This article is from the Australian Property Journal archive
PROPERTY group Australand has forecast a similar operating profit of $120 million for FY10, which was achieved in FY09. However, investors have been urged to approve a stapling proposal which could bolster distributions by 400%.
At the group’s Annual General Meeting, managing director Bob Johnston said the group delivered a FY09 operating profit after tax of $120 million in what were very challenging trading conditions and with the back-drop of falling asset values.
“We did end 2009 though in a strong financial position and with clarity around our long term strategic direction,” he added.
Johnston said group operating profit after tax in 2010 will be similar to that achieved in 2009 with earnings skewed to the second half of the year because of the timing of settlements for residential sales and the required ramp up period for the commercial and industrial development activities.
In the residential sector, he observed that first home buyer activity has dipped since the boosted grant expired. However Johnston said increased demand from homeowners upgrading and investors are expected to offset the decrease in first home buyers.
Meanwhile chairman Lui Chong Chee invited shareholders to ‘consolidate’ every five securities on issue into one security.
Australand currently has an excessive volume of securities trading following its capital raising initiatives.
The consolidation could bring benefits to shareholders, Johnston forecast a distribution of 4.1 cents per security in FY10, prior to the impact of the proposed consolidation.
This is lower than 5cps in FY09.
However if a consolidation is approved, the distribution is expected to be 20.5cps.
Johnston concluded that Australand now has strengthened balance sheet from which to provide growth and he predicts the group will deliver earnings growth from 2011.
Australian Property Journal
