Full Year 2024 Region Re Ltd Earnings Call Transcript
Key Points
- Region Group (ASX:RGN) reported a strong portfolio occupancy rate of 98%, indicating high tenant retention and demand.
- The company completed a record number of leasing deals, totaling 552, with an average leasing spread of 4%, showcasing effective leasing strategies.
- Region Group (ASX:RGN) has a healthy balance sheet with $262 million in cash and undrawn debt capacity, providing financial flexibility.
- The company successfully issued a $300 million seven-year medium-term note (MTN) in February 2024, enhancing its capital management initiatives.
- Region Group (ASX:RGN) has a diversified portfolio with 92 centers across Australia, reducing geographic risk and enhancing stability.
- The weighted average cost of debt increased to 4.3%, impacting overall financial performance.
- FY24 funds from operations (FFO) per security decreased by around 9% compared to FY23, indicating a decline in profitability.
- Interest expenses increased by 29% due to higher debt costs, affecting net income.
- Leasing incentive costs rose by close to $2 million, reflecting higher expenses associated with securing tenants.
- Discretionary tenant sales growth was negative at -4%, indicating challenges in the discretionary retail segment.
Thanks very much and welcome to our FY24 financial results. My name is Anthony Mellowes. I'm the CEO. I'm presenting these results. With me today is Evan Walsh, our CFO. And also, in the room with me is Erica Rees, our Chief Legal and Investment Officer.
Firstly, let me take you to Slide 4, which sets out our FY24 highlights. Our funds from operations or FFO per security was $0.154 per security. Our adjusted funds from operation or AFFO, was $0.136 per security. The distribution per security was $0.137 per security and our statutory net profit after tax was $17 million. Our operational metrics remained strong.
Our portfolio occupancy of 98%, our average specialty leasing spreads were 4% and our comparable nondiscretionary MAT growth remained resilient at 4%. With respect to capital management, we divested $177 million worth of properties as part of our $200 million capital recycling program. We have $262 million of cash and undrawn debt capacity. Our pro forma gearing at 32.3% is at the lower end of our range and
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