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Unaudited results for the six months ended 28 February 2013
REBOSIS PROPERTY FUND LIMITED
("Rebosis" or the "company")
Registration number 2010/003468/06
JSE code: REB ISIN: ZAE000156147
UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 28 FEBRUARY 2013
HIGHLIGHTS
- Interim distribution up at 44,50 cents per linked unit
- 30,1% total return to linked unitholders for 12 months
- 8,7% increase in net asset value to R11,44 per linked unit
Secured acquisitions of R1,76 billion
- Vacancy levels down to 2,0%
- Net operating costs down to 12,8%
- Gearing reduced to 22,6%
Successful R650 million rights offer
STATEMENT OF COMPREHENSIVE INCOME
Unaudited Unaudited Audited
six months six months year
ended ended ended
28 February 29 February 31 August
2013 2012 2012
R'000 R'000 R'000
REVENUE
Property portfolio 267 248 262 056 500 029
Rental income 248 112 196 072 414 163
Straight-line rental income accrual 19 136 65 984 85 866
Net income from facilities
management agreement 8 215 7 468 15 822
Sundry income 162 475 6 081
Total revenue 275 625 269 999 521 932
Property expenses (62 993) (42 700) (98 494)
Administration and corporate costs (9 868) (8 260) (15 961)
Net operating profit 202 764 219 039 407 477
Changes in fair values 77 855 (15 664) 157 461
Profit from operations 280 619 203 375 564 938
Finance charges (48 309) (59 515) (117 811)
Finance charges secured loans (72 381) (60 452) (126 434)
Interest received 24 072 937 8 623
Profit before taxation 232 310 143 860 447 127
Debenture interest (136 697) (94 490) (200 378)
Profit before taxation 95 613 49 370 246 749
Taxation (20 983) (67 005) (102 564)
Total comprehensive income/(loss)
for the period 74 630 (17 635) 144 185
Reconciliation of earnings
and distributable earnings
Total comprehensive income/(loss)
for the period 74 630 (17 635) 144 185
Debenture interest 136 697 94 490 200 378
Earnings 211 327 76 855 344 563
Change in fair value of properties (53 713) 24 419 (136 365)
Change in fair value of properties (66 025) 30 017 (167 623)
Deferred taxation 12 312 (5 598) 31 258
Deferred taxation adjustment
to CGT rate 50 108
Headline profit attributable
to linked unitholders 157 614 101 274 258 306
Change in fair value of
financial instruments (8 517) (10 334) 7 317
Change in fair value of
financial instruments (11 830) (14 353) 10 162
Deferred taxation 3 313 4 019 (2 845)
Straight-line rental income accrual
(net of deferred taxation) (13 778) (47 508) (61 823)
Straight-line rental income accrual (19 136) (65 984) (85 866)
Deferred taxation 5 358 18 476 24 043
Derecognition of current liability 50 108 (5 466)
Structuring fee amortisation 1 378 950 2 044
Distributable earnings attributable
to linked unitholders 136 697 94 490 200 378
Number of linked units in issue 307 183 417 219 744 713 249 147 699
Weighted average number of linked
units in issue 257 163 682 219 744 713 226 332 267
Basic and diluted earnings per linked
unit (cents) 82,18 34,97 152,24
Headline earnings per linked unit (cents) 61,29 46,09 114,13
Distributable earnings per linked
unit/share (cents) 44,50 43,00 85,50
STATEMENT OF FINANCIAL POSITION
Unaudited Unaudited Audited
As at As at As at
28 February 29 February 31 August
2013 2012 2012
R'000 R'000 R'000
ASSETS
Non-current assets 4 733 072 3 884 737 4 636 346
Investment property 4 637 000 3 784 500 4 540 200
Goodwill and intangibles 95 703 95 703 95 703
Property, plant and equipment 369 438 443
Structuring fee 4 096
Current assets 472 488 29 067 34 642
Trade and other receivables 27 122 18 419 17 320
Structuring fee 1 900
Cash and cash equivalents 445 366 8 748 17 322
5 205 560 3 913 804 4 670 988
EQUITY AND LIABILITIES
Equity 1 020 889 511 685 746 424
Stated capital 749 922 477 168 550 087
Reserves 270 967 34 517 196 337
Non-current liabilities 4 016 078 3 265 731 3 785 068
Debentures 2 230 152 1 595 347 1 808 812
Secured financial liabilities 1 479 614 1 433 300 1 679 098
Interest rate swaps 43 023 30 337 54 853
Deferred taxation 263 289 206 747 242 305
Current liabilities 168 593 136 388 139 496
Trade and other payables 31 896 39 072 33 608
Rental warranty 2 826
Unitholders for distribution 136 697 94 490 105 888
Total equity and liabilities 5 205 560 3 913 804 4 670 988
Net asset value per linked unit (R) 10,58 9,59 10,26
