Mirvac Set to Meet Earnings Target

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Wednesday, October 23rd, 2013
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Mirvac has announced it expects to achieve full-year earnings targets on the back of the strong performance of its investment portfolio.

The property company said it sees net profit rising to between $428 million and $443 million in the 2013/14 fiscal year, while also affirming its full-year guidance for earnings of 11.7 to 12 cents per share.

Dividends payments for the full financial year are expected to be between 8.8 and nine cents per share.

The upbeat forecasts come following a dismal performance for the 12 months to the end of the June, during which project write downs dragged full-year profits down 66 per cent to $139 million.

Mirvac chief executive Susan Lloyd-Hurwitz said earnings for the property business would receive a boost from the strong performance of the company’s investment portfolio, while its development operations enjoyed “strong visibility of earnings into the future.”

A pronounced upturn in the New South Wales real estate market – and apartment projects in particular – underpinned robust results for Mirvac’s residential business in the September quarter.

Housing prices in Australia’s major cities, particularly Sydney, have experienced a surge since the start of the year, with data released by real estate industry company RP Data Rismark indicating that home values in Australia’s state capitals in September surpassed the highs of the 2010 property boom.

Sydney led gains, with home values in Australia’s most populous city rising 2.5 per cent during the month while also gaining 5.2 per cent over the September quarter
“We haven’t seen market conditions this strong since April 2009 for Sydney and May 2010,” said Tim Lawless, research director for RP Data.
Lloyd-Hurwitz said Mirvac now hopes to capitalize upon the opportunities provided by this surge in the property market.
“We are finally starting to see housing volumes and pricing improve, albeit off a low base,” Lloyd-Hurwitz said. “We believe that in order to best take advantage of the residential markets it’s all about having the right product, price point and location.”
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