6 February 2019

2019 Half year results – Adding value

Dexus today announced its result for the half year and reaffirmed its guidance for distribution per security growth of circa 5% for FY19.

Dexus Chief Executive Officer, Darren Steinberg said: “It has been a productive six-month period where we have added value through enhancing our development pipeline and attracting new investors to our funds management business. This has all been achieved while maintaining low balance sheet gearing. 

“In our office portfolio we continue to outperform the MSCI office benchmark1 over one, three and five years through driving higher rents and lower incentives, particularly in Sydney which has been reflected in property valuations during the period. 

“In our funds management business, we now have $15 billion under management with investors and partners that can invest alongside us through the cycle, reinforcing our objective of being the wholesale partner of choice in Australian property.”

FINANCIAL HIGHLIGHTS 

  • Funds from Operations2 (FFO) of $353.3 million, up 9.8% on the previous corresponding period 
  • AFFO per security of 27.7 cents, up 14.5% on the previous corresponding period
  • Distribution per security of 27.2 cents, up 14.8% on the previous corresponding period
  • Net profit after tax of $726.4 million, down 27.2% primarily due to net revaluation gains of investment properties being lower than those recognised in the previous corresponding period 
  • Gearing (look-through)3 of 23.7%, down from 24.1% at 30 June 2018

OPERATIONAL HIGHLIGHTS

Property portfolio

  • One-year unlevered total return of 13.0% in the Dexus office portfolio and 15.5% in the Dexus industrial portfolio
  • Increased office portfolio occupancy4 to 97.3% with Sydney office leasing spreads5 of +18%
  • Progressed the group’s $5.2 billion development pipeline, replenishing both the industrial and office development pipelines Funds Management
  • Achieved strong performance across all funds with outperformance for Dexus Wholesale Property Fund (DWPF) across all time periods
  • Attracted new investors to Dexus’s funds management business
  • Established a new circa $2 billion unlisted trust that invests in Australian logistics properties seeded from Dexus’s existing portfolio 

Trading

  • Delivered $34.7 million of trading profits (post-tax)
  • Progressed developments to contribute to trading profits in future year