This article is from the Australian Property Journal archive
IN a somewhat shaky year for Desane Group Holdings Limited (ASX:DGH), the group managed to pull in a 14% increase in its operational revenue, despite seeing overall profit losses.
This increase was largely driven by a 41.7% rise in rental revenue from its investment properties, climbing from $1.46 million in FY20 to $2.08 million in FY21.
Statutory net profit after tax was $1.8 million, which is down 19.9% from FY20’s $2.2 million profit.
While NPAT was at $1.8 million, down from $2.3 million, and significantly down from FY19’s pre-COVID $27.3 million, which included the Rozelle sale.
The group posted an EBIT for FY21 of $2.7 million, with a NTA per share of $1.44 , which was stable from the previous period.
An EPS of 4.42 cents was posted, down compared to the previous period’s 5.52 cents, which is again significantly down from a pre-pandemic FY19’s 66.73 cents.
Operational income increased by 14%, attributed to an increase in rental returns, with operational costs remaining steady.
Total group assets at $87.7 million, an increase of 4% on FY20. This was largely represented by industrial properties, which made up 42% of assets.
“Desane’s industrial property assets are performing well, in line with industrial and logistic assets across the major capital cities,” said Phil Montrone, managing director of Desane.
In Desane’s Lane Cove industrial portfolio, three tenants formalised the renewal of leases, with two agreeing to a five year term. This property is expected to bring in more than $4 million in net rental income over the coming five years.
Desane has renewed its $6.0 million loan facility for the Lane Cove properties with the commonwealth Bank for three years, at 1.9% per annum variable.
“Desane’s investment assets fall into the highly sought‐after industrial asset class, providing stability of income during these challenging times,” said Montrone.
The remaining 58% of assets spanned approved Sydney residential projects at 31%, cash and financial assets at 15%, commercial properties at 11% and the final 1% listed as other.
“Desane’s strong balance sheet, coupled with the ability to add value to our existing assets and to acquire additional income producing assets, will provide a significant uplift in shareholder value in the medium to long term,” added Montrone.
Desane reported $13.2 million in cash and financial assets, with a diversified $7.0 million loan portfolio, bringing in an average of 7% per annum in interest revenue.
The group posted an ordinary final dividend of 2.25 cents per share unfranked, for a total FY21 dividend of 4.50 cents per share unfranked.
