Wrap Text
Unaudited Condensed Consolidated Interim Results for the six months ended 28 February 2013
DIPULA INCOME FUND
(Incorporated in the Republic of South Africa) (Registration number 2005/013963/06)
JSE code for A-linked units: DIA ISIN for A-linked units: ZAE000158317
JSE code for B-linked units: DIB ISIN for B-linked units: ZAE000158325
("Dipula" or "the company", and together with its subsidiaries, " the Fund" or "the group")
Unaudited condensed consolidated interim results
for the six months ended 28 February 2013
Highlights
- Acquisitions totalling R737 million concluded
- Successful R650 million private placement completed
- Portfolio value increased to R2,9 billion
- Revenue increased by 11,8% to R153,6 million
- Net operating profit increased by 17,3% to R125,5 million
- 44,1% increase in distributable earnings to R102,6 million
- 5% increase in A-linked distribution to 41,669 cents
- 7,4% increase in B-linked distribution to 29,804 cents
Condensed consolidated 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 159 347 142 752 299 583
Rental income 153 649 137 417 300 731
Straight-line rental income accrual 5 698 5 335 (1 148)
Total revenue 159 347 142 752 299 583
Property expenses (27 218) (30 755) (58 080)
Administration and corporate costs (6 590) (4 964) (11 757)
Net operating profit 125 539 107 033 229 746
Changes in fair values of investment properties (270) (7 043) 85 072
Fair value gain/(loss) on investment property 5 428 (1 708) 83 924
Adjustment resulting from straight-lining
of rental revenue (5 698) (5 335) 1 148
Profit from operations 125 269 99 990 314 818
Net finance charges (19 669) (30 542) (65 209)
Finance charges (38 864) (31 176) (67 305)
Amortisation of debenture premium 2 382
Finance income 16 813 634 2 096
Profit before debenture interest and taxation 105 600 69 448 249 609
Debenture interest (102 563) (71 156) (147 947)
A-linked units (59 795) (41 881) (83 761)
B-linked units (42 768) (29 275) (64 186)
Profit/(loss) before taxation 3 037 (1 708) 101 662
Taxation 1 738 (8 589) (20 843)
Total comprehensive income/(loss) for the period
attributable to equity holders 4 775 (10 297) 80 819
Reconciliation of earnings, headline earnings
and distributable earnings
Profit/(loss) for the period attributable to equity holders 4 775 (10 297) 80 819
Debenture interest 102 563 71 156 147 947
Earnings 107 338 60 859 228 766
Change in fair value of properties
(net of deferred taxation) 220 5 728 (60 318)
Change in fair value of properties 270 7 043 (85 072)
Deferred taxation (50) (1 315) 24 754
Headline earnings attributable to linked
unitholders/shareholders 107 558 66 587 168 448
Straight-line rental income accrual
(net of deferred taxation) (4 103) (3 841) 827
Straight-line rental income accrual (5 698) (5 335) 1 148
Deferred taxation 1 595 1 494 (321)
Lease cancellation income distributed/
(not distributed) 4 660 (19 003)
Deferred taxation other adjustments (3 284) 8 410 (3 591)
Amoritsation of debenture premium (2 382)
Amortisation of structuring fee 114
Pre-acquisition profits of Asakhe Realty Investments
acquired in 2011 1 266
Distributable earnings attributable to
linked unitholders 102 563 71 156 147 947
Total number of linked units 286 999 366 211 064 786 211 064 786
Number of A-linked units in issue 143 499 683* 105 532 393* 105 532 393*
Number of B-linked units in issue 143 499 683* 105 532 393* 105 532 393*
Weighted average number of A-linked units in issue 126 533 296* 105 532 393* 105 532 393*
Weighted average number of B-linked units in issue 126 533 296* 105 532 393* 105 532 393*
Basic earnings/(loss) per share (cents) 1,89 (4,88) 38,29
Headline earnings/(loss) per share (cents) 1,97 (2,16) 9,71
Basic earnings per A-linked unit (cents) 49,14 34,81 117,66
Basic earnings per B-linked unit (cents) 35,69 22,86 99,11
Headline earnings per A-linked unit (cents) 49,23 37,52 89,08
Headline earnings per B-linked unit (cents) 35,77 25,58 70,53
Distributable earnings per A-linked unit (cents) 41,669 39,685 79,370
Interim 41,669 39,685 39,685
Final N/A N/A 39,685
Distributable earnings per B-linked unit (cents) 29,804 27,741 60,821
Interim 29,804 27,741 27,741
Final N/A N/A 33,080
* Excluding treasury shares.
