Dexus Industria (DXI) H2 2024 earnings summary

Executive summary

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

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

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

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

• Statutory net loss after tax of $11.8 million, driven by net fair value losses on investment properties and derivatives.

Financial highlights

• FFO for the year was $55.3 million, or 17.4 cents per security, reflecting strong operating performance.

• Distributions were 16.4 cents per security, with a payout ratio of 94.1%.

• Net tangible assets per security decreased by 20 cents (5.8%) to $3.24, mainly due to asset devaluations.

• Like-for-like property valuations declined by $66.3 million (4.6%), with cap rates expanding by 58 bps to 5.98%.

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

Outlook and guidance

• FY25 guidance: FFO per security of 17.8 cents (AUD 0.178), up 2.3%, and distributions of 16.4 cents, implying a 5.7–6% yield.

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

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

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

• Minimal near-term lease expiries and favorable market dynamics with low industrial vacancy and restricted supply.