FY26 Annual Result Release

20.05.2026

FY26 Year end result - Resilient Buildings for a Better Future

Argosy Property Limited ('Argosy' or the 'Company') has reported its results for the year ended 31 March 2026.

• Net property income for the period of $120.8 million, which is up by 3.3% on the prior comparable period.

• $58.5 million revaluation gain, including assets held for sale, for the 12 months to 31 March ($72.7 million revaluation gain in the prior comparable period), up 2.7% on book value, contributing to a full year net profit after tax of $127.7 million ($125.9 million in the prior comparable period).

• Net distributable income of $60.9 million, up 9.1% on the prior comparable period.

• Occupancy steady at 94.6% and a Weighted Average Lease Term (WALT) of 5.0 years.

• NTA per share of $1.60, up from $1.53 at 31 March 2025.

• Portfolio gearing as at 31 March 2026 is 37.2%, comfortably within the target band of 30-40%. Portfolio gearing has fallen to 36.1% following the settlement of held for sale properties.

• Strong rent review increases (3.5% annualised rental growth on rents reviewed).

• Progress on green developments, continuing our portfolio transformation and progress to a 50% green portfolio by 2031 (39% at 31 March, including Warehouse 6 at Mt Richmond).

• FY26 full year dividend of 6.65 cents per share, in line with guidance.

Chair Jeff Morrison said "The Management team have continued to execute in accordance with the Company's focus on operational discipline, delivering solid outcomes across occupancy, rental growth and leasing activity."

Leasing enquiry levels have improved recently, albeit recognising they may be impacted by broader market uncertainty associated with ongoing geopolitical tensions. Current vacancy levels will present opportunities as conditions stabilise, enabling the Company to progressively attract new tenants and lift income levels.

During the year, the Company completed its 224 Neilson Street development, marking a key milestone towards the company's target of 50% green buildings by 2031. This property has achieved a 6 Green Star Design and Built rating, reflecting Argosy's commitment to delivering high-quality, resilient assets that support tenant wellbeing and long-term portfolio value.

The Board remains comfortable with the company's capital position and balance sheet strength. The sale of 4 Henderson Place settled for $40 million in April, and 143 Lambton Quay settled for $6 million in May. Proceeds from these transactions will initially be used to reduce debt. The business retains funding capacity to support its ongoing development requirements.

Following recent divestments, the capital position of the business is such that the Board have decided to suspend the Dividend Reinvestment Plan (DRP). As such, the DRP will not be available for shareholders to participate in for the fourth quarter dividend. Please see the dividend announcement today for more details.

The Company has reported a revaluation gain of $58.5 million this year, primarily driven by modest cap rate firming and market rental growth. This compares to a revaluation gain of $72.7 million in the prior financial year. Included in the revaluation gain this year is a $4.4 million gain on 4 Henderson Place and 143 Lambton Quay as they were held for sale properties at 31 March.

In September 2025, the Government outlined proposed reforms to New Zealand's earthquake-prone building regime, including the replacement of the existing New Building Standard (NBS) framework with a new earthquake-prone building system. The proposed changes are intended to better identify buildings that pose a genuine seismic risk, with low-seismic regions such as Auckland to be excluded from the new regime.

Jeff Morrison said "The reforms to New Zealand's earthquake-prone building legislation are a very positive step for the sector. Our Chief Executive Officer, Peter Mence, represented the Sector as a member of the Seismic Review Steering Group, and the Board acknowledges Peter for his contribution to the work in this area."

The Company continues with its investment strategy of maintaining a diversified, high-quality portfolio underpinned by its sustainability goals. The company's key portfolio targets are unchanged and include an Industrial weighting of 60-70% and an Auckland exposure of 70-80%.

Board and executive succession planning continues. Peter intends to step down as CEO by the 2027 Annual Shareholders Meeting, allowing for a well-planned leadership transition, and the Board have commenced a search for his successor.

At governance level, The Board has agreed that Martin Stearne will succeed myself as Board Chair following the 2027 Annual Meeting. Martin is now Chair of the Remuneration and Nominations Committee and is leading the succession transition.

The Board has reviewed its dividend policy. It is clear that Adjusted Funds from Operations (AFFO) has been significantly more volatile than a commonly used alternative basis, Funds from Operation (FFO). The distinction between FFO and AFFO is that AFFO makes deductions for maintenance capital, leasing and incentive costs and swap close out costs. These costs can be very significant from year to year, resulting in larger movements in AFFO cents per share and dividend payout ratios. A change to an FFO based policy removes some of this volatility.

Argosy's new policy targets a payout range of 80% to 95% of FFO. Argosy remains committed to ensuring that dividends are sustainable.

A fourth quarter dividend of 1.6625 cents per share has been declared with imputation credits of 0.274727 cents per share attached. This will bring the full year dividend to 6.65 cents per share in line with previous guidance. Overseas investors will receive an additional supplementary dividend of 0.124666 cents per share to offset non-resident withholding tax.

As a result of increased market uncertainty, guidance for FY27 is retained at 6.65 cents per share, consistent with the prior year and within the new policy target.

Despite a cautious property market in the first half of FY26 and increased market volatility toward year end, the business has continued to demonstrate resilience.

Peter Mence said, "Leasing activity reflected longer decision-making timeframes; however enquiry levels increased in the second half of the year."

