Small cap 360 Capital Total Return Fund (ASX: TOT), which is now called 360 Capital REIT, reported its financial results for the six months to 31 December 2019.
It reported a statutory net profit of $8.9 million, which was up 189% compared to the prior corresponding period reflecting the gain on its URB acquisition. Statutory earnings per share (EPS) was 11.5 cents, up 150% on last year.
Its operating profit of $3.5 million was down 11% because of the URB acquisition and higher cash balances. Operating EPS dropped 25% to 4.5 cents.
The property business' distributions per security was 4.5 cents, in line with forecasts. Its net tangible assets per security was $1.17 pre-AASB9 loss allowance.
During the period it completed the merger with URB Investments Limited, increasing the market capitalisation from $84.9 million to $148.7 million. It also completed a institutional placement of $10.8 million in October 2019.
It achieved an average internal rate of return (IRR) of 16% on exited loan investments. It also disclosed that it increased its loan book to $101 million of first mortgage real estate debt at an average interest rate of 9.8%.
Another highlight was that it acquired 23 apartments in Gladesville, NSW at 20% below the valuation and it has commenced a sales campaign. An initial four sales translated to a return on equity of 31% over a 3-month investment horizon.
It is forecasting FY20 operating earnings of 9 cents per security and distributions per security of 9 cents per security.
