Australian Unity Office Fund (AOF)

FY20 Results: Locking in the yield

  • FY20 FFO of 17.0cpu (from 17.5cpu in prior year). Rent collection rate of 92% in June 2020 quarter due to COVID-19. Earnings impact is -$1.1M (or -0.7cpu).
  • Portfolio appears well placed with 59% in metropolitan office markets and 41% in CBD locations.
  • Management guidance for FY21 distributions to remain flat at 15.0cpu, with only 4% lease expiries in FY21.
  • Current price factors in COVID-19 risks and lease expiries in FY22/23. Upside potential for greater income certainty as leases are worked through.
  • Recommendation upgrade to Accumulate (previously Hold)
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