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Dexus posts $348.5m half-year profit as property values lift

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A man stares out of an office window onto a landscape of high rise office buildings in an urban landscape.

The Dexus (ASX: DXS) share price is in focus as the property group delivered a half-year statutory net profit after tax of $348.5 million, up sharply from $10.3 million a year ago, and declared an interim distribution of 19.3 cents per security.

What did Dexus report?

  • Statutory net profit after tax of $348.5 million (HY25: $10.3 million), driven by property valuation gains
  • Adjusted funds from operations (AFFO) of $253.3 million, or 23.6 cents per security
  • Distribution of $207.6 million, or 19.3 cents per security (payout ratio of 82%)
  • Portfolio valuation uplift of 1.0% overall, with office+0.7% and industrial +1.6%
  • Office leasing volumes nearly doubled to 95,300sqm; industrial like-for-like income up 8.7%
  • Gearing at 33.9%, within target range; $2.5 billion in cash and undrawn facilities

What else do investors need to know?

Dexus’s property portfolio occupancy remained healthy, with office at 92.2% and industrial at 97.0%. Incentives are tracking below market levels, and strong leasing at key developments, such as Waterfront Brisbane (now 71% pre-leased), is supporting income growth.

The group advanced its $11.5 billion real estate development pipeline, with progress on flagship projects Atlassian Central and Waterfront Brisbane. Funds management continues to grow, now overseeing $36.2 billion in third-party capital, with flagship funds outperforming their benchmarks and new funds raising over $950 million in fresh equity.

Sustainability remained front and centre, with Dexus receiving high global ESG rankings, maintaining net zero emissions across Scope 1 and 2, and boosting solar generation across its managed assets.

What did Dexus management say?

CEO and Managing Director Ross Du Vernet said:

Underlying real asset markets are past the point of inflection and continue to improve, supported by positive business confidence, constrained supply pipelines, stabilisation in asset prices and improvement in transaction volumes, notwithstanding the evolving interest rate environment. Positively, this was the second consecutive six-month period of property portfolio valuation uplifts.

What’s next for Dexus?

Dexus reaffirmed guidance for full-year AFFO of 44.5–45.5 cents per security and distributions of 37.0 cents per security, barring unforeseen events. Management signalled ongoing asset divestments and a $2 billion divestment target, with an on-market buyback of up to 10% of Dexus securities being activated to address the discount to underlying asset value.

The company expects lower trading profits in FY27 but remains focused on capital discipline and unlocking value through asset sales, development completions, and growing its funds management platform as market conditions improve.

Dexus share price snapshot

Over the pat 12 months, Dexus shares have declined 19%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 6% over the same period.

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The post Dexus posts $348.5m half-year profit as property values lift appeared first on The Motley Fool Australia.

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Motley Fool contributor Laura Stewart has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial summary of the company announcement. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.

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