- $132.5 million statutory profit announced in half year results
- Decline in profit ascribed to increased tax expenses
- Company is also solidifying plans to establish new REIT
Real estate investor and fund manager, Cromwell Property Group (ASX:CMW) (Cromwell) revealed a $132.5 million statutory profit in their half-year results for the 2022 financial year.
This figure is 9% down from the previous corresponding half year when the company reported a $145.2 million statutory profit.
Cromwell Chair Gary Weiss commented on the half-year results.
“While the global operating environment continued to be challenging due to the ongoing COVID-19 pandemic, Cromwell has achieved a satisfactory half-year result which reflects the stability and resilience of our platform.
Cromwell Chair, Gary Weiss
Dr Weiss believes the results reflect the stability and resilience of the platform. He said plans to simplify the business are well underway.
Cromwell Property Half Year Results
*Statutory profit equates to profit after tax attributable to stapled security holders.
Cromwell attributes the 9% decline in statutory profit to higher tax expenses during the half-year.
The company’s underlying profit, which excludes one-off gains and losses, was $96.4 million for the half-year. This is down 3% from HY21 when the underlying profit reached $99.1 million.Cromwell ascribes the drop in statutory profit to the sale of non-core assets and effects of new gross leasing deals at HQ North, Fortitude Valley QLD (HQ North).
Cromwell CEO Jonathan Callaghan appointed during the half year, was pleased to announce the results. He described some new initiatives in store for the company.
“We have a clear vision to build a simplified and more capital efficient model, with a strategic emphasis on the major opportunities to grow our global funds and asset management business.
Jonathan Callaghan, Cromwell CEO
“In the near term, this will include the launch of various new initiatives including an externally managed real estate investment trust (REIT) listed on the ASX, the sale of non-core assets and the continued focus on the launch and marketing of new funds in Europe and via our retail funds business.
“We have also introduced a programme of initiatives which aim to retain our valuable people and attract new talent to the business to underpin the strategy,” he concluded.
Cromwell’s assets under management come to $12.1 billion, a figure up 4% from the previous corresponding half year.
Cromwell to create new REIT
The company is also solidifying plans to establish a new externally managed real estate investment trusts (REIT).
“Central to our future strategy is the aim for Cromwell to transition to a capital light funds management business model,” Mr Callaghan said.
“The new externally managed REIT is the first step in furthering this strategic ambition while giving investors the option to invest in two different vehicles with different risk return and growth profiles.”
The new branch is a part of the company’s four key priorities: to simplify the business, to build on its existing funds management platform in Europe and Australia, to grow capital partner relationships and to increase focus on culture and people.
Mr Callaghan concluded that Cromwell enters this next phase with a refocused and simplified vision for the business.