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E-commerce to fuel Goodman earnings

AAP logoAAP 10/08/2016 Prashant Mehra

Warehouse and office developer Goodman Group has met its upgraded full year earnings guidance and forecast a steady improvement in earnings and dividends for fiscal 2017 on the back of strong demand for logistics space and growth in e-commerce.

The company said net profit for the year ended June 30 rose 5.5 per cent to $1.27 billion, helped by revaluation of its properties and gains from derivatives and foreign currency items.

Excluding these one-off items, operating profit increased 9.3 per cent to $714.5 million.

The group reported operating earnings per security of 40.1 cents, in line with the revised guidance from February, and dividend of 24 cents a security, also as expected.

Goodman said it is betting on strong demand from e-tailers expanding their networks and customers focusing on operational and supply chain efficiencies.

"We continue to focus on improving the quality of our properties and income, capitalising on the strong demand for modern, well-located logistics space," Chief executive Greg Goodman said.

Goodman, which owns and manages properties across the world, has cashed in on asset sales over the last few years to exploit strong global investor demand for industrial assets, and has then poured the proceeds back into development or to cut debt.

The group's overall strategy will remain the same but asset sales will be at a slower pace as it focuses on building a strong development business, Mr Goodman said.

For the current financial year, the company has forecast a six per cent growth in EPS and dividends to 42.5 cents and 25.4 cents respectively.

At 1130 AEST, Goodman shares were up 0.2 per cent to $7.42 each.

GOODMAN MEETS EARNINGS GUIDANCE

* Operating profit of $715 mln, up nine pct on year.

* Statutory net profit of $1.27 bn, up 5.5 pct

* Earnings per security of 40.1 cents, up 7.8 pct.

* Distribution per security of 24 cents, up eight pct.

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