Vicinity Centres FY26: Profit up, distributions rise as premium focus delivers

The Vicinity Centres (ASX: VCX) share price is watch today after the shopping centre giant posted a statutory net profit of $1,391.2 million for FY26, with funds from operations rising to $700.1 million and annual distributions increasing to 12.40 cents per security.

What did Vicinity Centres report?

• Statutory net profit after tax rose to $1,391.2 million (up 38.5% from FY25).
• Funds from operations (FFO) were $700.1 million, a 3.9% increase on the prior year.
• FFO per security up 2.8% to 15.21 cents; AFFO per security up 3.6% to 13.04 cents.
• Annual distribution lifted 3.3% to 12.40 cents per security, with a payout ratio of 95.5% of AFFO.
• Net tangible assets rose 7.7% to $2.59 per security.
• Comparable net property income increased by 4.2%.

What else do investors need to know?

Vicinity Centres continued to reshape its portfolio during FY26, acquiring the remaining 75% interest in Brisbane’s Uptown for $212 million and DFO Eastern Creek in Sydney for $351 million. The group also divested non-strategic assets for $447.2 million, including Taigum Square, often at substantial premiums to book value. These moves have strengthened Vicinity’s premium asset weighting to 67% of its retail portfolio, reflecting a strategic pivot toward high-performing CBD and outlet centres.

Portfolio performance showed record leasing spreads (+4.2%) and occupancy of 99.6%, highlighting the strength in retail demand and a focus on differentiating asset quality. Gearing remains at the lower end of the target range (26.1%) after significant investment and asset recycling, with debt maturities well managed at a weighted average of 5.1 years.

What’s next for Vicinity Centres?

Looking ahead, Vicinity Centres is maintaining its focus on premium centre investments, mixed-use developments, and strategic tenant remixing. Major developments are progressing at Chatswood Chase in Sydney (which is now complete), Galleria in Perth (opening November 2026), and planning is underway to revitalise Uptown in Brisbane. Further expansion and repositioning at Chadstone and other flagship assets are also on track.

For FY27, guidance points to FFO of 16.0–16.2 cents per security and AFFO of 13.9–14.1 cents per security. The group expects comparable net property income growth around 3.5% and continued investment to support the evolving retail landscape.

Vicinity Centres share price snapshot

The Vicinity Centres share price has fallen short of the S&P/ASX 200 index (ASX: XJO) over the past 12 months with a decline of 3%.

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The post Vicinity Centres FY26: Profit up, distributions rise as premium focus delivers appeared first on The Motley Fool Australia.

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