Australia’s largest listed commercial and industrial property group, Goodman Group (ASX: GMG), has today released their results for the half year ended 31 December 2022.
The Company achieved an operating profit of $877 million, an impressive 11.5% increase from the first half of FY22. They increased their operating earnings per security (OEPS) to 46.4 cents, up 10.7% from last year. In addition, their statutory profit hit $1,097 million, whilst achieving revaluation gains of $1,276, across the Group and Partnerships.
In response, Group Chief Executive Officer, Greg Goodman said, “Goodman Group’s fundamentals remain strong and are withstanding the varied economic conditions we’re seeing around the world. Our $13.9 billion development workbook, combined with almost zero vacancy, rental growth, and increased assets under management to almost $80 billion, have produced solid results for 1H23. We expect this to continue to play out for the rest of the year, subsequently we upgraded our earnings guidance to 13.5% operating earnings per share growth for FY23.
“We’re experiencing unprecedented rental growth in some of our markets. North America is seeing possible rent reversion to the market of almost 60%, while rents in Australia are increasing by around 25%. There is more demand than there is supply, and developments are taking longer in planning which is adding to the supply crunch. We’re seeing a resettling of values take place from the overly exuberant values of the last 12-18 months. However, rental growth should offset the effect of expanding cap rates in our markets.”
In addition, Winston Sammut, Investment Manager at Sequoia Financial Group (ASX: SEQ), stated, “Goodman Group (GMG) delivered a strong result for the 6 months to December 2022. The balance sheet remains sound with balance sheet and look through gearing of 9.7% & 20.7%, whilst GMG has upgraded its FY23 EPS guidance to +13.5% (from +11%), this is on the conservative side with prospects of a better outcome. Although leasing was marginally weaker, occupancy rose to 99.0%.”
The release is closely followed by the news that Goodman Group has begun construction at Australia’s biggest warehouse, a 115,000 square foot behemoth, that is located in the west of Melbourne, for wholesale distribution and marketing company, Metcash.
