Key Takeaways

  • Eureka Group Holdings now expects FY26 underlying EBITDA to finish at or above the top of its guidance range of $20.2 million to $21.1 million (up 20-25% on FY25).
  • FY26 underlying earnings per share (EPS) is expected at the upper end of the 3.37 to 3.44 cents range (up 7.5-10.0% on FY25).
  • Seniors' occupancy remains high at approximately 97%, while all-age long-term rental occupancy has strengthened to about 95%, up from 86% at the first-half result.
  • Like-for-like rent growth is expected to exceed 6% for FY26, which the company links to strong demand and constrained supply.
  • Eureka has exchanged unconditional contracts to sell a 42-unit village in Broken Hill for $4.4 million and started selling down rental homes at two Brisbane communities.
  • The company says its acquisition pipeline now exceeds $120 million, and it expects to provide FY27 guidance with its full-year results on 20 August 2026.

Eureka Group Holdings Limited (ASX:EGH) has given investors an upbeat trading update for the financial year ending 30 June 2026 (FY26), released to the ASX on 15 June 2026. The headline message is that the company has reaffirmed its FY26 guidance and now expects to land at the stronger end of its forecasts.

Specifically, Eureka said it expects FY26 underlying earnings before interest, tax, depreciation and amortisation (EBITDA) to finish at or above the top of its guidance range of $20.2 million to $21.1 million, representing growth of 20 to 25 per cent on FY25. Underlying earnings per share (EPS) is expected at the upper end of the 3.37 to 3.44 cents range, equivalent to growth of 7.5 to 10.0 per cent on the prior year.

The company will publish its full-year results in August 2026 and expects to provide FY27 guidance at that time. As with any forecast, these figures are the company's own expectations and remain subject to change until results are finalised and audited.

Why the update matters

Guidance is one of the most closely watched pieces of information a listed company provides, because it shapes how the market thinks about future earnings. When a company says it expects to finish at or above the top of its range, it is signalling that trading has been at least as strong as it previously communicated. For income-focused investors in particular, the trajectory of EBITDA and EPS is central to how a business like Eureka is assessed.

The update also gives texture on what is driving the result. Eureka attributes its performance to high occupancy, above-inflation rent growth and disciplined cost control, combined with a program of selling lower-value assets and recycling the proceeds. Understanding these drivers helps readers judge how durable the performance might be.

The numbers behind the result

Occupancy and rents

Eureka said demand for its housing remains very strong. Seniors' occupancy is running at approximately 97 per cent, while all-age long-term rental occupancy has strengthened to around 95 per cent, up sharply from 86 per cent at the first-half (1H26) result. The company said vacancies are concentrated in a small number of villages where targeted initiatives or refurbishments are under way.

On rents, the company expects like-for-like growth to exceed 6 per cent for FY26. It linked this to sustained demand for affordable rental accommodation and constrained supply across its markets. Like-for-like growth strips out the effect of acquisitions and disposals, so it is a useful gauge of underlying pricing power in the existing portfolio.

Capital recycling and asset sales

Eureka is also actively reshaping its portfolio. It has exchanged unconditional contracts to sell its Broken Hill seniors' rental village - a small, 42-unit village in far western New South Wales - for $4.4 million, against a book value of $5.1 million, with settlement expected this month. The company framed the sale as consistent with exiting small, remote, non-core assets.

In Brisbane, Eureka has commenced a sell-down of rental units at its Bundamba and Eagleby communities, which it forecasts could unlock between $22 million and $24 million of capital over the next two to three years. The company said these are partially owned strata-titled communities where buying back remaining units is no longer feasible, and that the released capital is being redeployed into higher-returning development and acquisitions.

Funding, growth and the interest-rate backdrop

Eureka said it continues to operate in a 'higher-for-longer' interest-rate environment, noting the cash rate at 4.35 per cent, and that the associated increase in funding costs has already been incorporated into its guidance. This is an important point: the company is signalling that its improved outlook is being delivered despite, not in the absence of, elevated borrowing costs.

The company also pointed to a growth pipeline. It said acquisition opportunities now exceed $120 million, with more than that amount of accretive rental assets under due diligence or in advanced price discovery. Eureka is progressing funds management and capital partnering initiatives - building on an established Western Australia fund - intended to grow assets under management and recurring fee income while supporting balance sheet flexibility.

Managing Director and Chief Executive Officer Simon Owen said Eureka had traded strongly through the second half, with seniors' villages close to full and all-age occupancy strengthening, and that the company was allocating capital with discipline by realising value from selected homes and units, exiting non-core assets and redeploying capital into development and acquisitions.

Sector context: affordable and seniors' housing

As general market context rather than company-specific fact, the affordable and seniors' rental housing segment in Australia has been shaped by structural themes including an ageing population, housing affordability pressures and constrained new supply. Eureka itself referenced proposed changes to capital gains tax and negative gearing in a recent Commonwealth Budget, noting that many property economists expect such changes could further curtail the supply of affordable rental housing.

The company also noted that recent increases in construction and transport costs, which it linked to conflict in the Middle East, appear to have stabilised, and that several developments continue to be delayed by council permitting processes. These factors are common talking points across the listed residential and retirement-living sector, and they cut both ways: constrained supply can support demand for existing assets, while permitting delays and cost inflation can slow new development.

Company background

Eureka Group Holdings Limited (ASX:EGH) is an Australian company focused on affordable rental housing, with a core seniors' rental portfolio and a growing all-age long-term rental offering. Its strategy combines owning and operating communities with a developing, capital-light funds management business. The company is headquartered in Brisbane.

Because Eureka both owns property and earns rental income, its performance is influenced by occupancy, rent growth, funding costs and its success in recycling capital into higher-returning opportunities. This update touches on all of those levers.

Investor watchlist: what to monitor next

For those following ASX:EGH, the items most directly relevant to this update include:

  • Full-year results: the FY26 result is scheduled for release on 20 August 2026, when the company also expects to provide FY27 guidance.
  • Settlement of the Broken Hill sale, expected this month, and progress on the Bundamba and Eagleby sell-downs.
  • Acquisitions: conversion of the more than $120 million pipeline into completed deals, and the ingoing metrics on those assets.
  • Funds management initiatives: progress on capital partnering and growth in assets under management and fee income.
  • Funding costs: how the higher-for-longer rate environment continues to affect interest expense and margins.
  • Development delivery: new homes being delivered across its communities and the pace of council approvals.