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A $510 million acquisition of a 50 per cent interest in the David Jones, Sydney CBD flagship was the largest acquisition for the financial year for CLW.
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  • The earnings of Charter Hall Long WALE REIT (CLW) grow by more than a third, with earnings on a per-stapled security basis growing 3.2 per cent
  • Over the financial year that ended in June, the REIT enjoyed a 30.4 per cent jump in operating earnings or a $159 million increase
  • The company posted a statutory profit of $618.3 million and raised $652 million of equity in the financial year
  • The entire property portfolio rose by about $1.93 billion during the year, owing to net acquisitions of $1.4 billion and property revaluation uplift of $523 million
  • CLW is up 2.81 per cent on the market with shares trading at $5.12 cents at 12:00 pm AEST.

Charter Hall Long WALE REIT (CLW), a real estate investment trust focused on long weighted average lease expiry assets, increased earnings by over a third.

Over the financial year that ended in June, the REIT enjoyed a 30.4 per cent jump in operating earnings, or a $159 million increase, with earnings on a per stapled security basis grew 3.2 per cent to 29.2 cents.

The company posted a statutory profit of $618.3 million and raised $652 million of equity in the financial year while issuing $700 million Australian dollar medium-term notes (A$MTN) across 7, 8.5 and 10-year maturities at a weighted average all-in floating cost of 1.2 per cent at issue.

Charter Hall Long WALE REIT fund manager said CLW has seen a growing portfolio that has improved assets and tenant diversification and a growing income stream.

“The portfolio is highly diversified across 468 properties valued at $5.6 billion,” he said.

“CLW provides security and continuity of income with a WALE of 13.2 years and 48 per cent of leases that are NNN. These characteristics provide the REIT’s income and distributions significant insulation from market shocks.

“The 16.8 per cent growth in NTA and 3.2 per cent increase in distributions over the year demonstrates the resilience and attractive nature of our portfolio and the security of income it provides.”

The entire property portfolio rose by about $1.93 billion to $5.56 billion during the year, owing to net acquisitions of $1.4 billion and property revaluation uplift of $523 million.

The REIT’s portfolio was 98.3 per cent occupied at the end of the quarter, with 468 properties with a long WALE of 13.2 years. During the year, the portfolio weighted average capitalisation rate increased 65 basis points to 4.77 per cent as of June 30, 2021.

A $510 million acquisition of a 50 per cent interest in the David Jones, Sydney CBD flagship was the largest acquisition for the financial year.

CLW has a weighted average debt maturity of 5.6 years and a weighted average hedge maturity of 3.8 years as of June 30, 2021, as a result of these capital management measures.

The pro-forma balance sheet gearing of 31.4 per cent is still in the target range of 25–35 per cent, while look-through gearing is 39.7 per cent.

CLW reiterated its FY 22 operating (EPS) projection of no less than 4.5 per cent growth above FY 21 operating EPS of 29.2 cents, based on currently available information and barring any unanticipated events or additional COVID-19 effects.

Based on CLW’s closing price of $4.78 on July 1, 2021, this corresponds to a predicted FY 22 EPS of 6.4 per cent.

CLW was up 2.81 per cent on the market with shares trading at $5.12 cents at 12:00 pm AEST.

CLW by the numbers
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