Macquarie Goodman Full Year Results
MGP is pleased to announce its full-year results to 31 March 2005 to the NZX this morning. Please find details of this release below and attached.
Macquarie Goodman Property Trust recorded a tax paid profit of $17.7 million for the year ended 31 March 2005 , compared with $8.1 million over the same period last year.
This figure excludes portfolio revaluations which added $10.1 million to the value of the portfolio, bringing total net profit after tax to $27.8 million.
The net operating surplus after tax includes a $4.1 million gain primarily from the sale of South City Shopping Centre. This year’s tax charge of $2.1 million also compares with the $5.2 million paid during the 2004 financial year, which included a one-off charge of $3.8 million due to a depreciation write-back from the sale of three properties, and the subsequent transfer of 53% of MGP ’s properties to MGQ.
MGNZ is also pleased to advise that the net operating surplus before tax of $19.815 million compares favourably with the projection of $19.644 million included in the Investment Statement and Prospectus dated 7 March 2005 .
Gross distributions of 9.3 cents per unit were paid to unitholders as well as one-off imputation credits to the value of 2 cents per unit. This lifted total gross distributions in 2005 to 11.3 cents per unit. MGP is projected to produce a gross distribution of 9.86 cents per unit for the 12 months to 31 March 2006 .
MGNZ would like to remind unitholders that the fourth quarter distribution was paid to unitholders earlier than usual as part of its recent capital raising, and therefore no dividend is being announced at this result. However, the distribution for the quarter ended 30 June 2005 , is expected to be paid on 9 September 2005 .
Macquarie Goodman (NZ) Limited (MGNZ) Chairman Jim McLay said the year ended 31 March 2005 was a landmark year for MGP as the trust had been actively repositioned in line with its clear strategy of investing in industrial and business space assets. The following events have been the major highlights:
® $304.3 million of property acquired from co-ownership partner Macquarie Goodman Group (MGQ);
® Increase in net profit after tax from $8.1 to $17.7 million;
® Increase in total assets from $225.6 million to $541.8 million;
® Improved unitholder alignment with the introduction of a performance fee;
® Entry into NZSX50; and
® An increase in the portfolio’s value by $10.1 million.
“In addition, MGP has also consolidated its leading position in the industrial property market having acquired more than $380 million in property in the past 12 months, and significantly increasing our customer base,” Mr McLay said. “With a substantially enhanced and increased property portfolio, high customer retention, and low vacancy rates, we are well positioned for the 2006 financial year.”
“The expansion programme we have successfully implemented this year has delivered on our strategy of investing consistently in high quality well-located properties and undertaking low risk developments. The increased depth of our portfolio has contributed to our ability to meet the needs of new and existing customers requiring property solutions.”
Leasing activity for 2005
Customer retention over the past year has been especially strong with MGP retaining 87% of customers whose leases were due to expire. Notable customers that had their leases successfully renegotiated included BJ Ball, Fonterra, IBM and Vector. In addition to these retentions, solutions were achieved for existing customers Toll Logistics and Linfox Logistics with new premises being constructed at Savill Link and Westney Industry Park to meet their respective space requirements.
Under the management of MGNZ, MGP ’s portfolio has strengthened with occupancy rates up from 98.3 to 99.5%. The portfolio’s weighted average lease term also increased from 3.8 to 4.4 years as at 31 March 2005 .”
MGP has made acquisitions totaling $388.2 million over the past year. This included $77.0 million for a 50% interest in 4 quality properties purchased jointly with co-ownership partner Macquarie Goodman Group (MGQ), namely Fletcher Head Office, Savill Link, HP House and the HSBC Centre. MGP also acquired a 50% stake in the Norman Ellison Carpets and Recall buildings for $6.9 million from MGQ which developed the properties at The Gate Industry Park.
To secure future development land supply and facilitate the Linfox Development at Westney Road Industry Park MGP, in conjunction with MGQ, entered into a six-year development agreement with Workstore Developments to market and develop the 35 hectare site situated near Auckland’s International Airport. This development right was secured for no monetary consideration.
The remaining $304.3 million in acquisitions was completed in late March 2005 when MGP purchased MGQ’s interest in existing co-owned stabilised properties for $226.5 million, commenced developments for $71.5 million and a 50% interest in development land in which MGP had no prior interest for $6.3 million. This transaction was enabled through a capital raising made available to institutional and retail investors.
Following these acquisitions, approximately 4% of MGP’s total assets are now invested in greenfield or development land. This is within MGP’s stated policy to have no more than 10% of its gross assets invested in development land. This land is jointly owned with MGQ who continue to be development partners with MGP.
Subsequent to the year end, MGP also purchased an office building in the commercial and retail precinct of Newmarket , Auckland for $30.55 million. The property at 139 Carlton Gore Road is situated close to MGP ’s two other Newmarket properties (Vector Centre and BTI House).
On 7 March 2005 , MGNZ announced an institutional placement and pro-rata non-renounceable priority entitlement offer, which was overwhelmingly supported by institutional and retail investors, raising a total of $155 million. Prior to this significant capital raising, MGP also raised $20.8 million in May 2004 via an institutional placement.
MGP also secured a $300 million revolving syndicated credit facility from the Commonwealth Bank of Australia and Westpac Banking Corporation in March 2005. This facility replaced MGP ’s existing $150 million facility provided by those banks.
Several developments are currently underway at Savill Link, Otahuhu. These include warehouse and distribution developments for Toll Logistics and manufacturing firm Nylex, both of which are existing customers of MGQ in Australia .
Post balance date, MGP also secured its third customer at Savill Link. Prominent retailer Furniture City is to lease a new 6,850 square metre warehouse and distribution facility. These facilities total over 31,000 square metres of office and warehouse area and represent 21% of the development potential of Savill Link. These developments are all due for completion late 2005.
MGP is also developing three industrial units at The Gate Industry Park in Penrose, including a recently announced 7,334 square metre warehouse and distribution centre pre-committed by Winstone Wallboards, to be developed jointly with MGQ.
Meanwhile, MGP is currently on schedule to complete a 29,000 square metre warehouse and distribution centre for Linfox Logistics at Westney Industry Park by November 2005. Anticipated value on completion is expected to be approximately $29.2 million.
Considerable progress has been made over the past year in terms of implementing our new strategy. Over the coming 12 months we will continue to focus on delivering this strategy and leveraging off Macquarie Goodman’s unique Customer Service Model.
Macquarie Goodman (NZ) Limited
Chief Executive Officer
Macquarie Goodman (NZ) Limited
Investor Relations Manager