Region Group (RGN) H2 2025 earnings summary

Executive summary

• Returned to earnings growth with FFO of AUD 0.155 per security and AFFO of AUD 0.137 per security, both in line with guidance.

• Statutory net profit after tax surged to AUD 212.5 million, driven by valuation growth and resilient operational metrics.

• Distribution was AUD 0.137 per security, representing a 100% payout ratio.

• Portfolio occupancy remained high at 97.5%, with a strong focus on non-discretionary tenants and proactive leasing.

• CEO Anthony Mellowes announced intention to retire at the end of May 2026.

Financial highlights

• Statutory profit for the year was AUD 212.5 million, up from AUD 17.3 million in the prior year due to increased property valuations.

• FFO grew 0.6% year-over-year; comparable NOI increased by 3.2%.

• NTA per security rose to AUD 2.47, supported by an 8.7% increase in total assets under management to AUD 5.2 billion.

• Weighted average cost of debt stable at 4.3%; gearing at 32.5%, at the lower end of the target range.

• Property income rose 1.9% to AUD 390.6 million; net operating income up 1.0% to AUD 253.8 million year-over-year.

Outlook and guidance

• FY 2026 FFO guidance is at least AUD 0.159 per security, underpinned by 3.3% comparable NOI growth and accretive transactions.

• AFFO guidance for FY 2026 is at least AUD 0.14 per security.

• Targeting medium to longer-term FFO and AFFO growth of at least 3%-4% per annum.

• Distribution payout ratio expected at ~90% of FFO and ~100% of AFFO.

• Weighted average cost of debt expected to rise to 4.6% in FY 2026.