Mirvac has lifted first-half profit 39 per cent and says demand for its residential developments is holding up amid the housing market decline.
The property developer and manager says profit for the six months to December 31 rose to $648 million, from $465 million in the prior corresponding period, helped by a big increase in development revenue across its divisions.
‘Despite the challenging residential market, we believe our high-quality residential product, located close to amenity and transport, will continue to outperform the wider market,’ chief executive and managing director Susan Lloyd-Hurwitz said.
‘The resilience of our residential division along with the robustness of our investment portfolio, means we remain confident in our ability to deliver operating earnings growth of between three and four per cent.’
Investors welcomed the news, pushing Mirvac shares three per cent higher to $2.535 at 1114 AEDT on Thursday.
Ms Lloyd-Hurwitz said Mirvac would be well placed when residential property prices start recovering.
‘Although residential markets continue to deteriorate, we are still seeing consistent demand for our high-quality, well located product from our predominantly owner-occupier target market, particularly for our master-planned communities, which will bolster our residential division as the cycle plays out,’ Ms Lloyd-Hurwitz said.
‘Our strong pipeline, which supports the potential of over 12,000 lot releases over the next four years, will enable us to build the right product at the right time to take advantage of the next cycle.’
Sydney-based Mirvac raised the bottom end of its full-year operating earnings per share guidance to 16.9 cents per stapled security, from 16.8 cents.
The upper guidance of 17.1 cents was unchanged.
MIRVAC WEATHERING PROPERTY STORM
* Net profit up 39pct to $648m
* Revenue up 59pct to $1.562b
* Interim distribution 5.3 cents per stapled security, up 0.3 cents