Rural Funds Group (RFF) H1 2025 earnings summary

Executive summary

• Net property income rose 17% year-over-year, driven by new leases, higher rents from macadamia orchards, and rental indexation.

• AFFO and distributions met forecasts, with full-year guidance reaffirmed; AFFO rose to $22.3m from $15.5m year-over-year.

• Asset divestments totaling $54.9m–$55m were completed to manage gearing, with further sales planned.

• Eight properties leased, WALE maintained at 13 years, and leasing activity accelerated.

• Adjusted NAV per unit at 31 December was $3.10, down from $3.14 at June 2024, mainly due to interest rate swap revaluations.

Financial highlights

• Net property income from leased assets increased by $7m to $45.5m, mainly from macadamia orchard leases.

• AFFO per unit increased to 5.7–5.73 cents from 4.0–4.02 cents year-over-year.

• Distributions paid during the half totaled 5.87–8.8 cents per unit, in line with guidance.

• Adjusted total assets were $2,043.9m, with net assets at $1,064.5m at 31 December 2024.

• Net profit after tax was $12.1m, down from $43.8m in the prior year, mainly due to lower property revaluations and derivative movements.

Outlook and guidance

• Full-year AFFO forecast reaffirmed at 11.4–11.73 cents per unit, a 4% increase on FY 2024.

• Distributions for FY 2025 and FY 2026 forecast to remain steady at 11.73 cents per unit.

• Asset sales to continue, targeting a gearing range of 30%-35%.

• Second half farming income expected to be stronger due to upcoming harvests.

• Strategic priorities include macadamia development, new leasing, and growth in agricultural industries.