Thampapon@shutterstock

Highlights

  • HomeCo Daily owns and operates a portfolio of commercial real estate assets
  • HDN revenue zoomed by approximately 193% in the first half of FY23 and FFO jumped around 192% during the same period
  • Di Pilla (David) holds the maximum stake in the company with a shareholding of 15.56%

HomeCo Daily Needs REIT (ASX: HDN) is a real estate investment trust that owns and manages a portfolio of commercial real estate assets. In the first half of the financial year 2023 (1HFY23), the company registered a 192% growth in funds from operation (FFO) over the previous corresponding period (pcp) and a 2% growth in distribution per unit (DPU). The company said that these results display defensive and compelling qualities, driven by the focus on a low-geared balance sheet, highly strategic real estate and a focused tenant base.

During the same period, the revenue grew by around 193% year-on-year. The results reflect the synergies of investment in HMC Capital’s unlisted Last Mile Logistics fund and Southlands Boulevarde’s acquisition, said the company.

HomeCo Daily’s EBITDA margin grew to 68.8% in 1HFY23 from 61.9% in 1HFY22. However, the return on equity declined by a wide margin, from 11.4% in 1HFY22 to 3.0% in 1HFY23. Also, the net margin dropped to 57.3% in 1HFY23 from 212.1% in 1HFY22.

Top 10 shareholders

The top 10 shareholders of HomeCo Daily together hold a 40.69% stake in the company, and the top four shareholders form around 31.06% of the total shareholdings. Di Pilla (David) holds the maximum stake in the company with a shareholding of 15.56%. The Vanguard Group, Inc. have a 7.50% stake in HDN.

The chart below provides information about the top 10 shareholders in HDN-

Outlook

The company expects to report FFO per unit and DPU of 8.8 cents and 8.3 cents, respectively, in 2023. The guidance assumes that NOI growth will be 3.8% and the development pipeline will be over AUD 80 million at around 7% target ROIC.

HDN expects its development commencement to cross AUD 120 million in FY24. The company shared that it is on track to execute its strategy through development, acquisitions and an active approach to asset management.

HDN share price performance

HDN shares closed 2.10% lower at AUD 1.165 per share on 18 July 2022. Over the last 12 months, the share price has dropped by 14.38% and in the last six months, it has plunged by 11.74%. The 52-week high of AUD 1.403 was recorded on 29 July 2022, and the 52-week low is AUD 1.105, registered on 30 September 2022.

The current stock price is 5.43% higher than the 52-week low and 16.96% lower than the 52-week high.

Note 1: Past performance is neither an Indicator nor a guarantee of future performance. 

Note 2: The reference date for all price data, currency, is 18 July 2023. The reference data in this report has been partly sourced from REFINITIV.