Lendlease, ASX 200 stock, builds growth momentum
Lendlease shares jumped on Wednesday as investors reacted positively to the announcement of a major Sydney Metro project win along with continued progress on capital recycling which helped in developing confidence in the group’s earnings outlook.
Lendlease Group (ASX: LLC)
on 23 December announced that it has secured the Sydney Metro Hunter Street West Over Station Development which includes both the construction of the new metro station and the development of a 52-storey premium commercial tower located in Sydney’s CBD.
The West Tower is expected to have a gross end value of approximately $2.2 billion while the construction contract for the metro station is valued at around $1.5 billion.
The project is scheduled to commence in FY27 and is targeted for completion in 2032 which aligns with the planned opening of the Hunter Street metro station.
On 22 December, the company also announced further progress under its FY26 capital recycling program through a binding agreement to sell interests in The Exchange TRX retail mall and the adjacent office tower in Malaysia for approximately $400 million to a Malaysian investor.
Lendlease reaffirmed its target to achieve $2 billion of capital recycling through the Capital Release Unit in FY26.
The company returned to profitability in FY25 after a difficult prior year with statutory profit after tax of $225 million and operating profit after tax of $386 million.
The recovery in operating earnings was driven by the completion of major developments such as One Sydney Harbour along with gains from capital recycling activities and the formation of strategic joint ventures including the partnership with The Crown Estate in the UK.
Funds under management across the international investment management platform rose to $48.9 billion by year end which represents an increase of $1.6 billion compared to the prior year.
Looking ahead, management reiterated its focus on further capital recycling with a target to maintain gearing at or below 15% by the end of FY26.
(Source: Company Announcements)
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