Big picture

Goodman has performed very well this year and the results have been driven by the continued and successful execution of our long term strategy.

Our financial highlights include:

• Operating profit of $942 million, up 11.4% on FY18
• Statutory profit of $1,628 million, up 48% on FY18
• Operating earnings per security (EPS) of 51.6 cents, up 10.5% on FY18
• Distribution per security (DPS) of 30.0 cents, up 7% on FY18

• Maintenance of a strong financial position with balance sheet gearing stable at 9.7%
• Group liquidity of $2.7 billion available, $1.6 billion in cash (excludes available liquidity of $13.6 billion in Partnerships)
• Total Securityholder return of 59.4% over one year and 223.4% over five years.

A strategy for the future

Goodman’s success, particularly over the past five years, is due to our consistent execution of our long-term global strategy. With this strategy to guide us, we’ve balanced our financial and human resources to leverage opportunities and address ever-changing market conditions.

Our strategy is customer-led. Not only are we driven by the structural changes shaping our industry, we are responsive to the trends that impact our customers’ businesses, such as the expectation for faster deliveries and supply chain improvements. We have shifted both the location and type of properties we develop to accommodate these evolutionary changes occurring in the industrial sector. Our properties are now concentrated in high-demand locations as evidenced by the $3.8 billion increase in property valuations over the year.

Goodman’s international business has continued to grow, with 68% of earnings and most of our team now spread across 16 countries outside Australia. The Group has invested in the US and Greater China with returns now starting to materialise.

In the last three years, we expanded our US presence and grew assets under management from around $1 billion to a portfolio with a built-out value of more than $5 billion. Our strategy has been to monetise the existing land bank while developing strong relationships with customers, capital partners and local stakeholders.

All regions contributed to this year’s strong result. During the year in Asia, our assets under management grew to $16.8 billion. We achieved higher valuations and a 99% occupancy rate, primarily driven by a focus on quality, scale and intensification opportunities.

In Europe our determined focus on quality assets and service has produced positive results. Our operations in Australia and New Zealand have also continued to deliver strong results as the structural changes driving our industry begin to be realised, enabling us to maintain our market-leading positions.

Outcomes of this scale take time, foresight and patience. They take the ability to foster capital partner relationships as well as to keep our customers close and adapt to their changing needs, so their businesses thrive long term.

They also require a global team united in working consistently towards the positive, sustainable returns we have once again achieved.

Goodman’s people and culture are fundamental to our success. These results are contingent on our strong local expertise in each of our regions and a leadership team dedicated to transparency, ethics and corporate governance.

Aligning interests

The Group’s collaborative approach to remuneration continued, seeing our long-term returns shared between Securityholders, capital partners and Goodman’s people.

While our commitment to the equitable allocation of rewards remains consistent, the Board this year initiated changes to increase transparency and rigour around our remuneration structure. The framework aims to not only deliver superior returns but to influence long term decision-making and reinforce the Group’s cultural values and behaviour.

Our remuneration policy continues to align all Goodman people with Securityholders. It adds significant value to the Group, by providing a critical differentiator to generate and reward long-term performance and retain the best people in a highly-competitive global environment.

Board changes

The Goodman Board welcomes Chris Green as an Independent Director of Goodman Limited and Goodman Funds Management Limited and a member of the Audit Committee.

Chris is the Founder and Chief Executive Officer of a US based firm that invests in real estate innovation and technology. Prior to this he spent 16 years at Macquarie Group where he was the Global Head of Macquarie Capital’s real estate business.

I am proud of Goodman’s performance and the commitment of its management and people around the world to implement what has proven to be a very successful customer-focused strategy.

On behalf of the Board, I sincerely thank our customers and investors for their continued support and all of Goodman’s people for their contribution.

Sincerely,

Ian Ferrier AM
Independent Chairman