AI assistant
GOODMAN GROUP — Capital/Financing Update 2011
Apr 19, 2011
64998_rns_2011-04-19_e7e85885-1f4c-4172-b725-d6cbcce5d668.pdf
Capital/Financing Update
Open in viewerOpens in your device viewer
==> picture [83 x 74] intentionally omitted <==
==> picture [180 x 34] intentionally omitted <==
Goodman Australia Industrial Fund notes ‘BBB’ corporate credit rating assigned by Standard and Poor’s
Date 20 April 2011 Release Immediate
Goodman Australia Industrial Fund (GAIF) notes today’s announcement by Standard and Poor’s (S&P) that it has been assigned a ‘BBB’ corporate credit rating with stable outlook.
The assignment of the corporate credit rating by S&P follows an extensive range of capital management initiatives undertaken by GAIF over the last 12 months to restructure and refinance its debt platform. Key initiatives included the move from a secured to a senior unsecured structure and refinance of $1.5 billion of facilities in December 2010.
These initiatives provide GAIF with a simpler debt structure and the ability to further diversify its funding sources, including via the debt capital markets. They will also provide GAIF with greater operational flexibility, a longer average debt maturity profile and lower overall funding costs.
Please see the attached announcement by S&P for further information.
- ENDS -
For further information, please contact:
Greg Goodman Group Chief Executive Officer Tel +61 2 9230 7400
About Goodman
Goodman Group is an integrated property group with operations throughout Australia, New Zealand, Asia, Europe and the United Kingdom. Goodman Group, comprised of the stapled entities Goodman Limited and Goodman Industrial Trust, is the largest industrial property group listed on the Australian Securities Exchange and one of the largest listed specialist fund managers of industrial property and business space globally.
Goodman’s global property expertise, integrated own+develop+manage customer service offering and significant fund management platform ensures it creates innovative property solutions that meet the individual requirements of its customers, while seeking to deliver longterm returns for investors.
About Goodman Australia Industrial Fund
GAIF is Australia’s largest unlisted industrial fund with $4.4 billion of high quality industrial and business space assets under management in all major regions around Australia. The fund has a weighted average lease term of approximately 6.4 years and includes blue chip companies such as Coles, Toll, Coca Cola Amatil and Linfox among its customers.
Level 10, 60 Castlereagh Street, Sydney NSW 2000 | GPO Box 4703, Sydney NSW 2001 Australia Tel +61 2 9230 7400 | Fax +61 2 9230 7444 | [email protected] | www.goodman.com Goodman Limited ABN 69 000 123 071 Goodman Funds Management Limited ABN 48 067 796 641 AFSL Number 223621
==> picture [541 x 109] intentionally omitted <==
Goodman Australia Industrial Fund Assigned 'BBB' Corporate Credit Rating; Outlook Stable
Melbourne, April 20, 2011—Standard & Poor's Ratings Services today said that it had assigned its 'BBB' corporate credit rating to Goodman Australia Industrial Fund (GAIF), an unlisted wholesale fund that invests in commercial real estate assets across Australia. The outlook is stable.
"The ratings on GAIF reflect our opinion of the stable cash flow generated from the fund's diversified industrial and office-park portfolio; GAIF’s experienced property management and industrial property expertise; the fund's high occupancy levels; and its solid lease-maturity profile," Standard & Poor's credit analyst Philip Grundy said. "These strengths are partly tempered by the fund’s "moderate" financial policies and gearing. GAIF's gearing is near the maximum level under the fund’s policies and, in our view, limits the fund’s financial flexibility. Other weaknesses include the fund’s focus on industrial property, which typically has lower barriers to entry and can exhibit greater volatility than other major property types, and GAIF's exposure to cyclical real estate market conditions."
The stable outlook reflects our expectation that the fund will continue to maintain a high-quality and diverse asset base and operate a financial profile within our expectations for the ‘BBB’ rating category, including EBITDA interest cover near 2.0x. We also expect the fund to continue to expand and diversify its portfolio to meet the needs of its tenant base.
Mr. Grundy added: "Downward pressure on the rating could be precipitated by a more aggressive growth strategy, a move into more speculative development, or a move into asset types or geographic markets outside of its core business areas. In addition, downward rating pressure could arise from a material deterioration in the group's financial profile, including interest cover falling below 2.0x and gearing remaining near the 40% level. Upward rating movement is likely to be reliant on further diversification of GAIF's asset base across high-quality industrial and office assets, together with a conservative financial profile. For a higher rating to be considered, we would expect GAIF to demonstrate sustainable metrics, including EBITDA interest cover above 2.5x and debt to capital of about 30%, supported by financial policies and targets consistent with those metrics."
About Standard & Poor’s
Standard & Poor's, a part of The McGraw-Hill Companies (NYSE:MHP), is the world's foremost provider of credit ratings. With offices in 23 countries, Standard & Poor's is an important part of the world's financial infrastructure and has played a leading role for 150 years in providing investors with information and independent benchmarks for their investment and financial decisions. For more information, visit http://www.standardandpoors.com
Media Contact:
Sharon Beach, Melbourne, (61) 3 9631 2152, [email protected]
Primary Credit Analyst(s):
Philip Grundy, Corporate Ratings, [email protected] Adrian Chow, Corporate Ratings, [email protected]
Ratings may not be compiled into a database or systematically distributed or shared for commercial purposes in a manner that substitutes for a paid Standard & Poor’s service. Standard & Poor's (Australia) Pty. Ltd. holds Australian financial services licence number 337565 under the Corporations Act 2001. Standard & Poor's credit ratings and related research are not intended for and must not be distributed to any person in Australia other than a wholesale client (as defined in Chapter 7 of the Corporations Act).