HomeCo Daily Needs (HDN) H1 2025 earnings summary

Executive summary

• Achieved strong top-line revenue growth and FFO per unit of 4.3 cents in 1H FY25, with DPU up to 4.3 cents and profit rebounding to $116.8 million, driven by fair value gains and lower unrealised losses.

• Portfolio value reached $4.8bn–$4.9bn, diversified by subsector, tenant, and geography, with >99% occupancy and >99% rent collection.

• Strategic asset recycling included $250m in disposals and $200m in acquisitions focused on high-growth metro and daily needs assets.

• Robust development pipeline exceeds $650m, with $75m of pre-committed projects commenced in 1H FY25 targeting ~7%+ ROIC.

• Sustainability initiatives advanced, including solar PV at 31 sites and a 4.2 Star NABERS Energy rating portfolio average.

Financial highlights

• Property NOI grew to $142.2m in 1H FY25, up 4% YoY, with comparable NOI growth of 4% and leasing spreads of 6.1%.

• FFO was $89.9m (4.3 cents per unit), flat YoY, with DPU at 4.3 cents, up from 4.2 cents.

• Net tangible assets per unit increased to $1.45, up 1% from June 2024, supported by asset revaluations.

• Gearing at 34.6% pro-forma (36.0% reported), within the 30-40% target range; 80% of debt hedged until FY26.

• Occupancy and rent collection both above 99%.

Outlook and guidance

• FY25 FFO guidance reaffirmed at 8.8 cents per unit (+2.3% YoY) and distributions at 8.5 cents per unit (+2.4% YoY).

• Targeting $100-120m in FY25 development commencements at ~7% ROIC.

• Expectation to maintain sector-leading leasing spreads of 5-6% in the short to medium term.