FINBAR GROUP LIMITED — Earnings Release 2020

Feb 25, 2020

26 February 2020

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ASX MARKET ANNOUNCEMENT

FINBAR FIRST HALF RESULTS and FY GUIDANCE

• H1 FY20 net profit after tax of $6.64m

• Results boosted by return to net positive value of Karratha and East Perth investment properties

• Profits from sale of completed stock and settlements at Stage 1 Palmyra East

• Anticipating full year after tax profit of approximately $14m net profit for full year to June 30 2020

• First half results show more than $4.75m improvement on the same period last year

• Fully franked interim dividend of $0.02 per share

Perth, 26 February 2020: Western Australia’s leading apartment development company, Finbar Group Limited (ASX: FRI) (Finbar or the Company) has today announced a net profit after tax of $6.64 million for the first half of the 2020 financial year (H1 2020).

This shows a significant improvement over the $1.89m after tax profit reported for the same period last year.

The most significant contributor to the half year result for 2020 was the return to a positive net valuation of the Company’s long-term investment properties in both Karratha and East Perth.

The result was also bolstered by the sale of completed stock and the settlement on sold properties at Stage One of its Palmyra East project in October 2019, which marked the only project completion for the financial year to date.

The company finishes the reporting period with $31.2m in cash, having repaid $12m in bank facilities pertinent to Palmyra and further reducing the debt facility at its Karratha-based Pelago development by an additional $750,000.

Finbar currently has $102m in completed stock available for sale – with $57m of that attributable to Finbar after joint venture interests are accounted for and has sold down an average of $6.1 million per month in H1 FY20.

fnbar.com.au

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The completed stock levels are expected to be further bolstered following the imminent completion of the 30 level Sabina Apartment project in Applecross in March 2020.

The settlements on properties under contract at Sabina are anticipated to significantly boost second half earnings as the company moves into the settlement phase in April 2020 with 83 apartments under contract at the time of this announcement.

Second half earnings will also be boosted by the anticipated completion of One Kennedy in Maylands which is earmarked for May 2020.

The company currently holds a pre-sale book of $116m across its projects. This is anticipated to be substantially boosted by the release of Aurora (Stage 2 of the Applecross development) in March 2020 and followed by the much-anticipated launch of its landmark Civic Heart project in South Perth in April 2020.

Finbar also announced a new joint venture development in the first half of the financial year which will result in an application for approval of a 121-unit apartment development at 240 Adelaide Terrace, East Perth with settlement on that land achieved in February this year.

The recent approval of the landmark Civic Heart project by Planning Minister Rita Saffioti has also added further to the company’s approval pipeline.

In light of these positive results, while simultaneously acknowledging the significant capital requirements following the approval for the Civic Heart project to be launched in the second half of the financial year, the Board of Directors has approved a fully franked two cent interim dividend with full details to follow in a separate announcement.

Commenting on the results today, Finbar Managing Director, Darren Pateman, said: “We are pleased to be in a position to report a positive increase in the valuation of our investment assets in both East Perth and Karratha, with Karratha in particular performing strongly in an improved Pilbara economic environment.”

“Despite ongoing global uncertainty which now appears to be focused around the long term economic impacts of COVID-19, I am encouraged by the improvement in trading conditions that we have experienced in the calendar year to date and we believe this will play well into the timing of the release of both Aurora and Civic Heart in the following weeks and months,” Mr Pateman said.

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“We remain cautiously optimistic about seeing a gradual recovery in the Perth residential market as recent figures have indicated and that we are well positioned to take advantage of that uplift in sales through our approved project pipeline.”

Using stable market sales and settlement modelling for the second half of the financial year, the Company is cautiously optimistic of achieving a $14m net profit after tax for the full year to 30 June 2020.

For further information, please contact:

Darren Pateman Georgie Sweeting Managing Director GT Media Finbar Group Limited georgie@gtmedia.net.au Email: Darren@finbar.com.au Ph: 0417 179 024

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