Goodman Group (ASX: GMG) shares aren't going anywhere on Wednesday.
This morning, the industrial property giant has released its half year results and requested a trading halt.
Let's dig deeper into what has been announced this morning.
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Goodman shares in trading halt on results day
- Operating profit up 8% on the prior corresponding period to $1,222.4 million
- Operating earnings per share (OEPS) up 7.8% to 63.8 cents
- Statutory profit of $799.8 million (from $220.1 million loss)
- Distribution per share of 15 cents
- Capital Raising: $4 billion via an institutional placement and up to $400 million through a share purchase plan.
- FY 2025 Guidance: 9% OEPS growth (would have been 10% excluding the capital raise)
What happened during the half?
Goodman Group has delivered another strong performance in the first half of FY 2025, reporting an 8% increase in operating profit to $1,222.4 million.
This was driven by solid execution of its global strategy, with continued growth across logistics and data centre developments. OEPS climbed 7.8% to 63.8 cents.
Goodman's total portfolio was $84.4 billion at 31 December 2024, up 7% on 30 June 2024 with a sky high occupancy of 97.1%.
The company's global development work in progress (WIP) was maintained at $13 billion with an annualised production rate of $6.5 billion.
And with a yield on cost of 6.7% for projects in WIP, they are providing strong margins with development earnings of $700.7 million for first half. The good news is that development earnings are expected to provide an equally strong contribution in the second half of the year.
The company has declared a distribution of 15 cents per share for the first half, with full year distributions forecast at 30 cents per share.
Looking ahead, Goodman has maintained its FY 2025 OEPS growth guidance at 9%, which factors in the impact of its latest capital raising efforts. If not for this capital raise, guidance would have been 10%, which goes some way to highlighting the underlying strength of its operations.
Capital raising
In a move to support future growth, Goodman is raising $4 billion through a fully underwritten institutional placement, alongside a share purchase plan (SPP) for eligible investors to raise up to $400 million.
Goodman is raising these funds at $33.50 per new share, which represents a 6.9% discount to its last close price of $35.98.
Management notes that these funds will provide financial flexibility to expand its logistics and data centre developments, reduce gearing in the short term, and support overall working capital.
Goodman CEO, Greg Goodman, said:
Goodman's strategy of providing essential infrastructure for the digital economy – both through our logistics facilities and data centres – has set a strong foundation for the growth we expect to see by executing the global data centre opportunity before us.
Our 5 GW power bank sits across 13 major global cities – primarily in metro locations – to facilitate cloud and AI deployments. By June 2026, we expect to have commenced the development of new powered shells and fully fitted facilities, reflecting approximately 0.5 GW8. These projects across Sydney, Melbourne, Los Angeles, Tokyo, Paris, Amsterdam and Hong Kong will have an estimated end value of greater than $10.0 billion.
Commenting on its outlook, Goodman said:
The global opportunity set provided by the increased demand for data centres is driving the positive outlook for the Group. With access to power on existing sites in metro locations, and proven track record in delivering complex infrastructure developments, Goodman is well-positioned to benefit from this demand. Supply remains constrained in our locations, and combined with our attractive development workbook, provides opportunities to optimise our capital allocation and support future growth – particularly in the data centre space.
