Equites results exceed expectations

Equites CEO, Andrea Taverna-Turisan

Specialist industrial property developer and landlord, Equites Property Fund Limited today announced total distributions to shareholders since listing of R69.9 million, which constitutes a R3.4 million or 5.1% increase on the pre-listing forecast. The group indicated that, despite 5 million more shares being issued than in the original forecasts, Equites nevertheless was able to declare a distribution per share which marginally exceeded the projections in the pre-listing statement. Dividends per share of 61.3 cents as declared, equates to a distribution yield of 8.2% for 9 months to 28 February 2015.

Equites CEO, Andrea Taverna-Turisan, said that Equites has managed to deliver on all the transactions and profits forecasted for this year in the pre-listing statement. “Our business is predicated upon consistently delivering on our undertakings and exceeding expectations. We are pleased to confirm that we have achieved the above objectives in the current year.”

It has been an exceptionally busy period for Equites in terms of bedding down the portfolio of properties acquired as part of the merger and listing process earlier in the financial year. The fund has also acquired four further properties with a capital value of R118.8 million during the reporting period. In addition, the group concluded an agreement in terms of which Equites will be developing a 22 227 square meter distribution warehouse for The Foschini Group.

Equites also maintained tight operational discipline, with total vacancies across the portfolio at 2.9% of overall gross lettable area. The group has a strategic focus on A-grade distribution centres and large national, international or listed tenants, which meant that the results were largely insulated from the not insignificant headwinds facing the South African economy during the reporting period – a fact that should continue to stand Equites in good stead in future. Gearing remained a low 8.9% of loan-to-value, providing ample scope for future transactions.

Taverna-Turisan said that “We believe that the weighted average escalations of 8.1% for Equites’ existing property portfolio should support distribution growth on an annualised basis at the upper end of the 7% – 8% expected for the listed property sector as a whole. This means that Equites will comfortably exceed the projections in the pre-listing statement. It is also anticipated that distribution growth will accelerate over the medium term as new developments, such as the new TFG distribution centre in Midrand, come online.” He said the group was excited about Equites’ strong pipeline and prospects for 2016.

The net asset value per share of the Group was 1 137 cents per share as at 28 February 2015.