Charter Hall Long WALE REIT Slides on Weaker Half-Year Earnings

February 07, 2025 01:12 PM AEDT | By Team Kalkine Media

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Charter Hall Long WALE REIT Slides on Weaker Half-Year Earnings — Image source: shutterstock

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Highlights

Stock Decline: Charter Hall Long WALE REIT (ASX:CLW) drops 0.8% to $3.87 amid broader ASX 200 weakness.

Earnings Dip: H1 FY2025 revenue falls 14.8% to $94.5 million, with operating earnings down 4.4% year-on-year.

Strategic Moves: CLW completes a $50 million share buyback and divests $289 million in net property assets.

Shares of Charter Hall Long WALE REIT (ASX:CLW) are sliding in Friday’s trading session, underperforming the broader S&P/ASX 200 Index (ASX:XJO). The ASX 200 REIT, managed by Charter Hall Group (ASX:CHC), saw its stock drop 0.8% to $3.87 in early trade, following the release of its half-year (H1 FY2025) financial results. In comparison, the ASX 200 index itself was down 0.2% at the same time.

The REIT reported a 14.8% decline in revenue, bringing in $94.5 million for the half-year. Operating earnings also saw a 4.4% year-on-year decline, falling to $89.8 million. Meanwhile, operating earnings per share (EPS) slipped 3.8% to 12.5 cents.

In terms of profitability, statutory earnings came in at $51.3 million, while the company posted a 3.5% like-for-like net property income (NPI) growth. Net tangible assets (NTA) per share stood at $4.62.

Despite the earnings slowdown, Charter Hall Long WALE REIT continued to maintain strong tenancy metrics, with a portfolio occupancy rate of 99.8% and a weighted average lease expiry (WALE) of 9.7 years.

Over the past six months, the REIT executed significant portfolio adjustments, including the completion of a $50 million on-market share buyback and $289 million in net property divestments. These transactions included $300.4 million in asset sales and $11.5 million in new acquisitions.

One of the major deals during this period was an agreement with Coles Group Ltd (ASX:COL) for an expansion and lease extension at the Perth Airport Distribution Centre in Western Australia.

On the dividend front, the board declared an unfranked quarterly dividend of 6.25 cents per share, set for payout on Friday, February 14. This brings the half-year dividend payout to 12.5 cents per share and the projected full-year payout to 25.5 cents per share, translating to an unfranked trailing dividend yield of 6.6%.

Fund manager Avi Anger acknowledged the financial results, highlighting that "CLW has successfully completed its $50 million on-market security buy-back program."

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