|Shareholders are referred to Balwin interim results for the six months ended 31 August 2017, announced on Monday, 20 November 2017 (?Results Announcement?). In the Results Announcement, Balwin advised its shareholders that the board of directors of Balwin (the ?Board?) was considering a dividend re-investment alternative in which a shareholder would be entitled to elect to re- invest the cash dividend of 10 cents per share pre withholdings tax (?Cash Dividend?), and the 2 cents per share post withholdings tax (?Net Cash Dividend?), in return for shares in the Company ("Re- Investment Alternative"), failing which they would receive the Net Cash Dividend in respect of all or part of their shareholding.|
Following careful consideration of current market conditions and pricing of Balwin shares, the Board has decided not to offer the Re-Investment Alternative. Accordingly, shareholders are advised that they will receive their dividend in cash. The salient dates in respect of the Cash Dividend remain unchanged from those set out in the Results Announcement.
|Revenue for the interim period increased to R894.1 million (R749.9 million) whilst gross profit lowered to R289.9 million (R313.9 million). Operating profit decreased to R216.8 million (R235.2 million). Profit for the year fell to R163.1 million (R174.6 million). In addition, headline earnings per share took a knock to 35 cents per share (37 cents per share ). |
A dividend of 10 cents per share has been declared, in line with the board's dividend policy of distributing 30% of after-tax profit to shareholders.
Management is focused on the long-term growth of the business through the delivery of an innovative lifestyle product to the South African market. Continued urbanisation and the growth of the South African middle-class will increase the demand for affordable high-quality sectional title apartments whilst there is a relatively low supply by property developers.
Great focus is being placed on operational performance and execution across all developments, especially during the initial phases. Careful capital allocation and cautious cash flow management remain priorities. The team is also implementing initiatives to adjust the configuration of apartment blocks, the pace of development and the pricing points to address market dynamics and maintain healthy level of sales.
Significant progress has been made regarding regulatory approvals and the management team is working closely with the authorities to resolve any outstanding issues. The delays at The Blyde, The Whisken, The Reid and Ballito Hills are expected to be resolved with sales on these developments coming on stream in the 2019 financial year. Furthermore, all new land acquisitions are now done on the basis that all regulatory approvals have been secured.
Management is also focusing on delivering on its rental model through strategic alliances such as the one announced with Transcend in August. Going forward, the Company will also seek to acquire zoned land on which repayments can be made on registrations.
The increased scale brought about by the new developments, the delayed projects coming on stream, costs controls, operational efficiencies and the benefit of new annuity income initiatives such as fibre, solar energy solutions, storage and education will support the company's performance.
|Balwin shareholders are advised that at the annual general meeting of shareholders held on Tuesday, 10 October 2017 at 08h00 (?AGM?), all ordinary and special resolutions as set out in the notice of AGM dated Thursday, 31 August 2016 were approved by the requisite majority of shareholders present or represented by proxy.|
|Shareholders are advised that the company?s 2017 integrated annual report, containing the summarised consolidated financial statements for the year ended 29 February 2017, was posted to shareholders on Thursday, 31 August 2017 and contains no modifications to the audited results which were published on 15 May 2017. Deloitte - Touche audited the annual financial statements of the company and their reports and complete annual financial statements are available for inspection at the registered offices of the company or can be found on the company?s website www.balwin.co.za.|
Notice is hereby given that the annual general meeting (?AGM?) of ordinary shareholders will be held at the offices of the Company, Block 1, Townsend Office Park, 1 Townsend Avenue, Bedfordview on Tuesday, 10 October 2017 at 08h00 to transact the business as stated in the annual general meeting notice, forming part of the Integrated Report. The Form of Proxy posted to shareholders references Friday, 6 October as the voting record date. Shareholders should note the voting record date should be Friday, 29 September 2017 and last date to trade is Tuesday, 26 September 2017.
|It is the intention of both Balwin and Transcend to bring to market up to 8 900 quality affordable rental apartments across five developments in key Gauteng nodes over the next six years. |
Balwin will be responsible for the design and construction of each development and sectional title apartment. Balwin will also market and secure lease agreements for the apartments with prospective tenants. Transcend will then have the opportunity to purchase fully tenanted apartments in phases from Balwin. Transcend?s intention is to participate in all five developments although they will be treated and reviewed independently.
