Vicinity Centres (VCX) H2 2025 earnings summary

Executive summary

• Statutory net profit after tax rose to $1,004.6m, up 83.6% year-over-year, driven by property valuation gains, strong operating performance, and strategic execution.

• Funds from operations (FFO) increased 1.4% to $674m, with adjusted FFO up 3.6% after accounting for one-off items and development-related rent loss.

• FFO per security reached 14.8 cents, at the top end of guidance, and the final distribution was 6.05 cps, totaling 12.00 cps for FY25, with a payout ratio of 95.4% of adjusted FFO.

• Portfolio repositioning continued, with a focus on premium assets, including the acquisition of 50% of Lakeside Joondalup for $420m and divestment of $460m in non-strategic assets.

• Major developments completed at Chadstone and Chatswood Chase, with Chadstone’s Market Pavilion exceeding expectations and Chatswood Chase redevelopment on track for staged opening in FY26.

Financial highlights

• Statutory net profit after tax: $1,004.6m (FY24: $547.1m), including $674m FFO and $331m from valuation gains.

• FFO per security: 14.79c–14.8c (top end of guidance); distribution per security: 12.00c, payout ratio 95.4% of AFFO.

• Comparable net property income (NPI) grew 3.7%, led by premium assets delivering 4.9% NPI growth.

• Retail sales increased 2.8% in FY25, with specialty and mini majors sales up 4.7% in 2H FY25 versus 2H FY24.

• Net tangible assets per security increased 10c to $2.40 over the year.

Outlook and guidance

• FY26 FFO per security expected in the range of 15.0–15.2c; AFFO per security $0.128–$0.13.

• Adjusted FY26 FFO guidance implies 2%–3.5% growth, with comparable NPI growth of ~3% (3.5% excluding new taxes/levies).

• Distribution payout ratio to remain within 95–100% of AFFO.

• Loss of rent from developments expected to decrease to $25m in FY26 and $15m in FY27.

• No asset recycling included in FY26 guidance, but opportunities will be considered as they arise.