Lendlease shares slide after posting half-year loss results
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The news: Property developer Lendlease has posted a half-year loss on the back of lower property valuations and hefty redundancy costs.
The numbers: The company reported a $136 million loss for the six months to December 2023, compared to a $141 million loss a year ago. Revenue was down 5% to $4.92 billion, and it also lowered its return on equity guidance for the full year to 7% from 8% previously.
Lendlease shares slumped nearly 15% to $6.41 in early trading on the ASX.
The context: The developer attributed the weak results to the impact of property revaluations and redundancy costs as it looks to simplify its business. Its first half was marked by the $1.3 billion sale of 12 housing estates to Stockland as well as deep cost cutting which saw it lay off hundreds of employees, which racked up $56 million in redundancy costs.
The company has further cut back operations by exiting construction on the west coast and central operations in the United States. It had funds under management of $48 billion while development work-in-progress stood at $20.8 billion. It expects core operating earnings to improve in the second half but cited the lower certainty of deal timing and higher execution risks while cutting its full-year outlook.
The source: ASX announcement
