This article is from the Australian Property Journal archive
RESIDENTIAL developer Devine has booked a half year loss after tax of $28.6 million and the company is expecting to go deeper into the red for the year ahead.
The loss result is compared to the margin profit of $0.9 million reported in the same period last year.
Devine delivered a loss before tax of $27.2 million for the six month period ending 30 June 2016 versus a $1.2 million loss in the previous year.
The company’s revenue dived from $146.5 million a year ago to $113.1 million.
Devine CFO James Mackay said the result is due primarily to the impairment of inventory within the communities business, a settlement within the development business and the timing of project completions in the construction business.
During the half year period, land settlements totalled 285 allotments, with 87% of the full year settlement forecast either completed or secured and subject to contract.
Apartment settlement numbers for the period were limited as no new apartment projects finished during the period, however pre-sales at Mode Apartments project (Brisbane) now cover 80% of that total project with the settlements to commence in early 2017.
Meanwhile Mackay said the company is continue to progress with the strategic review of its business and this included the sale of Devine’s interests in the South Bank Townsville development site in Queensland) and the Pennyroyal Estate in Victoria.
Since March 31, Devine the company has negotiated the sale of its interest in assets that has, or will return, almost $38 million in cash to the business.
Devine has also entered into negotiations to offload an englobo site of the Eden’s Crossing Community site in Queensland for $30.05 million, with settlement to occur in September 2016.
And Devine is close to concluding the discontinuation of the wholesale and integrated housing business, and it is anticipated that all housing contracts currently under construction, including integrated and medium density projects, will be completed by the end of the 2016 calendar year.
Mackay reiterated that it expects to make a loss before tax of approximately $35 million for the full year to December 2016.
Australian Property Journal
