Abacus Property (ASX:ABP) affirms distribution guidance, shares fall

Diversified property group Abacus Property Group (ASX:ABP) on Wednesday (23 November 2022) affirmed its payout guidance for the financial year 2023 (FY23) while sharing an annual general meeting 2022 update. In addition to this, the group has provided an operational update for the first quarter of FY23.

At 2:45 PM AEDT, Abacus shares were spotted trading 1.28% lower at AU$2.70 per share with a market capitalisation of AU$2.44 billion.

Abacus affirms its payout guidance

The company has maintained its distribution guidance of a minimum of 18.4 cents per share, representing a payout ratio of 85 to 95% of funds from operations (FFO). According to ASX filing, the guidance is based on the assumption that business conditions will continue to normalise, and Covid-19 will have no further material impacts.

Myra Salkinder, chair, Abacus, said,

1QFY23 operational update

• The company reported growth and significant activity levels across the Self Storage portfolio during the quarter. In the commercial portfolio, the operating conditions were mixed. 
• The established occupancy declined from 92.7% across FY22 to 92.2% across 1QFY23. 
• The company ended the quarter with a gearing of 31.6% and minimal debt expiring in the medium term.

What happened in Abacus in FY22?

• In FY22, the company deployed more than AU$1.2 billion of capital in commercial and self storage asset classes. The deployment was achieved via joint ventures and acquisitions, which were funded through a combination of proceeds from selling non-core assets, debt and AU$200 million equity
• The company reported a statutory profit of AU$517.2 million in FY22, a rise of 40% over the prior corresponding period. As reported, the profit was driven by a value uplift in the storage portfolio and employment of capital into accretive acquisitions.
• The funds from operations grew by 18% over the previous year. 
• The full year distribution stood at 18 cents per security, representing a payout ratio of 95% of FFO and an increase of 2.9% over the previous year.
• The net tangible assets per stapled share grew by 12.2%. 
• The gearing was 28.7% as of 30 June 2022, within the target range of approximately 35%. 

The self-storage portfolio of the group reported a 56% increase in net property income.