Half Year Results
Released
Released
Announcement PDF
22 February 2024
ASX Market and Media Announcement
Finbar Group reports $1.3 million net profit for
half year to 31 December 2023
Highlights
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Net profit of $1.3m for the 6 months to 31 December 2023
No project completions during the reporting period
$434 million Civic Heart project on track to reach completion in May with
settlements in June 2024
$148.9 million Aurora project due to finish July 2024
$106.3 million The Point project due to finish September 2024
Perth, 22 February 2024: Western Australia’s leading apartment development company
Finbar Group Limited (ASX:FRI) (Finbar or the Company) will report a net profit of $1.3
million after tax for the first half of the 2024 financial year.
The first half result is largely attributable to there being no development project
completions in the company’s core business of property development during the period.
Investment Property
The independent revaluation of investment properties saw mixed results with Pelago rental
apartments in Karratha experiencing a valuation increase of $3.44 million after tax,
reflecting the continued strength of the resources sector in the Pilbara region and the
demand for accommodation in Karratha seeing limited new supply. This has manifested
increased rental income for the Pelago asset.
The Fairlanes office building in East Perth experienced a valuation impairment of $1.0
million after tax reflecting a shortened weighted average lease expiry profile and current
vacancy levels.
Construction Progress Update
CIVIC HEART – SOUTH PERTH: Construction at Finbar’s flagship 335 lot 52.5% profit-shared
Civic Heart project continues with the structure complete and the steel and glass roof
feature currently being erected.
Finbar has sold 264 lots to the value of $281.6 million in the $434.8 million project.
It is anticipated that practical completion for this project will be reached in late May 2024
with settlements for the sold lots expected to commence in June 2024.
ABOVE: Civic Heart (15/2/2024)
AURORA – APPLECROSS: Construction at Aurora’s 121 lot Applecross project continues with
the structure now complete.
Finbar has sold 61 lots to the value of $56.1 million in the $148.9 million project.
Based on the current progress and expected completion timeline it is expected that
practical completion of this building will not be reached until July 2024 with settlements
forecast to commence in July/August 2024.
ABOVE: Aurora (15/2/2024)
THE POINT – RIVERVALE: Structural completion of the 176 lot The Point project in
Rivervale is expected at the end of the month.
To date, 146 lots to the value of $82.1 million have been sold in this 65% profit shared
project.
The Point project is currently anticipated to be fully completed in September 2024, with
settlements at the $106.3 million project commencing thereafter.
ABOVE: The Point (13/2/2024)
Upcoming Commencements
The company is satisfied that some stability in construction costs is evident in the market
and is therefore finalising building contract conditions with a primary contractor for the
commencement of construction at the Garden Towers project in East Perth April 2024.
Garden Towers includes 344 apartments and has a total value of $259.5 million, with $129.5
million in sales made to date.
Sales Rate
There has been a notable increase in sales volumes since July 2023 following the initial
reduction in activity experienced earlier in 2023 due to the tightening interest rate cycle.
Overall accommodation choice in Perth remains constrained with record low vacancy rates
compounded by building cost pressures slowing down new housing supply. The Company
believes that Perth property prices will continue to rise throughout the calendar year. This
should lead to improved margins for projects that have been intentionally delayed.
This adds support to current and proposed feasibilities which have been affected by the post
pandemic increases in construction costs.
The Company will soon be re-launching Bel-Air, a 196-apartment project at 239 Great
Eastern Highway as its next major project marketing commencement.
Capital Management
The Directors have determined that the Company will not pay an interim dividend for the
half-year to December 2023 but will reward shareholders through the most appropriate
capital management means at the conclusion of the major projects due for completion in
the middle of the 2024 calendar year.
Outlook
The Company continues to be encouraged by the upward price movement for both new and
used apartment stock in Perth which is supporting the viability of development-ready
projects in the Company development pipeline. This will commence with the re-launch of
Bel-Air apartments in Belmont in March 2024.
Finbar Managing Director Darren Pateman commented: “Our Company is very much looking
forward to the completion of major projects Civic Heart and Aurora mid-year so we can
reward our patient shareholders and focus our efforts on commencing the next round of
projects in our pipeline.”
- ENDS Approved for release by the Board.
For further information, please contact:
Peter Kermode
Cannings Purple
Mobile: 0411 209 459
Email: pkermode@canningspurple.com.au
Finbar Group Limited, its controlled entities and its jointly controlled entities, is a property development company
whose core business lies in the development of medium to high density residential apartments and commercial
property within the Perth Metropolitan Area within the State of Western Australia.
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