Rural Funds Group (ASX: RFF) sees 15% revenue surge in FY24, expects further growth in FY25

4 min read | October 01, 2024 03:47 PM AEST | By Team Kalkine Media

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Rural Funds Group (ASX: RFF) sees 15% revenue surge in FY24, expects further growth in FY25 — Image source: Shutterstock

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Highlights

In FY24, RFF recorded a 15.6% YoY revenue growth, primarily driven by macadamia developments

The company's AFFO rose 2.8% YoY in FY24, and it is forecasted to grow by 3.6% in FY25

Macadamia assets expected to contribute 18% of FY25 revenue, with potential for further growth.

Interim dividend of AUD 0.029 per share, payable on October 31, 2024.

Rural Funds Group (ASX:RFF) is an agricultural Real Estate Investment Trust (REIT) with a diversified portfolio of Australian agricultural assets. With a diversified portfolio of Australian agricultural assets, including macadamia orchards, cropping properties, almond orchards, cattle properties, vineyards, and water rights, the company saw significant revenue growth across its operations in the financial year 2024 (FY24).

In FY24, the company recorded a 15.6% jump in its revenue to AUD 109.8 million, while property revenue surged by AUD 6.5 million, marking a growth of 8% YoY. Property revenue was primarily driven by an increase in rental income from macadamia developments.

During the reported period, adjusted net asset value improved by 7.2% YoY to AUD 3.14 per unit on the back of independent asset valuation and adjusted funds from operations (AFFO) jumped 2.8% YoY to 11 cents per unit. In FY25, AFFO is expected to touch 11.4 cpu, representing a growth of 3.6%.

Significant developments in FY24

In FY24, the company made several significant strides. One of the key milestones was the second tranche of the Macadamia development lease (approximately AUD 133.9 million of assets) after issuance of Rookwood Weir water entitlements.

Further, in June 2024, the company informed about the lease and sale of 50% of Mayneland and Baamba Plains cropping properties, while other assets continued to be developed. To improve earnings, gearing and operating exposure, RFF intends to lease and partially sell additional assets.

Revenue outlook

In 2021, macadamia development, spanning 3,000 ha, was commenced and is on track to be completed by the end of 2024. The 40-year leases linked with these assets is expected to contribute 18% of FY25 total revenue. Moreover, the contribution is expected to increase with the deployment of additional capex.

Dividend announcement

Recently, the company announced an unfranked interim dividend of AUD 0.029 apiece, with ex-date 27 September 2024 and pay date 31 October 2024.

Share performance of RFF

RFF shares closed 0.76% lower at AUD 1.97 apiece on 1 October 2024. In the past one year, RFF’s share price has increased by almost 9.70%, and in the past three months, it has dropped by nearly 1%.

52-week high of RFF is AUD 2.22, recorded on 9 February 2024, and 52-week low is AUD 1.755, recorded on 4 October 2023.

RFF Daily Technical Chart, Source: EODHD/Others

Note 1: Past performance is neither an Indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, and currency, is 01 October 2024. The reference data in this report has been partly sourced from EODHD/Others.

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This article has been prepared by Kalkine Media, echoed on the website kalkinemedia.com/au and associated pages, based on the information obtained and collated from the subscription reports prepared by Kalkine Pty. Ltd. [ABN 34 154 808 312; AFSL no. 425376] on Kalkine.com.au (and associated pages). The principal purpose of the content is to provide factual information only for educational purposes. None of the content in this article, including any news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations, and video is or is intended to be, advisory in nature. The content does not contain or imply any recommendation or opinion intended to influence your financial decisions, including but not limited to, in respect of any particular security, transaction, or investment strategy, and must not be relied upon by you as such. The content is provided without any express or implied warranties of any kind. Kalkine Media, and its related bodies corporate, agents, and employees (Kalkine Group) cannot and do not warrant the accuracy, completeness, timeliness, merchantability, or fitness for a particular purpose of the content or the website, and to the extent permitted by law, Kalkine Group hereby disclaims any and all such express or implied warranties. Kalkine Group shall NOT be held liable for any investment or trading losses you may incur by using the information shared on our website.

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