Mirvac shares tumble as full-year loss widens
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The news: Shares in Mirvac Group have tumbled after the property developer reported a wider full-year loss on the back of devaluations in its office portfolio.
The numbers: The company reported a statutory net loss of $805 million for the year to June, compared to a $165 million loss a year ago. Excluding devaluations in its portfolio, operating profit was down 5% to $552 million. However, total revenue jumped 54% to $3.04 billion, while final distribution was at 6 cents a share.
Mirvac shares were down nearly 12% at $1.86 in early trading on the ASX.
The context: The group outlined plans to lower its holdings in the struggling office sector from 59% of total investments to approximately 40% in the long-term.
The company said it intends to boost capital invested in industrial and living spaces instead. CEO Campbell Hanan said the company delivered a solid operational and financial result in a tough environment.
Margins in the residential segment were affected by higher costs across apartment projects, and this is expected to continue throughout FY25, he said.
The company has outlined weaker FY25 guidance for operating earnings per security of 12.0 to 12.3 cents and distribution per security of at least 9 cents per share.
What they said: “Earnings are expected to be lower next year, reflecting the impact of a lower contribution from our development business and higher net interest costs related to development activities. This includes lower margins at selected Queensland and New South Wales apartments projects,” Hanan said.
The source: ASX announcement
