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Audited summary consolidated financial statements for the year ended 29 February 2020
EQUITES PROPERTY FUND LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2013/080877/06)
Share code: EQU ISIN: ZAE000188843
Alpha code: EQUI
(Approved as a REIT by the JSE)
(“Equites” or “the Company”)
SHORT-FORM ANNOUNCEMENT: AUDITED SUMMARY CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 29 FEBRUARY 2020
NATURE OF BUSINESS
Equites is a listed Real Estate Investment Trust (“REIT”) with a focus on owning and developing modern, well-
located logistics properties let to A-grade tenants on long-dated leases. We have established ourselves as
a leading owner and developer of high-quality logistics assets in SA and the UK.
We are the only specialist logistics REIT listed on the JSE.
THE PERIOD IN BRIEF
- Distribution per share (“DPS”) of 151.39 cents compared to 138.43 cents for the financial year ended
28 February 2019, an increase of 9.4%;
- Loan-to-value of 26.1% (including the equity capital raise on 3 March 2020), compared to 26.9% at
28 February 2019 exhibits the characteristics of a conservative financial profile and sound financial
risk management;
- The all-in cost of debt has fallen by 77 basis points to 5.94%, partially as a result of falling global
interest rates but also due to the attractive spreads that we have been able to secure additional
debt funding;
- Diligent management of liquidity, resulting in cash and available facilities of R1.5 billion, an increase
of R0.6 billion from 28 February 2019; and
- Net asset value per share has increased by 3.7% over the financial year to R17.55 which reflects a
compound annual growth rate since listing exceeding 10%.
KEY FINANCIAL HIGHLIGHTS
Audited Audited
12 months ended 12 months ended
29 February 2020 28 February 2019 Change
R’000 R’000 %
Gross property revenue 993 699 766 158 29.7
Distributable earnings 839 367 696 903 20.4
Headline earnings per share (cents) 125.9 109.4 15.2
Earnings per share (cents) 128.8 149.6 (13.9)
Dividend declared per share (cents) 151.39 138.43 9.4
Net asset value per share (cents) 1 755 1 692 3.7
DECLARATION OF A CASH DIVIDEND WITH THE ELECTION TO REINVEST THE CASH DIVIDEND IN RETURN FOR EQUITES SHARES
(“DIVIDEND REINVESTMENT ALTERNATIVE”)
The board has declared a final gross dividend of 76.95693 cents per share for the six months ended 29
February 2020,further to the interim dividend of 74.43 cents per share. This brings the total distributions for
the year ended 29 February 2020 to 151.39 cents per share, which is a 9.4% growth over the prior year total
distributions of 138.43 cents per share. The DPS growth is in line with previous guidance of between 8% - 10%.
Dividends declared (cents per share) % change 29-Feb-20 28-Feb-19
Interim dividend 74.43 68.12
Final dividend 76.96 70.31
Total distributions for the year 9.4% 151.39 138.43
Shareholders will be entitled, in respect of all or part of their shareholdings, to elect to reinvest the cash
dividend in return for Equites shares. Those shareholders who elect not to reinvest will receive a gross cash
dividend of 76.96 cents per share. The entitlement for shareholders to receive the dividend reinvestment
alternative is subject to the board agreeing on the pricing and terms of the dividend reinvestment
alternative. The board in its discretion may withdraw the dividend reinvestment alternative should market
conditions warrant such actions and such withdrawal will be communicated to shareholders prior to the
finalisation announcement to be published by no later than 11:00 (SA time) on Tuesday, 12 May 2020.
A circular providing further information in respect of the cash dividend and dividend reinvestment
alternative (the “circular”) will be posted to shareholders and published on SENS on Tuesday, 5 May 2020.
Shareholders who have dematerialised their shares through a Central Securities Depository Participant
(“CSDP”) or broker should instruct their CSDP or broker with regard to their election in terms of the custody
agreement entered into between them and their CSDP or broker.
The distribution of the circular and/or accompanying documents and the right to elect shares in
jurisdictions other than the Republic of South Africa (SA) may be restricted by law and any failure to comply
with any of these restrictions may constitute a violation of the securities laws of any such jurisdictions.
