Rural Funds Group Limited (ASX:RFF) Managing Director David Bryant presents the company's full year FY18 results.Highlights: - Property revenue and AFFO higher for the period due to additional lease income from acquisitions, development capital expenditure and indexation (see page 7).
- TCI and EPU for the period higher mainly due to additional lease income (from investment described above) and non-cash changes in the fair value of investment properties (see page 7).
- FY18 AFFO per unit of 12.7 cents consistent with forecast.
- Forecast FY19 AFFO per unit of 13.2 cents and DPU of 10.43 cents reaffirmed. DPU forecast for FY19 consistent with 4% p.a. growth target.
- Forecast AFFO payout ratio of 79% provides capacity for continuing DPU growth and can be deployed to income generating investments.
- Increase in total assets to 30 June 2018 predominantly due to the acquisition of the Natal cattle property aggregation (settled December 2017), almond orchard development capital expenditure and valuation uplifts (see page 7).
- Pro forma provided to present balance sheet and portfolio metrics following the $149.5m Entitlement Offer and transactions announced 12 July 2018.
- Pro forma gearing of 25% below revised target of 30-35%.
- Pro forma WALE of 12.3 yrsprovides stability of income and long term rental growth via a mix of indexation mechanisms.
- Cattle acquisitions, valuation uplift and capex of $74.6m includes:
- acquisition of Natal aggregation2for $65.0m settled December 2017.
- valuation increase for Rewanof $5.4m or $17%.
- breeder acquisitions and capex of $4.1m.
- Macadamia orchard valuation uplifts for Swan Ridge, Moore Park & Bonmacof $3.3m or 37%.
- Almond orchard valuation uplifts for Mooral, Yilgah& Tocabilof $14.9m or 8%.
- Pro forma cattle sector acquisitions of $69.3m include Comanche for $16.6m (settled July 2018) and JBS feedlots for $52.7m (expected to settle progressively between October and December 2018).
For more, listen to Managing Director David Bryant present.
