Growthpoint Properties (GRT) H2 2024 earnings summary

Executive summary

• Distributable income per share and dividend per share both declined 10% year-over-year, mainly due to higher interest costs, with DIPS at 141.9cps and DPS at 117.1cps.

• Group property assets decreased by 2.8% to ZAR 174.7 billion, with loan-to-value (LTV) rising to 42% from 40%, driven by asset value write-downs, especially in Australia.

• Strong operational performance across all regions, with V&A Waterfront and international investments delivering standout results.

• Offshore assets constitute 42% of book value and 32.4% of distributable income, with Australia, Capital & Regional, and Globalworth as key international investments.

• ESG initiatives advanced, including a 195 GWh renewable energy power purchase agreement and ongoing solar installations, with 123 green buildings in the portfolio.

Financial highlights

• Distributable income per share and dividend per share both down 10% year-over-year, payout ratio maintained at 82.5%.

• Net property income rose 1% to ZAR 9.96 billion, but finance costs increased 16% to ZAR 4.39 billion, reducing distributable income to ZAR 4.8 billion, down 10.3%.

• Net asset value per share fell 6.1% to ZAR 20.20.

• Group LTV increased to 42% (SA: 34.6%, Australia: 39.8%, C&R: 43%).

• FFO per share down 11.5%, total borrowings up 0.9% to ZAR 69.9 billion.

Outlook and guidance

• Earnings expected to decline by 2%-5% in FY25 due to continued interest rate pressures and hedge roll-offs, with growth anticipated to resume in FY26.

• V&A Waterfront earnings growth to moderate to mid-single digits, impacted by major redevelopments.

• Australia and Globalworth expected to see further earnings declines, while Capital & Regional and fund management income remain stable.