Kiwi Property Group has reported a solid full year profit, following higher rental income and rising property values.
Shoppers at Sylvia Park mall. Photo: RNZ/ Marika Khabazi
The large retail and diversified property investor is best known for owning the country's largest shopping centre, Sylvia Park in Auckland.
Key numbers for the year ended March compared to a year ago:
- Net profit $224.3m vs $196.5m
- Revenue $246.8m vs $234m
- Property portfolio gains $120.5m vs $99.8m
- Underlying profit $124.8m vs $116.3m
- Final dividend of 5.6 cents a share
The bottom line was boosted by a $120 million gain in the value of its property portfolio.
Accounting for the one-off item, the underlying profit was 7 percent higher at $124.8m, following a lift in rental income and a full year of trading at Sylvia Park's level one expansion.
Total sales rose by nearly 7 percent at Kiwi Property's large retail centres, despite the effects of various lockdown restrictions.
Chief executive Clive Mackenzie said the company had performed well and entered into the current financial year with significant momentum.
"By working closely with our tenants and staying securely focused on operational performance we've mitigated the impact of Covid-19 and delivered a strong financial result.
"It's particularly pleasing to achieve such broad-based growth, with income, asset values and profitability all up on last year."
The company had an array of various developments underway including the development of build-to-rent accommodation and a new office tower at Sylvia Park.
It had sold nearby land to Ikea, secured resource consent to build a 25-storey mixed-use building at its LynnMall property, and had received the green light from the Auckland Council to pursue its 51-hectare community in Drury, which would pave the way for more than 4000 homes, as well as retail sites.
The company also revealed that it wanted to establish a "CBD office co-investment platform" to help fund future growth.
"Ensuring the optimal funding of our development pipeline is a key consideration and something we are highly attuned to," Kiwi Property chair Mark Ford.
Kiwi Property said it also had a range of other funding mechanisms available to it, such as asset sales, or the introduction of capital partners across one or more of its mixed-use properties.
During the year the company increased existing debt facilities and entered into new arrangements.
Looking ahead, Ford said the company was focused on generating value for stakeholders in the current year but also mentioned its share price, which he said was tracking at below expectations at $1.02 each at the start of Monday's trading.
"Some of this mispricing is likely due to macroeconomic factors beyond our control but in FY 23 we will continue to focus squarely on those that are."
Solar deal
The company also announced that it would switch to solar power later this year after signing a 15-year purchase agreement with Meridian Energy.
It would involve Meridian installing and paying to install the solar panels on Sylvia Park's roof, with Kiwi Property purchasing the power for a fixed cost.
Once the rooftop installation was complete, it said it would be the largest of its kind in New Zealand.