Other key measures of financial performance were broadly in line with the company's forecasts. Net rental income was $35 million in the year, versus the $34.9 million base case estimate in its prospective financial information. Corporate expenses were $4.7 million versus $4.8 million forecast and net finance expenses were $13.3 million versus $12.9 million.
Distributable profit before tax was $21.2 million compared with a forecast of $20.7 million, allowing the company to declare annual cash dividends of 5.34 cents a share, including 2.06 cents for the quarter ended March 31. It is targeting payments for 2018 of 7.46 cents. Its property portfolio was valued at $660.4 million and net drawn debt was $261 million, for a bank loan to value ratio of 39.5 percent.
Other income was $13.7 million versus a forecast expense of $1.2 million, which Investore said included the net change in fair value of investment properties. It paid tax of $2.3 million compared with $4.5 million forecast.
The occupancy rate across its properties was 99.8 percent at year end while its weighted average lease term (WALT) was 14.3 years.
Investore raised about $189 million in its initial public offering last year, allowing the company to buy 14 Countdown supermarkets as part of its 39 building portfolio, which was valued at $642.8 million as at Sept. 30. The company also refinanced its bank facility of $370 million, of which 84 percent was drawn as at March 31.
The property investor was separated from Stride and listed on the NZX in July, with Stride retaining a 19.9 percent shareholding and the management contract to run the portfolio. Investore paid Stride $2.7 million in management fees in the full year.
The shares last traded at $1.35 and have fallen 9.4 percent from last year's $1.49 offer price.