Bottom-line profit from $3.3 billion industrial and logistics landlord Goodman Property Trust dropped in the first half of this year compared to last year due to less-spectacular property revaluations.
The business made $224.3 million in last year's first half, falling to $176.3m net profit after tax in this latest six months to September 30, 2020, although revenue rose from last year's $84.1m to $87.3m this year.
Property valuations were the main influencer, rising $172.4m in last year's first half but $140.2m in this latest period.
That pushed down pre-tax profit from $236.4m last year to $186.4m this year, accounts showed.
Chairman Keith Smith called the result solid and said it was achieved despite a more challenging operating environment.
"We've adapted to the disruption of Covid-19 and continued to execute our investment strategy for the Trust. New acquisitions, further development progress and recent capital management initiatives have maintained positive momentum in the business," Smith said.
Changing consumer behaviour is driving the acceleration of e-commerce, Smith said. Customer demand for well-located warehouse and logistics space has continued to support the trust's portfolio fundamentals and targeted development activity.
John Dakin, chief executive, said: "We're extremely pleased with the resilience of the business. Occupancy has been maintained at almost 100 per cent, year-to-date rental cashflows are consistent with our expectations and development enquiry remains strong."
Cash earnings of at least 6.3cpu are now expected for the year, an increase of 0.1cpu from earlier guidance. Distribution guidance remains unchanged, with full-year cash distributions of at least 5.3cpu being reaffirmed.
The trust has $87.7m of development work on, including the recommenced 9000sq m warehouse project at M20 Business Park in Wiri. The development, which has a total cost of $25m, was one of the two build-to-lease projects that were paused earlier in the year while the impacts of Covid-19 were being assessed.
"The resumption of the M20 project reflects current customer demand and expectations of increasing economic activity," Dakin said.
Inquiry levels for development is strong, he said.
The trust has 8.9ha of land to develop and is aiming to secure tenant pre-commitments.
The acquisition of various properties neighbouring the trust's Savill Link and Mt Wellington industrial estates is consistent with this strategy. The properties have a combined land area of 14.5ha, he said.
He also noted that the trust had issued $200m of eight and 10-year fixed-interest-rate bonds to New Zealand wholesale investors in September.