Snow turns to cash for MFS Living

A STRONG result in ski resort and aquarium operations have buoyed MFS Living and Leisure's 2007 financial year.

MPY has reported a net profit of $14.22 million for the 12 months ended June 30 2007 – an increase of 936.9% when compared to a net loss of $1.7 million in the last year.

Chief executive Marshall Vann said the group’s results reflect a year of significant growth and development for MPY and the bedding down of a number of significant projects expected to be completed in the next 12 months.

“The FY07 result has been bolstered by strong results from property developments and we expect this to continue,” he added.

MPY’s Australian Alpine Enterprises reported EBITDA of $13 million supported by strong property sales at Dinner Plain at Mt Hotham, exceeding the prospectus forecast by 3.6%. The poor 2006 snow season reduced the revenue from the Victorian ski resorts Hotham and Falls Creek by $7.7 million, however tight expense control contributed EBITDA of $7 million which is only $4 million behind forecast.

Vann said significant property developments by AAE are also expected to contribute to an increase in overall AAE EBITDA over the coming reporting period.

MPY’s Oceanis group reported a 7.3% increase in EBITDA to $21.5 million, exceeding prospectus forecasts and including the commencement of the property development at Northbank Place in Melbourne.

Vann said Oceanis has identified a strong pipeline of growth opportunities in the aquarium industry and is currently in final negotiations on sites in Toronto, Prague and Lake Ilsan in Seoul. Oceanis is also working on a promising site in Hong Kong.

“The construction of the $200 plus million Northbank Place development, adjacent to the Melbourne Aquarium, with joint venture partner Far East Consortium is forecast to deliver EBITDA for MPY of circa $10 million over the coming FY08 and FY09 periods.

“The Northbank Place three tower developments have all been pre-sold and are being built under fixed price construction contracts,” he added.

Vann said MPY has a significant pipeline of property opportunities that will provide added growth to MPY, primarily at the ski resorts.

“We expect property will contribute between 10% and 20% of EBITDA over the next five years,”

Vann said MPY will continue to look at suitable investments in leisure to drive diversity in its business portfolio while delivering superior yield to investors.

A final distribution of 3.17 cents per stapled security was declared, bringing the full year distribution to 10.17 cps.

MPY has provided guidance on its FY08 distribution to show double digit growth to at least 11.5 cps.

MPY shares closed 1 cent higher at 88 cents.

Australian Property Journal