Goodman achieves strong performance for FY17 with operating profit of $776.0 million up 8.6% on FY16 - Seite 4

Management earnings were up 3% supported by positive valuations and development programs and despite the $2.5 billion in asset sales out of the Partnerships. Strong historic returns within the Partnerships have led to performance fees for the Group in FY17 and are forecast to continue beyond FY18. The development and management businesses continued to be strong contributors to Goodman's outperformance, with a combined operating EBIT margin of 67%.

Capital management -- operational flexibility and funding future obligations

Goodman's capital management activities are focussed on providing operational flexibility, the ability to fund financial obligations and support long term growth. The Group undertook several initiatives this year to capitalise on positive market conditions and the strength of the underlying business.

• The Group reduced its gearing target under its Financial Risk Management Policy from 25-35% to 0-25% in line with its current practice
• It amended bank and bond covenants; and
• Completed an exchange offer for US$1 billion in US144A bonds.

The Group received credit rating upgrades from both S&P and Moody's to BBB+ and Baa1 respectively, with a stable outlook, as a result of ongoing improvements and business strategy.

In addition, the Group has also announced the repurchase of all $327 million Goodman PLUS hybrid securities on 2 October 2017 and notes that it has GBP250 million 9.75% EMTN that will mature in July 2018. These capital management opportunities and further deleveraging will see continued interest savings in FY18 and beyond.

Leverage across the Partnerships also declined, reducing look through gearing to 18%. The Partnerships now have $11 billion in undrawn debt, equity and cash, providing capacity to participate in future growth opportunities.

Outlook -- deliberate repositioning strategy expected to sustain long term growth

Goodman is well positioned to capitalise on current market conditions and future opportunities.

The Group's continued strategy to improve asset quality through asset rotation and focus on key gateway markets has proven to be successful over the last few years and should continue to provide strong returns. 

Commenting on the outlook for the Group, Greg Goodman said, "we continue to see the long term benefits of our strategy to provide our customers with smart, modern, well-located logistics facilities, close to consumers.