Goodman Property lifts distribution; value drop wipes out net income

Thursday 14th May 2009

Goodman Property Trust lifted its annual distribution to shareholders after refinancing debt and selling assets.

The trust posted a full-year net loss after taking account of a drop in the value of its portfolio.Cash distributions rose 1% to 10 cents a unit, with a final payment of 2.47916 cents, it said in a statement.

The trust wrote down the value of its investment and development assets by $172.8 million, or 10.3%, to $1.5 billion, resulting in a net loss of $74.1 million in the year ended March 31, from a year-earlier profit of $99.3 million. NTA fell to $1.06 per unit.

“Mitigating the risks around debt refinancing and prudent capital management have been a key focus of 2009,” said Jim McLay, chairman of the trust’s manager. “GMT has maintained a strong financial position at a time when corporate balance sheets are under pressure and access to debt funding is more restricted than in the past.”

GMT refinanced $902 million of debt facilities and net borrowings less pending settlements made up 35.3% of property assets, below the banking covenants on its main debt facility of 45.0%. The refinancing resulted in increased interest costs.

The trust forecast 2010 operating earnings of 9 cents to 9.5 cents per unit.

The trust’s units rose 2.5% to 82 cents. In the past 12 months they have fallen 42%, lagging behind the NZ Property Group Index’s 30% decline.

The distributable profit rose to $83.8 million from $68.7 million a year earlier, reflecting a full-year contribution from GMT’s investment in Highbrook Development Limited.

The trust sold $50.6 million of assets with a further $57 million under conditional contract, it said. Current gearing was 35.3% and interest cover ratio was 3.2 times. Rents rose 5.4% and the trust has a 96% occupancy rate and 5.9 year average lease term.

Businesswire.co.nz

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