The two Westfield shopping mall companies revealed 2013 full year results in line with previous guidance this morning.
Westfield Group (WDC) has delivered an after tax profit of $1.6 billion for the full 2013 year, down 6.7% on 2012.
However one of the key measures used by the company, Funds From Operations per security was up 2.3% on a target of 66.51 cents.
The Group said the distribution for the 12 months was $1.08 billion, or 51.0 cents per security, an increase of 3.0% and also in line with forecast. Return on contributed equity for the year was 11.8%, up from 11.4% in 2012.
Westfield Group Co-CEOs, Peter Lowy and Steven Lowy AM said in this morning’s statement: “We are pleased with the results for the year which reflect the solid performance of the portfolio with each market showing high productivity with growth in specialty sales and comparable net operating income.
“Our focus is on creating and owning world leading retail destinations," the duo said in the statement.
"During the year we successfully continued the strategic repositioning of the Group by divesting non-core assets, introducing further joint ventures, investing in our development activity and announcing the acquisition of the remaining 50% interest in the Westfield World Trade Center in New York. Our business is in a strong position in each of the markets we operate.”
The Group said net property income for the year was $2.0 billion, consistent with the prior year. "Adjusting for the asset divestments during 2012 and 2013, net property income increased 8%," the company said.
Management fee income for the 12 months increased by 9% to $140m and project income increased 5% to $204m.
For the 12 months, comparable property net operating income in the United States was up 4.7%, the United Kingdom up 4.3% and Australia up 2%.
The 50% owned Westfield Retail Trust (WRT) also revealed its 2013 results this morning and a profit after tax of $777.1 million or 25.85 cents per stapled security.
WRT operates in Australia and NZ, managing the Westfield malls in both countries.
WRT said Funds from operations (FFO) were $596.8 million representing 19.85 cents per stapled security, up 2.5% and in line with forecast.
The full year distribution of 19.85 cents per stapled security, up 5.9%, was also in line with forecast.
WRT said that for the 2014 year it’s forecasting funds from operations (FFO) of 20.4 cents per stapled security representing a 2.8% increase on the 2013 level. The distribution payout for 2014 is forecast to be 100% of FFO, or 20.4 cents per stapled security.
"The 2014 forecast assumes comparable net operating income growth of 2.0% to 2.5% for Australia and no material change in the current operating environment. It excludes the impact of the merger proposal or any future capital transactions," WRT said.
WRT directors said that Comparable retail sales rose 1.7% in Australia and but fell 0.7% in New Zealand last year. But there was a noticeable improvement in the December quarter with comparable specialty sales growth of 3.0% in Australia and 0.6% in New Zealand in the December quarter.
WDC Vs WRT 1Y – Westfield companies did well in 2013
Both groups again strongly supported the proposed restructure of the Westfield Group that was revealed at the end of 2013, but which has run into opposition from some holders of WRT securities.
As part of that proposal, WDC’s Australia/NZ business will merge with Westfield Retail Trust to form Scentre Group. WDC’s international business will become Westfield Corporation. The proposal is subject to the approval of both WDC and WRT securityholders.
“WDC’s international business and its Australian/NZ business have both grown in scale and quality to the stage where they can now stand on their own. We believe that the restructure positions the new entities for better growth and thereby provides securityholders of both WDC and WRT with better long term returns,” Peter Lowy said in this morning’s statement.
The proposal has the unanimous support of the WDC Board and the independent directors of WRT. Consistent with the timetable outlined in December 2013, the Explanatory Memorandum is expected to be available in late April 2014 ahead of the securityholders meeting to consider the proposal which is expected to be held in late May 2014.
There will be more on this issue later in the day at company briefings with analysts and shareholders.
