Lend Lease (LLC)

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http://www.lendlease.com/WorldWide/home.aspx

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Lend Lease upbeat about growth
BUSINESS SPECTATOR NOVEMBER 14, 2014 10:43AM

Mitchell Neems

Business Spectator Reporter
Melbourne
CEO Steve McCann says Lend Lease has a platform for a “strong growth trajectory”.
CEO Steve McCann says Lend Lease has a platform for a “strong growth trajectory”. Source: News Corp Australia
LEND Lease says it is on track to deliver growth for shareholders, as it stares down an extensive development pipeline and backlog of construction revenues.

Chief executive Steve McCann told shareholders at the annual general meeting the group (LLC) remains very confident of its outlook, with a development pipeline of around $38 billion, a $16bn construction revenue backlog and more than $16bn funds under management.

“The embedded earnings in this pipeline of opportunities, underpins visibility over the next three years and provides a platform with a strong growth trajectory,” he said.

Mr McCann said macro-economic trends were continuing to support Lend Lease’s residential businesses in Australia and the UK.

“This is evident in the $2.5bn of pre-sold revenue that we have recorded across apartments and communities and a record year for settlements in our residential operations.

“That $2.5 billion pre-sold revenue will become cash and underpin profits over the next three years.”

Mr McCann added the group’s construction business is well-placed to participate in the foreshadowed Australian infrastructure spend, expected to total around $50bn.


Lend Lease made a net profit of $822.9 million during the last financial year, up 50 per cent from $549 million in 2012/13.

This was underpinned by a $485 million profit from the sale of the Bluewater shopping centre in the UK.

The developer makes about three-quarters of its earnings in Australia, excluding the Bluewater transaction in 2014, compared with 40 per cent in 2005.

“We will increase our focus on the offshore markets over the next few years, in line with expected macro trends, aiming to grow offshore earnings to 30-35 per cent of Group earnings,” Mr McCann said.

“The next phase of our strategy is not a reinvention but an evolution of what we have worked towards during the last five years.”

Business Spectator, AAP

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Lend Lease looks overseas but still bullish at home
THE AUSTRALIAN NOVEMBER 15, 2014 12:00AM

Lend Lease looks overseas
Lend Lease managing director Steve McCann at the company’s AGM in Sydney yesterday. Picture: David Moir. Source: News Corp Australia
LEND Lease managing director Steve McCann has restated the group’s push for increased ­international exposure but remains bullish on the demand for new apartments Melbourne and Sydney.

Mr McCann told shareholders at Lend Lease’s annual general meeting in Sydney yesterday that the company would aim to lift its overseas earnings from 25 per cent of revenues in 2014 to as much as 35 per cent over the next few years.

He said the group would eye opportunities in the US and the key Asian markets of Malaysia, Singapore and China. “We will increase our focus on the offshore markets over the next few years in line with expected macro trends,” he said. “But any expansion in (Asia) will be disciplined.”

Lend Lease has a development pipeline of about $38 billion, a $16bn construction book and more than $16bn worth of funds under management.

Speaking after the meeting, Mr McCann played down fears of an apartment oversupply in Melbourne. “The first indicator to us that the market is slowing is when our pre-sales start to struggle. That hasn’t happened yet, so we are still quite confident and optimistic about the outlook,” he said.

But he acknowledged that the unit cycle was near its peak. “At this point in the cycle there is always more build that comes and inevitably that’s what leads to the (market) turning,” he said.

Lend Lease heads a consortium selected by the Victorian government to build Melbourne’s $8bn East West Link toll road.

However, ahead of the state election later this month Labor has vowed to dump the plan to build the road and rip up the signed contacts.

Mr McCann would not be drawn on whether the group would seek compensation if an ­incoming Labor government ­terminated the project.

“I know there is a lot of talk around at the moment about what may or may not happen, but there is also a lot of political ­rhetoric leading up to an election, so I’m not entirely sure what the situation would be,” Mr McCann said.

In Sydney, Lend Lease is a major stakeholder on a prime ­Circular Quay block earmarked for a major office and apartment precinct.

Mirvac Group this week said it supported all owners on the block — bounded by Alfred, Pitt, Dalley and George streets — joining ­forces to submit a single masterplan.

Lend Lease is looking to expand its holdings on the block, with the $400 million Gold Fields House in its sights, though it faces stiff competition.

“We have got a very significant piece of that location and we are considering a whole range of ­options,” Mr McCann said.

“The Gold Fields House (sales) process is under way now, so assuming they do sell it, whoever emerges with that will be a player in it too so we just need to monitor where it all goes.”

Lend Lease shares closed up 9c yesterday at $15.94.