27/07/2015 - 11:57

Completions, competition weigh on Finbar profit

27/07/2015 - 11:57


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Finbar Group managing director Darren Pateman

Finbar Group's run of full-year net profit records appears to be over, with Perth’s biggest apartment developer flagging a net profit of $25.5 million for the 2015 financial year, around $11 million down from last year.

However, the result is a rebound from a slight dip in net profit in the first six months of FY2015, when Finbar recorded an $11 million result. 

At the time, the company said it did not expect to extend its run of consecutive record net profit results, which stood at eight years.

Last financial year, Finbar recorded a full year net profit of $36.5 million.

The developer, which recently completed the luxury Toccata apartments in East Perth and Subi Strand in Subiaco, said this year's result was still a solid achievement, in a year where the timing of its project completions, as well as market competition, were significant challenges to profit growth.

Finbar is preparing to launch sales of its 38-storey Civic Heart project in South Perth, which has an end value of more than $400 million, while it finished the financial year with a record $69 million in cash.

Managing director Darren Pateman said each project the developer completed this financial year had contributed to the record profit result.

He said pre-sales contracts in hand totalled $402 million, up from $239 million at the end of FY2014.

“This figure represents more than a 65 per cent increase on the previous financial year and is now the largest pre-sale level in the company’s history, which will underpin our future earnings growth,” Mr Pateman said.

In total, Finbar has six projects currently under construction, ahead of the launch of Civic Heart in coming weeks.

Mr Pateman said sales were still steady despite softer market conditions.

“With our strong balance sheet, projects under construction and record pre-sales levels, we are very well positioned to continue reviewing our most favoured new opportunities and this provides us with the confidence to commence new projects to meet our medium to long-term growth ambitions,” he said.

Finbar will pay a final dividend of 6 cents per share, taking its full-year payout to 10 cents per share.


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