Rural Funds Group financial results: Ag portfolio grows to $1.5 billion

The rural portfolio of one of Australia’s biggest landholders has topped $1.5 billion for the first time. See where it is investing and in what sectors.

The rural portfolio of one of Australia’s biggest landholders has topped $1.5 billion for the first time.

The ASX-listed Rural Funds Group released its 2021-22 financial results last week which showed a significant 34 per cent increase in the value of its 68-property almond, cattle, cropping, vineyard and macadamia portfolio in the 12 months to June 30.

According to its financial statements, Rural Funds’ adjusted total assets topped $1.51 billion – up from $1.13 billion a year earlier. The value of total assets grew 35 per cent to $1.4 million with water assets increasing 22 per cent in worth to $110.3 million.

In the statement, Rural Funds said assets had increased primarily because of $179 million worth of acquisitions and property revaluations worth $134 million.

In terms of acquisitions, the company spent $44.5 million on beef properties, $62.3 million on macadamia orchards and $72.4 million on cropping farms during 2021-22.

Revaluations were headlined by a $104.7 million adjustment of its beef portfolio, including a $48.8 million in the value of its Natal property at Charters Towers in Queensland, purchased as part of a three-farm sale and leaseback deal in 2017 for $72.5 million. A revaluation of its almond portfolio was worth $17.7 million.

According to the statement, the 22-farm beef portfolio was worth $534.7 million at June 30, with the three-farm almond business valued at $400 million, the 19-property cropping venture worth $186.9 million, the 17-farm macadamia operation valued at $178.3 million. Thirty-nine per cent of revenue was generated from the beef business, with 36 per cent coming from almonds and 9 per cent cropping.

Rural Funds managing director David Bryant described the results as “very prosperous”.

“Profits and asset values increased considerably while productivity improvements and property developments have created a pool of assets that have been prepared for new leases,” Mr Bryant said.

Major lessees of Rural Funds properties include beef giants JBS, the Australian Agricultural Company, Mort and Co and Stone Axe Pastoral Company as well as Treasury Wine Estates, Olam, Select Harvest and Queensland Cotton.

Rural Funds is the fourth-biggest investor in the Australian agriculture space, behind Canada’s PSP Investments, Macquarie Agriculture and the New York-based TIAA-CREF.