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Goodman Group Delivers Strong Half-Yearly Results

Goodman Group Delivers Strong Half-Yearly Results
Feb 11, 2016 By Ben Khouri Tags: gmg

Goodman Group (ASX:GMG) have released their half-yearly reports. The results reflected growth in revenue, profits, and operating cash flow.

Revenue up 56%

Revenue (and other income) for the half year ending 31st December 2015 was $1.7 billion. This is an over 56% improvement to the PCP. Additionally, Profit for the period was $929.3 million, equating to a 77% improvement to the PCP. In similar fashion, the group’s operating profit expanded 9%, when compared to the PCP, to $357 million.

The significant improvement in their performance this period is attributable to the growth in the group’s operations. Investments contributed $206 million to operating EBIT, a 5% expansion to the PCP. Developments added an operating EBIT of $177 million, a 39% increase to the PCP. In similar fashion, Management earnings adding an operating EBIT of $99 million, a 66% increase to the PCP.

Net operating cash flow for the period grew 35.7%, when compared to the PCP, to $444.8 million.

Goodman’s CEO Mr Gregg Goodman commented on the results: “The first half result highlights our commitment to the execution of the Group’s business strategy and our focus remains on improving the quality of our properties and income. A number of themes are shaping the industrial property sector globally, which are underpinning the ongoing demand for quality logistics space and expected to be key drivers of Goodman’s earnings.”

Half-Yearly Activities

For the half year, the Group expanded development activity in Europe and North America. Development work in progress has increased to $3.4 billion. Managerially, there was an increase in third party assets under management to $28 billion over the half year, being an 11% increase compared to the 30th June 2015.

Cash Balance Increased 76%

Over the period, the Group decreased its gearing ratio to 15.9%, with available liquidity of $1.9 billion. Furthermore, as at the 31st December 2015, the Group’s cash balance was at $844.7 million, a 76% increase to the PCP.

Dividend

No dividends were declared during the half year ending 31st December 2015

Outlook

Goodman expects its full year FY16 operating earnings per security and forecast distributions to be 40 and 24 cents. Equating to a 7.5% and 8% increase to FY15 respectively.

Share Performance

Investors have reacted positively to the announcement, with GMG surging over 5% (As at 2:43pm AEDT), to $6.20.

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Ben Khouri Author: Ben Khouri Feb 11, 2016

Ben Khouri is a financial editor for Wise-Owl with a particular focus on the top ASX 300 companies. Having a vast background in economics and finance, Ben provides financial commentary & analysis as well as global market updates, which guide investors in devising investment strategies. Ben specialises in analysing economic data and global events from around the world and examines the impacts they have on the major equity markets.

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