Kiwi Income boosts first-half earnings on management savings, Sylvia Park rental growth
Kiwi Income Property Trust, the country's second-largest property trust by market capitalisation, reported a 12.3 percent lift in first-half operating earnings as it saved on external management fees and achieved rental growth from Sylvia Park.
Operating profit before other income and tax rose to $42.1 million in the six months ended Sept. 30, from $37.5 million the same period a year earlier, the Auckland-based company said in a statement. Sales rose 1.1 percent to $103 million. Net profit fell 62 percent to $23.8 million, reflecting a one-time tax benefit in the previous period.
Net rental income rose 7.7 percent to $77 million, as income from its Sylvia Park mall, the trusts biggest earner, rose 10 percent to $18.2 million. Income was further boosted by the completion of several developments, including the ASB North Wharf project, which reported a 115 percent lift in income to $5.5 million.
Last month the company further tweaked its organisational structure after its shift to internal management after Commonwealth Bank of Australia sold the contract last December. Gavin Parker was appointed chief operating officer, while Stuart Tabuteau will become chief financial officer.
"The improved operating performance was a consequence of the completion of a number of development projects and was assisted by continued strong rental growth at Sylvia Park shopping centre and cost savings brought about by the recent internalisation," said chief executive Chris Gudgeon.
Kiwi Income also announced it will spend $36 million on developing its LynnMall shopping centre, including a new cinema and dining area.
Units of the trust last traded at $1.20 and have gained 6.7 percent over the past 12 months.