Countries: United States
Westfield America Trust (WAT) today announced a profit of A$75.4 million for the year to 31 December 1997.
This profit is after allowing for US withholding tax (for which Australian investors receive a tax credit) and will result in a full year's cash distribution of 9.26 cents per unit, a 9.2% increase over the annualised distribution for WAT's initial period of operation, the half year to 31 December 1996.
1997 earnings before withholding tax are A$81.2 million, representing 9.98 cents per unit of which approximately 52% is tax advantaged. This represents an annualised increase of 7.5% over the half year to 31 December 1996.
These results exceed the forecasts in the Prospectus issued at the time of WAT'S listing in 1996.
| Prospectus and prior year return comparison (Australian cents per unit) |
 |
1997 |
1997 |
1997/1996 |
1996 |
1996 |
| Earnings before Withholding Tax |
9.97 ¢ |
9.98 ¢ |
+ 7.5% |
9.28 ¢ |
4.64 ¢ |
| Cash distribution |
9.02 ¢ |
9.26 ¢ |
+ 9.2% |
8.48 ¢ |
4.24 ¢ |
WAT has a 50.8% interest in Westfield America, Inc. (WEA), a listed US real estate investment trust which currently owns a 2.2 million square metre portfolio of 22 regional shopping centres and three power centres in the major metropolitan areas of seven states in the US.
Retail sales for mall stores in the centres in 1997 were US$1.44 billion representing a 4.4% increase over last year on a comparable square foot basis. Mall store space was 93% leased at 31 December 1997, excluding centres under development.
Westfield Managing Director USA, Mr Peter Lowy, said that 1997 was an important year for expanding Westfield's shopping centre portfolio in the US and the listing of WEA on the New York Stock Exchange in May has provided a strong financial base for future growth.
Acquisitions
Since January 1997 WEA has made five property acquisitions
totalling US$456 million.
- Annapolis Mall, Maryland/Washington DC - ownership was increased
from 30% to 100% at a cost of US$133.0 million.
- Meriden Square, Connecticut - ownership was increased from 50% to
100% at a cost of US$54.5 million.
- Wheaton Plaza, Maryland/Washington DC - acquired a 68% interest
in this 102,000 square metre centre for US$51.0 million.
- Northwest Plaza, St. Louis, Missouri - purchased 100% of the
largest enclosed centre of 167,000 square metres in St. Louis for
US$111.0 million.
- Crestwood Plaza, St. Louis, Missouri - since year end 100% of
this 95,000 square metre centre was acquired for US$106.4
million.
Redevelopment Activity
During the year under review four redevelopments were completed
at: Eastland Shopping Center (Los Angeles, California), Enfield
Square (Enfield, Connecticut), Mission Valley Center (San Diego,
California) and South Shore Mall (Bayshore, New York). Development
work is currently under way for a new power centre at Mission
Valley Center - West comprising big box retailers and
restaurants.
New redevelopments are currently planned for the following four
centres :
- West County Center, St. Louis, Missouri - In May 1997, Westfield
secured commitments from both Nordstrom and the May Company's Lord
& Taylor division to open new anchor department stores at West
County Center as part of a major redevelopment planned for opening
in late 2001.
- Annapolis Mall, Maryland/Washington DC - An additional Lord &
Taylor department store as well as 1,100 square metres of specialty
stores are planned for late 1998.
- Meriden Square, Meriden, Connecticut - An additional Lord &
Taylor department store as well as 6,500 square metres of specialty
stores are planned for completion in late 1999.
- South Shore Mall, Bayshore, New York - An additional Lord &
Taylor department store is planned for completion in late 1998.
Financial Information
WAT is the fourth largest property trust listed on the ASX with a market capitalisation at 31 December 1997 of A$1.06 billion.
Net asset backing per unit increased from A$1.03 at December 1996 to A$1.22 at December 1997 which reflects the strengthening of the US dollar in relation to the Australian dollar and the revaluation of 5 shopping centres.
The total annual return to WAT unitholders for the year ended 31 December 1997 based on the ASX accumulation index was 25.5% compared to the ASX Property Trust Index return of 20.3% and an All Ordinaries return of 12.2%. For the 18 months since inception of WAT the annualised return to unitholders is 26.2% as compared to the Property Trust Index of 22.8% and the All Ordinaries Index of 15.3%.
The Westfield Group Finance Director, Mr Stephen Johns said that barring unforeseen circumstances, unitholders' 1998 income should exceed the WAT Prospectus forecast.
Future Outlook
Mr Peter Lowy said: "We are confident in our ability to meet our
1998 goals of increasing occupancy, increasing income and
implementing our redevelopment plans. With a strong US economy,
excellent retail markets, and well located regional centres,
Westfield America is well positioned for 1998 and beyond. We will
also continue to pursue acquisitions that can provide market
synergies and redevelopment opportunities for the portfolio."
| Westfield America Trust Financial Results for the year ended 31 December 1997 The consolidated financial results of Westfield America Trust and Westfield America, Inc. are as follows:- |
| 1. Balance Sheet | ||
|
A$ |
US$ |
| Total Assets (million) |
3,886.92 |
539.3 |
| Total Liabilities (million) |
1,916.51 |
254.6 |
| Net Assets (million) |
1,970.41 |
284.7 |
| Equity attributable to Unitholders of WAT (million) |
1,000.2 |
652.1 |
| Net Asset Backing per Unit |
1.22 |
0.79 |
| 2. Profit & Loss | ||
|
A$ |
US$ |
| Westfield America, Inc. Property Income (million) |
147.3 |
112.7 |
| Earnings before Withholding Tax attributable to Unitholders of WAT (million) |
81.2 |
63.4 |
| Distributable Income (after Withholding Tax) attributable to Unitholders of WAT (million) |
75.4 |
58.9 |
| Westfield America Trust Financial Results for the year ended 31 December 1997 |
| 3. Return per Unit | ||
| ASX Code: WFA |
Year Ended 31 December 1997 |
|
| Number of Units: 822.4 million |
Aus - Cents |
US - Cents |
| Pre-tax earnings |
9.98 |
7.79 |
| Withholding tax |
0.72 |
0.56 |
| Cash distribution |
9.26 |
7.23 |
Westfield Group