Subject to the requisite approvals, ?Green Park?, comprising of approximately 1 200 apartments, is the first development earmarked for this alliance. Located in Boksburg, the first apartments are expected to be delivered to Transcend in early 2018. The development, amongst other lifestyle facilities, will make use of solar energy solutions and provide high speed fibre connectivity.
Transcend is a Real Estate Investment Trust (REIT) created by the private equity group, International Housing Solutions (IHS) and listed on the JSE in 2016. Transcend focuses on specialised residential property assets and currently holds a portfolio of 13 properties, comprising 2 472 units, located primarily in Gauteng, as well as the Western Cape and Mpumalanga. As with Trancend?s existing portfolio, IHS will continue to provide the asset management services to Transcend on the acquired apartments through IHS Property Management (Pty) Ltd.
A memorandum of understanding has been signed, as at 18 August 2017, detailing this strategic alliance. Furthermore, the strategic alliance remains subject to the fulfilment of certain conditions including various regulatory, shareholder and other approvals to the extent required.
|According to Business Report Balwin Properties has partnered with SolarAfrica to introduce solar energy to its upmarket developments. Steve Brookes, the chief executive of Balwin Properties said that Solar Africa's clean energy solutions for the residential sectional title market in South Africa would result in a benefit to their clients of approximately 10 percent saving on their utility bill. Mr Brookes said the solar energy solution s were being introduced in two of its Johannesburg developments, Kikuyu in Waterfall and The Whisken in Crowthorne, but would be introduced to all future Balwin projects. Brookes added that Balwin was considering introducing wind turbines on its projects in the Western Cape and Kwazulu Natal, which would be placed on the top of the clubhouse in projects.|
|Shareholders are advised of the appointments of Mr Tomi Amosun and Ms Thoko Mokgosi-Mwantembe as independent non- executive directors of the board with immediate effect. |
Thoko will also assume the position of chairperson of the social and ethics committee and Tomi will be a member of the audit and risk committee as well as the transaction committee.
|Balwin advised shareholders that Mr Anthony Diepenbroek has accepted the company?s offer to become part of Balwin?s management with effect from 9 February 2017. |
Therefore Mr Diepenbroek will not have the capacity to chair the Social - Ethics Committee or serve as a Non-Executive Director and therefore had to resign in these capacities.
|Further to the announcement released on SENS dated 31 October 2016, Mr Arnold Shapiro has been appointed a member of the Audit - Risk Committee, Transaction Committee as well as Chairman of the Remuneration - Nominations Committee and Mr Anthony Diepenbroek has been appointed Chairman of the Social - Ethics Committee, with effect from 14 November 2016.|
|Revenue for the interim period was lower at R749.9 million (2015: R823.4 million). Gross profit decreased to R313.9 million (2015: R356.3 million). Operating profit dropped to R235.2 million (2015: R318.8 million) and profit for the year declined to R174.6 million (2015: R233.6 million). In addition, headline earnings per share were recorded at 37 cents per share (2015: 58 cents per share).|
Notice is hereby given that the directors have declared a gross dividend of 11.08975 cents per ordinary share, payable out of the income reserves for the period ended 31 August 2016 to shareholders.
Management is focused on delivering sustainable, steady growth over the long term despite the tough market conditions. Urbanisation continues to grow the population in key metropolitan areas in which the Company operates.
Continued urbanisation and a relatively low supply of affordable, high-quality sectional title estates in key nodes are expected to underpin Balwin's long-term growth prospects. Management remains confident of the establishment of a rental model as a key long-term objective to derive annuity income and support Balwin's growth ambitions.
Balwin's continuation of build to sell model (constructing a number of apartments across key locations at any given time) provides the Company with several levers to rapidly adapt to prevailing market conditions and reduce risk:
*Construction may be varied according to the rate of sales which improves cash preservation
*Some phases may contain more two- and one-bedroom apartments to maintain sales and margins, depending on market demand and affordability
*The Company's phased approach limits finance risk.
Going forward, management will continue to focus on the reduction of the working capital cycle, cash preservation and risk management.
