DEXUS (DXS) H2 2025 earnings summary

Executive summary

• Delivered FY25 AFFO of $483.9 million (45.0 cents per security), meeting guidance, with distributions of 37.0 cents per security and an 82.2% payout ratio.

• Statutory net profit after tax was $136.1 million, a turnaround from a $1,583.8 million loss in FY24, driven by stabilizing capitalisation rates and lower fair value losses.

• Maintained high occupancy: 92.3% in office and 96.2% in industrial, with rent collections at 99.6%.

• Funds management platform managed $35.6 billion, with flagship funds outperforming benchmarks and global sustainability recognition.

• Balance sheet strength maintained with gearing at 31.7% and $3.0 billion in headroom.

Financial highlights

• AFFO declined 6.3% year-over-year to $483.9 million, with a distribution payout of 82.2%.

• Office FFO declined 1.1% and industrial FFO fell 9.2% year-over-year, mainly due to divestments and lower one-off income.

• FFO from management operations rose to $155 million, driven by over $40 million in performance fees and cost savings.

• Net finance costs increased 11.3% year-over-year, reflecting higher interest rates and cessation of capitalized interest.

• Portfolio value declined 1.1% for the year, but second-half valuations increased 0.4% for Office and 1% for Industrial.

Outlook and guidance

• FY26 AFFO expected at 44.5–45.5 cents per security, with distributions of 37.0 cents per security.

• Growth anticipated in industrial FFO, offset by lower office FFO and higher finance costs.

• Office occupancy expected to dip toward 90% before recovering; industrial occupancy to benefit from strong leasing momentum.

• Maintenance and leasing CapEx for FY26 projected to be in line with FY25, with a shift toward industrial.

• Management anticipates a positive market cycle, with fundamentals driving the next phase and a strong platform for future growth.