Abacus Storage King (ASK) H1 2025 earnings summary

Executive summary

• Statutory net profit after tax for HY25 was $67.8 million, a significant increase from $0.4 million in HY24, driven by strong income growth, portfolio expansion, and resilient operating performance.

• Funds from operations (FFO) rose 15.1% year-over-year to $43.3 million, with FFO per security at 3.3 cents.

• Distribution per security increased 18.6% year-over-year to 3.1 cents, with full-year guidance reaffirmed at 6.2 cents per security (90%-100% FFO payout).

• Total assets rose to $3.3 billion, with over 1.2 million sqm of prime real estate and more than 200 stores across Australia and New Zealand.

• Multi-pronged growth strategy includes acquisitions, developments, and platform enhancements.

Financial highlights

• Revenue per available square metre (RevPAM) grew 5.4% to $339psm, with average rent per sqm up 4.4% to $373psm and occupancy at 91.0%.

• Operating margin was 63%, down from 66% in HY24 due to higher land tax and insurance costs.

• Portfolio value increased by $37 million (1.2%) for the half, with NTA per security up 1.3% to $1.60.

• Gearing at 29.0%, within the revised 25%-40% target range, and funding capacity of approximately $600 million.

• Weighted average cost of debt was 4.0%, with 77% of drawn debt hedged and average debt maturity of 2.6 years.

Outlook and guidance

• Affirmed FY25 distribution guidance of 6.2 cents per security, targeting a payout ratio of 90%-100% of FFO.

• Confident in capacity to fund developments and acquisitions for the next two years with current liquidity.

• Guidance assumes no material deterioration in current business conditions.

• Portfolio expected to benefit from organic growth, sector maturation, acquisitions, and platform initiatives.

• Margins forecast to improve in 2H FY25 as revenue growth outpaces cost increases.