This article first appeared on GuruFocus .
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Operating Profit:$1.2 billion for the first half of FY26.
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FX Impact:$33 million negative impact on foreign-denominated operating income.
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Investment Earnings:Increased by $54 million, with a $5 million adverse FX impact.
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Direct Property Net Rental Income:$59 million higher due to increased assets.
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Management Income:$137 million lower than the prior corresponding half.
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Total Portfolio:$87.4 billion at the end of December, with $75 billion in external assets under management.
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Development Earnings:Down $36 million on the prior corresponding period, with a $26 million adverse FX impact.
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Net Interest Income:Increased by $63 million compared to the prior corresponding period.
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Unrealized Valuation Gains:Over $250 million in the half.
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Gearing:4.1%, slightly lower than in June.
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Liquidity:$52 billion, including cash and undrawn lines.
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Target Operating EPS Growth:9% for FY26.
Release Date: February 18, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Goodman Group ( GMGSF ) reported an operating profit of $1.2 billion for the first half of FY26, exceeding expectations.
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The company is benefiting from strong demand in logistics and data centers, with significant investments in automation and consolidation.
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Goodman Group has expanded its power capacity to 6 gigawatts across 16 global cities, enhancing its ability to meet demand.
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The company has established significant partnerships, including a $14 billion data center development partnership in Europe and a $2 billion logistics partnership in the US.
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Goodman Group is on track to deliver operating EPS growth of 9% for FY26, supported by a strong balance sheet and capital partners.
Negative Points
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Foreign exchange movements negatively impacted operating income by $33 million, although this was offset by borrowing cost benefits.
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Management income decreased by $137 million compared to the prior corresponding half, primarily due to lower transactional and performance-based revenues.
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Development earnings for the half year were down $36 million compared to the prior period, with FX rates having a $26 million adverse impact.
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The company faces challenges in the timing of customer commitments for data center projects, which could affect revenue recognition.
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There is a significant capital requirement for developing data center facilities, which could strain resources if not managed effectively.
Q & A Highlights
Q: Does the early timing of development performance income in the first half affect the expected 40-60 EPS split for the year? A: Nick Vrondas, CFO: The full-year target remains unchanged, but the 40-60 split is no longer applicable due to some income being recognized earlier than anticipated.
Q: How much of the 497 megawatts of data center capacity is currently in work in progress (WIP), and what are the future plans for data center development partnerships? A: Gregory Goodman, CEO: 370 megawatts are in WIP, and we have activated 1,826 megawatts in total. We are not planning new partnerships in the near term but will focus on long-term holding structures and transferring WIP into assets under management.
Q: What is Goodman's view on AI and its impact on customer negotiations and infrastructure development? A: Gregory Goodman, CEO: AI is a significant factor in customer negotiations, particularly with hyperscale customers. Goodman is adopting relevant AI products to drive productivity and is well-positioned to capitalize on the AI-driven demand for digital infrastructure.
Q: How is Goodman approaching the development of data centers in Australia, and what is the strategy for the Australian DC partnership? A: Gregory Goodman, CEO: The current focus is on the Ottoman project, which has already started. The strategy involves bringing in capital as projects commence to ensure timely delivery and minimize delays.
Q: What are the expected returns on large industrial projects involving automation and robotics, and how does Goodman plan to fund these developments? A: Gregory Goodman, CEO: Returns on large industrial projects are expected to be between 7% and 9%. Goodman will not fund tenant-specific robotics but will focus on providing the necessary infrastructure, leveraging its expertise in developing complex projects.
Q: How does Goodman plan to manage the capital requirements for its extensive data center development pipeline? A: Gregory Goodman, CEO: Goodman is focused on maintaining a strong balance sheet and partnering with major investors to ensure sufficient capital for development. The company aims to build high-quality, investable infrastructure to attract long-term investment.
Q: What is the status of the European partnership and the transfer of assets into it? A: Nick Vrondas, CFO: The Frankfurt and Amsterdam properties have been transferred, and the Paris properties are expected to be transferred before the end of June, pending regulatory approvals.
Q: How does Goodman view the potential for alternative uses of its data center sites if market conditions change? A: Gregory Goodman, CEO: Goodman has flexibility with its sites, which are primarily industrial and can be repurposed if necessary. The company is cautious about overextending on land prices and maintains optionality for alternative uses.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
