Cromwell posts $129.5m loss due to fall in valuations

Oksana Patron

28 February 2023

Cromwell Property Group has posted a statutory loss of $129.5 million, from $132.5 million profit in HY22, for half-year 2023 due to a fall in property valuations.

Operating profit was also lower and stood at $87.1 million, compared to $96.4 million in HY22, but total assets under management remained unchanged from June 2022 and stood at $12 billion.

In the announcement made to the Australian Securities Exchange (ASX), Cromwell said that in Australia it would continue to sell-down non-core assets, with $381 million sold during 2022 calendar year.

The firm also said it would continue to “test market conditions for a suitable opportunity to take its Australian Investment Portfolio off the balance sheet”.

Following this, the funds under management platform contributed positively to HY23 operating profit, however this was offset by the decline in income from the company’s investment portfolio as Cromwell continues to dispose of its non-core assets.

Commenting on the outlook, Cromwell’s chief executive, Jonathan Callaghan, said: “Through the remainder of FY23 we will continue our program of non-core asset sales, applying proceeds to debt reduction in the first instance to ensure security through an ongoing difficult operating environment.

“Any redeployment will be measured and disciplined without unduly increasing gearing risks.”

In October last year, Cromwell announced the sale of its 50% interest in LDK Healthcare to Anglicare Sydney and in May the group sold 200 Mary Street, Brisbane, which served as the firm’s head office,  for $108.5 million to private markets finance and investment house, Wingate, as a part of its strategy of selling non-core assets.