Mirvac shares slide as development earnings miss expectations
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More news: Shares in Mirvac slid in afternoon trade after the property development group released its full-year earnings. UBS analysts highlighted that residential development earnings came in below their forecasts.
At 2:24pm AEST, shares in Mirvac had slipped 1.5% to $2.28.
UBS analysts said Mirvac’s residential development business EBIT for FY25 of $179 million, a 15.6% fall year on year, missed the bank’s estimated $192.8 million.
The analysts also flagged that commercial development EBIT of $46 million, a 68% decline year on year, also missed UBS expectations of $78 million.
Mirvac swings into full-year profit despite revenue slide
The news: Property development group Mirvac has returned to statutory profit in financial year 2025, after heavy losses in the previous year, as the group faced a significantly lower portfolio devaluations.
The numbers: Mirvac’s statutory profit for the year attributable to stapled securityholders was $68 million, a significant swing compared to the $805 million loss posted in financial year 2024.
Operating profit after tax however slipped 14% to $474 million year on year while total revenue and other income slid 10% to $2.74 billion.
The market consensus estimate for profit was $322.8 million, according to Visible Alpha data. For operating profit after tax it was $481 million.
Mirvac's saw investment property devaluations of $102 million, as its office sector assets offset gains in the industrial, retail and living sectors. In FY24, property devaluations were worth $1.1 billion, also driven by the office sector.
Mirvac has declared a final distribution of 4.5 cents. The record date was 30 June and is payable on 28 August.
The context: During the year, unconditional sales by Mirvac's residential business grew by 39% year on year with "$1.9 billion of residential pre-sales providing good visibility of future earnings", according to MIrvac CEO and managing director Campbell Hanan.
What they said: "We are beginning to see the benefit of our continued expansion into living sectors, with earnings up 184% on FY24, underpinned by strong fundamentals," Hanan said.
"There is significant potential for continued growth across our established platforms, where we can leverage our market leadership position and our long history in living to deliver much-needed housing product."