Shareholders’ rights to elect shares are not being offered, directly or indirectly, in the United Kingdom (UK),
European Economic Area (EEA), Canada, United States of America (USA), Japan, Hong Kong or Australia
unless certain exemptions from the requirements of those jurisdictions are applicable.
Fractions
Trading in the Strate environment does not permit fractions and fractional entitlements. Where a
shareholder’s entitlement to the shares in relation to the dividend reinvestment alternative gives rise to an
entitlement to a fraction of a new share, such fraction will be rounded down to the nearest whole number
with the cash balance of the dividend being retained by the shareholders.
Salient dates and times 2020
Equites results including declaration of an interim distribution
published on SENS Tuesday, 5 May
Circular and form of election posted to shareholders Tuesday, 5 May
Finalisation information including the share ratio and reinvestment
price per share published on SENS by 11:00 (SA time) Tuesday, 12 May
Last day to trade in order to participate in the election to receive
shares in terms of the dividend reinvestment alternative or to receive
a cash dividend (“LDT”) Tuesday, 19 May
Shares trade ex-dividend Wednesday, 20 May
Listing of maximum possible number of shares under the dividend
reinvestment alternative Friday, 22 May
Last day to elect to receive shares in terms of the dividend
reinvestment alternative or to receive a cash dividend (no late forms
of election will be accepted) at 12:00 (SA time) Friday, 22 May
Record date for the election to receive shares in terms of the
dividend reinvestment alternative or to receive a cash dividend
(“record date”) Friday, 22 May
Announcement of results of cash dividend and dividend
reinvestment alternative released on SENS Monday, 25 May
Payment of cash dividends to certificated shareholders by
electronic funds transfer Monday, 25 May
Dematerialised shareholders’ CSDP or broker accounts credited with
the cash dividend payment (if applicable) Monday, 25 May
Share certificates posted to certificated shareholders on or about Wednesday, 27 May
Dematerialised shareholders’ CSDP or broker accounts credited with
the new shares (if applicable) Wednesday, 27 May
Adjustment to shares listed on or about Friday, 29 May
Notes:
1. Shareholders electing the dividend reinvestment alternative are alerted to the fact that the new shares
will be listed on LDT + 3 and that these new shares can only be traded on LDT + 3, due to the fact that
settlement of the shares will be three days after the record date, which differs from the conventional
one day after record date settlement process.
2. Shares may not be dematerialised or rematerialised between Wednesday, 20 May 2020 and Friday,
22 May 2020, both days inclusive.
3. The above dates and times are subject to change. Any changes will be released on SENS.
Tax implications
Equites listed on the JSE as a REIT in line with the REIT structure as provided for in the Income Tax Act, No. 58
of 1962, as amended (the “Income Tax Act”) and section 13 of the JSE Listings Requirements.
The REIT structure is a tax regime that allows a REIT to deduct qualifying distributions paid to investors, in
determining its taxable income.
The cash dividend of 76.95693 cents per share meets the requirements of a qualifying distribution for the
purposes of section 25BB of the Income Tax Act (a “qualifying distribution”) with the result that:
- qualifying distributions received by resident Equites shareholders must be included in the gross income
of such shareholders (as a non-exempt dividend in terms of section 10(1)(k)(aa) of the Income Tax
Act), with the effect that the qualifying distribution is taxable as income in the hands of the Equites
shareholder. These qualifying distributions are however exempt from dividends withholding tax,
provided that the South African resident shareholders provided the following forms to their CSDP or
broker, as the case may be, in respect of uncertificated shares, or the company, in respect of
certificated shares:
- a declaration that the dividend is exempt from dividends tax; and
- a written undertaking to inform the CSDP, broker or the company, as the case may be,
should the circumstances affecting the exemption change or the beneficial owner cease
to be the beneficial owner,
both in the form prescribed by the Commissioner for the South African Revenue Service. Shareholders are
advised to contact their CSDP, broker or the company, as the case may be, to arrange for the
abovementioned documents to be submitted prior to payment of the dividend, if such documents have
not already been submitted.
