Centuria Industrial REIT (CIP)

1H23 Results - Tailwinds vs Headwinds

Centuria Industrial REIT (ASX: CIP) reported 1H23 Results for the 6 months to 31 December 2022.

Key points:

  • 1H23 results in line and on track for CIP to deliver on FY23 guidance.
  • Strong tailwinds in the industrial sector with CIP leasing spreads of +19% and high demand for well-located assets.
  • Strong rent growth is negated by higher interest costs with a flow through to FY23/FY24.
  • Core Property considers FY23 earnings guidance to be achievable with FFO per unit movement of -6.8% on FY22. Beyond this, FY24F is forecast to be -2.5% as we expect a moderation in lease spreads and interest rate movements.
  • Despite an uncertain macroeconomic environment, the distribution yield of 4.9% provides relative resilience. HOLD.

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