Vicinity’s profits reduced by 78 per cent to $271.5 million due to write-downsShopping mall owner Vicinity Centres has ridden the post-lockdown retail recovery to clock a 14.5 per cent increase in earnings for the 2023 financial year, but spending at its shopping centres moderated towards the end of the year.
“The team negotiated the highest number of leasing deals since facilities’ inception in 2015,” chief executive Peter Huddle said. The write-downs meant Vicinity’s statutory net profit was cut 78 per cent to $271.5 million for the 2023 financial year.The rate of retail sales growth also moderated late in the fourth quarter, after growing for most of the year, indicating that inflation and rising interest rates may finally be slowing retail spending.
As a result, Vicinity expects to deliver lower distributions in FY24, in the range of 14.1¢ to 14.5¢, compared to FY23. But Mr Huddle remained confident Vicinity would be able to absorb market volatility due to the REIT de-risking its income in FY23.