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- After a challenging 12 months, thanks to COVID-19, shopping mall major Vicinity Centres (VCX) believes there are clear skies ahead
- Portfolio retail sales declined 7.0 per cent in 3QFY21 relative to 3QFY19, which the company said is “reflecting a subdued but improving retail sales environment”
- Supermarket sales for Vicinity were up 1.5 per cent in 3QFY21 relative to 3QFY19
- Vicinity’s portfolio occupancy rate of 98 per cent, as at March 31, 2021, remains in line with three months earlier
- Vicinity completed 328 leasing deals during the quarter, resulting in a leasing spread of -13.5 per cent, slightly below the -12.6 per cent spread reported at 1HFY21
- Vicinity Centres shares are 0.31 per cent down following the announcement, trading at $1.60
After a challenging 12 months, thanks to COVID-19, shopping mall major Vicinity Centres (VCX) believe there are clear skies ahead.
“We are seeing signs of recovery, with improved centre visitation and retail sales during the quarter,” Vicinity Centres managing director and CEO Grant Kelley said.
“Whilst overall retailer confidence remains fragile, retailers are increasingly committing to new leases versus previous quarters which is encouraging,” he added.
After posting a $242.8 million profit in H1 FY20, the pandemic hit the company’s bottom line, resulting in a net loss after tax of $394.1 million for H1 FY21.
“As the recent quarter has demonstrated, risks of further disruptions from snap lockdowns remain, while tourism and the timing of office workers returning to CBD offices is uncertain,” Kelley said.
“We are focused on continuing to navigate the risks and uncertainties whilst managing the business for the long term,” he concluded.
Portfolio retail sales declined seven per cent in 3Q FY21 relative to 3Q FY19, which the company said is “reflecting a subdued but improving retail sales environment”.
This number is up from December and September 2020, when the company reported drops of 12.3 per cent and 32.0 per cent, respectively.
The company also said results were impacted by snap lockdowns during the third quarter in Perth, Melbourne and Brisbane, as well as restrictions on gatherings across Sydney.
Supermarket sales for Vicinity were up 1.5 per cent in 3Q FY21 relative to 3Q FY19, with the company noting that at the height of the pandemic, supermarket and fresh food sales benefited from hyper-local shopping, increased cooking at home and some panic buying as lockdowns became effective.
Discount department stores sales (+11.7 per cent) continued to outperform department stores (-22.4 per cent) during the quarter the company said.
Vicinity also reported that combined mini-majors and specialty stores witnessed a 5.7 per cent decrease in sales as discretionary spending remains in recovery.
Visitation is also down from 77 per cent from 3Q FY19, however excluding CBDs, where the impact of COVID-19 has been greater, average centre visitation for 3Q FY21 was 83 per cent of 3Q FY19.
Visitors are also reported to be spending more, with the average spend per visit increasing 23 per cent in March 2021.
Vicinity’s portfolio occupancy rate of 98 per cent, as at March 31, 2021, remains in line with three months earlier.
Vicinity completed 328 leasing deals during the quarter, resulting in a leasing spread of -13.5 per cent, slightly below the -12.6 per cent spread reported at 1H FY21.
In the third quarter of FY21, average cash collection was 82 per cent of total billings, according to the company, up from 80 per cent in the second quarter with the company earmarking improved cash collections in Q4.
Vicinity Centres shares are 0.31 per cent down following the announcement, trading at $1.60 at 12:13 pm AEST.
