APN Property Group (ASX: APD) and APN European Retail Property Group (ASX: AEZ) have downgraded distributions forecasts for the 2009 fiscal year.
APD has revised its to be approximately $4.3 million (3.0 cents per share) for FY09 – compared with the previous guidance of $5.7 million (4.0 cps).
Managing director David Blight said the market climate continues to be uncertain and volatile.
He also said AEZ has removed it 6.11 cps distribution forecast for FY09 and expects to deliver just 1.5 cents.
Blight said the change in distribution is part of a series of measures to further strengthen the trust’s balance sheet presented by the global financial crisis and its likely effect on European real estate markets.
AEZ will not pay a distribution for the December 2008 half year and has forecast 1.5 cents per security for the June 2009 half year, however this remains subject to market conditions.
Blight said whilst the majority of assets in AEZ’s portfolio continue to perform to expectations, deteriorating operating conditions in a number of the European markets in which AEZ operates are expected to reduce headline net property income in FY2009.
And he expects delays on completing leasing deals, higher doubtful debts charges and rent reductions to certain tenants at AEZ’s properties in Bucharest, Romania (City Mall), Madrid, Spain (Cuadernillos) and Thessaloniki, Greece (City Gate) will negatively impact AEZ’s earnings through 2009.
“APN understands many investors will be disappointed with the distribution reductions however the capital management strategy set out above is a balanced and prudent approach to managing AEZ’s balance sheet in these unprecedented times,” he concluded.
Australian Property Journal
