Mirvac Reports 896% Profit Surge and $508m Operating Profit in FY26

Profit Surge Reflects Strategic Reset and Portfolio Quality

Mirvac Group (ASX:MGR) reported a landmark financial year ending 30 June 2026, with statutory profit attributable to stapled securityholders soaring 896% to $677 million, from a modest $68 million in FY25. Operating profit after tax rose a solid 7% to $508 million, delivering earnings per stapled security (EPS) of 12.9 cents, in line with guidance.

The dramatic profit surge was driven by a combination of improved asset valuations across living, industrial, and retail sectors, alongside a 52% jump in development EBIT, notably from commercial and mixed-use projects. Residential sales grew 15% year-on-year to 2,425 lots, with gross margins recovering to 24%, comfortably above Mirvac's target range.

Investment Portfolio and Leasing Strength

Mirvac’s $10.5 billion investment portfolio maintained a high occupancy rate of 98%, with like-for-like net operating income growth of 5.3% and average leasing spreads of 4.5%. The portfolio’s quality is underscored by its strategic tilt towards premium-grade office assets, Sydney industrial properties, and resilient living sectors, which together are expected to underpin future income growth.

New income streams are set to emerge from recently completed developments such as LIV Albert and LIV Anura build-to-rent assets, Aspect Industrial Estate warehouses, and the 7 Spencer Street office in Melbourne, all contributing to approximately $130 million in new income over coming years.

Funds Management Expansion and Capital Partnering

Mirvac’s funds management platform continues to scale, with third-party capital under management rising to $18.1 billion, up 12% on FY25. The Mirvac Wholesale Office Fund (MWOF) raised approximately $310 million in equity during FY26 alone, reducing its gearing to 23.5%, among the lowest in its peer group.

Key partnerships were strengthened, notably with Australian Retirement Trust (ART) acquiring a 48.5% stake in the $2 billion LIV Mirvac build-to-rent fund and a 49% interest in the $3 billion Mirvac Industrial Venture (MIV). Mirvac also launched a new retail venture seeded by a 50% interest in East Village, Sydney, further diversifying its funds management offering.

Development Pipeline Restocked and Profitable

The development segment delivered EBIT of $270 million, up 52%, underpinned by the sell-down of stakes in Harbourside Sydney, SEED Badgerys Creek, and Kindira Brisbane. Residential settlements were steady at 2,130 lots, supported by three new masterplanned communities launched in Brisbane, Sydney, and Perth.

Mirvac secured major new projects including the $3 billion Hunter Street East commercial tower in Sydney’s CBD, the $2.5 billion Blackwattle Bay residential precinct in Sydney, and a $500 million masterplanned community in Karnup, Perth, the latter two in partnership with state governments. These projects are expected to contribute significant future earnings and NTA uplift.

Balance Sheet Strength and Capital Management

Mirvac’s balance sheet remains robust, with headline gearing reduced to 24.1%, comfortably within its 20-30% target range. The group holds $1.6 billion in liquidity, including cash and undrawn committed facilities, and maintains strong credit ratings of A3 from Moody’s and A- from Fitch.

Capital management initiatives included approximately $500 million in asset sales and $2 billion in capital partnering transactions. Reflecting confidence in the business and its embedded value, Mirvac announced an on-market share buy-back of up to $200 million, commencing September 2026 and running through September 2027, funded through a mix of cash and existing debt facilities.

Sustainability and Governance Highlights

Mirvac continued to advance its sustainability agenda, reporting for the first time under the mandatory AASB S2 climate-related financial disclosure framework. The group maintained net positive Scope 1 and 2 carbon emissions and achieved its social procurement target five years early by directing $100 million of procurement spend to social enterprises and Indigenous businesses.

Board renewal progressed with the retirement of long-serving director Christine Bartlett and the appointment of Janelle Hopkins, whose financial expertise complements the board’s skill set. The group also increased its focus on artificial intelligence adoption and digital transformation, balancing innovation with risk management and governance.

Outlook and Forward Guidance

Mirvac enters FY27 with a confident growth outlook, targeting operating EPS of 13.2 to 13.4 cents per stapled security, representing 2-4% growth, and a distribution of 9.9 cents per security, up 4.2%. This guidance assumes residential settlements between 2,800 and 3,100 lots and a weighted average cost of debt of approximately 5.7%.

The group’s growth drivers include a repositioned investment portfolio yielding higher cash flow, an expanded and restocked development pipeline, and a growing funds management platform providing capital-light earnings. The newly announced share buy-back underscores Mirvac’s belief in the embedded value across its integrated model of asset creation, investment, and funds management.

While macroeconomic uncertainties persist, Mirvac’s diversified portfolio, disciplined capital management, and strategic partnerships position it well to navigate challenges and deliver sustainable long-term value.

Investors may watch how the buy-back program unfolds alongside the ramp-up of residential settlements and the execution of major development projects like Hunter Street East and Blackwattle Bay, which will be key catalysts in the coming years.

Mirvac’s FY26 results, detailed in the audited Annual Report and supported by a comprehensive sustainability disclosure, illustrate a company that has successfully reset and is poised for its next phase of growth.