Frasers Property Limited reports FY23 half year results

12 May 2023 

Frasers Property Limited (FPL) today announced its results for the half year ended 31 March 2023 (“1H FY23"). 

 

Record number of projects in development pipeline to continue driving solid performance for the business unit  
 

Frasers Property Industrial reports profit before interest and tax of S$181.7 million (A$199.4 million & EUR 127.5 million) for 1H FY23, with assets under management of S$11.1 billion (A$12.5 billion & EUR 7.7 billion).

 
Key performance highlights as at 31 March 2023:

 

In 1H FY23, Frasers Property Industrial achieved a profit before interest and tax (“PBIT”) of S$181.7 million (A$199.4 million & EUR 127.5 million). 

 

  • Frasers Property Industrial’s assets under management valued at S$11.1 billion (A$12.5 billion & EUR 7.7 billion)  
  • Frasers Property Industrial’s total investment portfolio comprises 162 completed properties across five countries, equating to 4.2 million sqm of net lettable area (NLA): 
    • Australia: 
      • Non-REIT portfolio consisting of 33 completed assets with a total value of S$1.8 billion (A$2.0 billion & EUR 1.3 billion)
    • Europe: 
      • Non-REIT portfolio consisting of 22 completed assets with a total value of S$0.9 billion (A$1.0 billion & EUR 0.6 billion)
  • Frasers Property Industrial’s multinational expertise delivered a network to support high-quality customers’ businesses across geographies, with continuing demand driving a strong pipeline of development projects: 
    • A company record development pipeline with 19 projects totalling ~651,000 sqm is currently being developed, with 16 in Australia and three in Europe planned for completion in the next two years. 
    • Three development projects were completed in Australia in 1H FY23. 
      • In QLD & VIC totalling ~57,000 sqm
  • A strategically positioned landbank totalling 2.2m sqm across Australia and Europe, with 66,000 sqm of land acquired across two sites in Australia 1H FY23
    • Acquisitions were made at two greenfield development sites in Horsley Park, NSW, totalling ~18,000 sqm, as well as ~48,000 sqm in Staplyton, QLD, in Australia. 
  • Frasers Property Industrial realised strong leasing activity underpinned by high-quality tenants in 1H FY23 with ~438,000 sqm of renewals and new leases, comprising ~365,000 sqm in Australia and ~73,000 sqm in Europe 
    • Australian portfolio is 100% occupied with a weighted average lease expiry (WALE) of 5.0 years and 97.3% occupancy in Europe with 5.7 years WALE.  
  • Four non-core assets in Austria were divested to focus resources on growing strategic core markets of Germany and the Netherlands. 

 

The stable 1H FY23 performance by Frasers Property Industrial reflects the Group’s continued strategy to leverage its multinational platform and deep capabilities across development, and asset and investment management in the industrial and logistics sector. This strongly positions Frasers Property Industrial to create sector-leading and sustainable real estate facilities for high-quality tenants. 

 

Market overview and CEO commentary:

 

Reini Otter, Chief Executive Officer, Frasers Property Industrial says the business’ record industrial and logistics pipeline will continue to meet demand from diverse and high-quality tenants, particularly in the Food & Beverage, e-commerce, pharmaceutical and logistics industries, supporting its ongoing results performance. Its long-term value creation strategy continues to position the business well in navigating market conditions. 

 

“The industrial and logistics sector’s fundamentals continue to remain favourable in Australia and Europe as rental demand continues to outstrip supply, which we’ve seen translate to 100% occupancy in our Australian portfolio. Our strongest-ever development pipeline of 19 projects allows us to leverage these market conditions and meet the demands of high-quality tenants that are vacating older buildings and seeing efficient, sustainable and automated facilities. 

 

“In the past year the Frasers Property Industrial portfolio has grown to S$11.1 billion (A$12.5 billion & EUR 7.7 billion) and the current development pipeline remains stable.  The landbank also holds strong at 2.2 million square metres across Australia and Europe. 

 

“Despite land supply constraints and rising interest rates, we expect tight supply to continue driving healthy rental uplift supporting our strong position. This will ensure the resilience of our portfolio during a time of softening yields across the market. We’ll continue to monitor asset yields and return hurdles on development projects.

 

“As we manage sector headwinds, we’ll continue to focus on prioritising customer-centricity and sustainability to drive long-term value creation as an integrated, focused and resilient business. The strength of our portfolio is in its development pipeline and the existing modern facilities across prime locations in key markets, making us well positioned to support demands from a majority of blue-chip, publicly listed and often multinational customers. 

 

“We will be prioritising the development of our strategic landbank to capitalise on our end-to-end ability to acquire, develop and manage assets.”

 

Please refer to the attached announcement from Frasers Property Limited for further details: https://investor.frasersproperty.com/news.html/id/2438383

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