DEXUS (DXS) H2 2024 earnings summary

Executive summary

• Delivered FY24 results in line with guidance, maintaining high occupancy in office (94.8%) and industrial (96.8%) portfolios, and strong cash flows with AFFO of $516.3 million.

• Statutory net loss after tax of $1,583.8 million, mainly due to $1,901.6 million in property revaluation losses and one-off items.

• Completed integration of AMP Capital's domestic infrastructure and real estate business, expanding the funds management platform.

• Continued capital recycling with $1.7 billion of divestments in FY24, supporting a strong balance sheet and gearing at the low end of the 30-40% target range.

• Refined strategy and updated distribution policy for FY25 to support sustainable growth and co-investment.

Financial highlights

• AFFO of $516.3 million, down 7.0% year-over-year; AFFO per security 48.0 cents, with distributions matching at 48.0 cents per security.

• Portfolio valuation declined by $1.9 billion (12.9%) over 12 months, with office down 15.6% and industrial down 3.3%.

• Net tangible asset (NTA) per security fell to $8.97, down from $10.88 at June 2023.

• Management operations FFO up 26.6% to $142.6 million, driven by AMP Capital acquisition and performance fees.

• 92% of debt hedged in FY24, with weighted average debt maturity of 4.8 years and $2.5 billion in cash and undrawn debt facilities.

Outlook and guidance

• FY25 AFFO expected at 44.5–45.5 cents per security, with distributions of 37.0 cents per security.

• Distribution policy updated to pay out 80%-100% of AFFO, supporting sustainable growth and capital deployment.

• Higher debt costs and full-year impact of valuation declines and divestments to weigh on FY25 results.

• Focus on co-investment in industrial, infrastructure, and alternative sectors, with retained earnings invested in high-returning strategies.

• Guidance subject to no material deterioration in market conditions.