Scentre Group Grows FFO by 4.4% to $612 Million for First Six Months of 2026

Scentre Group (ASX: SCG) today released its results for the six months to 30 June 2026 with Funds from Operations (FFO) of $612 million (11.73 cents per security), up 4.4% and Distributions of $481 million (9.215 cents per security), up 4.9%.

Based on the Group’s operating performance in the first half of 2026, and subject to no material change in conditions, FFO guidance for the second half of 2026 has been upgraded to at least 12.06 cents per security, representing at least 4.5% growth over the prior corresponding period. This would equate to full year 2026 earnings of at least 23.79 cents per security representing growth of at least 4.25%.

Distribution guidance for the second half of 2026 has been upgraded to 9.258 cents per security. This would equate to a full year 2026 distribution of 18.473 cents per security representing growth of 4.25%.

Statutory Profit for the period was $975 million and includes an unrealised property valuation increase of $478 million. As at 30 June 2026 the Group’s portfolio was valued at $33.7 billion.

Scentre Group Chief Executive Officer Elliott Rusanow said: “Our focus is to continue generating long term earnings growth from our Westfield business in Australia and New Zealand and create significant additional value from our substantial land holdings.”

Westfield destinations

Mr Rusanow said: “We are focused on attracting more people, more often and for longer to our destinations and continue to deliver strong performance.

“So far this year, we have welcomed 347 million customer visitations, an increase of 3.5% or 12 million on the prior comparable period. We have attracted 552 million customer visits to our 42 Westfield destinations over the past 12 months which is a record for our business.

“Our ability to create more reasons for customers to visit our destinations continues to enable a broader range of business partners to connect and transact with more customers.

“For the 12 months to 30 June 2026, business partners’ sales grew to a record $30.3 billion or $1.0 billion on the same period last year. For the 12 months to 30 June 2026, business partners grew sales by 4.2% and specialty sales grew by 5.4%¹.

“Business partners achieved sales growth of 3.7% for the six months to 30 June 2026, compared to the same period in 2025. Specialty sales for the six months were 5.1% higher than the same period in 2025¹.

“For the month of July, total business partner sales were 2.7% higher and specialty sales were 3.6% higher than the prior corresponding period¹.

“We continue to see strong demand for space in our destinations with occupancy remaining at its highest level in more than a decade of 99.8%, up 10bps compared to the same period last year.”

Rent escalations increased by 5.5% in the six months to 30 June 2026. The Group completed 1,401 leasing deals, achieving average releasing spreads of +3.7%.

Westfield membership grew to 5.2 million, as a result of increased engagement through unique member benefits and experiences.

The Group continues to invest in its Westfield destinations to enhance the customer experience across the portfolio and provide more reasons for people to visit and spend their time in its destinations.

Successful redevelopments have been completed in recent years at Westfield Sydney and Burwood in Sydney, Knox and Southland in Melbourne, Tea Tree Plaza in Adelaide and Mt Gravatt in Brisbane with all destinations performing well.

We continue to enhance the customer offer at Westfield Bondi in Sydney to further strengthen its position as a pre-eminent destination. Works are progressing on the $240 million redevelopment to deliver an elevated dining, entertainment and lifestyle precinct on Level 6. This follows the successful repurposing of department store space on Level 1, to create a new health, wellness and fitness precinct. The transformed Level 6 precinct will be anchored by an upgraded Event Cinemas, a new Kingpin entertainment offer and unique dining experiences. It will open in stages from late Q4 2026.

The $30 million (SCG share $15 million) redevelopment to expand the entertainment and lifestyle precinct and HOYTS Cinemas complex at Westfield Penrith in Sydney commenced during the period.

The Group’s $20 million (SCG share $20 million) redevelopment at Westfield Tuggerah on the NSW Central Coast is repurposing department store space to introduce TimeZone, JD Sports and a relocated Rebel. The retailers will open progressively from Q3 2026.

On behalf of Cbus Property, the Group completed the residential component of the redevelopment above the expanded Westfield Sydney in the CBD.

Mr Rusanow said: “We will continue to invest in our Westfield business to drive visitation, customer experience and business partner sales.”

