This ASX 200 real estate stock just reported a 391% increase in profits in FY24

This Bunnings Warehouse property owner had a strong 12 months.

| More on:
A warehouse storeman stands with his arms folded in front of a well-stocked warehouse interior with goods and moving equipment in the background.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

As we covered here earlier, one ASX 200 real estate stock is falling heavily today following the release of its full year results.

The good news is that not all real estate stocks are tumbling. One is even outperforming the ASX 200 today after investors responded positively to its results.

That company is BWP Trust (ASX: BWP), which is the largest owner of Bunnings Warehouse properties in Australia.

Its shares are up 2.5% to $3.62 in afternoon trade.

ASX 200 real estate stock higher on strong results

  • Revenue up 10.3% to $174.5 million
  • Profit before fair value movements up 5% to $119.3 million
  • Profit up 391% to $180.2 million
  • Total dividends flat at 18.29 cents per share

What happened in FY 2024?

Let's firstly address the elephant in the room. How did BWP deliver a 10.3% increase in revenue to $174.5 million but a 391% jump in profit to $180.2 million?

Well, the latter includes gains in fair value of investment properties and derivatives of $61 million for the year. Whereas a year earlier, BWP recorded losses in fair value of $76.9 million.

Going back to the ASX 200 real estate stock's revenue for FY 2024. It rose 10.3% thanks partly to like-for-like rental growth of 4.2%. This was supported by the NPR, Broadmeadows Homemaker Centre, and Southport Showrooms acquisitions.

FY 2025 looks set to also get a big boost from acquisitions. In June, BWP completed its $540 million all-scrip acquisition of Newmark Property REIT. Management notes that the deal provides the company with nine high quality properties. It also provides a platform for income and capital growth, consistent with BWP's objective of providing unitholders with a secure and growing income stream and long-term capital growth.

Speaking of income, BWP kept its dividends flat at 18.29 cents per share in FY 2024. However, its shares have already traded ex-dividend for its final payout. It will be paid to eligible shareholders at the end of the month.

Outlook

Management appears cautiously optimistic on its prospects in FY 2025. It said:

The quality of the Group's property investment portfolio, with its large, prominently located sites, with good accessibility and adjacency to other retail and community facilities, means that these are expected to continue to be preferred locations for retailing or provide potential longer-term alternative uses.

In this context, BWP remains well positioned with rental income comprising largely the Wesfarmers Group (82 per cent), other national large format retail, automotive and self-storage businesses (15 per cent) and Commonwealth and Queensland Governments (one per cent).

The ASX 200 real estate stock also advised shareholders to expect a small dividend increase in FY 2025.

Subject to no major disruption of the Australian economy or material change in market conditions, BWP expects to increase its dividend by 2% year on year.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Wesfarmers. The Motley Fool Australia has positions in and has recommended Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Earnings Results

A woman looks up at a plane flying in the sky with arms outstretched as the Flight Centre share price surges
Earnings Results

Web Travel share price rockets 13% on market leading full-year growth

Investors are sending Web Travel shares soaring today. Here’s why.

Read more »

Happy shopper at a clothes shop.
Earnings Results

Why did Myer shares just rocket 9%?

Investors are piling into Myer shares on Friday. But why?

Read more »

A woman looks up at a plane flying in the sky with arms outstretched as the Flight Centre share price surges
Earnings Results

Up 78% since April, why is the Webjet share price taking off again today?

Webjet shares have soared 78% since 4 April and are lifting off again today. But why?

Read more »

a woman holds her hands to her temples as she sits in front of a computer screen with a concerned look on her face.
Industrials Shares

Guess which ASX 200 stock is crashing 24% on results day

Investors were not impressed with this result. But why?

Read more »

A man in full American NFL playing kit crouches over with his arms across his chest in a defensive stance against a dark background.
Technology Shares

ASX 300 tech stock charges 7% higher to record high on stellar results

This tech stock delivered another impressive result this morning.

Read more »

a group of people sit around a computer in an office environment.
Earnings Results

Guess which ASX 200 tech stock is rocketing 12% on record results

Another half, another record result from this high-quality company.

Read more »

A young man sitting at an outside table uses a card to pay for his online shopping.
Consumer Staples & Discretionary Shares

Why is the Kogan share price crashing 12%?

Profits are down at this ecommerce company during the second half.

Read more »

Frustrated stock trader screaming while looking at mobile phone, symbolising a falling share price.
Resources Shares

Guess which ASX 200 mining stock is sinking 7% following its quarterly update

Let's see how this miner performed during the third quarter.

Read more »