Port Bouvard forecasts return to solid profit growth

Western Australian property developer Port Bouvard Ltd has forecast profit growth in excess of $40 million this financial year following a profit slump in the 12 months to June 30.

Last year's fall in profit reflected its earlier decision, since reversed, to wind-down the company once its Port Bouvard and Princeton Estate projects were completed.

The sale of assets during the wind-down mode enabled the company to post a $49.9 million profit in 2005-06.

Port Bouvard reversed its position in July 2006 and embarked on an aggressive strategy to replenish its portfolio of projects, resulting in an $18.9 million net profit in 2006-07.

Port Bouvard said this was almost 20 per cent higher than its forecast of $16 million.

The company has added 5,000 lots to its portfolio and achieved gross revenue from continuing operations of $50.7 million for 2006-07.

Port Bouvard managing director Ross Neumann said the results, together with its quality acquisitions, had set a solid foundation for the company as it completed its existing projects and bought newly acquired projects online.

Mr Neumann said its directors anticipated the company returning to higher profit levels in the next three years than experienced in the past and were confident of recording solid profit growth of over $40 million in the current financial year.

"We believe these results strongly reflect the success we have achieved and we are confident the projects that we will be bringing online in the coming 12 to 18 months will provide significant revenue opportunities for our company," he said in a statement.

The company's positive outlook this financial year is based on the settlement of remaining blocks at the Princeton Private Estate at Stirling and Port Bouvard Residential Resort Estate near Mandurah, as well as strong demand for the recently released Oceanique luxury apartments resulting in over $90 million worth of sales to date.

Other projects in the pipeline include residential estates at Dawesville, Melros, Point Grey, Furnissdale and Gidgegannup, with a strategic site in Esperance earmarked for a canal-lot development.

The full text of a company announcement is pasted below

ASX listed property developer Port Bouvard Limited (ASX: PBD) has today reported an after tax profit of A$18.9m for the 12 months to June 30, 2007 - an increase of almost A$3m (or 17.5%) on its earlier forecast of A$16m.

This pleasing profit result for the "re-born" Port Bouvard was on the back of gross revenue from continuing operations of $50.7m, from the company's fully owned Port Bouvard Residential Resort Estate south of Mandurah (WA) and the Princeton Private Estate in Stirling (WA).

In July 2006 the board of Port Bouvard reversed plans to wind-down the company and committed to an aggressive strategy of acquiring projects that would assist it to replenish is product pipeline. To date over 5,000 lots have been added to the product pipeline as a result of this strategy.

Port Bouvard Managing Director Ross Neumann believes these results, together with the quality acquisitions, have set a solid foundation for the company as it completes its existing projects and brings its newly acquired projects online.

"It was important for the company to spend considerable time and resources this year to complete the sales of homesites and our existing projects, and at the same time expand our product pipeline to ensure we have significant revenue opportunities for the future," Mr Neumann said.

"We believe these results strongly reflect the success we have achieved and we are confident the projects that we will be bringing on-line in the coming 12 to 18 months will provide significant revenue opportunities to our company.

"In the next three years, the Directors anticipate Port Bouvard Limited returning to higher profit levels than experienced in the past."

In the past twelve months the company has expanded its product pipeline, with Port Bouvard entering into agreements to purchase sites for five new residential developments in the Peel region, the Perth foothills and in Esperance.

In the fast growing Mandurah-Peel region the company has acquired sites at Dawesville, Melros and Point Grey, while in the Perth hills the company recently acquired land in Gidgegannup, which it is hoped will become a community orientated development targeting the "tree change" market.

In July this year the company acquired a strategic site in Esperance, on Western Australia's south coast - to seek a canal-lot project in this fast-emerging growth region.

The company has also entered into Heads of Agreements for a residential land project at Furnissdale, near Mandurah.

These projects are currently in various stages of the approval process, both environmental and planning, with the first homesites expected to be released to the market in FY2009.

Outlook

The board of Port Bouvard is confident of recording solid profit growth, of over $40m, in the current financial year. This outlook is based on the unprecedented demand for the recently released Oceanique Luxury Apartments and the completion of settlement on the remaining blocks at the Port Bouvard Residential Resort Estate and the Princeton Private Estate.

The highly-anticipated $160 million Oceanique Luxury Apartments development was officially released to the public in July, with sales to date exceeding all expectations. In total, 33 of the 67 apartments have been sold, representing over A$90m worth of sales. These sales will underpin the FY08 profit forecast.

"Sales of Oceanique have exceeded our expectations, but is not surprising given they will be of an unprecedented standard for WA. They will be located at one of the best sites for an apartment complex of this nature - on The Cut golf course, already seen as one of Australia's finest, and overlooking the beach a short stroll away," Mr Neumann said.

"All apartments have been designed so as to ensure dual views, to the golf course and ocean to one side, and over the golf course/estate and estuary to Darling Range on the other.

"Apartment owners will be delivered to either a private lobby or direct into their apartment, depending on the apartment layout (no shared lobbies), which has created a significant privacy factor that has already received tremendous praise from the buyers to date. The variation of sizes and layouts has meant that they are suitable to a larger cross section of the market."

The apartment development is the first in a series of projects Port Bouvard will develop within the Port Bouvard estate during the next three to four years. Future projects include the development of a resort hotel, apartments, golf villas and island homes.