Charter Hall half-year profit boosted by property valuation gains

Property developer and funds manager Charter Hall Group announced operating earnings of 15 cents per security in the six months to December-end, a rise of 9.5 percent from the previous comparable period, and raised its outlook for FY 16.

The company made a statutory profit after tax of $143.5 million, up 259.6 percent from pcp, helped by $89 million in property valuation gains.

Operating earnings rose 26.3 percent to $61.2 million over the comparable period. The group made property deals worth $1.7 billion, and grew its funds under management to $15.9 billion, a 17 percent rise.

“Given volatility across global equity markets, we expect quality property with secure cash flow to remain highly attractive to both institutional and retail investors. We will continue to focus on portfolio security by investing in assets with strong tenant covenants and long lease durations delivering sustainable income and capital growth for securityholders,” Charter Hall’s managing director and group CEO David Harrison said.

The company increased its distribution of 13.3 cents per security, up 9.9 percent over pcp and raised its operating earnings outlook for FY16 to 8-10 percent growth over FY15.

Charter Hall focuses on two key earnings streams; property investment income generated from investing alongside its capital partners in property funds and partnerships and earnings generated from property funds management.

The group focuses on office, retail, industrial and hospitality.

Charter Hall $15.9 billion property portfolio had a total occupancy of 98.1 percent and a stable WALE (weighted average lease expiry) of 7.9 years. This followed 283 leasing deals, including new ones with Target and The Reject Shop in Melbourne, and Amazon Corporate Services and Twitter in Sydney.