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Westfield Group's earnings meet guidance

Nicholas Grove  |  23 Feb 2017Text size  Decrease  Increase  |  

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Westfield Group's (ASX: WFD) funds from operations (FFO)--a preferred measure of underlying performance among property trusts--stood at US$700 million for 2016, down from US$783 million in 2015 but in line with guidance.

FFO per security was 33.7 US cents, up 3.8 per cent on the previous year on a pro-forma basis, the global shopping centre operator said in a statement to the ASX on Thursday.

Westfield declared a distribution for the year to 31 December 2016 of 25.1 cents per security, also in-line with guidance.

The company said its financial position is strong, with balance sheet assets of $21.1 billion, a gearing ratio of 35.2 per cent and $2.8 billion in available liquidity.

Westfield said it currently has assets under management of $30.9 billion, of which 82 per cent are flagship assets.

Westfield co-CEOs, Peter Lowy and Steven Lowy, said that in 2016 over $1 billion of revaluation gains were achieved, driven by the value created from completed developments.

"Our $9.5-billion retail development program is creating significant long-term value and earnings accretion for securityholders," the Lowy brothers said.

"Westfield is focused on creating great experiences for retailers, consumers and brands, and has significantly enhanced our resources and capability in the areas of events, entertainment, digital technology and data analytics.

"We are transforming our food, fashion, leisure and entertainment offer with a broader mix of uses including the introduction of many new concepts and brands."

Westfield said it expects to achieve FFO of between 33.8 and 34.0 US cents per security in 2017, representing pro-forma growth of between 3 per cent and 3.5 per cent from 2016.

The distribution forecast for 2017 is 25.5 cents per security, the company said.

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Nicholas Grove is a Morningstar journalist.

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