Lower debt costs and recent acquisitions have led property giant Dexus to upgrade its full-year distribution guidance, despite posting a fall in half-yearly profit.
The group's net profit after tax fell by 7 per cent in the half-year, dropping to $257.8 million for the six months to December 31, down from $277.2m for the first half of fiscal 2014.
This was against a strong rise in revenues, which increased 35.8 per cent to $419.6m for first half of the 2015 financial year, compared to $309m in the prior corresponding period.
Dexus also saw a strong lift in funds from operations, up 25.4 per cent year on year to $258.4m.
“Positive momentum in office leasing enquiry in Sydney and Melbourne resulted in increased activity in our portfolio," executive general manager, office and industrial, Kevin George said.
The group will pay an interim dividend of 19.68c, a 6.8 per cent increase on the 18.42c dividend a year prior.
“Despite the challenging economic environment, we expect the remainder of 2015 to be favourable for investment demand and total returns from commercial real estate," chief executive Darren Steinberg said.
Mr Steinberg upgraded full-year guidance for the group to 59.48c per share, reflecting a 9.3 per cent growth year on year, as the company is buoyed by lower debt costs and recent acquisitions. Dexus is now also targeting a distribution of 41.04c per share for the full year.