The Aventus Group (ASX: AVN) share price is failing to rally after the retailer property owner reported its half year results.
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The Aventus Group (ASX: AVN) share price is relatively flat today. This comes after the largest owner, manager, and developer of larger format retail centres in Australia report its half results for FY21.
At the time of writing, the Aventus share price is trading at $2.82, up 0.71%.
Let’s take a closer look at the announcement and why the share price is flat.
Why the Aventus share price isn’t moving on today’s results?
It appears that people got out and about during the last half. Foot traffic to Aventus’ centres was 8% above pre-covid levels. This traffic wasn’t just window shopping either. The company maintained its cash collections of 98% from its retailer tenants.
With 63 leases negotiated during the period, Aventus managed to increase its occupancy level to 98.5%. Aventus puts this down to its affordable rent compared to other retail sub-sectors, strong sales growth, and solid traffic performance.
Revenue remained flat at $87 million, with a negligible increase of 0.1%. However, net profit after tax (NPAT) increased by 43% to $103.4 million. Although an impressive result, it is worth keeping in mind that the majority of this was due to a $25.7 million increase in the net fair value of its property. Excluding accounting adjustments, funds from operations (FFO) were $55.9 million, an increase of 6.5%.
The forward outlook is strong
Aventus also upgraded its guidance for FY21, stating that it expects FFO of at least 19 cents per security. This would represent an increase of at least 4% from FY20. However, this guidance has been given on the assumption of no additional outbreaks of COVID-19. Additionally, this will rely on no new significant government restrictions.
The company’s CEO, Darren Holland, provided the following statement on Aventus’ results and outlook:
On capital management, we preserved value for investors by not raising capital through a dilutive equity raising. Additionally, the prudent management of our relief agreements resulted in an additional $2millionof rent being billed and our focus on cash collection resulting in98% of rent for the period collected. Pleasingly, we increased occupancy to 98.5% and reported a $46 million net valuation gain mainly driven from income growth and the completion of our Caringbah development
Pertaining to the company’s outlook, he stated:
Aventus remains focused on our strategy of optimising portfolio performance,seizing consolidation opportunities, building our development pipeline and diligent capital management. It has proven to be a successful formula from year to year and we remain confident in its value
Aventus also interestingly pointed to its diversified income opportunities in its results. Both solar projects and ticketless parking have been earmarked as drivers for added income streams.
The company now has $2.1 billion of assets under management.
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Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia has recommended AVENTUS RE UNIT. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.