Rural Funds Group
ASX:RFF
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Rural Funds Group
ASX:RFF
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AU |
Rural Funds Group
Rural Funds Group is a real estate investment trust, which holds and leases agricultural property and equipment. The firm is a real estate investment trust (REIT) which owns a diversified portfolio of Australian agricultural assets that are leased to experienced agricultural operators (tenants). The company leases almond orchards, macadamia orchards, vineyards, cattle properties, cropping properties, agricultural plant and equipment, cattle, and water rights. The firm holds 3 almond orchards approximately 4,139 planted hectares, 7 vineyards approximately 666 planted hectares, 3 macadamia orchards approximately 261 planted hectares, 3 macadamia orchards under development approximately 118 hectares, 21 cattle properties made up of 16 breeding, backgrounding and finishing properties and 5 cattle feedlots approximately 672,342 hectares, and 2 cropping properties approximately 7,905 hectares.
Rural Funds Group is a real estate investment trust, which holds and leases agricultural property and equipment. The firm is a real estate investment trust (REIT) which owns a diversified portfolio of Australian agricultural assets that are leased to experienced agricultural operators (tenants). The company leases almond orchards, macadamia orchards, vineyards, cattle properties, cropping properties, agricultural plant and equipment, cattle, and water rights. The firm holds 3 almond orchards approximately 4,139 planted hectares, 7 vineyards approximately 666 planted hectares, 3 macadamia orchards approximately 261 planted hectares, 3 macadamia orchards under development approximately 118 hectares, 21 cattle properties made up of 16 breeding, backgrounding and finishing properties and 5 cattle feedlots approximately 672,342 hectares, and 2 cropping properties approximately 7,905 hectares.
Net Property Income: Net property income rose 7% year-on-year to $49 million, driven by new macadamia orchard rent and indexation in leases.
Asset Sales: Over $65 million of assets were sold during the half, all at or above book value, with plans to sell up to $260 million more over the next 12 months.
Gearing: Pro forma gearing remained steady at 39.1%, with a target to reduce this towards the 30%–35% range as more asset sales are completed.
AFFO and Distributions: Adjusted funds from operations (AFFO) reached $21.5 million ($0.55 per unit), on track to meet full-year guidance, and distributions paid were $0.0587 per unit, in line with forecasts.
Guidance Reaffirmed: Management reaffirmed full-year guidance for AFFO and distributions.
CapEx: Capital expenditure has peaked, with significantly lower CapEx forecast for FY '27 compared to prior years.
Bank Margins: Debt facility was refinanced with a 5 to 10 basis point reduction in bank margins and tenor extension.
J&F Guarantee: A proposed increase to the J&F guarantee is expected to be accretive to AFFO by up to $0.01 per unit annually, pending unitholder approval and asset sales.
