APN Property Group today provided the an update to the market, confirming that it expects to pay a final distribution for FY20 of approximately 1.55 cents per stapled security, in line with the February guidance.
The Group had withdrawn guidance at the end of March as COVID19 disruptions emerged, however the performance of its funds and the strong cash position for the Group has enabled the Fund to reinstate the previous guidance. The final distribution will take the full year distribution to approximately 3.15 cents per stapled security.
APN’s CEO Tim Slattery commented, ‘APN and its funds entered the current period of uncertainty with strong balance sheets and well positioned portfolios. While our funds have been impacted most significantly by market pricing movements, at an underlying level they continue to be well placed to deliver strong cash income yields for investors, including APN as a material co-investor. We continue to remain focused on delivering value for our fund investors and securityholders through this period.’
At the end of April 2020 the Group’s Funds Under Management (FUM) stood at $2,561 million, versus $3,067 million at 31 December 2019, with the sharp fall, reflecting the mark to market movements in the value of APN’s real estate securities funds.
APN has implemented a range of expense reduction measures (including personnel costs). On an annualised basis, these equate to approximately 30% of FY2019 operating costs of $14 million. The duration of these expense reductions will depend on a range of factors including how market and underlying economic and trading conditions change.
For APN and other REITS, it will be sometime before guidance on FY2021 will be made with confidence as conditions for tenants may deteriorate further once the JobKeeper program and rental assistance measures come to an end.
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