Landlease (ASX:LLC) share price falls on subdued earnings

Lendlease share price has fallen slightly today, after the company says in AGM its earnings for FY21 will still be subdued due to COVID-19.
The post Landlease (ASX:LLC) share price falls on subdued earnings appeared first on Motley Fool Australia. –

falling infrastructure asx share price represented by disheartened looking builder on work site

The Lendlease Group (ASX: LLC) share price has fallen slightly today after the company advised its earnings for FY21 will still be subdued due to uncertainties surrounding COVID-19. At the time of writing, the Lendlease share price is trading 1.62% lower at $14.59. During Lendlease’s annual general meeting (AGM) this morning, the company also announced that it has multiple pipeline projects to be executed in FY21 and beyond.

What’s in the pipeline?

Landlease says that while the financial result announced in August was disappointing, it has made substantial progress on its strategic agenda, including the development of its project pipeline, and creating new investment partnerships.

The company says it added two new major residential projects to its portfolio – Thamesmead Waterfront in London and a partnership with Alphabet Inc‘s (NASDAQ: GOOGL) (NASDAQ: GOOG) Google in the San Francisco Bay Area. These projects have a combined estimated end development value of $37 billion.

Landlease also announced today that several other pipeline projects have emerged that will produce profit and investment grade product beyond FY21. The most notable is the major urbanisation project, Java Street New York, alongside its partner, Aware Super. This project, with an estimated end value of $1 billion, will transform a full city block into more than 800 residential for-rent apartments. The company says it is also making good progress in securing additional projects in Los Angeles and Singapore.

The group says its plan to divest non-core assets was executed after the sale of its engineering business to Acciona in September. This sale follows separate divestments in United States telecommunications and energy businesses. Potential buyers of Landlease’s services business are also in the pipeline for the the new year after the sales process was paused in the wake of COVID-19. 

Despite all these upcoming projects, Lendlease still expects earnings in the first half of FY21 to be subdued due to the pandemic.

However, Lendlease Chief Executive, Steve McCann, remains optimistic for the year ahead, saying:

Despite these impacts, we remain confident that the significant growth in the secured pipeline, the achievement of planning milestones, and expected investment partner appetite, provides the foundation for accelerating development activity to our target of more than $8 billion of completions per annum. That is an increase of more than 80 per cent on our historical completion rate of $4.3 billion per annum over the last 5 years.

How has the Lendlease share price performed in 2020?

In August, Lendlease posted a net loss of $310 million in its full year results for FY20. Like most property companies with international operations, this was mainly due to its exposure to markets with mandated coronavirus shutdowns. The company also said that, at the time, about 207 of its workers had tested positive to the virus, but fortunately none had died.

The Lendlease share price has lost almost 19% in 2020, as the depressed property market took its toll on the company’s business model. The Lendlease share price began the year at $17.95 before dropping to $9.50 in March during the height of the pandemic. Based on its current share price, Lendlease commands a market capitalisation of $9.9 billion.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of June 30th

More reading

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Eddy Sunarto has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Alphabet (A shares) and Alphabet (C shares). The Motley Fool Australia has recommended Alphabet (A shares) and Alphabet (C shares). We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Landlease (ASX:LLC) share price falls on subdued earnings appeared first on Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!