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Aventus Executing Strategy to Drive Earnings


Aventus Group announced this week its results for the half year ended 31 December 2018.

Key Achievements

• Internalisation completed

• Funds from Operations (FFO) of $47 million or 9.2 cents per security

• Distributions of 8.2 cents per security

• Revaluation gains of $26 million driven by income growth

• The Weighted Average Capitalisation Rate (WACR) unchanged at 6.7%

Portfolio Highlights

• Consistently high occupancy of 98.5% including 16 of 20 centres with 100% occupancy

• Like-for-like net property income (NPI) growth of 3.3%

• Strong leasing demand with 81 leases negotiated across 74,000 sqm of GLA achieving positive leasing spreads and with low incentives

• High exposure to national tenants, comprising 86% of the portfolio by GLA

• Diversifying tenancy mix with 37% of the portfolio by income in the Everyday-Needs category

Financial Highlights

• Profit of $64 million, down from $75m due to lower valuation gains than previous year and higher costs from internalisation process

• Gearing of 39.4% and weighted average debt expiry (WADE) of 3.9 years

• Hedging increased by $100 million to protect against interest rate volatility

• Following internalisation and valuation gains, NTA per security is $2.15 and NAV is $2.42 per security

Valuation Increases through Income Growth

Property valuation gains of $26 million were achieved in the portfolio, bringing the value of assets under management to $2.1 billion . The WACR of the portfolio has remained stable at 6.7% since December 2017. The valuation increases takes into account annual rent increases, market rent reviews, positive leasing spreads, and completion of a number of asset management and development initiatives.

The strategy for the group remains to drive sustainable earnings from the portfolio through:

• Active diversification of the tenant base with a focus on increasing Everyday-Needs uses

• High occupancy and annual contracted rent increases to underpin future income growth

• Continued re-investment into the portfolio to enhance shopper experience and capitalise on attractive development returns

The Board confirms the FY19 guidance for FFO per security of 18.4 cent.

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