Substantial gains in property valuations gave NZ Rural Land Company (NZL) nearly $40 million of net profit after tax in the 2022 financial year, ended June 30.
The adjusted funds from operations (AFFO) were $4.3m, of which 95% will be paid to shareholders as dividends.
The net asset value of the company’s shares has risen to $1.65, about 30% higher than its current trading price.
Therefore, the company is claiming net asset value per share growth of 18.6% over the financial year.
The directors have declared a full-year dividend of 3.61c a share, 2.01c of which was paid after the interim results.
Both the AFFO and the dividend were about 0.5c a share below the most recent guidance, due to the dilution effect of 16% increase in shares issued to 112.85m on June 30.
In a flurry of activity before balance date, a one-for-five entitlement offer raised a further $20m of capital which, with $9m of new borrowing, financed the purchase of two large Southland dairy farms.
At balance date NZL had total assets of $289m, being 11 farms comprising 11,710ha of prime production land, all under long-term leases to experienced sharemilkers.
It also had $100m of debt, which almost doubled in the past year.
In the outlook for the current financial year, the NZL directors made an AFFO guidance between $4.9m and $5.4m.
They said that bank debt had been arranged and hedged to have an average all-in cost of 4.69% during the year.
The NZL board wants to change the balance date to December 31 to shift the company’s results to February, well ahead of the May/June season when pastoral farms traditionally trade.