AFTER six tough years, Federation Centres, the redesigned Centro Properties, has returned to a credit rating of A- from Standard & Poor's and is talking about acquisitions and a simplified structure.
In its report for the first half of the 2008 financial year, the then chief executive Glenn Rufrano talked about the $14 billion of debt the retail landlord was carrying and how it was his task to keep the banks from foreclosing.
After much pain, legal action and some asset sales, Mr Rufrano was successful.
A year ago Steven Sewell assumed that role and this week said the group was on track to report solid earnings for 2013 full year.
But underpinning the hard work of settling a multibillion dollar class action, re-organising staffing levels and changing the name to Federation Centres, was the business: food-anchored small to medium-sized shopping centres.
At the group's half-year result on Friday, Mr Sewell said the life-blood of Federation was and always would be the food-anchored malls.
For the half year, the shopping mall group reported profit of $115.6 million, up from the $22 million in the previous corresponding period. Net income was $115.9 million, from a loss of $100.1 million a year earlier.
An interim distribution of 6.6¢ was declared.
Mr Sewell said the outstanding feature of the result was the credit ratings, which were a vindication of the hard work done by the group in recent years.
"Standard & Poor's has assigned FDC a senior secured bank debt rating of A- and a corporate credit rating of BBB+," Mr Sewell said.
"These ratings provide an opportunity to diversify our funding sources via the debt capital markets.
"Focusing on being an Australian-based, food-anchored shopping centre landlord has stood us in good stead.
"We will continue with the strategy of simplyfying the structure, development of existing centres as well as looking for joint venture partners for some of the portfolio."
Peter Zuk, an analyst at Goldman Sachs, said Federation's development pipeline of $1.1 billion would be rolled out over the next five years, with the group's share of costs at about $591 million.
Gearing post balance date is 24.4 per cent, which provides scope to debt fund much of this future pipeline. The downscaling of the syndicates business is continuing. Federation expects to have only five core syndicates with total assets of about $33 million by the end of 2015.
"Our earnings estimates and target price are under review," Mr Zuk said.
Analysts at Moelis & Co said Federation had upgraded 2013 earnings per security guidance slightly to 15.5¢ to 15.75¢.
"We anticipate upgrades to consensus for both 2013 and beyond and the core earnings of $106.2 million were in line with our estimates," the analysts said.