Shares hit near four-decade low, close 7.2% lower
Property revaluations, impairment weigh on results
CEO Tony Lombardo calls FY26 transitional year
Declares interim distribution of 6.2 AU cents/share
Updates to close and adds analyst's comments
By Kumar Tanishk and Rajasik Mukherjee
Feb 23 (Reuters) - Australia's Lendlease Group LLC.AX swung to a first-half loss on Monday, pressured by impairments and a fall in the valuation of its foreign properties, sending its shares to a near four-decade low.
The property developer logged a loss after tax attributable of A$318 million ($224.86 million) for the first half of the year, compared to a profit of A$48 million a year earlier.
Lendlease booked A$118 million in non-cash negative revaluations and impairments on investment property, mainly in the United States, the UK and Singapore.
The write‑downs were a major drag on the results but were not an outlier given the global property backdrop, said William Taylor, COO at ETFshares.
"Most of the pressure is coming from offshore assets in the U.S., UK and Singapore, where higher rates and softer leasing conditions continue to weigh on commercial valuations," Taylor said.
Shares of Lendlease skidded as much as 9.17% to A$4.160, their lowest since December 1987, before closing 7.2% lower, while the broader ASX200 benchmark .AXJO dipped 0.6%.
Lendlease reported an operating loss after tax of A$200 million, including A$87 million in profit from its Investments, Development and Construction (IDC) arm and a A$287 million loss from its Capital Release unit.
Within IDC, lower contributions from Investments and Development were partially offset by a turnaround in Construction.
The Construction business swung to a A$69 million operating profit from a A$25 million loss a year earlier, driven by higher revenue and improved project performance.
Calling fiscal 2026 a transitional year, Chief Executive Tony Lombardo said the group expects IDC earnings to strengthen through the second half and into fiscal 2027.
The bigger question for Lendlease is execution and stability, Taylor said, pointing to a CEO transition later in 2026 that adds uncertainty "at a time when balance sheet repair is critical."
Lendlease declared an interim distribution of 6.2 Australian cents per share, up from 6 cents a year earlier.
($1 = 1.4142 Australian dollars)
(Reporting by Kumar Tanishk and Rajasik Mukherjee in Bengaluru; Editing by Mrigank Dhaniwala, Eileen Soreng and Subhranshu Sahu)
((tanishk.Kumar@thomsonreuters.com; X: @thatstanishk))