Q&A

Why have you changed your distribution policy and how will this affect my dividends?

We are committed to taking a conservative approach to distributions and so reviewed our policy to ensure we deliver returns appropriate to our earnings. This approach is sustainable for Stockland and our securityholders and is the best way to provide steady growth over time.

In light of this we have adopted a policy that aligns distributions with funds generated from operations. From FY10 Stockland will pay out the greater of our trust taxable income or 80 per cent of our adjusted funds from operations.

Why has Stockland taken stakes in several other companies? What are you planning to do with these?

We have taken stakes in three companies:

  • GPT – a large property company with a focus on owning and managing commercial property
  • FKP – a leading retirement operator in Queensland
  • Aevum – a leading retirement operator in New South Wales

These stakes provide strategic option value for future growth. No corporate transactions will be contemplated unless they clearly show value enhancement for Stockland's securityholders.

What are you doing to address the challenges your business faces?

We're continuing to focus on our key strengths of asset management, development and customer insight. We have realigned our business structure to improve efficiency and reduce costs and have deferred capital expenditure until conditions improve.

We have also capitalised on momentum in the housing market and with our increased market share we anticipate good results from this business in FY10.

During the year we undertook a number of capital management initiatives to strengthen our balance sheet raising new equity of $2.7 billion, renegotiating debt facilities and selling non-core assets. We will maintain our conservative approach to capital management.

Is Stockland exiting the UK?

In light of the changed market conditions, we have decided to embark on an orderly sale of assets over the next two to three years. In the meantime, we will complete projects underway and manage our assets tightly to maximise returns. We anticipate a break even result from this business during this period.