Argosy made further progress against its sustainability objectives during the year. The completion of 224 Neilson Street and progress at the first Mt Richmond development, underpin the company's goal of achieving a portfolio that is at least 50% green by market value by 2031. Both Warehouse A and Warehouse B at 224 Neilson Street have achieved a 6 Green Star Design and Built rating. In addition, the achievement of a 5 Star NABERSNZ rating for the Citibank Centre in Customs Street, Auckland, reflects ongoing initiatives with existing assets in the portfolio.

Peter Mence said "Market enquiry around energy performance and on-site renewables reflects a growing focus on operating costs, resilience and long-term efficiency. This reinforces the value of investing in assets that can accommodate evolving energy and sustainability requirements. Assets that support these outcomes are proving more attractive to tenants in a challenging operating environment."

Statement of Comprehensive Income

Argosy reported net property income of $120.8 million for the period, up 3.3% on the prior comparable period. Rent review outcomes and income from developments have contributed strongly.

The company continues to benefit from the establishment of its insurance captive subsidiary.

Chief Financial Officer, Dave Fraser said "The insurance fundamentals of 2025 appear set to continue into 2026 and excess capacity remains in the market. This creates an opportunity for us to further stabilise premiums and improve coverage terms and conditions."

Interest expense of $39.1 million was down on the prior comparable period ($41.6 million). Lower rates more than offset higher average debt levels in the period.

Annual valuations for the year to 31 March 2026 were performed by CBRE Limited, Colliers International New Zealand Limited and Jones Lang LaSalle Limited. The total unrealised revaluation gain was $58.5 million, or 2.7% on book value, which compares to an unrealised revaluation gain for the year to 31 March 2025 of $72.7 million.

A modest firming of cap rates and an increase in market rents were the key drivers of the revaluation increase. Of the annual increase of $58.5 million (including a gain on held for sale assets of $4.4 million), $31.3 million was recognised in the interim result at 30 September 2025.

By sector, Industrial increased by $27 million or 2.2%, Office increased by $16 million or 2.0%, and Large Format Retail increased by $11 million or 5.5%. The portfolio is 9.3% under-rented, excluding market rent on developments.

As a result of the FY26 revaluations, Argosy's NTA increased to $1.60 per share from $1.53 at 31 March 2025. Following the revaluation, Argosy's portfolio shows a contract yield on values of 5.72% and a yield on fully let market rentals of 6.62%.

In May 2025, the Government announced the Investment Boost tax programme, encouraging productivity and economic growth by providing a tax deduction for qualifying new investment. Under the programme, businesses can deduct 20% of the cost of eligible new assets in the year of purchase or development, in addition to standard depreciation.

Practical completion of Warehouse A at 224 Neilson Street in October 2025 has resulted in an Investment Boost deduction being available in the second half of FY26.

Net profit after tax was $127.7 million (including a $58.5 million revaluation gain), compared to net profit after tax of $125.9 million (including a $72.7 million revaluation gain) in the prior comparable period.

Distributable Income/AFFO

After adjustment for revaluation gains and the movement in derivatives, net distributable income (NDI) for the year was $60.9 million, compared to $55.8 million in the prior comparable period, an increase of 9.1%.

AFFO was 6.85cps for the year, compared to 6.43cps in the prior comparable period, an increase of 6.5%.

Peter Mence said "Challenging economic conditions and geopolitical uncertainty influenced the year. The team maintained a strong focus on operational discipline, delivering solid leasing outcomes."

As at 31 March, Argosy's WALT was 5.0 years and portfolio occupancy was 94.6%.

Over the financial year, Argosy completed 111 rent reviews, achieving annualised rental growth of 3.5%. These reviews were achieved on rents totalling $80.9 million.

On rents subject to review by sector, Argosy achieved annualised rental growth of 4.4% for Industrial rent reviews, 2.4% for Office rent reviews and 2.6% for Large Format Retail rent reviews. Over the financial year, 72% of rents reviewed were subject to fixed reviews, 25% were market reviews and 3% were CPI based.

Argosy completed 32 leasing transactions across 45,335m² of NLA over the year. Lease transactions were made up of new leases (13), renewals (13) and extensions (6).

During the period Argosy retained two key Wellington Office tenants:

• New Zealand Post Limited exercised their right of renewal for the Ground Floor and Level 1 of 7 Waterloo Quay (4,332m²). The renewal is for six years with a final expiry date of 31 December 2031. Rent reviews are CPI based with a market review at 1 January 2029.

• The Ministry of Business, Innovation and Employment (MBIE) have extended their lease at 15 Stout St (20,709m²) for a further 9 years from 23 July 2026. Reviews are fixed at 2.75% pa with market reviews at 23 July 2026 and 23 July 2032. As part of the new lease Argosy and MBIE will progress a decarbonisation project (including conversion of gas boilers to heat pumps, solar panels, LED light conversion and EV chargers), and façade works (including installing additional parapet flashings for enhanced protection and extending downpipes in various locations for rainfall disbursement). The project has commenced and is expected to cost $13 million.

  Peter Mence said "We are very pleased to have retained such valuable tenants on long leases. The two leases addressed the biggest expiries for both FY26 and FY27, and lifted the weighted average lease term to 5.0 years at 31 March."

  Other leasing highlights over the year include:

• Boffa Miskell, 82 Wyndham Street - 1,642m² on a 10 year renewal.

• Steel and Tube Holdings, 39 Randwick Road - 2,097m² on a 3 year renewal.