Mirvac Group (MGR) H2 2024 earnings summary

Executive summary

• Achieved all strategic objectives for FY 2024, with Group EBIT up 12% to AUD 860 million and operating profit after tax of AUD 552 million, despite a challenging macro environment and higher interest expenses.

• Statutory loss of AUD 805 million due to AUD 1.1 billion in investment property devaluations, mainly in the office portfolio, offsetting strong operational performance.

• Maintained a strong balance sheet with gearing at 26.7% and available liquidity over AUD 1 billion at year-end.

• Executed AUD 1 billion in non-core asset disposals and raised AUD 1.6 billion from capital partnering, including major sell-downs of 55 Pitt Street and Aspect North & South.

• Continued focus on sustainability, diverting 96% construction waste from landfill and targeting net positive carbon by 2030.

Financial highlights

• Group EBIT up 12% to AUD 860 million; operating profit after tax at AUD 552 million, down 5% year-over-year.

• Statutory loss of AUD 805 million, driven by AUD 1.1 billion in investment property revaluation losses.

• EPS at AUD 0.14, down 5%; distribution per share flat at AUD 0.105.

• NTA per security at AUD 2.36, down 11% from FY23.

• Net financing costs increased due to higher average debt balances and rising cost of debt (4.7% to 5.5%).

Outlook and guidance

• FY 2025 expected to be a trough year with lower development earnings and residential margins temporarily below the 18%-22% range, mainly due to NSW and QLD apartment settlements.

• Earnings per security guidance for FY 2025 is AUD 12–12.30, with distributions per security of AUD 0.09, assuming over AUD 500 million in non-core asset sales and 2,000–2,500 residential settlements.

• Focus on capital partnering and maintaining cost of debt at approximately 5.6%.

• Positioned for future earnings growth with over AUD 90 million future NOI from committed developments and AUD 2.6 billion FUM growth underway.

• Recovery anticipated in FY 2026 and beyond, with margin normalization and increased residential sales volumes.