The continuing success of Australian retailers was a contributing factor behind Centro Retail’s (CER) $113 million net profit attributable to members for the full year ended 30 June 2010.
“2010 was a challenging year for CER but with many pleasing accomplishments including the continued excellent performance of the Australian retail centres, successful refinancing and the recent extension of the Super LLC debt to December 2011,” Robert Tsenin, CER CEO said.
However, the group’s underlying profit was $160 million, down 14 per cent from $186 million in the previous corresponding year.
The drop was due to the stronger Australian dollar and lower average income from its US properties, the company said.
According to CER, its overall property portfolio comprises of 29 investment properties located in Australia worth $1.6 billion and 382 located across the US worth US$4.4 billion. In total, CER owns 411 centres valued at a total of $6.9 billion.
“The Australian CER portfolio has performed very well in FY10 despite the tough operating environment,” Mark Wilson, Centro general manager of property operations for Australia, said.
“Comparable NOI growth of 4.3 per cent was above our expectations from 12 months ago. Occupancy remains high at 99.6 per cent, continuing the trend of the past four reporting periods, and occupancy costs are stable and sustainable at 14.1 per cent.”
Despite capital availability remaining constrained, CER has commenced work on property developments at Box Hill South and Toombul.
“The Centro Box Hill South development involves replacing the existing Target with a new Big W store which is scheduled to open in November 2010. Incorporated into the development, Woolworths extended their supermarket lease for a further 20 years and has also undertaken a store refurbishment and expansion,” Wilson said.
“The repositioning of Centro Toombul has been initiated in response to retailer demand with several major retailers eager to open at the centre. Lincraft and Dick Smith opened at the centre in the first half of FY10.”
Wilson added that for the 2011 financial year, the company will build upon the strong fundamentals of its portfolio and has forecasted that NOI growth will be around 3 per cent.
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