Goodman’s focus on key logistics locations and the continued demand in online shopping and the rise of the digital economy, has seen the Group deliver strong performance in FY21. The Group delivered operating profit of $1,219.4 million, up 15.0% on FY20, and operating earnings per security (EPS) of 65.6 cents, up 14.1% on FY20.
In addition, robust underlying property fundamentals and investor demand has supported significant growth in revaluations of $5.8 billion across the Group and Partnerships, contributing to the 14% growth in Goodman’s net tangible assets driving statutory profit to $2.3 billion.
Long-term structural trends are well established and are resulting in higher utilisation of space and customer demand for logistics assets.
Customer demand for space continues to increase across a range of industry segments. The prolonged impacts of the COVID19 pandemic continue to accelerate consumers’ propensity to shift to online shopping across the globe with logistics and warehousing critical infrastructure to enable distribution of essential goods to time-sensitive consumers through this period.
In response to the high levels of demand, Goodman have increased the development book to $10.6 billion at June 2021, bring forward significant projects ahead of time. A high-quality workbook with 70% pre-commitments and an average 14 year WALE, allows the projects to be delivered on a yield on cost of of 6.7%. Larger scale, higher value projects have seen average production time increase to approximately 19 months, providing greater visibility over future capital requirements. Notwithstanding this, average annual production rate is approximately $6.6 billion and is expected to remain broadly at these levels through FY22.
Strong revaluations of $5.8 billion across the group has supported growth in total AUM to $57.9 billion. The development WIP will organically grow AUM which is expected to exceed $65 billion in FY22 (up 12%).
Commenting on the outlook, Group Chief Executive Officer, Greg Goodman said “After a robust year in FY21, we expect the current levels of development activity to be sustained over the coming year. The Group is well positioned to maintain WIP of around $10 billion throughout FY22, with multi-storey developments remaining a meaningful contributor.
Goodman remains well-capitalised with available liquidity of $1.9 billion, including $0.9 billion in cash and gearing at 6.8%.
During the year, Goodman also made significant progress on its ESG initiatives including achieving carbon neutrality across the global operations, well ahead of its previous target.
The Group has forecast operating EPS for FY22 at 72.2 cents per security, up 10% on FY21, but will maintain a full year distribution of 30 cents per security in line with the Group’s capital management strategy to maintain an appropriate payout ratio in light of the strong activity levels.