CVC (CVC) H2 2024 earnings summary

Executive summary

• Reported a net loss after tax of $2.5m for FY24, compared to a $13.4m profit in FY23, driven by a 76% decline in total income and limited property divestments.

• Net assets to shareholders were $173.5m ($1.49 per share), down 4% year-over-year, with statutory asset values understating independent property valuations by ~$1.13 per share post-tax.

• Fully franked dividends paid totaled 5.0 cps, down from 9.0 cps in FY23; no final dividend declared for FY24 to preserve capital.

• The company is transitioning its investment book to focus solely on property, emphasizing capital protection, value creation, and risk management.

Financial highlights

• Total income fell 76% to $23.6m (FY23: $100.2m); reported net loss after tax was $2.5m, with underlying NPAT a loss of $4.7m.

• Net assets per share at 30 June 2024 were $1.49, excluding an estimated $1.13 per share in non-statutory asset value uplift from independent property valuations.

• Cash and equivalents at period end totaled $14.0m, down from $51.2m; fair value of corporate note was $30.3m.

• Property investments contributed $6.7m (down from $24.7m in FY23), while non-property investments contributed a loss of $2.9m (down from a $5.8m gain in FY23).

• Earnings per share was a loss of 2.15 cents (FY23: profit of 11.49 cents); net tangible assets per share decreased to $1.49.

Outlook and guidance

• Focus remains on unlocking value in the direct property portfolio, with significant upside over current book value.

• FY25 objectives include formalizing rezoning outcomes for major NSW projects, achieving planning milestones for Officer South and Donnybrook, and completing subdivision works at Burleigh Waters.

• Gradual exit from non-property investments and ongoing management of property-backed lending portfolio.

• Board remains committed to dividends aligned with profitability but cannot provide FY25 forecasts due to transactional nature of operations.

• Management sees opportunities in property but notes ongoing macroeconomic weakness and challenging planning environment.