Charter Hall Group (CHC) H2 2024 earnings summary

Executive summary

• FY24 operating earnings per security (OEPS) of AUD 0.758 (post-tax $358.7m), slightly ahead of guidance but below FY23 due to asset devaluations and higher interest expenses.

• Group FUM declined from AUD 87.4bn to AUD 80.9bn, mainly from cap rate softening, devaluations, and divestments, partially offset by AUD 1.3bn in development completions.

• Distributions grew 6% year-over-year to 45.1c per security, with 13.1c franking credits distributed.

• Strong balance sheet with 3% gearing, $6.6bn investment capacity, and NTA per security at $5.49.

• Group EBITDA margin expanded to 79.3%, reflecting platform scale and cost control.

Financial highlights

• PI EBITDA up 9.1% to $271m, driven by high occupancy, rent increases, and net investment.

• Development EBITDA at $36.4m, in line with prior year.

• Funds management income down 27.7% due to lower transaction/performance fees.

• Statutory earnings: -$222.1m due to portfolio devaluations and non-operating items.

• Distribution per security rose to 45.1c, payout ratio at 59%.

Outlook and guidance

• FY25 guidance: post-tax OEPS of ~79c (4% growth) and 6% distribution growth, assuming stable market conditions.

• No performance fees included in FY25 guidance; cost restructuring benefits and asset value stabilization expected.

• Management anticipates increased capital deployment as market conditions improve and interest rates decline.