Lifestyle Communities (LIC) H2 2024 earnings summary

Executive summary

• Achieved 375 new home sales and 311 settlements, the fourth highest in company history, despite challenging Victorian market conditions and declining consumer confidence in FY 2024.

• Ended the year with 3,860 sold homes under management across 24 communities, with a total portfolio and pipeline of 6,563 homes.

• Raised AUD 275 million through a fully underwritten rights issue to pay down debt, strengthen the balance sheet, and support future growth.

• Revenue from community management rose 16% to $54.7m, supported by increased annuity income streams.

• New land acquisitions included sites at Clifton Springs, Yarrawonga, Inverloch, Clyde, and Armstrong Creek.

Financial highlights

• Operating profit after tax fell 25.7% to $52.9m, down from $71.1m year-over-year, due to lower settlements and higher marketing costs.

• Community management revenue increased 16% to $54.7m, while operating earnings per share dropped to 48.1 cps from 68.1 cps.

• Net assets rose to $831.8m (up from $524.9m), and net debt reduced to $319.9m.

• Full year dividend was 10.5 cps (down from 11.5 cps), with a final fully franked dividend of 5.0 cps declared for FY24.

• Asset fair value adjustments from independent valuations were -AUD 4 million in FY 2024, compared to AUD 15 million in FY 2023.

Outlook and guidance

• Withdrawing forward-looking guidance due to market uncertainty and the impact of recent negative media coverage.

• Focused on strengthening the balance sheet, optimizing resourcing, and right-sizing the business to match expected demand.

• Monitoring sales performance closely and adjusting build rates, land acquisition, and marketing spend as needed.

• 348 new home deposits on hand; 228 homes to settle in FY25, 120 in FY26.

• Independent expert to review sales process and disclosures to restore trust after recent media scrutiny.