The residential property group has affirmed its previous guidance that full-year profit will land between $18 million and $22 million.
However, a rush of settlements at two projects in Queensland and Victoria could see that figure exceeded.
At that level, the result will be almost triple the 2012 bottom line of $8.2 million and a $25 million-plus turnaround on last year’s $13.5 million loss.
The result is expected to be the company’s best since 2006 when, under one of its former guises as MFS Diversified Group, it recorded a net profit of $23 million at the peak of the property boom.
Villa World says it has recorded 726 sales across 18 projects in the 10 months to the end of April.
Cascades on Clyde in Melbourne and Park Vista in Brisbane have delivered record sales this financial year, while five other projects have sold out.
The company plans to reward shareholders with a final dividend of 9c a share, bringing the full-year payout to 15c. Based on yesterday’s closing price, Villa World is trading on a yield of around 7.5 per cent.
Managing director Craig Treasure tells Gold Coast Business News that the Villa World of old – the affordable housing developer – is “back doing what it has done for 27 years”.
“We’ve been out there for some time telling people we’re a lower risk development play,” Treasure says.
“Our market is dictated by lower interest rates, first-home owner grants and consumer confidence and that doesn’t appear to be changing.”
Treasure says Villa World has been able to secure new sites to capitalise on the momentum in the property market, but the challenge has been to get product to the market quickly enough to satisfy demand.
“We’re selling so much we’re having trouble keeping up with demand,” Treasure says. “It’s a good problem to have.”
Treasure says Villa World has “ample” capital to pursue new projects and that it has a number of acquisitions in train.
The company has made six new acquisitions in Queensland and NSW, totalling 615 lots. It says an additional 560 lots across a number of sites in Brisbane and Melbourne are under due diligence.
Villa World says it will take advantage this financial year of some of the $22 million in tax losses it has carried forward which will boost its net profit after tax.
Villa World also is poised to begin the 2015 and 2016 financial years with $102.5 million in carried forward sales totalling 245 lots. It says the majority of the sales for the 2015 financial year will settle in the first half.
Meanwhile, Villa World has appointed Gold Coast property veteran Mark Jewell as its new chairman, replacing Treasure who held the dual roles of managing director and chairman.
The Jewell and Treasure combination has not been lost on Treasure who says it might bode well for the company’s fortunes.
“We were very fortunate to have Mark join our board three months ago, and it is a logical next step to have roles of chairman and managing director separated,” he says.
“It’s also good for me to have another seasoned property professional helping me drive this company forward.”
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