Ann: FLLYR: GMT: GMT records 24.4% increase in pr

• Release Date: 17/05/12 11:33
• Summary: FLLYR: GMT: GMT records 24.4% increase in profit before tax
• Price Sensitive: No
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GMT
17/05/2012 09:33
FLLYR

REL: 0933 HRS Goodman Property Trust

FLLYR: GMT: GMT records 24.4% increase in profit before tax

Goodman (NZ) Limited, the manager of Goodman Property Trust ("GMT" or
"Trust") is pleased to announce the Trust's annual result for the year ended
31 March 2012.

Key highlights include:
- A 24.4% increase in profit before tax, from $43.0 million in the previous
corresponding period, to $53.5 million.
- A corresponding $3.8 million increase in after tax profit, to $40.5
million.
- Distributable earnings before tax of $80.9 million or 8.41 cents per unit.
- Full year cash distributions of 6.25 cents per unit.
- Renewed development impetus with the commencement of seven new projects
providing 49,615 sqm of net rentable area. This compares with 11,485 sqm in
the previous corresponding period.
- $63.4 million of new equity funding secured through the Distribution
Reinvestment Plan.
- Further refinancing activity with $132.0 million of bank facilities renewed
and extended at competitive margins (GMT share $106.0 million).
- Strong leasing results across the investment portfolio with over 155,000
sqm of space secured on new or revised terms.
- Achieving an average occupancy rate of 96% over the period with a weighted
average lease term of 5.4 years at 31 March 2012.

Result overview
It has been another successful year for the Trust with the strong financial
performance reflecting the quality of the underlying property portfolio and
the benefits of an active management approach.

Keith Smith, Chairman of Goodman (NZ) Limited, said, "The Board and
Management Team are pleased with the sound operating result that has been
achieved. The 24.4% increase in profitability to $53.5 million and a 4.4%
increase in pre-tax distributable earnings to $80.9 million are particularly
satisfying given the sluggish operating conditions that have persisted."

The additional revenue generated from the Trust's development programme and
earlier acquisitions are reflected in the 2.4% increase in net property
income, to $111.3 million, and the 4.4% increase in distributable earnings
before tax.

A higher effective tax rate this year has reduced distributable earnings to
$74.8 million, compared to $78.0 million in the previous corresponding
period.

The higher tax expense results from the removal of building depreciation
deductions from 1 April 2011. The impact of the legislative change has been
noted in previous annual reports and was incorporated in the earnings
guidance for the year.

On a weighted unit basis, distributable earnings were 8.41 cents per unit
before tax and 7.78 cents per unit after tax, consistent with the guidance
range.

Adjustments for non-cash items including valuation movements, deferred tax,
changes in the cash flow hedge reserve and fair value changes in interest
rate derivatives provides the reconciliation between distributable earnings
and the after tax profit.

The $3.8 million lift in profit to $40.5 million reflects an improved
valuation result this year, although the Trust's portfolio still recorded a
1.2% devaluation overall.

While the movements in non-cash items have no impact on distributable
earnings, they contribute to a reduction in adjusted net tangible assets from
97.3 cents per unit last year to 95.4 cents per unit at 31 March 2012.

Next distribution
The record date for the fourth quarter distribution is 14 June 2012 with
payment on 21 June 2012. The distribution will include a cash component of
1.5625 cents per unit with 0.1852 cents per unit of imputation credits
attached.

This final quarterly payment will result in a full year cash distribution of
6.25 cents per unit, reflecting a payout ratio of 80.4%.

Eligible Unitholders are reminded that the Distribution Reinvestment Plan
continues to operate with a 2% discount and any amendment to their
participation is required by 5:00pm on the record date. Changes should be
advised directly to the registrar, Computershare Investor Services.

Portfolio performance
An active management style and an ongoing focus on customer relationships has
facilitated strong leasing results with 15.8% of the investment portfolio
leased on new or revised terms during the year.

