17/02/2021 - 11:45

Cedar Woods posts profit increase

17/02/2021 - 11:45

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Cedar Woods Properties has posted a net profit of $22.4 million for the first half of the 2021 financial year, up 120 per cent on the same time last year.

Cedar Woods posts profit increase
The group has sold about 50 per cent of its townhouse product at its Subiaco project, which launched in November. Image: DKO

Cedar Woods Properties has posted a net profit of $22.4 million for the first half of the 2021 financial year, up 120 per cent on the same time last year.

The ASX-listed property group said the increase in net profit after tax reflected the delay of some settlements from FY20 due to COVID-19, as well as the impact of state and federal government stimulus measures in boosting housing demand.

Cedar Woods is now forecasting a full-year net profit after tax of about $29 million, subject to market conditions.

Total revenue for the first half of FY21 was up 31 per cent on the first half of FY20, at $169.2 million.

“Cedar Woods’ strong first-half performance can be attributed to the diversification and quality of our property portfolio combined with the government stimulus the housing sector has benefitted from across the nation,” Cedar Woods managing director Nathan Blackburne said.

“Low levels of supply and pent-up demand in some markets have helped ongoing sales activity, seeing Cedar Woods record very healthy presales of more than $380 million.”

About 30 per cent of those pre-sales are expected to settle in the second half of FY21, with the balance expected to contribute to earnings in the following years.

The group settled 582 lots (lots, homes, offices) during the first half of the calendar year.

“We remain in a strong position with a solid balance sheet, low gearing and significant undrawn finance facilities as we continue to assess acquisition opportunities in a number of markets to boost our portfolio and future earnings,” Mr Blackburne said.

“Favourable conditions are expected to continue as the economy recovers and while Cedar Woods’ second-half earnings performance will be lower than the first, we expect strong growth in earnings for the full year, subject to market conditions remaining positive.”  

During the first half of FY21 Cedar Woods launched four projects in Western Australia, Queensland, Victoria and South Australia, with several other developments under way.

That included its 41-townhouse Incontro project on Salvado Road in Subiaco.

The group said the first two releases of Incontro, designed by DKO architects, had largely sold out and that 50 per cent of the townhouses were now sold.

Home builder Webb and Brown-Neaves was appointed to the project last year.  

At the time of writing, Cedar Woods shares were up 0.7 per cent at $7.29 per share.

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