Perron Group has maintained its standing as one of WA’s most profitable private companies despite making substantial write-downs in the value of its expansive property portfolio.
Perron Group has maintained its standing as one of WA’s most profitable private companies despite big write-downs in the value of its expansive property portfolio.
The East Perth group’s key subsidiary, Perron Investments, has reported a net profit of $301.8 million for the year to June 2023, according to annual accounts lodged with ASIC.
That is the third year running it has achieved a net profit in excess of $300 million.
Only three other private companies in WA have posted higher profits – Gina Rinehart’s Hancock Prospecting, Hancock subsidiary Roy Hill Holdings and Laurence Escalante’s gaming company VGW Holdings.
Perron’s profit was on revenue of $746 million, up 6.7 per cent.
The group’s main source of income was rentals of $253 million.
This comes from its expansive property portfolio, which include stakes in shopping centres such as Belmont Forum, Galleria and Cockburn Gateway, along with industrial properties and a 50 per cent stake in Central Park.
It also earned $129 million in ‘distributions’ from other assets, which include holdings in multiple airports and land developments.
Iron ore royalties of $45 million provided a further boost to the group’s financial performance.
These stem from a deal struck by the group’s founder, the late Stan Perron, with the late Lang Hancock in the 1960s.
Perron is also the sole WA distributor of Toyota vehicles and products – an arrangement Mr Perron held for many years on the strength of a handshake before it was formalised by the two companies.
Since Mr Perron’s death in 2018, the group has operated as a permanent endowment primarily for the benefit of the Stan Perron Charitable Foundation.
The foundation has rapidly increased annual giving over the past few years to about $30 million and the group’s profits indicate it has plenty of scope for more.
Led by chief executive Adam Irving, Perron has always been defined by a conservative investment strategy.
Its balance sheet shows equity of $4 billion and total assets of just above $6 billion.
The company’s profit came after a $112 million write-down in the value of investment properties.
Its property portfolio was valued at $3.2 billion at the June 30 balance date.
The property write-down was more than offset by a $161 million positive revaluation of financial assets.
It had financial assets worth $2.1 billion at June 30.
This is mostly held in unlisted investments, with the notes to the financial statements indicating Perron sold the last of its listed investments for a modest $34 million.
Perron Investments Pty Ltd paid an annual dividend of $31 million, up from $7 million in the prior year.
Its shareholders are Perron Group Ltd and PG Holdings Ltd.
