AVJENNINGS is back in the black thanks to tighter management and a resilient housing market, but the residential property developer remains wary of the volatile operating environment.
For the six months to December 31, AVJennings recorded a net profit of $3.2 million on the back of improved margins, reduced costs and a bigger emphasis on project management fees. This compared with a loss of $9.7 million for the same period the previous year. No interim dividend was declared.
Revenue was $239.9 million, against the previous $241.7 million, but net debt also fell to $67.4 million, with gearing at 23 per cent against 58.4 per cent at the previous December 31. Contract signings rose 39 per cent to $255.1 million.
The contract building division - building a house on the client's land - had revenue of $105.7 million, while revenue in the development division (the subdividing and sale of land parcels) fell 16 per cent to $131.7 million. Profit rose due to a bigger focus on recurring income.
Chief executive Peter Summers said consumer confidence remained volatile and likely interest rate rises would make housing more expensive. But the property market had ''proven resilient'', he said.
AVJennings shares closed unchanged at 50ยข.
PHILIP HOPKINS
