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STRONG Queensland property sales and successful short-term capital raising initiatives have contributed to Devine Limited’s (ASX: DVN) announcement of a near-doubling of its full-year profit guidance.
The company has raised the bar from between $7 million and $10 million to $12 million and $14 million, indicating it is bouncing back from a $15 million half-year loss last December.
DVN has secured 60 per cent of its annual forecast land settlement target and 70 per cent of its annual home construction starts.
Short-term capital recycling initiatives announced following the loss have come into fruition, where DVN has exited selected assets in Brisbane and Sydney to facilitate investment in higher margin opportunities.
Managing director and CEO David Keir says more than $110 million has been raised through this initiative in the past six months.
“This has enabled the company to investigate and negotiate a number of new development opportunities that will underpin the future of business,” says Keir.
In the meantime, existing DVN developments are performing strongly particularly on the local apartment front.
The company's apartment sales presently stand at 80 per cent of its full year settlement target.
Currently sold to 98 per cent capacity, the award-winning Hamilton Harbour mixed-use development has been the big property winner for DVN, as well as its DoubleOne3 apartment project in Teneriffe which has reached nearly 90 per cent sold.
Furthermore, market conditions have appeared to work in the company’s favour, something managing director and CEO David Keir was hopeful of earlier in the year.
“Market fundamentals, headlined by low interest rates and the demand-supply imbalance, combined with the quality of Devine’s product and place offerings support an improved level of trading over the next 12 months,” said Keir in the company’s half-year report in December.
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