Property For Industry, the industrial property investor, reported a record full year profit on higher revenues and lower costs and remained upbeat about the current financial year.

Net profit rose to $123.4 million, or 27.4 cents per share, in calendar 2016 from $72.8m, or 17.3 cents, in the prior year, the Auckland-based property investor said in a statement. It noted that non-operating income and expenses which, for the most part, comprised an $88.2m fair value gain on investment properties, were more than double the amount in the prior year at $89m.

Distributable profit, which strips out unrealised movements in the value of the property portfolio, was $34.1m, or 7.58 cents per share, 8.1 per cent higher than the prior year when distributable profit was $29.6m, or 7.01 cents. The board declared a fourth-quarter dividend of 2.05 cents per share, taking total cash dividends for the year to 7.35 cents per share.

PFI's operating revenues increased 6.2 per cent to $71.1m. Operating expenses fell 7.9 per cent to $28m.


"We've maintained our focus on industrial property, concentrated on extracting value from strong Auckland demand and watched and waited for favourable investment opportunities," chairman Peter Masfen said.

Looking ahead, Masfen said it expects distributable profit before management performance fees to be between 7.5-and-7.7 cents per share "subject as always to economic conditions." It also expects to pay a cash dividend of "at least" 7.35 cents per share in 2017.

The company's 83 properties were valued at $1.08 billion as at December 31 versus 84 properties and $986.6m in the prior year as several properties increased in value. Its occupancy rate remained steady at 99.6 per cent. The weighted average lease term was 4.79 years, compared to 5.18 years in the prior period. Its annual contract rent was $72.5m, up from $72.3m a year earlier.

PFI's shares last traded at $1.615 and have increased 4.2 per cent over the past 12 months.