Yet another property group appears to be in trouble.
APN Property Group (APD) said on Thursday it expects to book a lower net profit in fiscal 2008 – a move that will bring further investor nervousness amidst the already damaged property sector.
The group, which specialises in the management of property funds, expects net profit to fall between $9.5 and $11 million based on the current market conditions.
The company posted a net profit of $17.4 million in the previous financial year.
In its forecast assumptions, the group said it generates a substantial share of its revenue from management fees which are based on the value of its managed funds at the end of each quarter.
“However the current market climate, particularly in respect of listed property securities, makes reliable assessment of fees for the final quarter difficult,” APN said.
APN property group listed on the Australian Securities Exchange in June 2005, after raising $31 million from its initial public offering. It allotted 31 million shares at $1 each.
Since the listing, APD’s share price had surged to reach a high of $3.90 in February 2007. However, the price has not weathered the volatility well with the price plummeting to an all time low of 79 cents just four days ago.
The overall property sector has been damaged with the high profile fallouts from the likes of Centro, MFS and Allco.
Shares in the fund ended nearly 10% or 9 cents down at 85 cents.
