Shareholders endorse Peet growth plans
15/11/2006National property fund and asset manager Peet Limited (ASX: PPC) today earned ringing endorsement from shareholders for its $82 million equity raising, undertaken by institutional placement earlier this week.
All existing shareholders have a separate opportunity to acquire additional shares in Peet via a Share Purchase Plan entitling them to a maximum of $5,000 worth of shares at $4.10 – the same price as the institutional placement.
Chairman, Tony Lennon, said “There was strong demand and we were able to bring a large number of new institutional investors onto our register, including some of the most well-known in Australia.
“On current pricing, and allowing for the increased number of shares, it is anticipated that the company’s market capitalisation will be in excess of $900 million.”
Peet Limited Managing Director, Warwick Hemsley said the support of all shareholders would underpin an accelerated rate of growth being undertaken on the back of another record year.
Some 150 shareholders turned out in Perth to hear about Peet’s growth and diversification plans, to celebrate strong results for FY06 and to return to the Board two of the men who helped achieve them.
Chairman Tony Lennon and fellow Board member, Graeme Sinclair were both re-elected, unopposed. Mr Lennon has been a Director for 21 years and controls a major shareholding in Peet. He is a long-term industry participant and qualified valuer with more than 40 years experience in property. Mr Sinclair is a Chartered Accountant with more than three decades’ experience in investment and wealth management services including property investment and is Managing Director of The Myer Family Company, Melbourne. He has been a Director of Peet since June 2004.
At the AGM Peet Limited detailed a record profit from operations of $36.8 million for the year ended 30 June 2006 – a 24% increase on the previous year and another result of consecutive year-on-year net profit after tax growth.
The company passed onto all shareholders the success of the company with the dividend per share for FY06 increasing 17% to 17 cents per share, fully franked or 24.3 cents per share before tax, allowing for the 100% franking.
“Peet Limited’s land bank diversification has helped deliver our continued strong results and, with the successful $82 million capital raising earlier this week, we will be in an even better position to continue the Company’s strategy to leverage our land bank and expertise into an expanded range of asset management and funds management products,” Mr Hemsley said.
“We have built on our already strong balance sheet and will grow our emerging activities in areas such as the retirement, commercial and residential built form property sectors.
“In FY06, 53% of earnings before tax was delivered by Peet’s operations in Victoria and Queensland, and we are well positioned to continue to take advantage of the best of market conditions in a variety of property sectors throughout Australia.”
Chairman, Tony Lennon outlined to shareholders significant growth in the company’s landbank since the close of the financial year. “At today’s date,” he told investors, “the Company’s managed and owned landbank has increased to approximately 31,000 lots with end sales values of some $5.4 billion expressed in today’s prices.
“The size of our landbank gives us many strategic opportunities, including leverage into an expanded range of asset management and funds management opportunities.”
Peet is recognised as the leading retail land syndicator in Australia and last financial year successfully completed three syndications for land assets in Western Australia and Victoria – raising equity capital for syndicates totalling more than $48 million.
The company is about to launch its first syndicated land investment opportunity for 2006/07. Peet Botanic Village Syndicate Limited gives investors the opportunity to tap into the high-growth area of Cranbourne in south east Melbourne.
Peet Botanic Village Syndicate Limited is seeking to raise a minimum of $16 million to be applied toward the costs of acquiring 64 hectares of land in Cranbourne South, within the popular Casey Cardinia growth corridor. The land is already identified by the Melbourne 2030 Urban Growth Boundary for its future residential development potential.
Ultimately, it is anticipated the Botanic Village land will be developed to include around 760 residential lots with an end-value estimated at more than $106 million based on current lot prices, with a Neighbourhood Activity Centre providing a focal point for the estate.
Peet Limited Chairman, Tony Lennon, paid tribute to his fellow Board members, management and the rest of the Peet team across the country, confirming the company’s target of earnings per share growth of 15% for FY07, including the new shares – exceeding the company’s underlying long-term target of 10% growth.
“We have a very successful funds management model and an established track record of consistently delivering quality returns to shareholders,” he said. “And we look forward to another successful year ahead.”
