Charter Hall Group has further reviewed the impacts from COVID-19 and reaffirms its FY20 earnings guidance for approximately 40% post-tax operating earnings per security growth on FY19.
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Across the funds platform the focus on defensive, essential services and resilient industries and tenant customers, combined with sector-leading WALE’s, provides a solid foundation for investment returns.
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Charter Hall currently has zero net gearing and $420 million of available liquidity. The Groups liquidity will further improve as a result of the Group’s distribution policy, leaving Charter Hall well-placed to take advantage of any future opportunities that may arise.
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Despite this, Managing Director and Group CEO, David Harrison said, "COVID-19 has presented a unique set of challenges and opportunities for our business and people".
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"Our priority remains focused on the health, safety and wellbeing of our people, tenant customers and all the communities that share our spaces.
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The Group notes that the total proportion of rent from those who are classified as SME’s under the National Cabinet Commercial Code is 10% for the Charter Hall balance sheet and 9.7% across the Funds Platform. The Group is working to support those tenants to ensure sustainable and long term outcomes are achieved.
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Charter Hall has a highly defensive earnings stream from its diversified investments held by Charter Hall Property Trust. The Group’s top 10 tenants by income represent over 52% of income and are all highly defensive and resilient.
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The Group’s development pipeline continues to grow, providing significant opportunities to deploy capital, with $3.0 billion in committed projects that will deliver assets for the funds and drive incremental fund returns. The $4.3 billion uncommitted pipeline also stands ready to replace development completions and provide attractive returns without the need to transact on market, providing further additional growth.
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Charter Hall continues to attract equity inflows across all source segments, included its listed funds, with $1.6 billion of new equity raised since 31 December, 2019.
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Transaction activity was subdued in the period as a result of the usual seasonal lull that occurs in January and February and then the onset of COVID-19. The Group completed $761 million of gross transactions, consisting of $368 million of acquisitions and $392 million of divestments.
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The Group has conducted independent valuations on approximately 50% of assets under management. Office valuations moved by -0.5%; Industrial & Logistics values moved by +0.7% and our long WALE assets increased in value by +0.5%. There was no net change in FUM from valuations.
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