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DIFFICULT trading conditions have not stopped FKP Property Group (ASX: FKP) from reporting a FY11 net profit of $82.3 million, representing a 62 per cent increase on the previous financial year.
Strong contributions from its residential and retirement divisions underpinned the earnings. Residential reported a 19 per cent jump in sales revenue to $118.9 million, while the average margin on retirement resales increased from $79,000 to $91,000 in fiscal 2011.
FKP CEO and MD Peter Brown (pictured), says the strong result reflects his employer’s assets and diversification.
“The underlying quality of our assets has driven strong profit growth with both our Residential Communities and Retirement divisions delivering record contributions for the year – a testament to the strength of our residential platform and mature retirement portfolio,” says Brown, in a statement to the ASX.
Having reweighted its development portfolio towards residential, FKP is poised to deliver further growth from its national residential platform. The developer will focus on unlocking value from the roll out of the master-planned communities and residential apartments.
Comprising 250 apartments and mixed-use space, the first stage at Albion Mill in Brisbane is expected to be launched in September. Applications for master plan approval and a development permit for stages two and three have been submitted.
More residential apartments to be developed include the mixed-use urban renewal project at The Gasworks in Newstead, which is will create 1,700 apartments and generate more than $850 million in revenue.
Meanwhile, the retirement division profit is tipped to show positive growth in FY12 through continued improvements to ongoing unit buybacks and reactivation of the development pipeline.
FKP owns or manages a total of 76 villages and more than 9,786 units across Australia.
Shares are trading at $0.50 per unit.
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