Waypoint REIT (ASX:WPR) executives outlined full-year FY2025 performance and provided FY2026 guidance during an earnings call, highlighting modest earnings growth, a higher net tangible asset (NTA) value, continued portfolio pruning through non-core asset sales, and substantial progress on upcoming lease expiries.
FY2025 results and key metrics
Managing Director and CEO Hadyn Stevens said distributable earnings per security (DEPS) of AUD 0.1664 was in line with the updated mid-year guidance and up 1% on FY2024. NTA as at 31 December rose to AUD 2.90 per security, up 5% over the year. Stevens added that the management expense ratio (MER) was 30 basis points, consistent with the previous two financial years, while gearing was “largely unchanged” at 32.7% despite completing an AUD 50 million buyback.
Operating expenses rose, driven primarily by higher property-related costs including non-recoverable land tax and specific repair and maintenance items on double net sites, while the MER remained stable due to discipline on corporate costs. Interest expense increased as expected in line with a higher weighted average cost of debt. The statutory result for the year was a net profit of “just over AUD 200 million,” according to the CFO.
Capital management, debt and hedging
The CFO highlighted the AUD 50 million on-market buyback was completed at an average price about 10% below NTA, contrasting with non-core asset sales executed at less than a 1% discount to book value. He said the REIT maintained gearing at the low end of its target range and “optimized” liquidity following asset sales, the buyback, and refinancing.
Waypoint’s weighted average cost of debt increased to 4.8%, which the CFO said was below the company’s guidance of 5% due to refinancing outcomes and lower commitment fees. Interest coverage also remained with “healthy headroom” to the 2 times covenant.
On the debt profile, he said the group refinanced almost 40% of facilities during the year and expected these initiatives to generate an overall margin saving of about 15 basis points across the debt book. He attributed the largest part of that improvement to early repayment of a tranche of US private placement notes with a margin of over 250 basis points, cautioning against extrapolating that outcome across the full debt portfolio.
Stevens said weighted average debt maturity was 3.8 years and more than AUD 400 million of debt facilities were refinanced or extended during the year. Weighted average hedge maturity was 2.8 years, with 90% of FY2026 debt hedged.
Portfolio valuation and non-core asset sales
Stevens said Waypoint’s portfolio was valued at AUD 2.86 billion as at 31 December, with a weighted average cap rate of 5.61%, reflecting 11 basis points of cap rate compression over the year. He also pointed to six non-core asset sales totaling AUD 40.6 million, representing a 0.4% discount to book value, and said the proceeds effectively funded about 80% of the buyback.
In a broader market update, Stevens said fuel and convenience transaction volumes continued to recover in 2025, rising about 10% to around AUD 580 million. Average yields were down about 40 basis points, which he attributed to strong investor demand and a shift in transaction mix from regional to metro assets and from Queensland to other states, particularly Victoria. However, he said the market may remain cautious with “the prospect of another rate increase or two,” and that caution could affect demand for more secondary assets while demand for high-quality assets remains strong.
On valuations at 31 December across 395 assets (including one held for sale), Stevens said there was an AUD 3.1 million increase in gross valuation in the second half, with four basis points of cap rate compression partly offset by softer market rent assumptions across both independent and directors’ valuations as part of the company’s regular rent assessment process.
Leasing progress and Viva Energy updates
Management emphasized progress on FY2026 lease expiries. Stevens said 25 of 28 expiries had been resolved, and Aditya later detailed that Viva Energy had been retained on 23 of 24 sites where the market rent review and auction process was complete, with one smaller non-fuel tenant also exercising an option. The overall rental reversion across the 24 renewed leases was an 11.7% increase versus passing rent, and Stevens said this outcome was in line with Waypoint’s independently assessed market rent range.
One site, Slacks Creek, was the exception where Viva did not exercise its option. Stevens described it as a 2-hectare site on the old Pacific Highway in South Brisbane, zoned mixed use, retail and commerce. He said Waypoint was investigating options including a potential subdivision, retaining roughly a quarter of the site as a service station leased to a new operator and selling the remaining 1.5 hectares. The company expects to provide another update in August alongside an update on the three remaining FY2026 expiries.
Stevens also referenced Viva Energy’s OTR conversion program, noting Viva opened or converted 35 OTRs during the year and expected to open a further 40 to 60 stores in the year ahead, weighted to the second half. Within Waypoint’s portfolio, 17 conversions had been completed to date, all described as basic conversions funded by Viva. Stevens said Waypoint remains open to acting as a funding partner for larger-scale conversion projects that make sense for security holders, but added that Waypoint had not received any such funding request from Viva.
FY2026 guidance and analyst Q&A themes
For FY2026, Stevens provided guidance of AUD 0.1714 DEPS, representing 3% growth from FY2025. The REIT is targeting AUD 10 million to AUD 20 million of non-core asset sales per year and expects to explore further refinancing opportunities to take advantage of what management described as attractive lending conditions. The CFO added that for FY2026 the company is guiding to a circa 5% cost of debt, supported by fixed-rate debt and hedging providing cost certainty on 90% of borrowings.
During Q&A, management said it had no indication that upcoming OTR conversions would require Waypoint funding, and Stevens said the conversions seen to date were basic projects that would not make sense for Waypoint to fund. On FY2027 expiries, Stevens said it was “early days,” adding that the company believes that cohort is under-rented but did not provide a numerical expectation, citing ongoing work and the sensitivity of negotiations.
On capital management, executives said another buyback was not being considered “at this point,” with the CFO noting the decision would likely require additional funding sources such as non-core asset sales. In response to a question on portfolio rent positioning, Stevens clarified that the portfolio overall is not under-rented; based on current valuers’ views, Waypoint considers the portfolio about 6% over-rented, with that over-renting concentrated in later years such as 2033 and 2034, while the FY2027 cohort is viewed as under-rented.
About Waypoint REIT (ASX:WPR)
Owning and leasing freehold property (Fuel and Convenience Properties).
