Growthpoint Properties Australia (ASX: $GOZ) FY24 Distribution and Valuations Update

Growthpoint Properties Australia (ASX: $GOZ) has announced a final distribution of 9.65 cents per security (cps) for the six months ending 30 June 2024, aligning with the total FY24 distribution of 19.3 cps as per guidance. The company also maintains its FY24 funds from operations (FFO) guidance of between 23.2 to 23.6 cps. Additionally, preliminary draft external valuations for approximately 91% of the Group's portfolio by value indicate a decline of around $187.3 million to $4,001.0 million, reflecting a 4.5% decrease on a like-for-like basis relative to 31 December 2023 book values. The weighted average capitalisation rate of the externally valued properties increased by 42 basis points to 6.36%.

Executive Commentary on FY24 Distribution and Valuations

Ross Lees, CEO and Managing Director of Growthpoint, stated, 'The office portfolio declined by $182.4 million or 6.2% from 31 December 2023 to 30 June 2024 due to an expansion in the weighted average capitalisation rate of 49 basis points to 6.47%. The industrial portfolio declined by $4.9 million or 0.4% from 31 December 2023 to 30 June 2024 due to an increase in the weighted average capitalisation rate of 25 basis points to 6.11%, partially offset by continued rental growth.'

Summary of FY24 Distribution and Valuations Update

Growthpoint Properties Australia (ASX: $GOZ) has delivered its final FY24 distribution in line with guidance and maintains its FFO guidance. The preliminary draft external valuations for the majority of the Group's portfolio indicate a decline, impacting the net tangible assets (NTA) by approximately 25 cps. The company's pro forma gearing as at 30 June 2024 is expected to be around the midpoint of the target range of 35% to 45%. The final audited valuations for individual properties will be available as part of Growthpoint's FY24 results, to be released on 22 August 2024. The company remains committed to sustainable operations and reducing its environmental impact, targeting net zero by 2025 across its on-balance sheet operationally controlled office assets and corporate activities.