Finbar Reports $2.78m net profit
Released
Released
Announcement PDF
23 August 2023
2023
ASX Market and Media Announcement
Finbar Group reports $2.78 million net profit
Highlights
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Finbar reports a net profit of $2.78 million for the 12 months to 30 June 2023
AT238 apartment tower completed in second half of FY2023
Dianella apartment project fully sold
Projects valued at approximately $680m currently under construction to be delivered in
FY2024 and FY2025
Perth, 23 August 2023: Western Australia’s leading apartment development
company, Finbar Group Limited (ASX: FRI), is pleased to report a net profit after tax
of $2.78 million for the financial year ended 30 June 2023, compared with $10.98
million the previous year.
In a year focused on the ongoing construction of major projects Civic Heart in South
Perth, Aurora in Applecross, and The Point in Rivervale, Finbar apartment
settlements were limited to the Dianella apartment project, which has now sold
out, and the recently completed AT238 tower in the Perth CBD.
The Company also wrote down the value of its Fairlanes commercial investment
property by $3 million.
Finbar’s other investment property, the Pelago apartment complex in Karratha,
continues to perform well. It is 98% per cent occupied and generated rental income
in FY2023 of $6.0 million.
CAPITAL MANAGEMENT
The company ended the financial year with $18.2 million in cash. Coupled with the
cash commitments from joint venture partners for joint venture projects, the
company is adequately capitalised to fulfill all working capital commitments and
contingency provisions for all projects currently under construction.
SALES UPDATE
The current sales pipeline is as follows:
PROJECT
AT238
CIVIC HEART
AURORA
THE POINT
GARDEN TOWERS
SOLD
$M
$56.3
$226.0
$55.0
$74.8
$96.0
NOT SOLD
$M
$44.6
$201.7
$91.0
$30.6
$160.5
EST. COMPLETION
DATE
Completed
2H FY2024
2H FY2024
1H FY2025
TBC
Finbar Managing Director, Darren Pateman, commented: “The company continues
to face challenging trading conditions, with higher than forecast construction costs
and sales dampened by the current cycle of rising interest rates.”
“However, construction costs have begun to stabilise and there is increasing
confidence that interest rates are nearing their peak.”
“Finbar has approximately $680 million in project value under construction,
expected to be delivered to market later this financial year and the first half of
FY2025. Although apartment prices have not risen significantly in recent years, we
are confident that the chronic shortage of accommodation in Perth, combined with
population growth and interest rate stability, means our projects will be well
received when they are delivered to the market.”
OUTLOOK
The company currently holds a pre-sale book of $452 million which is the highest
level of unsettled sales since 2015.
Based on the completion timing of projects, the Company anticipates revenue for
FY2024 will be second half weighted with the anticipated completion of Civic Heart
and Aurora resulting in a significant settlement revenue contribution from these
projects.
FY2025 will likely see ongoing settlements from Civic Heart, Aurora, and first
settlements from The Point in the first half of the 2025 financial year.
DIVIDEND
The Finbar Board has resolved to conserve capital and no dividend will be paid for
the 2023 financial year. The Board is investigating best options for returning capital
to shareholders upon completion and settlement of the current major apartment
projects.
ENDS
For further information, please contact:
Peter Kermode
Cannings Purple
(M) +61 411 209 459
(E) pkermode@canningspurple.com.au
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