Diverse markets key to Peet profit lift

Land developer Peet has banked a solid lift in revenue on the back of strong performance by its operators in Victoria, resulting in a 27 per cent rise in net profit.

Peet today announced to the ASX that its revenue was up by 22 per cent over the previous financial year, to $354 million, which drove a net profit of $38.5 million.

Managing director Brendan Gore said development projects were a standout, particularly in Victoria.

“The diversity of our national land bank has enabled us to manage the variable market conditions across the country during the year, and we are well placed to pursue the right growth opportunities, as and when they arise,” he said.

Mr Gore said Peet was well placed to continue further growth, with seven projects in key markets across growth corridors in major Australian cities to be launched in FY2016.

But he said prospects for growth in Western Australia were not as certain.

“The Australian property market continues to benefit from good population growth, a low interest rate environment and relatively low unemployment rates,” Mr Gore said.

“However there also remain some key challenges including changing consumer and business sentiment, the contracting resources sector, particularly in Western Australia and other job losses in the manufacturing sector, as well as the ongoing issue of affordability.”

Nonetheless, Mr Gore said Peet entered the new financial year with $127 million in cash and debt headroom, with a number of quality projects nearing the construction and development phase.

“We have the experience, a committed team and the right business strategies to target earnings growth,” he said.

“We are well positioned to deliver more than 3,500 settlements in FY16, with earnings expected to be skewed to the second half. ”