- Dividend growth -7,07% to 60,08 cents per share.
- Rebosis A-Share dividend growth – 5,9% 120.41 cents per share.
- Growth in total assets – 51% to R17.1bn.
- Net Property Income Growth – 74.6% year-on-year.
- Vacancies down -2,4% from 3,1% at year-end.
- Market CAP growth – 54,7% from R5.3 to 8.2bn (excluding Rebosis A-shares).
- Share Price Growth – 24,3% year on year – from R10.23 to R12.72.
Rebosis Property Fund has reported net property income growth of 74,6% for the six months ended 28 February 2017.
Total distributable income increased 32,7% to R389 million from R293 million over the period. Following various acquisitions during the period, assets under management rose a significant 51% to R17,9 billion from R11,8 billion.
A dividend of 60,08 cents per share has been declared for the six month period. This amounts to 7,07% dividend growth year-on-year, which is in line with the 7% to 9% guidance expected for the financial year.
Rebosis’ South African retail portfolio makes up 62% of its South African assets and consists of six high-quality, dominant shopping malls with strong anchor national tenants delivering income streams escalating at 7,4%.
The office portfolio consists of 14 buildings in nodes attractive to government tenants. These buildings are mainly single-tenanted buildings let to the National Department of Public Works, providing for average escalations of 8,2%.
During the reporting period Rebosis concluded a watershed transaction valued at R5 billion which saw it acquire two large regional malls – Baywest Mall in Port Elizabeth and Forest Hill in Pretoria and internalized its asset and property management entities. This gave rise to the increase in market cap growth and share price appreciation and sees the fund further achieve its stated objective of becoming a retail-focused fund with an internalized management function.
Rebosis’ Chief Executive Officer, Sisa Ngebulana, said, “We achieved exciting growth in both total assets and income during the 6-month period under review. We were also able to hedge 100% of our debt and extend debt maturity profiles in order to mitigate potential risks that arise as a result of a market downgrade and low economic growth. To have achieved a 38% increase (74.6% including new mall acquisitions) in net property income while reducing our overall vacancies to 2.4% bears testament to our defensive office-sovereign underpin and the dominant retail strength in the portfolio, which we believe will continue to perform well in a sluggish economic environment.”
The retail portfolio delivered a strong 6% trading density growth and the fund’s remaining industrial property is presently under offer and is being held for disposal.
Rebosis’s Chief Operating Officer Andile Mazwai, said, “We saw strong retail performance despite a depressed retail sales environment. This performance was largely led by Baywest Mall, which held the highest trading density growth at 11.6%, and Bloed Street Mall. Alongside this performance we reduced our retail vacancies to 1.5% in the reporting period.”
Rebosis A Shares
Rebosis also concluded the acquisition of Ascension Properties which led to the listing of the Rebosis-A shares at a market capitalisation of R1.6bn (thus giving Rebosis a combined market capitalised value of R9.8bn). The Rebosis A-shares were listed on the JSE on the 19th of April 2017.
The completion of this acquisition consolidates Ascension Properties under Rebosis’ direct properties and has bolstered the Rebosis asset portfolio by a further R17.9 to R21.3bn.
The combined SA properties now constitute 8 retail shopping malls, 42 office buildings and 2 industrial properties.
The dividend growth in the period is in line with the Rebosis Board’s view that the dividend per share will grow by between 7% and 9% for the full year to 31 August 2017, provided there are no unexpected or drastic deteriorations in the South African economy.
This forecast outlook is issued by the Board, and has not been reviewed or reported on by the company’s auditors.