Agriculture sector focused REIT, Rural Funds Group (ASX: RFF) on 3 June 2019 announced an estimated dividend for the current quarter ending on 30 June 2019.
As per the company’s release, an estimated dividend of AUD 0.026075 per stapled security has been announced, which is 100% unfranked. Also, the company offers a dividend reinvestment plan (DRP) wherein the DRP discount rate is 1.5%, last date and time for the election of DRP is 01 July 2019 by 19:00. The dividend announcement has been made on 3 June 2019, with the record date of 28 June 2019. Moreover, the Ex-Date and Pay-Date for the dividend are 27 June 2019 and 31 July 2019, respectively.
In February 2019, the company released its half-year results for the period ended 31 December 2018. As per the company’s half-year release, earnings of AUD 7.73 cents per unit was up by 17% compared with prior corresponding period, mainly due to the independent revaluation of Kerarbury almond orchard caused an increase of $15.6 million or 10% to the previous value coupled with acquisitions, sale of unleased annual water allocations resulted in higher income as well. Also, distributions per unit (DPU) of 5.22 cents was up 4% against prior corresponding period, and pro forma gearing of 33% was in line within the target of 30-35%.
Kerarbury Almond Orchard Revaluation (Source: Company’s HY19 Financial Presentation, Feb 2019)
Regarding capital management of the company, the half-year release notified that the term debt facility limit increased, and tenor was extended to include expiries in two tranches via $200m three-year facility which expires in November 2021 (FY22) and $100m five-year facility which expires in November 2023 (FY24).
As per the company’s half-year release, RFF’s portfolio included 49 properties (pro forma) across six agricultural sectors and multiple climatic zones and weighted average pro forma lease expiry of 11.4 years. Also, following the new acquisitions – frequency of rental reviews increased, and the company continued geographic, climatic and sector diversification. However, half-year results included pro forma figures to adjust for four properties, which were not settled by 31 December 2018.
The company notified about the acquisition of four additional cattle properties & one cotton property, which were funded from the balance sheet capacity of RFF. Reportedly, all cattle property has productivity development potential and accompanying leases with ten-year terms along with a market rent review in the fifth year.
Rural Funds Group is a constituent of S&P/ASX 300, and its portfolio includes diversified high quality Australian agricultural assets. RFF’s invests in assets to produce stable income from leasing assets to suitable industry participants along with capital growth by the appreciation in the value of those assets. Rural Funds Group (RFF) is managed by its responsible entity, Rural Funds Management Ltd (RFM).
The stock of the company settled, the day’s trading session, at A$2.24 (as on 4 June 2019) down by 1.754% from the previous close. The long-term performance of the stock in the past five-years period is +160.30% and short-term performances for one-month, three-month and six-month periods are 1.33%, 0.88% and 1.33%, respectively. RFF’s market capitalisation is A$762.12 million, with 334.26 million shares outstanding.
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