Reporting Season: AV Jennings to deliver pre-tax profit of $45 million

By Trevor Hoey. Published at Aug 7, 2018, in Features

Name: AVJennings Limited (ASX:AVJ)
Market Capitalisation: $270 million
Last Closing Price: 68 cents

Ahead of releasing its fiscal 2018 result on August 17, 2018, AVJennings Limited (ASX:AVJ) has informed the market that it expects to achieve a pre-tax profit of $45 million.

There was some accounting treatment regarding revenue recognition from its Arcadian Hills project in NSW that needed to be resolved prior to releasing its result.

The decision was taken to exclude revenues from the FY18 result that would have had a positive impact on pre-tax profit to the tune of about $6 million.

Had the revenue and profit from this stage been recognised, the result would have been in line with the FY17 result of $51 million profit before tax.

While management is yet to declare its final dividend, it is anticipated that the total dividends for the year will be in line with FY17 at five cents per share.

This implies a yield of approximately seven per cent relative to yesterday’s closing price of 68 cents.

Of course this is speculative and investors should seek professional financial advice if considering this stock for their portfolio.

Analysts at Bell Potter said in a note this morning that they expected the full year dividend to increase to 5.5 cents in fiscal 2019.

It should be noted that broker projections and price targets are only estimates and may not be met. Those considering this stock should seek independent financial advice.

From an operational perspective, AVJennings management will be updating the market on industry conditions and discussing significant newer projects including Lyndarum North, Waterline Place and Riverton which did not materially contribute to the FY18 result.

S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.

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