Kiwi Property Posts Sharp Profit Drop as Write-Downs Bite, but Sees Upside Ahead

Highlights:

• Kiwi Property Group (NZX: KPG) reported a sharp drop in interim after-tax profit, driven by fair-value write-downs on investment properties and inventory impairments, despite growth in revenue and underlying operating earnings.
• Underlying pre-tax profit rose 11.5% to NZ$62.9 million, and net rental income increased, even as net tangible assets slipped to NZ$1.12 per share at the time of writing, down from NZ$1.17.
• The company remains optimistic about FY26 and beyond, saying it is well-positioned to benefit from improving economic conditions and ongoing execution of its development and leasing strategy.

Interim Results Show Profit Slide

Kiwi Property Group (NZX: KPG) reported a steep fall in after-tax profit for the six months to 30 September 2025. At the time of writing, the net profit stood at NZ$9.8 million, a decline of around 77% compared with the prior year.

Revenue and Operating Profit Stay Up Despite Challenges

Despite the profit slump, the group’s underlying performance showed resilience. Total revenue nudged higher, while operating profit before tax rose by 11.5% to NZ$62.9 million at the time of writing. Net rental income surged about 7% during the period. The drop in profit was largely due to a fair-value loss of approximately NZ$30.3 million on investment properties, and inventory impairments.

Strategic Outlook: Positioned for Recovery

The company remains upbeat about its future. At the time of writing, net tangible assets per share were NZ$1.12, down from NZ$1.17 a year ago. Kiwi Property stated that it is “well-positioned to benefit from improving economic conditions and the continued execution” of its strategy beyond FY26. Key strategic plugs include the completion of the lease-up at the Resido build-to-rent precinct, increased occupancy at its office assets, and conditional land sales at its Drury large-format retail site.

Why Investors Should Take Note

While the headline profit drop may raise red flags, the underlying business metrics continue to show health: rental income growth, strong leasing outcomes and land-sale pipelines. The current value decline is largely non-cash in nature (fair-value adjustments) rather than a reflection of core operations. Still, the large fall in net profit means shareholders will be watching the execution of strategic initiatives closely to assess whether the rebound can be sustained.

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