Region Group shares dip as FY result falls short of estimates
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The news: Shares in Region Group dipped at market open after the shopping centre owner's full-year results fell short of analysts' forecasts, despite swinging to a statutory profit in FY24.
The numbers: Region recorded a statutory profit of $17.3 million, compared to a loss of $123.6 million a year earlier, as portfolio occupancy improved from 97.8% to 98.1%
However, adjusted funds from operations (AFFO) per share of 13.6 cents was down 11.1% year on year, and below consensus forecasts of 13.7 cents. Funds from operations (FFO) per share of 15.4 cents fell 8.9% and missed average estimates of 15.6 cents.
Its FY25 FFO and AFFO guidance of 15.5 cents per share and 13.7 cents per share came in below consensus expectations of 16 cents and 14.2 cents respectively.
Region, which operates 93 shopping malls across the country, also established a $393.9 million metro fund this month, and completed the $74 million acquisition of Cooleman Court in Canberra.
Shares were down 1.3% to $2.22 by 10:35am AEST.
The context: The company said it remains "focused on executing our core strategy of delivering defensive, resilient cashflows to support secure and growing long-term distributions to our security holders".
Jarden analysts said that Region's FY24 result and initial FY25 guidance are "slightly below" consensus expectations "despite steady operating metrics".
What they said: "It is good to see [Region] being more preactive with an accretive acquisition and the establishment of a second $394 million metro fund," the Jarden analysts said.
"The stock has underperformed over the last six to 12 months and the risk-reward looks good to us in the medium term but we don't see this result as a major catalyst."
The sources: ASX announcement, Jarden research
