No profit revision despite "very strong" reaction

Gold Coast-based property group MFS Diversified has delivered sharply higher sales from its residential projects across Australia, but its forecast profit remains unchanged.

Land sales from the Groups 19 residential projects totalled 437 at the end of September, up a staggering 100 on forecasts.

"The figure underlines how strong the residential market is," said MFS Diversified managing director Guy Farrands yesterday.

However, Mr Farrands stressed the group was not upgrading its profit forecast for the year as a result.

"The figure is more a reflection of current activity; it's not a profit upgrade," he said.

This did not stop investors from marking MFS Diversified's stapled securities up almost 6 per cent yesterday.

They jumped from 84.5c to close at 86.5c yesterday on volume of more than 1 million securities.

Dean McMahon, acting head of residential development, said the Gold Coast market remained 'very strong' for the group.

However, he said the search for suitable land for future projects remained a challenge in the region.

He said the past year had been marked by development planning for existing sites and this was beginning to bear fruit.

"In August, we released the first stages of our 1004-lot integrated land project Cascades on Clyde, near Berwick, Victoria, and have seen a strong buyer response with 139 lots already sold.

"Our $1 billion 2900-lot joint-venture project, Eynesbury township at Melton, Victoria, released the initial residential lots in August this year with 76 lots sold.

"We achieved 222 sales for the quarter in Queensland and, in August, released the first stages of two new projects in Brisbane with an end total of 392 house and land packages."

Among new Gold Coast projects set to come on stream for MFS Diversified is an estate know as This at Burleigh Waters, where it will launch its new upmarket MODA brand, as well as 12-level, 27-apartment project at Tweed Heads.

Its next major southeast Queensland land development is a 677-lot estate at Mt Cotton.

It also has plans in place to release 60 up-market housing lots on Sydney's northern beaches.

Mr Farrands said MFS Diversified had about six years supply of land in its portfolio at the current sales rate.

The group has its foot on about 6100 lots with an end value of $1.5 billion.

MFS Diversified posted a net profit of $13.4 million in 2007 and has forecast a $33.7 million net profit this financial year.

Gold Coast Bulletin
Thursday October 25, 2007