Dexus Convenience Retail (DXC) H1 2025 earnings summary

Executive summary

• Delivered resilient income growth with HY25 FFO of $14.3m (10.4 cps) and distributions of 10.3 cps, on track for FY25 guidance of 20.6 cps.

• Net profit after tax was $14.7m, reversing a $1.7m loss in the prior period, driven by $3.2m property valuation uplift.

• Portfolio comprises 91 assets valued at $709m, with 99.4% occupancy and 8.2-year WALE, 86% weighted to metro/highway locations.

• Active portfolio management included $38.8m of divestments and commencement of the fully pre-leased Glass House Mountains redevelopment.

• Like-for-like net operating income grew 2.8%, supported by fixed and CPI-linked rental escalators.

Financial highlights

• FFO of $14.3m (10.4 cps), down 1.0% year-over-year, mainly due to higher interest rates; distributions 10.3 cps.

• Net profit after tax of $14.7m, a turnaround from a $1.7m loss in HY24, driven by $3.2m property valuation uplift.

• NTA per security increased 0.3% to $3.57, supported by $3.2m net revaluation uplift.

• Gearing reduced to 28.7%, at the lower end of the 25–40% target range.

• Portfolio capitalization rate at 6.41%; portfolio value at $709m across 91 assets.

Outlook and guidance

• FY25 FFO and distributions guidance reiterated at 20.6 cps, implying a 7.3% distribution yield.

• Guidance supported by contracted rental increases and current interest rate expectations.

• Focus remains on income certainty, balance sheet flexibility, and value-adding developments, notably the Glass House Mountains project.

• Management expects incremental savings from debt facility cancellations to be realized in FY26.