Net asset value per linked unit
(excluding deferred taxation) (R) 11,44 10,53 11,23
ABRIDGED STATEMENT OF CHANGES IN EQUITY
Unaudited Unaudited Audited
six months six months year
ended ended ended
28 February 29 February 31 August
2013 2012 2012
R'000 R'000 R'000
Stated capital 749 922 477 168 550 087
Balance at beginning of the period 550 087 477 168 477 168
Issue of shares 199 835 72 919
Reserves 270 967 34 517 196 337
Balance at beginning of the period 196 337 52 152 52 152
Profit for the period 74 630 (17 635) 144 185
1 020 889 511 685 746 424
ABRIDGED STATEMENT OF CASH FLOW
Unaudited Unaudited Audited
six months six months year
ended ended ended
28 February 29 February 31 August
2013 2012 2012
R'000 R'000 R'000
Cash flows from operating activities 20 166 6 902 17 211
Cash generated from operations 174 364 115 315 278 410
Net finance costs (48 310) (59 515) (117 811)
Debenture interest paid (105 888) (48 898) (143 388)
Cash outflows from investing activities (12 437) (348 143) (886 963)
Cash inflows from financing activities 420 315 279 769 816 854
Net movement in cash and
cash equivalents 428 044 (61 472) (52 898)
Cash and cash equivalents
at the beginning of the period 17 322 70 220 70 220
Cash and cash equivalents
at the end of the period 445 366 8 748 17 322
COMMENTARY
Introduction
Rebosis is one of the fastest growing property loan stock companies which is included in all the
JSE Limited ("JSE") indices, other than the JSE ALSI Top 40. The company owns a high growth
defensive portfolio of 12 quality properties that includes one of the largest retail centres in South
Africa, Hemingways Mall in East London. Rebosis' primary objective is to grow its portfolio and
distributions by investing in high-quality retail and commercial properties yielding secure capital and
income returns for unitholders.
Financial results
On 27 March 2013, Rebosis declared an early distribution of 44,5 cents per linked unit for the
six months ended 28 February 2013 which represents an increase of 3,5% on the distribution
of 43,0 cents per linked unit for the comparable period. The early announcement and resulting
early payment of the distribution was in terms of a commitment made pursuant to the rights offer
implemented on 4 February 2013.
The increase in the unit price from R9,70 per linked unit at 29 February 2012 to R11,75 at
28 February 2013 together with a total distribution of 87,50 cents per linked unit for the 12-month
period then ended provides a total return of 30,2% to unitholders.
Following the acquisition of the four commercial properties in mid-2012, the retail sector now
contributes 53% of rental income while Hemingways Mall remains the dominant property in the
portfolio, contributing 32% of rental income for the period under review. Net operating costs are
down to 12,8% from 13,8% in the comparable period due to operational efficiencies achieved
during the period.
Property portfolio
The properties, which were valued by independent valuer Quadrant Properties (Proprietary) Limited,
increased in value from R4,540 billion at 31 August 2012 to R4,637 billion at 28 February 2013. The
portfolio has a total gross lettable area ("GLA") of 295 716m², is located in Gauteng, the Eastern
Cape, KwaZulu-Natal and North West Province and comprises 52% retail and 48% office buildings
(by value).
GLA Value Value/m(2)
m(2) R'000 R/m(2)
Retail portfolio 132 845 2 406 000 18 111
Office portfolio 162 871 2 231 000 13 698
Total portfolio 295 716 4 637 000 15 681
The retail component includes three exceptional quality shopping malls delivering secure, escalating
income streams underpinned by strong anchor and national tenants. The office portfolio consists of
nine buildings which are well located in nodes attractive to government tenants. These are mainly
let to the National Department of Public Works, under long leases providing for average escalations
of 8,3%. The office portfolio represents a sovereign underpin to a substantial portion of the earnings
and shields it from private sector risks such as tenant insolvency and default. Notwithstanding tough
operating conditions in which tenants have the upper hand and are reducing their requirements for
space, vacancies have reduced from 3,7% at 31 August 2012 to 2,0% at 28 February 2013.
