Lend Lease Group, Australia’s biggest property developer, posted a 39 percent increase in first-half profit driven by earnings from its Barangaroo South development in Sydney.
Net income rose to A$302.3 million ($311 million) in the six months ended Dec. 31, from A$217.8 million a year earlier, the Sydney-based company said in a statement to the Australian stock exchange. That compares with a forecast of A$287 million based on an average of four analyst estimates compiled by Bloomberg. Profit was boosted by advisory fees from two infrastructure projects in Australia and the sale of businesses in Europe.
“There were a lot of one-off transactions that were profitable, but aren’t necessarily going to be repeated,” Tony Sherlock, Sydney-based head of property research at Morningstar Australasia Pty, said in a telephone interview. “The margin on the construction business was also down.”
The shares fell 2.5 percent to A$10.42 at the close of trading in Sydney, paring this year’s gains to 12 percent.
Lend Lease in July signed tenants and capital partners for the first two office towers at its Barangaroo South financial precinct, which helped boost profit by 146 percent in its Australian development business. The company is also stepping up developments elsewhere, with approval for a $2.3 billion redevelopment in London received in January and an agreement for a A$1 billion mixed-use project in Perth this month.
Profit after tax in the Australian construction business fell to A$94 million from A$105.4 million a year earlier, and to A$13.2 million from A$27 million in its investment management division, Lend Lease said.
Lend Lease will pay a dividend of 22 Australian cents for the half, it said.