Innovation remains a key success factor for the Group with the launch of various unique lifestyle centres in its developments. Management firmly believes that the unique product offering, competitive pricing and the expansion of the current geographical footprint will support the Group in reaching its growth targets over the short to medium term.
|Balwin shareholders (?Shareholders?) are advised that Mr Arnold Shapiro and Mr Anthony Diepenbroek have been appointed as non-executive directors of the Balwin board of directors (the ?Board?) with effect from Wednesday, 26 October 2016. |
Arnold Shapiro has over 22 years of experience in financial services and real estate. Arnold is the co- founder of Trematon Capital Investments (?Trematon?) in its current incarnation and has served as the chief executive officer of Trematon since 2005. Prior to his current role, Arnold occupied various management positions in the asset management industry including the positions of chief executive officer at Brait Asset Managers and Capital Alliance Asset Management.
Anthony Diepenbroek has over 20 years of experience in real estate from an investment, management and development perspective and was previously the chief executive officer of Zendai South Africa, a subsidiary of Hong Kong Stock Exchange Listed Zendai Properties. Prior to this Anthony served as the chief executive officer of the property division of AECI prior to the disposal of AECI?s property assets at Modderfontein to Zendai Properties as well as serving in other senior positions at Transnet Ports Authority, Pangbourne Properties, Asakhe Real Estate Fund and IFour Properties and iProp Properties. Anthony is also a past president of SAPOA.
The Board welcomes the opportunity to have new non-executive directors with Arnold and Anthony?s extensive commercial and real estate expertise and look forward to their contribution to the Company.
Shareholders are further advised that Ms Basani Maluleke has resigned as a non-executive director of the Board with effect from Wednesday, 26 October 2016. The Board wishes to express its gratitude to Basani for her contribution to the Company since its listing in October 2015 and wishes her well in her future endeavors.
|Shareholders are advised that headline earnings per share (?HEPS?) and earnings per share (?EPS?) for the 6 months ended 31 August 2016 are expected to be below the prior year comparative figures within the ranges outlined below:|
Measure ; Decrease relative to comparative period 31 Aug 2015; Anticipated cents per share 31 Aug 2016; Cents per share in comparative period 31 Aug 2015
*HEPS: (33%) ? (38%); 36 ? 39; 58
*EPS: (33%) ? (38%) ; 36 ? 39 ; 58
The decrease is as a result of:
*a 21% - 28% reduction in profit after taxation, driven primarily as a result of delays in the registration of transfer of 277 units that had been sold at 31 August 2016 but for which transfer had not been registered at the deeds office (unit purchasers have paid guarantees in full, have already moved in to the units sold and are paying occupational rent in anticipation of the registration of transfer thereof). Balwin anticipates that these transfers will be registered during the second half of the financial year and will form part of revenue for the financial year ended 28 February 2017. As per Balwin?s revenue recognition policy, the company only recognises revenue on the registration of transfer in the deeds office and not on sale; and
*due to Balwin?s weighted average number of ordinary shares in issue increasing from 400,000,000 during the period ended 31 August 2015, to 469,662,237 during the period ended 31 August 2016. This increase is as a result of the issue of additional ordinary shares on the listing of Balwin on 15 October 2015.
The financial results on which this trading announcement is based have not been reviewed or reported on by Balwin`s external auditors.
Balwin`s results for the six months ended 31 August 2016 are scheduled to be published on or about 15 November 2016.
|Balwin shareholders are advised that at the annual general meeting of shareholders held on Friday, 9 September 2016 at 08h30 (?AGM?), all ordinary and special resolutions as set out in the notice of AGM dated Friday, 5 August 2016 were approved by the requisite majority of shareholders present or represented by proxy.|
In this regard, Balwin confirms the voting statistics from the AGM as follows:
*Total number of shares that could be voted at the AGM (?Total Shares?) - 472,192,592
*Total number of shares present/represented including proxies at the AGM (?Voted Shares?) - 79,201,436
*Total number of members present - 5
|Shareholders are advised that the company?s 2016 Integrated Annual Report, containing the summarised consolidated financial statements for the year ended 29 February 2016, was posted to shareholders today and contains no modifications to the audited results which were published on 23 May 2016. Deloitte - Touche audited the annual financial statements of the company and their reports and complete annual financial statements are available for inspection at the registered offices of the company or can be found on the company?s website www.balwin.co.za.|
Notice is hereby given that the annual general meeting (?AGM?) of ordinary shareholders will be held at The Capital Moloko, 160 Helen Road, Strathaven, Sandton on Friday, 9 September 2016 at 08h30 to transact the business as stated in the annual general meeting notice, forming part of the Integrated Report.
