Goodman Group has reviewed the impact of COVID-19 on its business reaffirms FY20 earnings and distribution guidance whilst keeping an eye on the ever changing market.
The trends of ongoing supply chain consolidation, online expansion and growth in the digital economy have been accelerated due to COVID-19. The focus of the Group’s portfolio on infill logistics markets and providing space for customers to directly service consumers, is providing more resilient cash flows and demand.
As a result, development work in progress is forecast to be in excess of $5 billion at June 2020. The Group’s gearing remains at the lower end of our 0-25% target range and available liquidity is currently $2.5 billion, reflecting cash of $1.4 billion and undrawn facilities of $1.1 billion. This will be supported through the continuation of Goodman’s ~50% payout ratio and is in addition to the $18.8 billion of liquidity available within the Partnerships.
The group has reaffirmed its earnings guidance for full year FY20 at 57.3cps and full year distribution of 30cps.
Greg Goodman, CEO said, “We acknowledge the unprecedented times we’re experiencing and the terrible impact COVID-19 is having on people’s lives and livelihoods around the world. The markets we’re in have been affected at various times and to varying degrees. Throughout, our priority continues to be the safety and wellbeing of our people, customers and Partners. Alongside our customers and the logistics and warehousing sector globally, we are playing an important role in delivering essential infrastructure and enabling distribution of critical supplies. We are also working on a one-on-one basis with our customers who are genuinely suffering financial distress as a direct result of COVID-19.”
Goodman says that it has experienced increased demand for both temporary and permanent space from customers in the food, consumer goods and logistics sectors, particularly related to e-commerce operators and those transitioning to online. The portfolio occupancy remains stable at 97.5% and in general, Goodman has experienced relatively limited closure or disruption of warehouse facilities over the past few months. The group is however working through on a case by case basis a number of customers who have been facing difficulty due to COVID-19 disruptions.
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