BWP ups annual payout

Bunnings’ property arm, ASX-listed BWP Trust, will deliver a higher distribution payout to its stakeholders after achieving a solid full-year result.

BWP has announced a final distribution per unit of 8.88 cents, for a total payout of 17.51 cents for the 2017 financial year, up 4.3 per cent on FY16.

The trust posted a 2 per cent increase in revenue to $152.5 million and a 4 per cent rise in profit before gains on investment properties to $112.4 million, however it reported a net profit of $223.8 million for FY17, down 28 per cent, after property revaluations came in at $111.3 million, down 45 per cnet on its FY16 result.

“The trust is well positioned at year end with a core portfolio of well located Bunnings Warehouse properties, balance sheet flexibility, and good future prospects of trust-owned properties that Bunnings has, or is considering vacating,” BWP said.

“The increase in revenue was mainly due to rental growth from the existing property portfolio and from completed property developments during the previous year.”

BWP said in the absence of a significant change in the economy that would direct capital out of the country, it expected an ongoing strong demand for quality property assets which should continue to support the valuation of its property portfolio.

“The trust remains financially disciplined in terms of growing the portfolio and is focused on acquiring properties with good potential for rental growth, valuation upside over the medium term, and longer term alternative use should Bunnings vacate the property,” it said.

“For FY18, the trust expects further rental growth from its core Bunnings Warehouse property portfolio, but at the same time may be transitioning up to four Bunnings Warehouse stores to alternative uses, which may require different lease terms, rent-free periods and capital expenditure to re-position the properties.”

BWP shares were 1.7 per cent lower to $2.90 each at the close of trade.