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Lend Lease Group Reports Strong Residential Results

Lend Lease Group Reports Strong Residential Results
Aug 24, 2015 By Ben Visser

Lend Lease Group (ASX:LLC) reported its full FY15 results with strong profits and promising future growth forecasts.

The company's net profit after tax come in at $618 million with earnings per share of 106.8 cents. This compares to FY14 net profit after tax of $822 million, however last year’s net profit included a contribution of $485.0 million from the sale of the Bluewater Shopping Centre in the UK.

The companies final dividend of 27 cents per share with 25 per cent franking, represent an annual pay-out ratio of 51 per cent.

The company experienced record pre sold revenue of $5.2 billion across residential apartments and communities, up 109 per cent on the previous period and an estimated development pipeline of $44.9 billion, up 19 per cent on the prior year.

Construction backlog revenue is now at $17.3 billion, up 7 per cent, and Funds Under Management is up 31 per cent at $21.3 million, of which $2.1 billion is third party capital raised during the year.

The company maintains a strong balance sheet with 2.2 billion of cash and undrawn facilities, and Return on Equity of 12.4 per cent.

The Group’s CEO and MD, Steve McCann commented, “In the last year our pre sold residential revenue has more than doubled to $5.2 billion, with the related revenue to begin emerging as profit and cash from FY16 onwards. Our Development pipeline has continued to expand, with a number of new international projects secured during the year in Asia and our first major development projects in the Americas. The pipeline has reached a record level almost $45 billion, with approximately 70 per cent represented by urbanisation projects.”

Lend Lease’s share price has suffered since its most recent peak in late February this year. This is not due to any significant fundamental change and is likely due to over buying after promising results over the last couple of years. Today the company has once again reported strong results and forecasts significant growth going forward. Investor sentiment will likely stay positive towards Lend Lease, however current economic conditions will likely overshadow most results today.

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Ben Visser Author: Ben Visser Aug 24, 2015

Ben is a Wise-owl equity analyst focusing on ASX blue-chips stocks. Ben has a Bachelor of Business in Finance majoring in property valuations and management. In his role at Wise-owl Ben conducts in-depth fundamental and technical analysis which helps him to find profitable investment opportunities on the ASX and abroad.

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