|Balwin shareholders (?Shareholders?) are referred to the announcement released by the company on SENS on 30 June 2016, as well as the circular issued to shareholders on the same date, regarding the acquisition by Balwin of development rights in Johannesburg?s Kyalami / Waterfall node.|
Shareholders are advised that at a general meeting of the company held on Friday 29th July 2016 at 09h30 (?General Meeting?), all resolutions as set out in the Notice of General Meeting incorporated in the circular were approved by the requisite majority of shareholders.
|According to Business Report, Balwin Properties secured developmental rights for the Waterfall node in Midrand for R1.5 billion. The company plans to build 15 000 sectional title residential units in the next eight to ten years. The units will be in twelve to fifteen separate estates and will be developed in phases. Development will commence next year.|
|Shareholders are referred to the announcement released by Balwin on the Stock Exchange News Service on 6 April 2016 (the ?Announcement?) regarding the conclusion by Balwin of a formal acquisition agreement for the acquisition of development rights in Johannesburg?s Kyalami / Waterfall node (the ?Proposed Acquisition?).|
Shareholders are advised that the circular setting out, inter alia, the terms of the Proposed Acquisition and a notice of general meeting to convene a meeting of Balwin shareholders will be posted by no later than 30 June 2016 as approved by the Johannesburg Stock Exchange.
|According to Business Report Balwin Properties the listed sectional title home builder is committed to developing a rental portfolio of about 2000 units by 2020 and separately listing this portfolio as a real estate investment trust (REIT). Stephen Brookes, the chief executive and founder of Balwin confirmed this but indicated that the timing of when it would commence with the development of rental units had not yet been decided. Brookes added that Balwin had a geographic expansion plan and was looking at two future nodes, Durban and Nelspruit. Brookes indicated that Balwin had acquired the development rights to a portion of land in the Waterfall node in Midrand close to the Mall of Africa, on which a further 15000 sectional title apartments could be developed and wanted to start executing on this deal.|
|Balwin declared their maiden final results for the year ended 29 February 2016. Revenue for the year came in at R2.084 billion, gross profit was R895.1 million, operating profit was recorded at R767.6 million, while profit for the year was R558.6 million. Furthermore, headline earnings per share was 131 cents per share.|
The directors have declared a final gross dividend of 21 cents per ordinary share, payable out of income reserves for the year ended 29 February 2016 to ordinary shareholders.
|Shareholders are referred to the voluntary trading statement released by the Company on SENS on 3 March 2016 and are advised that headline earnings per share (?HEPS?) and earnings per share (?EPS?) for the financial year ended 29 February 2016 are now anticipated to be in excess of the ranges previously reported. |
The updated ranges are:
HEPS: 67% - 71% increase; 130 - 133 cents per share
EPS: 55% - 58% increase; 130 - 133 cents per share
The percentage growth in HEPS is greater than the percentage growth in EPS due to the effect of the reversal of a profit on the disposal of investment property in the prior year.
The financial results on which this trading announcement is based have not been reviewed or reported on by Balwin`s external auditors.
Balwin`s results for the 12 months ended 29 February 2016 are scheduled to be published on Monday, 23 May 2016.
|Following the announcement made on 29 April 2016 regarding the resignation of CIS Secretarial Services (Pty) Ltd., and in compliance with paragraph 3.59(a) of the Listings Requirements of the JSE Ltd., shareholders are hereby advised that Juba Statutory Services (Pty) Ltd. represented by Sirkien van Schalkwyk has been appointed as company secretary of Balwin with effect from 6th May 2016.|
|Shareholders are advised that CIS Company Secretarial Services (Pty) Ltd., represented by Mr Neville Torrien has resigned as the Company Secretary with effect from 30 April 2016.|
The company has commenced the process to appoint a new Company Secretary and will advise the market in due course.
|Shareholders are referred to the announcement dated 14 December 2015, in which Balwin announced that it had concluded a non-binding conditional agreement with Portimix (Pty) Ltd. (?Portimix?) for the acquisition of development rights in Johannesburg?s Kyalami / Waterfall node, on which an approximate 15,000 residential sectional title units may be developed (the ?Announcement?) (collectively, the ?Acquisition?).|
The board of directors of Balwin announced that the company has successfully concluded a formal acquisition agreement (the ?Agreement?), on the terms outlined in the Announcement, save for those outlined in paragraphs 2 and 3, below.
The consideration payable by Balwin in respect of the Acquisition is outlined in the relevant SENS note.
