Real estate Investment Manager, Cromwell Property Group (ASX: CMW) has released its half-year results for FY 2019 (H1 FY19). For the half-year period, the company has reported a statutory profit of $111.1 million which is 37.5 percent higher than the previous corresponding period (pcp). Further, the company has reported a growth of 7.6% in its underlying operating profit which has reached to $82.6 million for H1 FY19 as compared to 76.8 million for 1H FY18.
Following the release of the half-year results, the share price of the company increased by 1.553% during the day trade as on 28 February 2019 (AEST 2:57 PM).
The companyâs direct property investment segment has witnessed an increase of 1.6% in its segment profit for H1 FY19 which has reached to $62.7 million. For the same period, the companyâs indirect segment reported an operating profit of $19.4 million. Cromwellâs funds and asset management business reported a profit of $18.6 million which was down from the prior year amount of $25.4 million.
While announcing the half-year results, the companyâs CEO Paul Weightman informed that over the course of the last six months the company has made progress on the value-add opportunities in its direct property portfolio. During the half year period, the company allocated additional capital to its indirect property portfolio including the Cromwell European REIT, or CEREIT. The company also worked with its institutional capital partners on funds and mandates that meet their investment criteria.
He further informed that the company has lodged an application for Development Approval for Victoria Avenue, Chatswood, and it is examining options for assets in Melbourne, Canberra and Adelaide.
While providing the outlook and guidance, Mr Weightman informed about the global trade tensions, Brexit and the possibility of slower economic growth in China, Europe and the US has impacted the global growth forecasts.
In Australia, currently there is political unrest due to the upcoming elections, and there is a possibility of changes in the taxation policies. Moreover, Australia is facing a residential market downturn which has contributed to significant falls in Australian consumer confidence and business conditions generally. In light of these circumstances, the management of Cromwell is anticipating a downside risk in all markets in which Cromwell operates.
The company is having a strong balance sheet with liquidity and optionality. The company NTA (Net Tangible Assets) is $0.99 for H1 FY19 which is up $0.06 than NTA for H1 FY18. The companyâs gearing of 33.7% is below its target range and its WALE (Weighted Average Lease Expiry) is 7.2 years.
For FY 2019, the company has confirmed its distributions of not less than 7.25 cents per security, and it has maintained its earnings guidance of 8.00 cents per share.
Meanwhile, in the last six months, the share price of Cromwell has decreased by 0.26% as on 27 February 2019. CMWâs shares traded at $1.112 with a market capitalization of circa $2.44 billion as on 28 February 2019 (AEST 2:57 PM).
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