Cromwell Property Group (CMW) H1 2025 earnings summary

Executive summary

• Completed sale of European platform and co-investments in December 2024, generating €274.1 million ($456.7 million) in proceeds and simplifying operations.

• Net debt reduced by 66% since 2021/2022 to $645.7 million, with gearing at 29.1%, below the target range.

• Assets under management now $4.5 billion, with a focus on Australia and New Zealand.

• Portfolio occupancy increased to 95.8%, with 68% of income from government tenants and Qantas.

• Positioned for growth with capital flexibility and a capital-light investment management strategy.

Financial highlights

• Statutory loss for HY25 was $28.6 million, a significant improvement from $271.4 million loss in HY24, mainly due to $99 million investment portfolio revaluation loss and $31.6 million in derivative losses.

• Underlying operating profit was $55.1 million (2.10 cps), down 34.4% year-over-year due to non-core asset sales.

• Net tangible assets per security declined from $0.61 to $0.57.

• Distributions of 1.5 cps (payout ratio 106.4% of AFFO); AFFO at $36.9 million.

• Liquidity increased to $538.5 million, with interest rate hedging at 99.7%.

Outlook and guidance

• No OEPS guidance provided due to ongoing capital deployment flux; board to review guidance at year-end.

• Distributions for March 2025 quarter expected at 0.75 cps.

• Focus on organic and inorganic funds management growth, leveraging strong capital position.

• Strategy centers on being an Australian capital-light investment manager targeting multiple investor segments.

• Market conditions remain challenging with higher interest rates and subdued property transaction volumes.