Dexus Industria (DXI) H2 2024 earnings summary

Executive summary

• Achieved FFO per security of AUD 0.174 (17.4 cps), up 1.7% year-over-year, in line with upgraded guidance, and maintained distributions of 16.4 cps.

• Portfolio value at $1.4bn, with 99.3% occupancy by income, 5.9-year WALE, and 53% of income CPI-linked.

• Divested AUD 135 million in assets, increasing industrial weighting to 89% and providing capital for development pipeline.

• Delivered 44,000 sq m of new developments and secured heads of agreement at Moorebank project.

• Maintained carbon neutral status for controlled assets, with 2.5 MW of solar installed and advanced sustainability initiatives.

Financial highlights

• FFO for the year was AUD 55.3 million, or AUD 0.174 per security, up 1.7% year-over-year, reflecting strong operating performance.

• Distributions were AUD 0.164 per security, with a payout ratio of 94.1%.

• Net tangible assets per security decreased by AUD 0.20 to AUD 3.24, mainly due to asset devaluations.

• Like-for-like property valuations declined by AUD 66.3 million (4.6%), with cap rates expanding by 58 bps to ~6%.

• Portfolio like-for-like growth of 7.8%, with 4.4% average rent review and 15.7% re-leasing spreads.

Outlook and guidance

• FY 2025 guidance: FFO per security of AUD 0.178 (17.8 cps, up 2.3%) and distributions of AUD 0.164, implying a 6% yield.

• Balance sheet flexibility retained to fund $250m development pipeline targeting 6.25%+ yields.

• Like-for-like NPI growth expected to moderate to mid-4% range due to lower inflation and less lease-up contribution.

• Expect look-through gearing to rise to ~29% post-committed pipeline spend.

• Focus remains on disciplined capital deployment, maintaining strong balance sheet, and targeting development yields above 6.25%.