The Charter Hall Group (ASX: CHC) share price has raced into the green on Tuesday after the company posted its FY24 results.
Shares of the ASX REIT have surged nearly 14% to $13.77 at the time of writing as investors react positively to the update.
Let's see what the company posted.
Charter Hall share price jumps on FY24 results
The key takeouts from the year include:
- Operating earnings of $358.7 million, with operating earnings per security (OEPS) of 75.8 cents
- Produced a FY24 statutory loss of $222.1 million
- Distributions came to 45.1 cents per security, in line with the last 12 months
- Property investments were valued at $2.8 billion at year's end
- Funds Under Management (FUM) settled at $80.9 billion, including $65.5 billion in property FUM
What else happened in FY24?
FY24 was an interesting one for the Charter Hall share price. It was also a year of strategic adjustments for the business. The company reported operating earnings of $358 million despite a statutory loss of $222 million.
Even so, management declared distributions of 45.1 cents per security.
Meanwhile, the company's group FUM decreased by $6.5 billion, ending the period at $81 billion.
Reductions were largely driven by property devaluations and divestments throughout the year, totalling $8.5 billion.
Despite these challenges, Charter Hall's property investment portfolio was firm, with a value of $2.8 billion and a high occupancy rate of 97.4%.
The weighted average lease expiry (WALE) on the portfolio was 7.2 years, whereas the portfolio capitalisation rate was up 80 basis points to 5.7%.
It also completed $1.3 billion of developments over the year.
Management says the development pipeline is valued at $12.5 billion, including nearly $5 billion of "committed developments". This could impact the Charter Hall share price.
What did management say?
Charter Hall's CEO, David Harrison, was encouraged by the performance in FY24:
FY24 has seen us focus on the ongoing curation of the portfolios we manage, selective development, partnering with our tenant and investor customers to meet their needs and closely managing our cost base. This has seen us deliver a good result set against a tough real estate environment.
Harrison also highlighted the company's commitment to sustainability, noting that Charter Hall is on track to meet its Net Zero carbon emissions target by 2025.
What's next?
Looking ahead, management is cautious on the operating environment, as questions on the broad economy emerge. But it still sees plenty of growth potential.
The company expects FY25 earnings per security to grow to approximately 79 cents, with a 6% increase in distributions. Moreover, it is ready to pounce on any opportunities:
With evidence emerging of a slowing economy and inflation trends moderating, we consider ourselves well positioned to take advantage of a lower interest rate environment as it emerges.
We see current market pricing as offering attractive long-term returns for stabilised core real estate products and value-add development and opportunistic strategies and it's our expectation that capital deployment will increase to take advantage of market conditions.
Charter Hall share price snapshot
The Charter Hall share price has pushed 24% into the green over the past 12 months, offering a substantial advantage over the sector and the broader market.
It is up 12% this year to date.
