- DXC recorded a $40M profit, up 90% on last year
- $21.1 million of property valuation gains
- NTA was $3.83 per security
Dexus Convenience Retail REIT (ASX: DXC) released its half-yearly results, with the company’s highlights including a $40 million profit, $15.4 million FFO, and gearing at 32%.
| 31-Dec-21 | 31 June 2021 | |
| Gearing | 32% | 28.20% |
| Cost of debt | 2.70% | 3% |
| Weight average debt maturity | 2.5 years | 2.9 years |
| Hedged debt (incl. caps) | 66% | 55% |
| Headroom | $66.5M | $74.3M |
Source: Dexus Convenience Retail REIT.
DXC opened this morning at $3.42, with trading up across the day, topping out at $3.49 in the afternoon, before closing up 1.46% at $3.47.
“We delivered a solid financial result for the six months, culminating in an upgrade to our FY22 guidance in December as a result of $73.7 million of acquisitions announced during the half,” said DXC fund manager, Chris Brockett.
“The portfolio’s concentration in quality non-discretionary retail assets underpinned like-for-like net operating income growth of 2.3%, in addition to valuation uplifts and NTA per security growth.”
The strong results comes almost a year after Dexus acquired APN Convenience Retail and APN Industria, since renamed Dexus Convenience Retail and Dexus Industria.
Among other highlights for the company, distributions were confirmed at 11.5 cents per security, up 4.6% on the previous corresponding period, and an increased NTA, now $3.83.
Profit was 90% up on the previous corresponding period, and FFO was 25.9% up.
Revenue from ordinary activities for the company was up 37.5% from the previous corresponding period, reported as $27.3 million.
“During the half, DXC announced six strategic acquisitions to strengthen the portfolio. The assets are modern, recently built convenience retail facilities with a strong focus on non-discretionary retail,” said Mr Brockett.
“The acquisitions are underpinned by a long weighted average lease expiry of 10.5 years with strong lease covenants and favourable annual rent review structures providing sustainable income growth for investors.”
The company also spoke about the resilience of its portfolio in the long term, noting industry trends included domestic electric vehicle adoption on the rise, increased government focus on climate change, among others.
DXC said the portfolio was well-positioned because it had long-dated leases, providing income certainty in the medium to long term; proactive tenant engagement to improve convenience retail offerings and install EV charging stations; an optimal portfolio mix, and a diversified tenancy mix.
DXC financial reporting for HY22, Appendix 4D
| 31 Dec 2021 | 31 Dec 2020 | % | |
| $000 | $000 | Change | |
| Revenue from ordinary activities | 27,267 | 19,827 | 37.5% |
| Net profit attributable to security holders after tax | 39,979 | 21,044 | 90% |
| FFO per security | 15,447 | 12,269 | 25.9% |
| Distribution to securityholders | 15,933 | 12,858 | 23.9% |
| Cents | Cents | ||
| FFO per security | 11.52 | 10.81 | 6.6% |
| Distribution per security for the period | 11.45 | 10.95 | 4.6% |
| Payout ratio (distribution per security as a % of FFO per security | 99.4% | 101.3% | -2.0% |
| Basic earnings per security | 29.82 | 18.53 | 60.9% |
| Diluted earnings per security | 29.82 | 18.53 | 60.9% |
| Franked distribution amount per security | – | – | – |
| ‘000 | ‘000 | ||
| Total assets | 816,781 | 542,693 | 50.5% |
| Total borrowings | 265,691 | 119,670 | 122.0% |
| Security holders equity | 532,481 | 408,309 | 30.4% |
| Market capitalisation | 499,541 | 431,024 | 15.9% |
| $ per security | $ per security | ||
| Net tangible assets | 3.83 | 3.35 | 14.3% |
| Securities price | 3.59 | 3.54 | 1.4% |
Source: Dexus Convenience Retail REIT.
