Anne Gibson

Property editor of the NZ Herald

Westfield profits surge 18pc

Global profits at New Zealand's biggest mall operator, Westfield, rose by 18 per cent last year. Photo / NZ Herald
Global profits at New Zealand's biggest mall operator, Westfield, rose by 18 per cent last year. Photo / NZ Herald

New Zealand's biggest shopping mall owner pushed up full-year profit from global operations 18 per cent.

The Westfield Group, with nine malls spread throughout New Zealand, said that in the December year, it made net profit of A$1.72 billion.

See its investor presentation here.

Funds from operations were A$1.47 billion representing 65 cents per security, up 0.3 per cent on the prior year and in line with forecast.

Westfield Group co-chief executives Peter Lowy and Steven Lowy said the year was significant year "as we continued to position Westfield to generate greater shareholder value. The performance for the year has been very good and in line with expectations."

Earnings before interest and tax were A$2.12 billion, up 3 per cent on the prior year. Return on contributed equity was 11.4 per cent for the year.

Net property income was A$2.02 billion, in line with the previous year and up 7 per cent adjusted for divestments.

Management fee income was A$128 million, up 12 per cent and project income was A$194 million.

"Our strategy is to develop and own superior retail destinations in major cities by integrating food, fashion, leisure and entertainment using technology to better connect retailers with consumers. We aim to operate our centres at the highest standards and efficiency to create assets that are highly productive, have strong franchise value and have the ability to attract the world's leading retail brands," the Lowys said.

"We actively manage our capital position with a focus on enhancing our return on contributed equity."

Westfield completed a number of strategic transactions including A$4.1 billion of divestments, A$300m of acquisitions and invested A$800m in development activities. The group has bought 81 million securities for A$774m under its on-market buyback program.

It now has assets under management of A$64.4 billion, a A$2.1bn increase on the prior year.

Over A$1.4bn of new projects commenced in the year, including Westfield World Trade Center retail development in New York. The identified pipeline of development work has increased by A$1 billion to about A$12 billion. This pipeline includes landmark developments at Milan and at Croydon in south London together with the expansion of Westfield London, and the redevelopments of Century City and Valley Fair in California and Miranda in Sydney.

During the year, Westfield raised and extended A$3.9 billion of debt facilities.

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