- With improving rent collections and better-than-expected sales, Mirvac (MGR) has increased its earnings guidance for the 2021 financial year
- Earnings per share would be “at least” 13.7 cents, compared to a previously announced forecast of between 13.1 and 13.5 cents per share
- Third quarter residential sales came to 897, representing a 98 per cent increase compared to the same period last year
- The company also noted a 67 per cent increase in lot sales, which puts its residential division on track to equal a previous sales record set in 2017
- Notably, the COVID-19 pandemic has accelerated the growth of eCommerce and supply chain investment, leading to increased demand for industrial developments
- Mirvac is up 4.49 per cent to $2.68 per share
With improving rent collections and better-than-expected sales, Mirvac (MGR) has increased its earnings guidance for the 2021 financial year.
The property developer said, based on an ongoing economic recovery and a strong third-quarter performance, earnings per share would be “at least” 13.7 cents, compared to a previously announced forecast of between 13.1 and 13.5 cents per share.
Mirvac said this figure accounts for the return of JobKeeper payments that were received this year, as well as the delayed sale of a 50 per cent stake in its Locomotive Workshops in South Eveleigh, Sydney, which is expected to take place in the first quarter of 2022.
“During the quarter, our business has performed well and has strong momentum leading into the final quarter with rent collection rates improving, and residential settlements and sales ahead of expectations,” said Susan Lloyd-Hurwitz, Managing Director and CEO of Mirvac.
“The residential business, with 1791 settlements in the financial year to date, positions Mirvac to comfortably exceed guidance of over 2200 lot settlements in FY21.”
These strong residential results were driven largely by increasing demand for masterplanned communities, inner ring attached homes and high-quality apartments. Third quarter sales came to 897, representing a 98 per cent increase compared to the same period last year.
Mirvac also noted a 67 per cent increase in lot sales, which puts its residential division on track to equal a previous sales record set in 2017.
Notably, the COVID-19 pandemic has accelerated the growth of eCommerce and supply chain investment, and Mirvac said the demand for last mile industrial and logistics hubs means its industrial developments are well placed.
While leasing activity remains subdued, the company said more than 107,000 square metres of leasing deals were executed during the financial year to date.
On top of that, rent collection rates have also marginally improved, with 95 per cent of rent collected so far this year compared to 93 per cent in the first half.
“The strong third quarter results again demonstrate we have a resilient business with increasing momentum, that continues to deliver strong, visible and secure cash flows, sustainable distribution growth and attractive returns for our securityholders,” Lloyd-Hurwitz added.
Mirvac is up 4.49 per cent to $2.68 per share as of 12:49 pm AEST.