Trafalgar Corporate Group has reported a strong rise in net profit for the half-year despite meeting difficult trading conditions in the New South Wales residential sector.
TGP has booked a net profit after tax $30.98 million for the six months to December 31, 2006 – up 100% compared to $15 million in the same period last year.
The group’s revenue increased by 31% to $44.2 million from $33.6 in 2005, and net tangible assets increased by 11% to $2.93 per security.
TGP’s managing director Mark Davidson said it was an encouraging result, achieved despite the difficult trading conditions experienced in the NSW residential sector.
“We continue to capitalise on our substantial development pipeline, and are in a strong position to take advantage of opportunities to expand our development and investment portfolios. The group’s gearing is relatively low at 35%, with approximately 85% of the group’s debt hedged to 2011, and we have significant unused facilities,” he added.
Prospects for the investment division, which has a portfolio valued at $268 million in Sydney, Brisbane, Melbourne and Canberra, remain positive. The division contributed 63% of operating earnings and performed particularly well in Brisbane where 30% of assets are based. In December 2006, the group took advantage of the buoyant Sydney commercial market and sold a North Ryde property for a price significantly in excess of book value.
The development division had a strong half year and contributed 27% of operating earnings, due partly to the diversified nature of the Group’s portfolio and firm markets in Brisbane and Darwin.
Assets under management, at $475 million, were slightly lower following the divestment of the Centenary Square development in Brisbane.
“We expect to continue to make progress in all three divisions in the second half. We have portfolios of prime commercial investment property and development assets in our books at historic cost, and our development division has recently been strengthened with additional senior staff who will allow us to make further gains during the next six months,” he added.
The group has declared an interim distribution of 12.5 cents per security for six months period.
Davidson said the group is expected to pay a distribution for the 2007 full year of 27.9 cents per security.
Australian Property Journal
