Mirvac Accelerates Residential Sales, Confirms FY25 Earnings Guidance

Robust First Half Performance

Mirvac Group has delivered a resilient interim result for the half year ended 31 December 2024, reporting an operating profit after tax of $236 million. While slightly below the $252 million recorded in the same period last year, the result underscores steady momentum as the company navigates a complex market environment. Earnings per stapled security stood at 6.0 cents, with the group maintaining a consistent distribution of 4.5 cents per security.

CEO Campbell Hanan highlighted the strong residential sales performance as a key driver, with lot sales soaring 51% to 947 units and pre-sales hitting $1.9 billion, the highest since 2018. This surge was bolstered by the successful launch of Harbourside Residences in Sydney, which alone accounted for $700 million in pre-sales during its launch weekend, attracting a significant proportion of repeat buyers.

Strategic Execution and Portfolio Strength

Mirvac’s strategic focus on expanding its living sector footprint is evident, with EBIT from this segment jumping to $26 million from just $2 million a year earlier. The completion of the LIV Aston build-to-rent asset in Melbourne, now 66% leased, and the acquisition of three new land lease communities, further diversify the group's income streams and growth prospects.

The investment portfolio remains robust, with occupancy levels holding firm at 96.2% and positive rental reversion across industrial, office, retail, and living assets. Despite $139 million in investment property devaluations, primarily in office assets, these were offset by gains in industrial and retail sectors, reflecting Mirvac’s prudent asset management and sector diversification.

Balance Sheet and Capital Management

Mirvac’s balance sheet remains healthy, with pro forma headline gearing at 26.3%, comfortably within its target range of 20% to 30%. The company boasts approximately $1 billion in available liquidity, a weighted average debt maturity of 4.5 years, and 44% of its debt portfolio classified as green loans. Credit ratings from Fitch and Moody’s remain stable at A- and A3 respectively, underscoring investor confidence.

Capital partnering initiatives and non-core asset sales totaling around $340 million have been instrumental in strengthening the balance sheet and funding growth projects. These moves align with Mirvac’s strategy to accelerate the release of residential lots into an undersupplied housing market, unlocking value and enhancing returns.

Development Pipeline and Outlook

The company’s development pipeline is substantial, with committed projects expected to deliver over $100 million in future net operating income and $650 million in potential development value. Key projects include ongoing progress at 55 Pitt Street and Aspect Industrial Estate in Sydney, alongside residential developments in Brisbane and Melbourne.

Mirvac reaffirmed its full-year guidance of 12.0 to 12.3 cents per stapled security in operating earnings and a distribution of 9.0 cents per security. The outlook is underpinned by expectations of 2,000 to 2,500 residential lot settlements, further non-core asset sales exceeding $500 million, and continued capital partner engagement.

Looking ahead, Mirvac anticipates a market turnaround supported by easing inflation and interest rates, positioning the group to capitalise on growth opportunities across its diversified portfolio and development pipeline.