Centuria Industrial (CIP) H2 2024 earnings summary

Executive summary

• Achieved FY24 Funds From Operations (FFO) of AUD 109.3 million or 17.2 cents per unit, meeting or exceeding upgraded guidance, with 6.5% like-for-like NOI growth and 43% average re-leasing spreads across 22% of portfolio GLA.

• Portfolio comprised 89 assets valued at AUD 3.8 billion, with 97.1% occupancy and a 7.6-year WALE.

• Divested four non-core assets for AUD 120 million at or above book value, with proceeds used to repay debt and support net tangible assets.

• Provided FY25 FFO guidance of 17.5 cents per unit and distribution guidance of 16.3 cents per unit, reflecting a third consecutive year of earnings growth.

• Distributions totaled 16.0 cents per unit, in line with guidance, and statutory profit was AUD 48.1 million, reversing a prior year loss.

Financial highlights

• Gross property income for FY24 was AUD 227.2 million, up from AUD 220.0 million in FY23; total revenue reached AUD 233.9 million.

• FFO increased to AUD 109.3 million (17.2 cents per unit), up from AUD 108.2 million (17.0 cents per unit) year-over-year.

• Statutory net profit was AUD 48.1 million, rebounding from a AUD 76.6 million loss in FY23, despite a AUD 37.9 million net loss on fair value of investment properties.

• Net tangible assets per unit at AUD 3.87, with total assets of AUD 3.88 billion.

• Pro forma gearing at 34%, with interest cover ratio at 2.9x and weighted average capitalisation rate (WACR) expanded to 5.81%.

Outlook and guidance

• FY25 FFO guidance set at 17.5 cents per unit and distribution guidance at 16.3 cents per unit, with distributions to be paid quarterly.

• 93% of debt hedged and no maturities until FY26; weighted average debt expiry of 3.3 years.

• Distribution payout ratio expected to trend toward 90% over time, currently at 93% for FY25.

• Management expects continued rental growth in industrial markets, though at a slower pace, and ongoing benefit from sector tailwinds such as ecommerce, onshoring, and data centre growth.

• Development pipeline of AUD 1 billion over five years, requiring AUD 400–500 million in funding, with multiple funding avenues available.