Gasworks sale helps Aveo climb
RETIREMENT village operator Aveo has lifted full-year profit by 44 per cent, boosted by a major property sale and asset revaluations.
Aveo has posted a net profit of $365.1 million for the year to June 30, although revenue was down 5.4 per cent to $425.3 million.
The company, which is planning to build a 16-storey tower at Labrador, benefited from the sale of its Brisbane residential development, Gasworks, for $53.7 million, as well as the revaluation of its investment properties, to the value of $177 million.
Aveo’s profit was also boosted by the creation of 506 new units during the financial year and the company’s latest community in Brisbane achieving higher than expected development margins.
Aveo shares closed up 7.24 per cent at $2.37.
However, the stock remains well below its 2016 high of $3.65 and CEO Geoff Grady said the current price did not reflect the company’s underlying value.
Aveo has announced a strategic review, which may include a new major investor partner, to boost the company’s valuation. “We are trading well under (net tangible assets) due to concerns around sustainable sales levels, perceived industry regulatory risk and to a lesser extent the class action,” Mr Grady said.