Acquisitions
On 14 March 2013, the company took transfer of the Antalis property ("Antalis"), a specialised
single-tenanted, industrial warehouse with a GLA of 18 954m² for R120,0 million. Antalis is
strategically located in a light industrial node in Selby, Johannesburg with great connectivity to key
highways and provides additional bulk for future tenant-driven expansions which will further diversify the
company's income streams.
During the reporting period, Rebosis concluded agreements for the acquisition of a high quality and
well established retail centre, Sunnypark Mall in Pretoria for R576,7 million, and the Nthwese office
portfolio for R1,06 billion.
The Sunnypark Mall is a dominant centre located in the resurging suburb of Sunnypark in Pretoria.
The centre, which has recently had a major refurbishment, has a GLA of 28 072m² and comprises
in excess of 75% of national retailers.
The Nthwese portfolio comprises four recently refurbished quality properties in Johannesburg and
one in Pretoria let to Gauteng provincial government and national government, respectively, on
long-term leases. The 67 952m² portfolio is currently virtually fully occupied.
Rights offer
On 4 February 2013, Rebosis successfully raised R650 million in terms of a rights offer that
was oversubscribed. In term of the offer, 58 035 718 new linked units were issued at a price of
R11,20 per unit increasing the total number of units in issue to 307 183 417. The issue price
effectively included an accrued distribution of 38,6 cents for the period 1 September 2012 to
4 February 2013. Excluding the accrued distribution, the rights offer linked units were issued at
a price of R10,81 per linked unit.
The purpose of the rights offer was to enhance Rebosis' ability to take advantage of pipeline
acquisition opportunities and to strengthen its balance sheet, thereby improving its ability to use
cash to effect acquisitions.
Borrowings
Rebosis' net borrowings of R1,048 billion at 28 February 2013, which have been reduced by the
proceeds of the rights offer, equate to a gearing ratio of 22,6%. In line with the company's hedging
policy. 77,5% of borrowings have been fixed resulting in an average cost of borrowing of 8,5% for
the period under review. The average remaining term of the debt is 2,5 years.
Prospects
Despite the tough economic conditions, vacancies and operating costs have reduced and there has
been a strong increase in interest for space in our retail properties from national and international
retailers.
The board is confident that Rebosis is well-positioned to capitalise on future high quality growth
opportunities that are currently being assessed by the company.
Further, the board is confident that Rebosis is still on track to achieve a distribution of between
92 cents and 95 cents per linked unit for the year ending 31 August 2013, in line with our previous
forecast announced on 24 October 2012. This is based on the assumption that there will be no
change in current trading conditions of the existing portfolio, a stable macro-economic environment
will prevail, tenants will be able to absorb rising utility costs, there will be no major corporate failures
and that Sunnypark and the Nthwese office portfolio will be acquired effective 1 May 2013. This
forecast is the responsibility of the directors of Rebosis and has not been reviewed or reported on
by the company's auditors.
Debenture interest distribution
As announced on SENS on 27 March 2013, Distribution No. 4 of 44,5 cents per linked unit for the
six months ended 28 February 2013 will be paid to linked unitholders on Monday, 22 April 2013.
Basis of preparation
The results for the six months ended 28 February 2013 have not been audited or reviewed by
the company's independent auditors. These results have been prepared in accordance with
International Financial Reporting Standards (IFRS), IAS 34: Interim Financial Reporting, the SAICA
Financial Reporting Guides as issued by the Accounting Practices Committee, JSE Listings
Requirements and the requirements of the South African Companies Act (2008). The accounting
policies adopted in the preparation of these unaudited results are consistent with those applied
in the preparation of the financial statements for the year ended 31 August 2012. These financial
results have been prepared under the supervision of the financial director, JA Finn CA(SA).
By order of the board
Rebosis Property Fund Limited
18 April 2013
REBOSIS PROPERTY FUND LIMITED
("Rebosis" or the "company")
Registration number 2010/003468/06
JSE code: REB ISIN: ZAE000156147
Directors:
ATM Mokgokong*+ (Chairperson)
SM Ngebulana (CEO)
JA Finn
AM Mazwai*+
WJ Odendaal*+
NV Qangule*+,
KL Reynolds*
TSM Seopa*+
SV Zilwa*+
*Non-executive +Independent
Registered office
3rd Floor, Palazzo Towers West
Montecasino Boulevard, Fourways, 2191
(PO Box 2972, Northriding, 2162)
Transfer secretaries
Computershare Investor Services (Pty) Ltd
Sponsor
Java Capital
Company secretary
M Ndema
www.rebosis.co.za
Date: 18/04/2013 07:15:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
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indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
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