Property firms look to year ahead

By Anne Gibson, APNZ

Rebuilding in Christchurch is slow to get started. Photo / APN
Rebuilding in Christchurch is slow to get started. Photo / APN

Most of the listed property companies and trusts trading on NZX are about to issue guidance on the year ahead when they hold annual meetings or release full-year results this month.

Unitholders and shareholders in six of the nine businesses trading will meet in Auckland, Wellington and Christchurch from Tuesday till August 28, reviewing performance in the last year and giving an outlook on the market and conditions they trade in for 2013 and three will release annual results.

Jeremy Simpson, Matthew Leach and Fraser Hunter, analysts at Forsyth Barr, said the listed property sector gained 2.4 per cent in July, outpaced by the NZX50 which gained 4.3 per cent.

But over the past 12 months, total returns on the property stocks rose 15.5 per cent, compared with the NZX50's 5.9 per cent gain.

"A stabilising property market plus an attractive dividend yield continues to drive interest in the listed property sector. The defensive quality of the sector's cash flows relative to the broader equity market also continues to appeal.

Our picks are Argosy Property, Kiwi Income Property Trust and DNZ Property Fund," the analysts said.

AMP NZ Office led the gains in share price and dividends, followed by Kiwi, DNZ, Augusta and Argosy.

Property For Industry, AMP and Vital Healthcare Property Trust will also issue results and Property For Industry will also update the market on its leasing progress, the analysts said, and the market was looking forward to receiving earnings and dividend guidance from AMP and Vital.

The listed property sector has been actively trading real estate lately. Goodman has sold its Newmarket Vector Centre for $20.3 million and Argosy settled an insurance claim on its building at 12 Foundry Drive, Christchurch, receiving a net material damage settlement sum of $10 million, less than the $12.5 million book value.

NPT sold 342 Lambton Quay, Wellington, to Robt. Jones Holdings for $24.5 million, $500,000 below the March book value and Kiwi settled the deal to sell Beca House in Auckland.

The analysts said Wellington had office growth opportunities, as the Government was looking for up to 60,000sq m of floor space following the creation of the Ministry of Business, Innovation and Employment whose staff are spread through a number of buildings.

AGMs:

Tomorrow: Kiwi Income Property Trust, Christchurch, 10am
Tomorrow: Goodman Property Trust, Christchurch, 1.30pm
Friday: Augusta Capital, Auckland, 2pm
August 15: DNZ Property Fund, Auckland, 10am
August 22: NPT, Wellington, 9.30am
August 28: Argosy Property, Auckland, time to be arranged

FULL-YEAR RESULTS:

Today: Property For Industry
Wednesday, August 15: AMP NZ Office
Friday, August 24: Vital Healthcare Property Trust

- Anne Gibson

EXPECTATIONS LOW FOR STEEL TUBE RESULT

A depressed construction sector and delays in getting Christchurch rebuilding projects under way are expected to weigh heavily on Steel & Tube's annual result when it reports this week.

The Lower Hutt-based company's net profit for the year to June 30 is expected to fall to around $13 million, down from $17 million a year earlier.

Steel & Tube's first half net profit came to $6.4 million, down $2 million or 24 per cent compared with the first half of the previous year.

The company has complained of subdued activity across all product categories, particularly during September and October, but with November seeing some improvement.

Ongoing uncertainty in overseas markets continue to impact on business sentiment, generally resulting in a cautious approach, the company has said.

Continued seismic activity in Christchurch has also played havoc with rebuilding schedules.

- APNZ

- NZ Herald

© Copyright 2014, APN New Zealand Limited

Assembled by: (static) on production apcf03 at 26 Nov 2014 14:59:53 Processing Time: 421ms