Stockland lowers payout, CEO to exit

Stockland has flagged a reduced second half distribution after reviewing the impact of COVID-19 pandemic on its business.

In a separate announcement, the property group also said chief executive Mark Steinert will retire after more than seven years at the helm.

The reason or timing of Mr Steinert’s departure was not specified but Stockland said it will begin looking for a replacement from a field of internal and external candidates.

Chairman Tom Pockett said there would be a flexible transition to ensure a handover and strong leadership during the COVID-19 pandemic.

Earlier on Monday, Stockland estimated a second-half distribution of 10.6 cents per share will be paid to investors.

The property group had previously forecast the payment to be 14.1 cents per share, but scrapped the figure in March as the economic impact of the virus took hold.

The reduction in distribution is reflective of the impact of COVID-19 on the business during the last quarter of the financial year and the timing of the expected recovery in cashflow, it said.

“Reducing the distribution and retaining this capital will protect our balance sheet and positions us well to navigate the recovery phase,” Stockland added.

It also flagged a considerable hit to commercial property values.

According to draft revaluations as of June 18, book value of its entire commercial property portfolio has dropped 6.0 per cent.

This includes a slide in the value of retail properties by 10.0 per cent. Almost 95 per cent of stores at its shopping centres have now resumed trading, it said.

The company will undertake an independent external valuation of the entire portfolio as at June 30.

Stockland said COVID-19 caused much volatility in the industry and these values could change.

Meanwhile government stimulus for the property market such as the HomeBuilder program, which gives grants to owner-occupiers, was helping its home sales.

Stockland said since mid-May, there had been more inquiries about its residential properties than before the virus crisis.

The company’s full-year results are due on August 25.

Stockland shares were trading lower by 1.1 per cent to $3.58 at 1340 AEST.

Comments

Comment Manually

Twitter

What happens when an ex-Aesop employee decides to start her own nail salon business? You get Buff, a modern-looking… https://t.co/VgAWMiA8S5

4 hours ago

Underpayments in the retail and hospitality sectors was a top priority for the workplace watchdog until Covid-19. H… https://t.co/rQstqL1tz0

6 hours ago

After an 18-month review of APRA, the main music licensor businesses use to play music in their shops and cafes, th… https://t.co/piv36mwUb8

19 hours ago