Frasers Property Limited reports FY22 results

Financial highlights

Locally in Australia, Frasers Property Australia achieved a profit before interest and tax (“PBIT”) of S$80.8 million (A$83.0 million). Key highlights for Frasers Property Australia include:

• In FY22, ~1,500 residential units were released for sale and 1,593 were sold.
• 1,377 residential units were completed and settled in FY22.
• A$1.3 billion (S$1.2 billion) in unrecognised revenue as at 30 September 2022.
• A ~252-hectare site in New Beith, QLD, was secured in 1H FY22 and settled in October 2022.
  The site is expected to yield ~2,150 lots.
• Residential development pipeline comprises ~13,200 units as at FY22
• Largest sales contributors in FY22 include Five Farms, VIC (221 units); The Grove, VIC (219 units); Mambourin, VIC (215 units); Brookhaven, QLD (185 units); Berwick Waters, VIC (141 units); Ed.Square, NSW (106 units); and Wallara Waters JV, VIC (95 units).
• The ~A$3.0 billion Central Place Sydney project received Development Application approval in October 2022. Frasers Property Australia and Dexus are joint venture partners in the development, which is a key component of the NSW Government’s Tech Central innovation precinct.
• Investment portfolio of S$1.9 billion (A$2.1 billion) with a weighted average lease expiry of 4.4 years and occupancy at 73.9%. Rhodes Corporate Park, NSW, is being repositioned to enhance competitiveness. Office portfolio metrics depressed due to the strategic Lee Street tenancy relocation for the upcoming redevelopment into Central Place Sydney.
• In retail, positive operating trends continue post the easing of lockdown restrictions during 1H FY22 and improved AOR reflects successful leasing efforts and improved operating environment. Eastern Creek Quarter Stage 2 (ECQ XL) in NSW opened in June 2022 (NLA: 11,305sqm) almost fully-leased, boosting retail portfolio metrics.
• Frasers Property Australia’s in-house licensed energy retailing business Real Utilities has embedded networks and 7,365kW of solar PV installed across 16 projects to date now serving ~1,878 customers.

Anthony Boyd, Chief Executive Officer, Frasers Property Australia says the FY22 result demonstrates the resilience of the business, underpinned by a broad product offering and strong value proposition, amid interest rate and inflationary headwinds.

“Our full-year result is a story of diligence and hard work from a great team working on great projects. Our focus on designing and delivering quality to meet market expectations, enhanced by connectivity and the sense of belonging achieved through complementary amenity and community building initiatives, continues to resonate with customers,” Mr Boyd says.

“This broader quality offering is reflected in our strong pre-sales which will underpin future performance and provide a buffer against market challenges. We have also made progress in the stabilisation of our retail assets and repositioning of our commercial assets maintaining the same quality focus.

“Competing pressures in the market will continue to impact confidence in the short to medium term. On one hand, rising interest rates and inflation are affecting affordability and business confidence, while on the other hand immigration is switching back on strongly, exacerbating the supply shortage and putting further pressure on residential rental vacancies, which are already at record lows.

“COVID impacts such as supply chain pressure and materials costs continue to be a factor, with inclement weather also impacting construction programs in FY22.

“Nevertheless, in any market, customers deserve value and expect quality. Our high number of residential contracts on hand and strong leasing enquiry points to a positive future and reinforces our belief that a focus on quality and the right overall offer, encompassing connection, community and amenity, will continue to underpin value for customers and generate sales and leasing activity, even through market cycle shifts.” Mr Boyd says.

Read Frasers Property Limited’s FY22 media release here.

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Trudy Wise
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