John Dakin, Chief Executive Officer of Goodman (NZ) Limited, said, "The
performance of the investment portfolio is the main driver of the Trust's
financial result and the property services team have worked hard in a highly
competitive market to maintain its strong rental streams."

New service initiatives have enhanced customer satisfaction, helping to
maintain portfolio occupancy at 96%, well above the industry average. They
have also helped preserve the Trust's extended average lease term at 5.4
years, ensuring that rental streams are contracted well into the future.

Development progress
Encouraging progress has been achieved in the development programme with
almost 50,000 sqm of new projects announced during the year.

Super Cheap Auto has been the largest of these with the Australasian
automotive parts supplier committing to a new distribution facility at Savill
Link in Otahuhu. At 20,000 sqm it is the largest design build project
undertaken by GMT since 2006 and one of the largest industrial developments
completed in Auckland over the last 10 years.

There has been further success since the 31 March balance date with a
substantial new commitment from Frucor Beverages Limited at M20 Business
Park.

Frucor, a leading supplier of non-alcoholic drinks, is relocating its
distribution operations from an older facility at the estate, to a new 17,150
sqm purpose built warehouse. The commitment continues the momentum at this
business park, closely following the completion of the Kmart distribution
centre and Bridgestone warehouse projects.

John Dakin said "Progressing our development programme and realising the
value in our strategic land holdings is an important driver of future growth.
It broadens the customer base and enhances the overall quality and value of
the portfolio."

With increasing levels of business activity expected to lift occupier demand
over the next few years a greater level of design-build commitments are
anticipated in 2013 and beyond.
To secure the full benefit of this uplift a limited amount of partially or
uncommitted development is also planned. The timing allows the Trust to take
advantage of the competitive construction pricing that exists at present and
ensures it has the right range of property options to meet future demand.

Capital management
On-going capital management initiatives during the period have maintained the
Trust's strong balance sheet position. These initiatives included:

? Underwriting the Distribution Reinvestment Plan, raising $63.4 million of
new equity;
? Renewing and extending an $80.0 million tranche of the Trust's main bank
facility for a further 5 years; and
? The amalgamation and extension of the $52.0 million bank facility for the
Viaduct Corporate Centre joint venture (GMT share $26.0 million).

Keith Smith said, "Equity issuance through the Distribution Reinvestment Plan
has funded the growth of the development business while the bank refinancing
has allowed us to take advantage of competitive rates that exist at present
to extend the term of these facilities."

The Trust has always adhered to prudent financial policies, typically equity
funding new opportunities.  With property markets strengthening the sale of
assets will also be contemplated with the proceeds recycled back into more
growth orientated investment and development opportunities.

At 31 March 2012, the Trust had a weighted term to expiry across all its debt
facilities of 3.1 years and an interest cover ratio of 2.5 times. The Trust
has also deleveraged with net borrowings now representing 35.7% of property
assets compared to 36.7% last year.

Outlook and guidance
The current business environment is likely to continue over the next 12
months with only modest economic growth anticipated. The Trust is expected to
deliver similar results under these conditions, maintaining its tax paid
distribution at 6.25 cents per unit or around 80% of distributable earnings
for the 2013 financial year.

While immediate growth prospects are limited, rising business confidence and
a positive economic forecast provide a more encouraging longer term outlook.
The Trust is well positioned to take advantage of the anticipated lift in
economic activity with new leasing initiatives and recent development success
strengthening the business.

For further information please contact:
John Dakin

Chief Executive Officer
Goodman (NZ) Limited
(09) 375 6063
(021) 321 541

Andy Eakin
Chief Financial Officer
Goodman (NZ) Limited
(09) 375 6077
(021) 305 316

Attachments provided to NZX:
1. NZX Appendix 1
2. NZX Appendix 7
3. Independent Auditors' Report
4. Investor Presentation
End CA:00222945 For:GMT    Type:FLLYR      Time:2012-05-17 09:33:23