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25 February 2010
Strong First Half Result With Significant Project Wins
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 | Statutory Profit after Tax of A$204.9 million for the half year ended 31 December 2009 |
| Statutory Profit after Tax includes net property investment revaluation gains of A$17.0 million after tax |
| Interim dividend of 20 cents per security, franked to 100% |
| Significant project wins across the Group |
Lend Lease delivered a Statutory Profit after Tax for the half year ended 31 December 2009 of A$204.9 million despite difficult economic conditions and currency headwinds.
The Group has continued to strengthen its pipeline with its selection as developer or preferred bidder on a number of significant projects. These include:
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| The A$2.5 billion RNA Showgrounds redevelopment; |
| Stage 1 of Barangaroo, the largest CBD development in the history of Sydney with an end development value of cA$6.0 billion; |
| The A$1.4 billion ING Retail Property Fund portfolio. Lend Lease will have an investment of cA$200.0 million in the ING portfolio, which it will seek to sell down over time. Lend Lease has commitments from its managed funds and other investors to acquire cA$1.2 billion of the portfolio; |
| The c£1.5 billion regeneration of Elephant & Castle in the UK; and |
| The first stage of the 710 hectare Alkimos Community Development in Western Australia with an end development value of over A$400.0 million. |
The Group’s Retail, Communities and Public Private Partnership business units performed well despite difficult market conditions. The Project Management & Construction business in Asia Pacific performed strongly with a record profit for the half year. This was however offset by weaker results from our construction businesses in the US, Europe and the Middle East which continued to be impacted by weak market conditions.
The Group’s Statutory Profit after Tax for the period of A$204.9 million includes net property investment revaluation gains of A$17.0 million after tax, primarily relating to the Group’s interest in the Somerset shopping centre in Singapore which commenced trading during the period. The Group has continued to recycle capital through the sale of the Group’s interest in the Millennium Dome and the Queen’s Hospital, Romford releasing A$65.4 million of cash.
| Dec 2009
A$m | Dec 2008
A$m |
| Operating Profit after Tax | 187.9 | 185.4 |
| Property Investment Revaluations | 17.0 | (169.6) |
| Other net write downs and charges | | (612.2) |
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| Statutory Profit / (Loss) after Tax | 204.9 | (596.4) |
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| Interim Dividend (1) | 20 cps | 25 cps |
| Earnings Per Security (EPS) on Operating Profit After Tax (2) | 40.9 cps | 46.1 cps |
| (1) | The interim dividend is 100% franked; the interim dividend for the period ended 31 December 2008 was 60% franked |
| (2) | EPS is calculated based on Operating Profit after Tax and the weighted average number of securities on issue including treasury securities. |
Lend Lease declared an interim dividend of 20 cents per security, franked to 100%. This represents a payout ratio of 49% of Operating Profit after Tax for the half year.
In view of the proposed capital raising announced by Lend Lease today, Lend Lease will suspend its Distribution Reinvestment Plan for the December 2009 interim dividend.
Group Debt
Lend Lease had cash reserves of A$967.5 million and gearing of 9.2% (net debt including other non-current financial liabilities to total tangible assets, less cash) as at
31 December 2009.
Lend Lease has today separately announced plans to raise A$806 million of equity. The pro forma impact of the raising would have been to move the Group to a positive net cash position of cA$38 million as at 31 December 2009.
Outlook
Commenting on the outlook for Lend Lease, Group CEO and Managing Director, Steve McCann said: “Lend Lease delivered a strong result in the first half of the financial year which included the successful recycling of mature assets such as the Group’s interest in the Millennium Dome and the Queen’s Hospital, Romford. Market conditions for our construction business in the US and Europe remain very difficult and our earnings have been impacted by the strong Australian dollar.
“Nonetheless, Lend Lease continues to perform well despite these challenging conditions due to our diversified business model, mix of active and passive earnings and our focus on reducing overheads.
“We remain confident of the Group’s outlook over the long term. The Group has demonstrated a capacity to perform well in the face of extraordinary global conditions. We have a well defined strategy, a clear view of where the opportunities lie and are well placed to leverage our competitive advantages. For the year ending 30 June 2010, Operating Profit After Tax is expected to be broadly in line with the year ended 30 June 2009, before the benefit of the capital raising.” Mr McCann said.
For further information please contact:
Sally Cameron
Lend Lease Corporation
Tel: 02 9236 6464
Attachments:
Management Discussion & Analysis
Investor Briefing Presentation [pdf - 2.57mb]stock exchange
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