Scentre Group: Westfield owner’s $3b loss sparked by COVID-19

The owner of Westfield shopping centres in Australia has taken a massive financial blow and lost billions because of the coronavirus pandemic.

The owner of Westfield shopping centres in Australia has incurred a major financial blow, with the economic downturn induced by the coronavirus pandemic taking a swipe at its profits by more than $3 billion.

Releasing its half-year results on Tuesday, shopping centre giant Scentre Group said its interim profit had plummeted due to the impacts of COVID-19 denting the value of its property assets by $4.1 billion.

For the six months ending June 30, the company posted a statutory loss of $3.6 billion, an almost $4.4 billion financial slide compared with its 2019 mid-year results.

The shopping mall landlord has also been hit by a significant number of rent relief claims from tenants who were forced to close during the peak of the lockdown.

Shopping centres became ghost towns at the height of the pandemic. Picture: Britta Campion / The Australian

Rental negotiations have adversely impacted the group’s operating earnings and cash inflows over the period.

For the first of half of 2020, Scentre Group’s operating earnings were $361 million, a fall of $281 million on the prior corresponding period.

Scentre chief executive Peter Allen said the company had agreed arrangements with 2438 of 3600 retail partners and had provided tenants with approximately $1.6 billion in support since the pandemic took hold.

“We acknowledge that this has been a difficult time for our customers and our retail partners,” he said.

“We have supported our retail partners throughout this period on a case-by-case basis.”

Total revenue over the period was down 16 per cent on the same period in 2019 to $1.1 billion.

The group has decided not issue an interim dividend to its shareholders.