• Defensive income with embedded growth
• Improved portfolio quality and capacity to fund growth initiatives
• Resilient income growth in uncertain market

Dexus Convenience Retail REIT (ASX:DXC) has reported its FY25 annual results, highlighting the defensive and growing nature of its portfolio. The REIT's 91-property, $728 million portfolio is predominantly located on Australia's eastern seaboard and leased to leading Australian and international convenience retail tenants. The portfolio has a long 7.9-year WALE, with 99.9% occupancy and 74% of income subject to fixed or CPI-linked rental escalations, providing a sustainable and strong level of income security. The REIT delivered FY25 FFO and distributions of 20.7 cents per security, slightly above guidance, despite higher cost of debt and moderate dilution from divestments. The REIT's balance sheet is well-positioned, with gearing at the lower end of the 25-40% target range and an average debt maturity of 4.5 years. The REIT also executed $38.8 million of strategic divestments at a 1.8% average discount to prior book values. The Glass House Mountains Northbound redevelopment, expected to complete in February 2026, will further enhance the REIT's WALE and deliver strong development returns. The REIT remains focused on value-enhancing activities, including potential pipeline restocking and other growth opportunities, and is currently trading at a circa 19% discount to NTA.

Barring unforeseen circumstances, DXC expects to deliver FFO and distributions of 20.9 cents per security in FY26, reflecting growth of 1.2% supported by property income growth and current interest rate expectations.

The REIT is well-placed to generate defensive income with embedded rental growth and capacity for future growth. It remains focused on value-enhancing activities, including the Glass House Mountains redevelopment, potential pipeline restocking, and other growth opportunities.