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Viva Energy REIT Earnings Meet Expectations

Tim Montague-Jones

Tim Montague-Jones has over 20 year investment management experience working in the financial markets. Previous experience includes a ten year stint at Morningstar as a Senior Equity Analyst/Portfolio Manager, founding the Morningstar Growth Portfolio and a founding member of their Investment Committee. Tim was also a Senior Equity Analyst for Macquarie Group and a member of the winning team to obtain the 2016 LONSEC Fund Manager of the Year award.

Viva Energy RREIT Ltd (ASX: VVR) announced their FY19 results shortly before market open this morning. With distributable earnings of $111.7m and DPS of 14.54 cps, the results were roughly in line with consensus expectations. The company saw valuation uplift of $99.9m as at 31 December 2019 following an independent valuation. Meanwhile, gearing came in at 30.4%, on the low end of 30-45% target range. The results were driven by revenue growth from contracted annual rent increases, and lower net funding costs.


Viva Energy REIT Ltd (ASX: VVR) announced their FY19 results shortly before market open this morning. The share price remained largely unaffected due to the results remaining in line with consensus expectations. (Credit: Geelong Advertiser)

Net assets increased by 11.8% to $1.78b, and the Net Asset Value (NAV) per security increased 4.1% to $2.29 per security. VVR had also guided towards distributable earnings growth of 3-3.75% in FY20, which is roughly in line with expectations.

The earnings of VVR are fairly predictable given the transparency of their asset portfolio and relatively stable income growth from contracted rent increases. As such, these results were largely expected.

As is expected with a company who reports earnings in line with expectations, the share price remained unchanged at $2.84 per share. The market expects relatively low risk to VVR achieving their dividend guidance for FY20 and are attracted to the dividend yield of the company which is currently around 5%.



This article has been prepared by the Australian Stock Report Pty Ltd (AFSL: 301 682. ABN: 94 106 863 978)

(“ASR”). ASR is part of Amalgamated Australian Investment Group Limited (AAIG) (ABN: 81 140 208 288 Level 13, 130 Pitt Street, Sydney NSW 2000).

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