Key highlights from Region RE's FY24 Results Presentation

Region RE (ASX: $RGN) presented its FY24 Results, showcasing a resilient portfolio with a healthy balance sheet and a record number of completed leasing deals. The company reported a distribution per security of 13.7 cps, representing a 101% payout of AFFO. Additionally, the portfolio occupancy stood at 98.1%, with a strong tenant retention of 83%. The company's pro forma gearing of 32.3% remains at the lower end of its 30-40% target range, reflecting a conservative balance sheet positioned for future investment.

Executive Commentary on FY24 Performance

Region RE's FY24 performance reflects the resilience of its portfolio metrics and the successful execution of its strategy. The company's focus on convenience-based retail centers and non-discretionary retail segments has contributed to the strong financial and operational performance. The increased hedging to 96% in FY25 and 82% in FY26 demonstrates the company's proactive approach to mitigating downside risk on financial performance. Furthermore, the establishment of a new fund (Metro Fund 2) and the acquisition of Cooleman Court at an implied initial yield of 6.73% highlight the company's commitment to growth through acquisitions and expansion of its funds management platform.

Outlook and Future Growth Strategy

Region RE's FY24 Results Presentation indicates a positive outlook, with the company's portfolio positioned to take advantage of market conditions. The company aims to achieve a Net Zero target by FY30 through operational decarbonization. Additionally, Region RE targets a growth rate of 3-4%+ pa in the medium to longer term. The company's key priorities include maintaining a disciplined approach to acquisitions and non-core divestments, exploring funds management growth, and investing in its centers to unlock potential. The outlook reflects a focus on continued investment in the portfolio, balanced with a disciplined approach to financial management and growth opportunities.