Strategic land holdings

The Group’s Westfield destinations are located on more than 670 hectares of land, close to major transport hubs and existing infrastructure. The Group is focused on generating greater economic activity in and around its destinations through better use of its strategically located land.

Mr Rusanow said: “We are working collaboratively with governments across Australia and New Zealand on how we can contribute to housing supply and make housing more accessible to more people for decades to come.

“Over the past 24 months, we have identified and progressed a significant pipeline of dwellings. This year, our potential pipeline has increased from 20,200 to 25,600 dwellings that are approved or in the advanced stages of planning.”

The Group has substantially progressed its concept plans to deliver a new town centre at Westfield Warringah Mall on Sydney’s northern beaches with the potential to deliver up to 1,600 new dwellings.

At Westfield Eastgardens, the opportunity to deliver 1,300 new dwellings as part of an integrated mixed-use development is being explored. The Group has lodged an expression of interest to the Housing Delivery Authority for a State Significant Development.

During the half the Group submitted a master plan to Brisbane City Council to deliver up to 4,000 dwellings on land at Westfield Chermside.

At Westfield West Lakes in Adelaide, the opportunity to deliver up to 2,000 dwellings has been initiated. The South Australian Government has approved the Group’s proposal to commence the formal master planning process to transform land surrounding the destination into a mixed-use destination.

Capital management

Yesterday the Group announced that Australian Retirement Trust (ART) will purchase a 50% interest in Westfield Mt Gravatt in Brisbane for $882.5 million, subject to ART obtaining clearance from the Australian Consumer and Competition Commission. The transaction involves the sale of a 50% direct property interest in Westfield Mt Gravatt for $870.0 million at a capitalisation rate of 5.50%. The aggregate $882.5 million of gross proceeds represents a 3.5% premium to the book values at December 2025.

Mr Rusanow said: “The Group is very pleased to extend our strategic relationship with ART, following their 19.9% interest in Westfield Sydney for $864 million at a capitalisation rate of 4.69%.

“During the half, the Group successfully refinanced all remaining senior and subordinated notes that were issued during the pandemic in 2020. These transactions demonstrate the Group’s ability to execute on its capital management strategy through accessing diverse sources of capital to deliver long-term earnings growth to securityholders.”

In March, the Group redeemed via make-whole, all its US$750 million ($1.15 billion) senior notes due 2030 and in April issued a $750 million 6-year senior note in the Australian domestic market reflecting a margin of 1.20% over 3-month BBSW.

In May, the Group redeemed all remaining US$1.3 billion ($1.8 billion) non-call 2030 subordinated notes via a combination of tender and clean-up call.

Senior bank facilities of $1.7 billion were renegotiated and extended.

As a result of the capital management initiatives undertaken by the Group in 2026, the Group’s average debt margin has reduced from 2.6% at 31 December 2025 to 1.6% at 30 June 2026.

The Group’s level of interest rate hedging was 95% at an average base rate of 3.26% at June 2026 and 89% at an average rate of 3.29% at December 2026².

As at 30 June 2026, the Group had available liquidity of $3.5 billion, sufficient to cover all debt maturities until the second half of 2028.

Outlook

Mr Rusanow said: “Our strategy is to grow the economic activity at our Westfield destinations, broaden the businesses that partner with us and unlock growth from our strategic land holdings. This is expected to continue to deliver sustainable long-term growth in earnings and create significant long term value.”

Based on the Group’s operating performance in the first half of 2026 and subject to no material change in conditions, the Group’s target for FFO has been upgraded to at least 23.79 cents per security for 2026, representing at least 4.25% growth for the year.

Distribution guidance for 2026 has been upgraded for the full year to grow by 4.25% to 18.473 cents per security. This consists of 9.215 cents per security for the first six months to 30 June 2026 and 9.258 cents per security for the second six months to 31 December 2026.

Authorised by the Board.

¹ Percentage growth on a constant currency basis.
² Debt from December 2026 onwards, pro-forma for the divestment of a 50% interest in Westfield Mt Gravatt due to settle H2 2026.