The Lendlease Group (ASX: LLP) share price is in focus after the company reaffirmed FY26 earnings per security guidance for its core Investments, Development and Construction (IDC) business at 28–34 cents, while updating investors on the progress of its capital recycling program.
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What did Lendlease report?
- FY26 earnings per security guidance (IDC segment): 28–34 cents, subject to targeted completions
- Underlying group gearing at FY26 expected in the mid-30% range
- New work secured for Construction in FY26 expected to be ~$6.5 billion
- Backlog Construction revenue at 30 June 2026 forecast at ~$8 billion
- Over $2.9 billion in Capital Release Unit (CRU) transactions announced or completed since May 2024
What else do investors need to know?
Lendlease continues to work through its asset recycling strategy, with several major transactions close to completion. These include the TRX Retail and Office divestment in Malaysia (~$400 million) and multiple UK development projects in a joint venture with The Crown Estate (~$300 million), both anticipated to settle over FY26 and FY27 depending on conditions.
Underlying group gearing is now expected to be in the mid-30% range at June 2026, reflecting the timing of asset sales and more challenging market conditions. Management highlighted that most large, complex capital recycling transactions are either complete or nearing finalisation, which should assist in reducing net debt and simplifying the business.
What's next for Lendlease?
Lendlease plans to continue simplifying the business while prioritising capital efficiency and debt reduction. With a significant pipeline of capital recycling transactions in progress and major development commitments winding down, the company expects improved cash flow in FY27. Management is also focused on a more streamlined approach to capital recycling and a capital-light partnering model for major projects.
The company's investment grade credit rating was reiterated in May 2026, supporting future plans. As FY27 approaches, further asset sales and settlements are expected to drive lower capital outflows, while Construction and Investments divisions aim to generate positive cash flow independently.
Lendlease share price snapshot
Over the past 12 months, Lendlease shares have declined 55%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 1% over the same period.
