Stockland Warns of Tough Times Ahead, Posts Fall in Profit

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Greenblat, E. ‘Heavy Winds Flatten Stockland’s Growth Prospects,’ The Age Online, August 15. 2008.

Sydney-based property developer Stockland warned of tougher times ahead as property values fall and new housing sales slow after it posted a 59 percent drop in annual net profit this week. The company’s net profit was $705.2 million for 2007 / 08, down 58.9 percent on the previous year. Yet, its operating profit rose 10.3 percent to $674 million on the back of increased revenue from its commercial properties.

Managing director Matthew Quinn stated: “We face a tough market in the year ahead, but we are well placed to withstand these conditions with a proven business model, clear strategy and sound property skills.” He explained that the commercial property business remained in “very good shape,” but rising interest rates had slowed growth in its residential business. Australian consumers are nervous at present and “hesitant to commit – whether to retail purchases or residential,” he said. Stockland controls 39 retail properties, 39 office and 29 industrial properties.