Goodman Group ('Goodman' or 'Group') today announced its results for the full year ended 30 June 2012.
Goodman's Group Chief Executive officer, Greg Goodman said, "The Group has exceeded initial targets in FY2012, to deliver a solid result with a strong contribution made by all parts of our business. The year on year increase in operating profit we are announcing today reflects the successful delivery of our focused strategy and our ability to leverage opportunities in all our markets given the size and scale of our business, quality portfolio, global operating platform and our significant global customer and capital partner relationships."
Goodman has used its industrial sector specialisation and development capability to focus on securing high quality opportunities in line with the continued strong customer and investor demand for prime quality industrial space in its key operating markets. This is represented by development work in progress of $1.9 billion (approx. 1.5 billion) and over $0.9 billion (approx. 0.7 billion) of third party equity raised from new and existing investors during the year. Further to our announcement on June 20, 2012, we have now completed on the development joint venture in North America, with targeted third party equity of $400 million (approx. 325 million) from Canada Pension Plan Investment Board (CPPIB).
The strength of our capital partner relationships was further demonstrated by the establishment of a new global relationship with EPF, securing an initial equity commitment of $300 million (approx. 244 million) to Australia. Greg Goodman added: "We have adapted our business to operate in a low growth and capital constrained environment, and have selectively and prudently pursued opportunities to expand our platform around the world, while maintaining a sound financial position. We are increasing market share across our operations and recently launched in North America, the world's largest logistics market.
"The growth in the Group's international operations has resulted in our offshore businesses contributing 41% to operating EBIT, providing diversity of earnings, and access to a broader range of growth opportunities. We expect earnings from our offshore businesses to continue trending toward 50% of operating EBIT over the medium-term. These factors, coupled with our ability to access third party capital and the partnering approach we take with our global investor and customer base, has placed the Group in a strong competitive position and will continue to drive the growth of our business and generate future value for our stakeholders."
As a specialist provider of prime quality logistics property and business space, Goodman's focus is to leverage its expertise, global operating platform and extensive customer and capital partner relationships to maintain its position as a leading global industrial property and business partner. This focused strategy provides the Group with a distinct competitive advantage, enabling it to pursue new opportunities that reinforce its position as a global leader in its sector and to drive future earnings.
"Our strategic focus remains on the prudent yet active execution of our business strategy. We have built a strong competitive position, providing significant scope to explore a range of opportunities in the year ahead, including a possible entry into Brazil, while expanding our operating platform in the largest and growing consumer economies of North America, Europe, China and Japan." Greg Goodman said.
The Group's operations achieved an operating EBIT of $527 million (approx. 428 million), or a 12% increase compared with the same period last year, reflecting the growing contribution from its development and management businesses. The earnings composition was in line with the Group's expectations, with 62% contributed from investments, 24% from developments and 14% from management services.
Operational highlights include the following:
Underlying property fundame