NZL to reinstate dividends

The company made the announcement amid the release of its annual results, which saw it post a net profit after tax (NPAT) of $10.9m, up from $2.5m announced in September 2023.

The company, which owns 16,063 hectares of rural land, also reported Adjusted Funds From Operations (AFFO) of $6m.

“NZL’s intention has always been to pay regular semi-annual dividends with an interim dividend paid in October and final dividend paid in March each year,” NZL chair Rob Campbell said in a statement to the NZX.

He says the amended dividend policy targets a payout of 60-90% of AFFO.

“The payout range grants the company greater flexibility to deploy NZL’s cash operating earnings in ways considered most beneficial to increasing shareholder value,” Campbell says.

The interim dividend will be based on results for the 1 January 2024 to 30 June 2024 and is set to be paid out in early October.

The announcement comes on the heels of a partnership between the rural landowner and Australia-based private market investment manager Roc Partners.

The partnership, announced on 19 January 2024 and settled on 9 February, saw Roc Partners acquire 25% of NZL’s assets at a value of $44.2m.

NZL says it has used the proceeds to repay the $11.8m on a convertible note it drew down in April 2023 to partially fund its forestry acquisition.

“A further $20.7m of the proceeds were used or committed to fund orchard and forestry land acquisitions announced to the market on 20 February 2024,” Campbell says.

Meanwhile, Allied Farmers, NZL’s external manager, has reported a net profit before tax (NPBT) of $1.945m for the six months ended 31 December 2023, down from $2.129m for the same period in 2022.

The profits reflect Allied Farmers’ 67.7% ownership of New Zealand Farmers Livestock Limited (NZFL) and 100% ownership of New Zealand Rural Land Management Limited Partnership (NZRLM). In a statement to the NZX, the listed company said it would not be paying dividends for the period while it continues to use tax losses.

“The board strongly believes that in the short term, retaining and redeploying earnings is in shareholders’ best interests,” the company said in a statement to the NZX.

It said that because NZL did not complete any asset transactions in the half-year period, NZRLM was not paid any transaction fees.

“However, NZL’s rural portfolio increased in value, from which NZRLM received performance fees,” the statement reads.

“The outlook for NZRLM remains positive, driven by a larger opportunity set for NZL and an expanding international investor base at NZL.”