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Unaudited condensed consolidated interim financial statements of Tradehold Group for six months to 31 August 2022
TRADEHOLD LIMITED
(Registration number: 1970/009054/06)
Incorporated in the Republic of South Africa
JSE Ordinary Share code: TDH ISIN: ZAE000152658
JSE B Preference Share code: TDHBP ISIN: ZAE000253050
("Tradehold" or the "Group")
Unaudited condensed consolidated interim financial statements of the
Tradehold Group for the six months to 31 August 2022 and cash dividend
declaration
MAJOR DEVELOPMENTS
- Tradehold sells UK assets
- Pays special dividend R4.34 a share
- Declares interim dividend 30c a share
- Company to be turned into a REIT
On 23 May 2022, Tradehold announced the disposal of all its property assets
and operations in the United Kingdom as part of a far-reaching restructuring
of the business. These assets comprise its 100% investment in Moorgarth
Property Group.
These interests were sold with non-conflicted shareholders' approval to a
British company owned by some of Tradehold's directors, including its main
shareholders, for £102.5 million, a sum considered fair to shareholders by
an independent expert accredited by the JSE.
This move resulted in a net loss for the period of £41.5 million as against
a profit of £4.9 million in the corresponding period. Moorgarth's results
are shown at the reporting date as those of a discontinued operation. The
formal date of the transaction, announced in June this year, was
17 November.
The proceeds from the sale, after reducing some outstanding debt, forms part
of a special dividend to shareholders of R4.34 per ordinary share payable on
21 November. This is in addition to the 30c per ordinary share the company
declared in respect of the six months to end August 2022 (24 May 2022: final
dividend 30 cents).
Tradehold's remaining assets comprise a 74.3% holding in the Collins
Property Group and full ownership of both the Nguni Group (Namibia
portfolio) and the Tradehold Africa Group.
Total assets now amount to £806.5 million (28 February 2022: £830.4
million), which includes Moorgarth assets of £206.7 million (28 February
2022: £254.2 million). Headline earnings per share was 6.7 pence, compared
to earnings of 2.6 pence per share for the corresponding interim period, and
tangible net asset value per share (as defined by management) was
92 pence/R18.25, compared to 101.3 pence/R20.96 at 28 February 2022.
COLLINS GROUP
Despite the disruptions and damage to some of its properties caused by die
devastating floods in KwaZulu-Natal in April 2022, Collins managed to
increase the total value of its portfolio to R9 720 million from R9 584
million six months ago. Vacant space was reduced from 2.5% to 1.7%. Collins
reported a profit before minorities of R156 million for the six months
compared to R140 million for the corresponding period in 2021.
The group continued growing and diversifying its portfolio which for 75%
consists of industrial space and large distribution centres leased on long-
term contracts to major, mainly listed companies. At the reporting date the
weighted average lease expiry date was 5.5 years.
In the past, the portfolio was centred on KwaZulu-Natal and Gauteng.
However, the company is now growing its presence in the Western Cape
substantially to acquire a more representative national footprint.
At the same time it is increasingly looking to Europe for expansion with a
view to ultimately account for 15% of the portfolio being outside Southern
Africa. It already owns a cluster of buildings in Austria and is at present
considering, inter alia, the acquisition of a portfolio of properties in The
Netherlands.
OUTLOOK
Given prevailing economic uncertainties, exacerbated by recent inflation and
interest rate hikes, Collins will be working towards ensuring a strong
balance sheet for facing the challenges that lie ahead.
The Board is confident all legal procedures necessitated by the
restructuring of the group following the sale of its UK operations, will be
completed shortly after the end of February 2023 also being the end of
Tradehold's financial year.
As part of the restructuring, Tradehold will be converted to an
industrial/logistics-focussed real estate investment trust (REIT) under the
name Collins and remain listed on the Johannesburg Stock Exchange. In future
the company will no longer report its results in pound sterling, but in ZAR.
ORDINARY SHARE CASH DIVIDEND
The board of directors of Tradehold (the "Board") resolved to declare a
gross cash dividend of 30 cents per ordinary share on 22 November 2022 -
Tradehold's third interim dividend to date. The income used for this purpose
is Tradehold's share of the dividend Collins group declares every six months
in terms of the agreement with its minority shareholders. The dividend will
reduce Tradehold's stated capital.
The distribution constitutes a foreign dividend as defined in section 1 of
the Income Tax Act ("ITA") and is a dividend for purposes of dividends tax
("DT"), since the shares are listed on the JSE Limited ("JSE").
An exemption from DT is provided for in the ITA in respect of foreign
dividends paid to a South African company and to a non-resident to the
extent that it is paid in respect of listed shares, provided certain
administrative procedures are complied with.
The ITA further provides for an exemption from income tax in respect of
foreign dividends received or accrued in respect of listed shares.
In terms of the ITA, DT of 20% has been withheld in the case of those
shareholders who are not exempt from it. They will therefore receive a net
dividend of 24 cents per ordinary share.
Tradehold has 261 346 570 ordinary shares in issue. Its South African income
tax reference number is 9725/126/71/9.
The salient dates for the dividend are as follows:
Declaration date Tuesday, 22 November 2022
Last date to trade cum dividend Tuesday, 6 December 2022
Date trading commences ex dividend Wednesday, 7 December 2022
Record date Friday, 9 December 2022
Date of payment to shareholders Monday, 12 December 2022
Share certificates may not be dematerialised or rematerialised between
Wednesday, 7 December 2022, and Friday, 9 December 2022, both days included.
C H Wiese K L Nordier
Chairman Director
22 November 2022
FULL ANNOUNCEMENT
The contents of this announcement is the responsibility of the directors of
Tradehold Limited. It is only a summary of the information contained in the
full announcement ("Full Announcement"). Any investment decisions by
investors and shareholders should be based on consideration of the Full
Announcement published on SENS on Tuesday, 22 November 2022 which is
available at the following link:
https://senspdf.jse.co.za/documents/2022/jse/isse/tdh/ie2022.pdf and on
Tradehold's website at www.tradehold.co.za. Copies of the Full Announcement
are available for inspection and may be requested at no charge from
Tradehold's registered office at Leinster Hall, 7 Weltevreden Street,
Gardens 8005, or from that of its sponsor, Questco Corporate Advisory (Pty)
Ltd, Ground Floor, Block C, Investment Place, 10th Road, Hyde Park, 2196 at
no charge, from Monday to Friday during office hours.
DIRECTORS AND ADMINISTRATION
Executive directors: TA Vaughan, FH Esterhuyse, KL Nordier
Non-executive directors: CH Wiese (alternate JD Wiese), HRW Troskie,
MJ Roberts, KR Collins, LL Porter, PJ Roelofse
Independent non-executive directors: HRW Troskie, MJ Roberts, LL Porter
Company secretary: PJ Janse van Rensburg
Transfer secretary: Computershare Investor Services (Pty) Ltd
Sponsor: Questco Corporate Advisory (Pty) Ltd
Date: 22-11-2022 12:00:00
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