July 25 (Bloomberg) -- Stockland, Australia’s biggest diversified property trust, said Managing Director Matthew Quinn will retire in February. The company said annual profit was less than forecast.
Quinn, who has led the group for more than 11 years, will continue in his role until a replacement is found, Stockland said in a statement to the Australian stock exchange. The Sydney-based company posted unaudited earnings of 29.3 Australian cents (29.6 cents) per share for the 2012 fiscal year that ended June 30, below its May forecast of 29.8 cents, due to one-time charges, it said.
The company is buying back shares to close the gap between its trading price and the value of its assets, and is selling office and industrial properties as it shifts its focus to residential, retail and retirement businesses, a strategy the company refers to as 3-R.
“I’m a little surprised to see a change in leadership with the change in structure only partly completed,” said Stuart Cartledge, Melbourne-based managing director of Phoenix Portfolios. “It does beg the question as to how the strategy is going to change under new leadership.”
While the company’s board of directors supports the 3-R strategy, “there’s no suggestion that we’ll be directing a new CEO to be bound by past decisions,” Chairman Graham Bradley said on a teleconference today. The company will continue selling assets, he said.
Stockland shares fell 0.6 percent to A$3.18 at the 4:10 p.m. close of trading in Sydney. The shares have tumbled 64 percent since a December 2007 peak, compared with a 38 percent decline in the benchmark S&P/ASX 200 Index.
Stockland hasn’t acquired as many shares as was expected in its recent outlook statement, it said in today’s announcement. The company, which hasn’t repurchased any shares this month, will resume the buyback following its fiscal year 2012 results announcement on Aug. 8, Quinn said on the call.
The timing of some land lot settlements also affected expected earnings, it said. The group will pay a dividend of 24 Australian cents for the year ended June 30, it said.
Stockland is looking both in Australia and overseas for Quinn’s replacement and is searching outside the property industry as well, Bradley said on the call. It expects to appoint a new chief executive within six months, he said.
“The board is confident Stockland is in good shape to remain resilient in the current challenging environment,” he said in the statement. “While Stockland’s performance in recent years has been impacted by extremely challenging market conditions, under Matthew’s leadership Stockland has grown to be a market leader in its core businesses.”
Quinn in April told Bradley he was committed to staying at Stockland for the next three years, he said today.
“But I went on holiday with the family and had the family proverbial board meeting and decided that the time had come for me to make this change,” Quinn said.
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