- qualifying distributions received by non-resident Equites shareholders will not be taxable as income
and instead will be treated as ordinary dividends but which are exempt in terms of the usual dividend
exemptions per section 10(1)(k) of the Income Tax Act. Any qualifying distributions are subject to
dividends withholding tax at 20%, unless the rate is reduced in terms of any applicable agreement for
the avoidance of double taxation (“DTA”) between South Africa and the country of residence of the
shareholder. Assuming dividends withholding tax will be withheld at a rate of 20%, the net dividend
amount due to non-resident shareholders is 61.56554 cents per share. A reduced dividend withholding
rate in terms of the applicable DTA, may only be relied upon if the non-resident shareholder has
provided the following forms to their CSDP or broker, as the case may be, in respect of uncertificated
shares, or the company, in respect of certificated shares:
- a declaration that the dividend is subject to a reduced rate as a result of the application of
a DTA; and
- a written undertaking to inform their CSDP, broker or the company, as the case may be,
should the circumstances affecting the reduced rate change or the beneficial owner
cease to be the beneficial owner,
both in the form prescribed by the Commissioner for the South African Revenue Service. Non-resident
shareholders are advised to contact their CSDP, broker or the company, as the case may be, to arrange
for the abovementioned documents to be submitted prior to payment of the dividend if such documents
have not already been submitted, if applicable.
Shareholders are advised that in electing to participate in the dividend reinvestment alternative, pre-
taxation funds are utilised for the purposes and that taxation will be due on the total cash dividend amount
of 76.95693 cents per share.
Other information
- The issued ordinary share capital of Equites at the date of declaration is 597 221 994 ordinary shares
of no par value each before any election to reinvest the cash dividend.
- Income Tax Reference Number of Equites: 9275393180.
The cash dividend or the dividend reinvestment alternative may have tax implications for resident as well
as non-resident shareholders. Shareholders are therefore encouraged to consult their professional advisors
should they be in any doubt as to the appropriate action to take.
SHORT-FORM ANNOUNCEMENT
This short-form announcement is the responsibility of the directors of and the contents were approved by
the board on 4 May 2020. This short-form announcement is a summary of the full announcement released
on SENS on 5 May 2020 and does not include full or complete details. None of the information in this
announcement has been reviewed or reported on by the company’s auditors.
The full announcement is available on the Company’s website at www.equites.co.za/financial-results and
can also be accessed using the following JSE link:
https://senspdf.jse.co.za/documents/2020/jse/isse/EQU/2020AFS.pdf
A copy of the full announcement may be requested from info@equites.co.za or the sponsor, Java Capital
at sponsor@javacapital.co.za. Any investment decision should be based on the full announcement
available on the Company’s website.
The consolidated annual financial statements have been audited by the Company’s auditors,
PricewaterhouseCoopers Inc., who expressed an unmodified audit opinion thereon. The auditor’s opinion
also includes communication of key audit matters. This opinion is available, along with the annual financial
statements, on the Company’s website at www.equites.co.za/financial-results.
By order of the Board
5 May 2020
Directors
A Taverna-Turisan (CEO)^, G.R. Gous (COO), P.L. Campher*# (Chairman), G Lanfranchi* (Deputy Chairman),
A.J. Gouws*, K Dreyer*, N Khan*#, R.E. Benjamin-Swales*#, M.E. Brey *#, E. Cross *#, K. Ntuli *#
* Non-executive
# Independent
^ Italian
G Mtetwa resigned from the board effective 31 August 2019 and B Goossens (CFO) resigned effective 31 December 2019.
Registered office and business address
14th Floor, Portside Towers, 4 Bree Street, Cape Town, 8000
Contact details
info@equites.co.za
Company secretary
Riaan Gous
Transfer secretary
Computershare Investor Services Proprietary Limited
Auditors
PricewaterhouseCoopers Inc.
Bankers
Nedbank Limited
Corporate advisor and sponsor
Java Capital
6A Sandown Valley Crescent, Sandton, 2196
Date: 05-05-2020 07:05:00
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