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Results: Aventus delivers solid growth in FY 2019

On Wednesday the Aventus Group (ASX: AVN) share price pushed higher following the release of a strong full year result.

The shares of the owner and operator of large format retail parks across Australia rose over 2% to hit a 52-week high of $2.62.

How did Aventus perform in FY 2019?

Aventus was a solid performer in FY 2019. It reported like for like net operating income (NOI) growth of 3.5% and achieved a sky-high occupancy rate of 98.4%. The latter even includes centres that are under development.

This led to Aventus reporting funds from operations (FFO) of $96 million or 18.4 cents per security, compared to $89 million and 18.1 cents per security in the prior corresponding period.

As a result of this strong form, Aventus was able to declare total distributions of 16.6 cents per security over the 12 months.

The company also revealed property valuation gains of $85 million and a weighted average capitalisation rate (WACR) of the portfolio of 6.7%, which was steady year on year. This latest valuation gain brings the total gains over the last two years to $202 million, which management advised has been driven by income growth and development.

The company’s CEO, Darren Holland, appeared to be very pleased with its performance in FY 2019.

He said: “I am proud of what my team has again achieved this year. We have achieved strong gains because we remain focused on delivering the strategy that we set out when Aventus listed nearly four years ago.”

Looking ahead, Mr Holland believes the company is well-positioned for growth thanks to the continued momentum from its portfolio.

He expects FFO per security growth of 3% to 4% in FY 2020, which is equal to 19 cents to 19.2 cents per security.

“This coming year our focus will be no different. We will continue to proactively drive asset performance, deliver strong returns from our development pipeline, assess selective capital transactions that improve the quality of the portfolio and execute capital management initiatives to ensure the Group is well-positioned,” added the chief executive.

If the company were to grow its distribution by the same amount as its FFO, it would mean a distribution of approximately 17.2 cents per security in FY 2020. This equates to a forward distribution yield of 6.6% based on its last close price.

Overall, I think this makes Aventus worth considering along with fellow dividend shares Scentre Group (ASX: SCG), Stockland Corporation Ltd (ASX: SGP), and these three.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended AVENTUS RE UNIT and Scentre Group. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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