Aussie Property Prices Slap Aveo Group (AOG) With A $44m Loss

Aveo Group (ASX: AOG) released its first half year results for FY19 to the market, posting a loss of $44.7 million, down from a $149.3million profit in the prior period

You’re reading a free article on Rask. Join 4,000+ Australians who get our expert advice, tools, exclusive research and investment recommendations. Get your 30-day trial for $1! Learn more

Aveo Group (ASX: AOG) released its first half year results for FY19 to the market, posting a loss of $44.7 million, down from a $149.3 million profit in the prior period.

Even its underlying profit after tax, which excluded property revaluations, was only $12 million, down 67% from $36.3 million previously. Ouch.

Aveo Group is the owner, operator and manager of retirement communities across Australia.

Weak Property Market

Aveo said that while demand remained strong and written sales were up on the previous period, a challenging property market is putting pressure on converting their written contracts into sales.

Aveo CEO Geoff Grady said, “settlements are taking longer to occur as incoming residents are experiencing increased difficulty in selling their homes. This has led to a substantial increase in the number of our deposits on hand, from 89 at 30 June 2018 to 212 at 31 December 2018”.

The weak property market also led to the group’s revaluation of investment properties being revised down by $63.2 million, with this being partially offset by the profit on the sale of the Gasworks complex in QLD.

A Takeover?

Aveo also provided an update on its strategic review process it announced on 15 August 2018.

As the group considers offers from a potential buyer, it stated, “In late January 2019, a number of indicative non-binding bids were received from parties interested in a whole of company transaction”. Aveo said it will keep shareholders updated in line with continuous disclosure obligations.

Uncertainty Ahead

Aveo also announced a potential buyback in the second half of FY19 around May with potential free cash flow being used to buy back shares below their NTA. While that sounds promising, the Royal Commission into Aged Care Quality and Safety

online pharmacy buy antabuse without prescription with best prices today in the USA
online pharmacy purchase pepcid without prescription with best prices today in the USA

established 8 October 2018 looms as a potential industry game changer with an interim report due to be handed down on 31 October 2019.

[ls_content_block id=”14946″ para=”paragraphs”]

CSL, Xero, ANZ... the ASX is beaten up

Right now, only brave investors are buying. Is ASX Reporting Season your KEY opportunity to act? Buy, or sell.

This coming Monday night, our two most experienced professional investors, Owen Rask and Leigh Gant, are hosting an exclusive and rare webinar on the what to watch this ASX reporting season. LIVE and free

With over 35 years of combined investing experience, join our Chief Investment Officer and Head of Content for our free Q&A.

We’ll be diving into results from CSL, Pro Medicus (ASX: PME), ANZ Bank and more. It’s absolutely free to join us. Take advantage of this volatility with our free playbook. Simply click here to view the topics.

A $50,000 per year passive income special report

Join more 50,000 Australian investors who read our weekly investing newsletter and we’ll send you our passive income investing report right now.

How can Rask help you?

About Rask

Learn more about us, our your community and our mission.

Rask investing philosophy

Nearly 15 years later.
It's still a work in progress.

Online investment community

You won't find our investment community on Facebook or Reddit because it's secure, free and available now.

Join 250,000+ podcast listeners

250,000 investors tune into the Rask podcasts every month. Find out why.

Find a financial planner

Australia's financial experts. At your doorstep.

Free finance courses

35,000 students have enrolled in free Rask courses. We're on a mission to 100,000.

Subscribe to Rask's free investor newsletter

53,000 Australian investors subscribe to our Sunday newsletter... and love it! It's free.

$50 million invested

We manage almost $50 million on behalf of Aussies. Discover how you can invest with us.

Better investing starts here.

Want to level-up your analytical skills and investing insights but don’t know where to start? Join 50,000 Australian investors on our mailing list and we’ll send you our favourite podcasts, courses, resources and investment articles every Sunday morning. Grab a coffee and let Owen and the team bring you the best  insights.

Subscribe to Rask's free investor newsletter

Kick off your week with our pick of podcasts, courses and investing resources to keep your finger on the Rask pulse!

Here you go: A $50,000 per year passive income special report

Join more 50,000 Australian investors who read our weekly investing newsletter and we’ll send you our passive income investing report right now.

Simply enter your email address and we’ll send it to you. No tricks. Unsubscribe anytime.

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian owned.