Indluplace delivers forecasted solid results

Carel de Wit, CEO of Indluplace Properties Limited.
Carel de Wit, CEO of Indluplace Properties.

– Dividend of 92,61 cents per share, 10,5% up on the pre-listing forecast.
– Investment property growth of 40%.
– Number of residential units increased to 5 447 for the reporting period.
– Under 7% geared portfolio.
– Low vacancies – improved to 3,4%.
– Bad debts under 0,5% of revenue.

Indluplace Properties Limited today announced their Annual Results for the first full year since listing in June 2015 on the Main Board of the JSE. Indluplace pays quarterly dividends and declared a dividend of 23,35 cents per share for the quarter ended 30 September 2016. This brings the total dividends for the full year to 92,61 cents per share; 10,5% higher than the pre-listing forecast.

Indluplace has changed remarkably since its prior comparable reporting period. The company acquired properties consisting of 1 757 units valued at over R630 million during this reporting period, increasing the residential units to 5 447 valued at R2,4 billion.

Carel de Wit, CEO of Indluplace commented: “We remain upbeat about the growth opportunities for Indluplace. We have strong prospects in our pipeline and will continue to pursue the acquisition of yield accretive properties and portfolios that provide income from the day of acquisition. The first acquisition for the year is a building with 64 units in Randburg, an area that is showing strong rental demand.”

The company’s revenue, including rental income and expenditure recoverable from tenants, but excluding straight line rental income, has increased from R157,8 million to R349,0 million year-on-year. This increase is a result of the acquisitions concluded during the previous financial year in conjunction with the impact of acquisitions concluded during the current financial year.

Indluplace’s investment property has increased 40% from R1,7 billion to R2,4 billion in the year to 30 September 2016. The number of residential buildings within the portfolio has increased from 95 to 116 through the acquisition of five portfolios. The latest include Greenshank Villas comprising 119 units in Roodepoort, Longfellow Village consisting of 51 student housing units and the JWS portfolio consisting of 240 units on the periphery of the inner city of Johannesburg.

“We are pleased with the performance of our growing diverse portfolio, which includes a balance of inner city, suburban and townhouse complexes. The defensive nature of the portfolio affords Indluplace the opportunity to play across building types and income levels mitigating the risk of our portfolio,” said de Wit.

With a loan of R150 million at year end, Indluplace’s gearing is under 7% and this is fully covered by a three-year fixed interest swap of 10.11%.

“Although South Africa is facing economic and political challenges, Indluplace is well positioned with low gearing levels, leaving ample headroom for growth to take advantage of current opportunities in our pipeline to grow the portfolio substantially over the next few years,” said Terry Kaplan, FD of Indluplace.

South Africa currently has a shortage of rental housing with strong demand evident for value for money rental accommodation. Indluplace is well positioned providing an exit for developers and owners of residential stock or portfolios.

“As the only focussed residential REIT listed on the JSE, Indluplace provides the South African investor with a defensive investment vehicle through its diverse residential portfolio underpinned by strong fundamentals. It pays dividends every quarter and offers excellent value at the current share price and forward yield. The distribution growth from our current portfolio excluding any acquisitions, is expected to be between 5,5% and 6,5%,” concluded de Wit