Scentre Group has released its results for the six months to 30 June 2022 with an Operating Profit of $540.5 million up 17.5% compared to the prior corresponding period and Funds From Operations (FFO) of $548.6 million, up 18.3%.
In the six-month period to 30 June 2022, Scentre Group’s business partners achieved more than $12 billion of sales, $800 million more than the first half of 2021 and $500 million more than the first half of 2019, pre-pandemic.
Portfolio occupancy has increased to 98.8%, up 30bps since 30 June 2021. During the first six months, the Group completed 1,579 lease deals, with leasing spreads improving significantly to (3.9%). These lease deals included 585 new merchants of which 108 brands are new to the portfolio.
Average rent across the entire portfolio has increased $5 per square metre since 30 June last year, to $827 per square metre. Average specialty rent escalations were 5.6% for the six months to 30 June 2022. Gross rent collection during the half was $1,250 million, exceeding billings and reducing debtors. The Group has seen continued strong collections with a further $220 million collected in July.
Scentre Group CEO Peter Allen said: “I am very pleased with these results. Our team has continued to drive our business and deliver strong operational performance.
“We’ve grown customer visitation, portfolio occupancy, rental income and cash collection resulting in strong profit growth for the half.
Westfield Plus has grown its membership to 2.75 million, an increase of 550,000 members since the start of this year
“Our customer-focused strategy is to create the places that more people choose to come, more often, for longer. We have welcomed more than 277 million customer visits in the year to date and expect to achieve approximately 500 million visits in 2022.
“Our 42 Westfield Living Centres provide the most efficient and productive platform for our business partners to engage and transact with customers,” said Allen.
Westfield Plus, the Group’s membership program, has grown its membership to 2.75 million, an increase of 550,000 members since the start of this year.
Westfield Direct, an aggregated ‘Click and Collect’ service, which launched in October 2021 continues to grow, with the majority of customers choosing to ‘Click and Collect’ from their local Westfield Living Centre.
The opening of the $55 million rooftop entertainment, leisure and dining precinct at Westfield Mt Druitt
During the half, the $55 million rooftop entertainment, leisure and dining precinct at Westfield Mt Druitt opened resulting in a significant increase in customer visitation and dwell time.
The $355 million investment in Westfield Knox, Melbourne is progressing well with strong pre-leasing and in line with budget. Stage 1, which will open in December 2022 is currently 96% leased.
The Group also continues to make significant progress on its responsible business initiatives across community, people, environment, and economic performance.
Stage 1 of Westfield Knox will open in December 2022 and is currently 96% leased
During the half the Group released its 2021 Responsible Business Report, 2021 Modern Slavery Statement and third Reconciliation Action Plan (2022-2024). Earlier this month the Group announced an agreement with CleanCo to source 100% renewable electricity to power its Queensland portfolio from 2025, consistent with its pathway to achieve net zero by 2030. The Group’s initiatives have seen it recognised as the only company in Australia and New Zealand on the CDP Climate ‘A’ list.
Scentre Group CFO and CEO-Elect Elliott Rusanow said: “Our approach to capital management during the period has seen the Group execute new and extended bank facilities of $2.6 billion, including syndicated bank facilities of $1.4 billion. As a result, the Group has available liquidity of $4.8 billion, sufficient to cover all debt maturities until the fourth quarter of 2025.
“In addition, we have increased our interest rate hedging profile, with 80% hedging for the second half of 2022, 70% at January 2023 and 67% at December 2023.
“Our business is in a strong position to deliver long-term growth by being essential to people, their communities and the businesses that interact with them,” Rusanow said.
