Villa World marks successful year at annual meeting with upbeat assessment of its projects aimed at mid-market buyers

GOLD Coast-based developer Villa World believes its focus on the affordable part of the housing market will provide a buffer to gathering headwinds in the residential market.

GOLD Coast-based developer Villa World believes its focus on the affordable part of the housing market will provide a buffer to gathering headwinds in the residential market.

Home prices in the Sydney and Melbourne markets are declining and the Gold Coast is not immune.
According to respected valuation firm Herron Todd White, the house and unit markets are both starting to decline on the Gold Coast.

However, Villa World, which held its annual meeting this morning at the Sofitel in Broadbeach, struck an upbeat tone when its executives fronted shareholders.

CEO Craig Treasure said tightening finance was putting the squeeze on the market for land and new housing.

Villa World’s sole Gold Coast project — Arundel Springs.

“However, Villa World’s strong positioning within the affordable to mid-priced residential housing and land market provides a strong buffer against market challenges,” Mr Treasure said.

“Villa World’s clear and deliberate strategy of seeking consistent, through-the-cycle

performance was supported by a positive medium-term outlook underpinned by strong carried forward sales for the company into FY19 and FY20.”

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Villa World announced its net profit for FY18 grew 15 per cent to $43.6 million.

The full-year result was at the top of its forecast of between $42 million and $44 million.

Villa World recorded 1678 sales in the past financial year, 39 per cent higher than FY17.

Queensland projects contributed to 64 per cent of sales, slightly down on the previous period, with strong sales in southeast Queensland and Hervey Bay.

Lisa MacCullum’s appointment as a non-executive director at Villa World was ratified by shareholders today.

Chairman Mark Jewell told shareholders that its on-market share buyback was proceeding well.

The company announced the buyback in September as a means to shore up its share price.

“In October, we commenced an on-market share buyback for up to five per cent of shares on issue over the next 12 months,” Mr Jewell said.

“This is proceeding well and we have bought back more than $700,000 worth of shares.

“At current market pricing, we believe that investing in our own securities is an attractive and accretive use of capital.”

He said Villa World was on track to meet its forecast this financial year for a profit of “about $40 million”.

Also at the meeting, shareholders ratified the appointment of former Nike vice president Lisa MacCallum as an independent non-executive director.

Mr Treasure said after the meeting that sales had been strong at the company’s sole Gold Coast project — Arundel Springs.

Construction has started on the townhouse component, with properties priced at about $560,000.