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.
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.
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.
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".
"Our priority remains focused on the health, safety and wellbeing of our people, tenant customers and all the communities that share our spaces.
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.
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.
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.
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.
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.
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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