This article is from the Australian Property Journal archive
GLOBAL serviced offices provider Servcorp is looking to a year of consolidation as it faces disruption from shared and flexible workspace providers, who are becoming an embedded feature of the office market.
The ASX-listed group posted a slight drop in net profit before tax to $48.2 million, and a 3% increase in net profit after tax of $40.7 million, which it expects to increase to between $45 million and $55 million for the 2018 financial year.
Revenue was up in 2017 by 0.3% to $329.6 million.
“In FY 2018, growth in office stock will be significantly lower than during the last seven years while we consolidate the operating performance of our global footprint.
“Our industry is in unprecedented transition; we are seeing many new participants and as a result the shared workspace market is growing rapidly.
“We are in a strong financial position to maximise leverage in this expanding market,” the company said.
The group has a 10% compounded annual growth rate in its office stock over the past seven years, and grew its stock by 7% in 2017 with the opening of new floors in Tokyo, Brussels, Jakarta, Chicago and the Barangaroo International Tower One in Sydney, and expanded two floors.
Its operating cash flow of $54.4 million was down 10%; and its unencumbered cash and investment balances were up 8% to $107.9 million. Net tangible assets backing was up 3% to $2.56 per share. Earnings were up 3% to $0.414ps. Final dividend of 13.00cps, 50% franked, and total dividends for the year were up 18% to 26.00cps.
Australian Property Journal
