The Lendlease Group (ASX: LLC) share price is tumbling in morning trade today. At one stage it was down more than 5%. However, at the time of writing it has recovered slightly, with shares trading at $11.27 — down 1.66% on the previous close.
Below we take a look at the international property and infrastructure group's latest market update.
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What update did Lendlease report?
Lendlease's share price is sinking after the company updated the market on the continuing impact of COVID-19 on its core operating business.
According to the update, the virus and subsequent lockdowns continue to affect each of the property group's core global segments.
In addition, Lendlease is expecting a core operating profit of between $375 and $410 million after tax for FY21.
In its announcement, Lendlease said the pandemic's resurgence in the UK has resulted in a delay in its expected timing to secure an investment partner for its International Quarter London.
Also in London, Lendlease said lower rents along with diminished demand on its recently completed residential buildings at Elephant Park were "impacting the profitability of our first two residential for rent buildings".
On the positive front, in Australia Lendlease reported it had secured an investment partner for the second residential tower at One Sydney Harbour. In Melbourne, it signed an anchor tenant for the largest office tower at Melbourne Quarter. This was then forward sold.
And back in Europe, the company said it had secured another investment partner for the Milan Innovation District.
Lendlease forecasts statutory profit for the 2021 financial year in the range of $200 million–320 million after tax. In addition, it said its balance sheet and liquidity position "remain strong, with gearing expected to be below the bottom end of the target range of 10-20%".
The company's new global CEO, Tony Lombardo, is carrying out an extensive review of core business operations. Lendlease said it will update the market on the outcome when it announces its full financial year results on 16 August.
Lendlease share price snapshot
The Lendlease share price has been under pressure over the past 12 months, down 7.78%. By comparison the S&P/ASX 200 Index (ASX: XJO) is up 22.79% over that same time.
Year-to-date Lendlease shares have continued to struggle, down 14% so far in 2021.