Balwin intends to fund the ongoing payments out of cash generated through the development and sale of units, pursuant to the company?s phased development model.
Outstanding Acquisition conditions precedent
The outstanding conditions precedent to the Acquisition are as follows:
* the approval of the board of directors of Balwin;
* the approval of Balwin shareholders;
* to the extent required, the approval of the South African competition authorities;
* the conclusion of an agreement between Balwin and Yaetsho Investments (Pty) Ltd. (?Yaetsho?), recording the terms of Yaetsho?s participation in the proceeds derived by Balwin from the sale of units; and
* the approval by Balwin and the Waterval Management and Operating company (Pty) Ltd. of the standard township lease, the leasehold title in favour of unit purchasers and the memorandum of incorporation of the residents? associations to be formed.
Categorisation of the Acquisition
In terms of the JSE Listings Requirements, the Acquisition is classified as a Category 1 transaction and will require Balwin shareholder approval. Accordingly, a circular will be posted to shareholders by no later than 31 May 2016 containing, inter alia, a notice of general meeting.
|Shareholders are advised that Mr R Tomlinson has informed the Board of his intention to resign as an independent non executive director of Balwin with effect from 31 March 2016.|
|Balwin wishes to advise shareholders that the Company is participating in the 2016 RMB Morgan Stanley Property Showcase on 11 March 2016.. A presentation providing an overview of the company and its operations can be viewed on the company?s website http://www.balwin.co.za/wp-content/uploads/2016/03/RMB-MS-Property- Show-Case-Presentation-Final.pdf. The presentation contains no new or material information.|
|Shareholders are advised that headline earnings per share (HEPS) and earnings per share (EPS) for the financial year ended 29 February 2016 are expected to exceed the prior year comparative figures within the ranges outlined in the table below. These amounts are anticipated to be in line with or exceed Balwin?s forecast financial information as presented in the Company?s Pre-listing Statement (?PLS?) dated 1 October 2015:|
28 February 2016
*HEPS: 47% - 55% increase: 115cps -121cps
*EPS: 37% -44% increase: 115cps - 121cps
The financial results on which this trading announcement is based have not been reviewed or reported on by Balwin`s external auditors. Balwin`s results for the 12 months ended 29 February 2016 are scheduled to be published on or about 23 May 2016.
|Shareholders are referred to the announcement released by Balwin on the Stock Exchange News Service on 14 December 2015 (the ?Announcement?) regarding the conclusion by Balwin of a non-binding conditional agreement for the acquisition of development rights in Johannesburg?s Kyalami / Waterfall node (the ?Proposed Acquisition?).|
Balwin is still in the process of finalising the formal legal agreements, which process includes the finalisation of project feasibility and build assessments. The material terms of the proposed acquisition remain consistent with those set out in the announcement. As a result, a circular setting out the terms of the proposed acquisition, including, inter alia, a notice of general meeting to convene a meeting of Balwin shareholders is now expected to be posted by no later than 31 May 2016.
|Balwin announced the appointment, with immediate effect, of Rodney Norman Gray as an Executive Director. Rodney has been involved in the management of Balwin since 1998. He will be assuming the formal title of Managing Director which duties and responsibilities include his previous title of Chief Operating Officer of Balwin as disclosed in the Company?s Pre-listing Statement issued on 2 October 2015.|
|Shareholders are referred to the Balwin pre-listing statement dated 1 October 2015 in terms of which Shareholders were advised that Balwin is currently engaged in negotiations for the acquisition of a land parcel in the Kyalami node on which an approximate 15,000 residential sectional title units may be developed.|
Shareholders are advised that negotiations are ongoing which, if successfully concluded, may have an impact on the price of Balwin shares. Shareholders are accordingly advised to exercise caution when dealing in Balwin shares until a further announcement is made.
|Listed in the real estate holding and development sector on the JSE since October 2015, Balwin has developed over 17 000 apartments in 77 residential estates since its inception 21 years ago. These estates are located in high-density, high-growth metropolitan areas in greater Johannesburg, Cape Town and Pretoria.|
Founded in 1996 by the current CEO and largest shareholder, Stephen Brookes, Balwin completed its first sectional title development later in the same year.
The Group is headquartered in Bedfordview, Johannesburg, with regional offices in Stellenbosch, to service its Western Cape developments, and more recently in Umhlanga as the base for the planned expansion into KwaZulu-Natal.