Garda Property Group reported a 16% rise in revenue and a 20% increase in funds from operations for the first half of 2026, while net profit after tax fell by nearly 24%. The group declared a steady interim distribution of 4 cents per security.
- Revenue increased 16% to $17.6 million
- Funds from operations up 20.3% to $8.9 million
- Net profit after tax declined 23.6%
- Interim distribution maintained at 4.0 cents per security
- Total assets and net tangible assets slightly decreased
Mixed Financial Signals in 1H26
Garda Property Group has released its interim results for the six months ended 31 December 2025, revealing a nuanced financial performance. The group reported a solid 16% increase in revenue to $17.6 million and a 20.3% rise in funds from operations (FFO) to $8.9 million, signalling operational strength in its property investment portfolio.
However, these positive top-line movements contrast with a 23.6% decline in net profit after tax, which fell to $6.8 million. This divergence suggests that while core operations are generating more cash flow, other factors such as increased expenses, financing costs, or non-operating items may have weighed on profitability during the period.
Asset Base and Security Metrics
The group's total assets decreased marginally by 1.2% to $433.5 million, with net assets and net tangible assets per security also down by 1.2%. Despite these slight contractions, Garda maintained a stable capital structure, issuing 200.7 million securities with net tangible assets per security at $1.60, a minor dip from the previous period.
Investors will note that the group’s securities remain stapled units, combining shares in Garda Holdings Limited and units in the Garda Diversified Property Fund, which cannot be traded separately. This structure continues to underpin Garda’s integrated property investment strategy.
Distribution Maintained Amid Profit Pressure
In line with its commitment to delivering income to security holders, Garda declared an interim distribution of 4.0 cents per security, payable in January 2026. This distribution is fully unfranked, consistent with the prior period, and reflects the group’s confidence in its cash flow generation despite the net profit decline.
The steady distribution will likely reassure income-focused investors, although the unfranked status may have tax implications depending on individual circumstances.
Outlook and Compliance
The interim report was prepared in accordance with Australian and International accounting standards and reviewed by auditors without qualification, lending credibility to the reported figures. Garda’s executive leadership, including Executive Chairman Matthew Madsen and Head of Treasury Paul Brown, remain focused on navigating the property market dynamics and delivering value to security holders.
While the report does not detail the drivers behind the net profit decline, stakeholders are encouraged to consult the full 1H26 Interim Report for deeper insights into operational performance and strategic initiatives.
Bottom Line?
Garda’s growth in revenue and cash flow is promising, but the net profit dip and asset contractions warrant close investor attention moving forward.
Questions in the middle?
- What factors contributed to the significant drop in net profit despite rising revenue and FFO?
- How will Garda manage asset base contractions amid current market conditions?
- What is the outlook for distributions given the mixed financial results?