The company does not have any dilutionery instruments in issue.
Condensed consolidated statement of changes in equity
Stated
capital/ Fair Accumu-
Share value lated Total
capital reserve loss equity
R'000 R'000 R'000 R'000
Balance at 1 September 2011 427 852 116 895 (70 936) 473 811
Total comprehensive loss
for the six months (10 297) (10 297)
Transfer of capital items to
fair value reserve (11 405) 11 405
Balance at 29 February 2012 427 852 105 490 (69 828) 463 514
Balance at 1 September 2012 427 852 175 562 (48 784) 554 630
Total comprehensive profit
for the six months 4 775 4 775
Transfer of capital items to
fair value reserve (35) 35
Balance at 28 February 2013 427 852 175 527 (43 974) 559 405
Condensed consolidated statement of cash flows
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 inflows from operating activities 11 460 63 111 91 275
Cash outflows from investing activities (466 764) (4 498) (142 144)
Cash inflows from financing activities 519 464 187 762
Net movement in cash and cash equivalents 64 160 58 613 136 893
Cash and cash equivalents at the beginning of the period 162 153 25 260 25 260
Cash and cash equivalents at the end of the period 226 313 83 873 162 153
Segmental information
For the six months ended 28 February 2013
Retail Industrial Offices Total
R'000 R'000 R' 000 R'000
Extracts from statement of
comprehensive income
Total revenue from property portfolio 86 811 21 063 45 775 153 649
Property expenses (18 691) (5 070) (3 457) (27 218)
Net property income 68 120 15 993 42 318 126 431
Extracts from statement of
financial position
Investment property 1 489 964 357 279 1 039 402 2 886 645
For the six months ended 29 February 2012
Retail Industrial Offices Total
R'000 R'000 R' 000 R'000
Extracts from statement of
comprehensive income
Total revenue from property portfolio 75 209 20 921 41 287 137 417
Property expenses (15 965) (5 854) (8 936) (30 755)
Net property income 59 244 15 067 32 351 106 662
Extracts from statement of
financial position
Investment property 1 124 730 332 300 650 069 2 107 099
Condensed consolidated statement of financial position
Unaudited Unaudited Audited
28 February 29 February 31 August
2013 2012 2012
R'000 R'000 R'000
ASSETS
Non-current assets 2 935 127 2 155 581 2 441 968
Investment property 2 886 645 2 107 099 2 393 486
Goodwill 48 482 48 482 48 482
Current assets 242 517 98 277 188 665
Trade and other receivables 16 204 14 404 25 310
Loan to related party 1 202
Cash and cash equivalents 226 313 83 873 162 153
Non-current assets held for sale
Investment property held for sale 28 850 1 400 54 987
Total assets 3 206 494 2 255 258 2 685 620
EQUITY AND LIABILITIES
Equity 559 405 463 514 554 630
Stated capital 427 852 427 852 427 852
Reserves 131 553 35 662 126 778
Non-current liabilities 2 505 894 1 686 964 1 848 872
Debentures 1 504 498 900 629 900 629
Interest-bearing liabilities 964 123 759 550 906 562
Deferred taxation 37 273 26 785 41 681
Current liabilities 141 195 104 780 282 118
Interest-bearing liabilities 159 208
Trade and other payables 38 632 33 624 46 120
Linked unitholders for distribution 102 563 71 156 76 790
Total equity and liabilities 3 206 494 2 255 258 2 685 620
Net asset value per A-linked unit
(excluding deferred taxation) (cents) 732,12 659,01 707,98
Net asset value per B-linked unit
(excluding deferred taxation) (cents) 732,12 659,01 707,98
Net asset value per A-linked unit (cents) 719,13 646,31 689,48
Net asset value per B-linked unit (cents) 719,13 646,31 689,48
Notes
1. Basis of preparation
The unaudited condensed consolidated interim financial results have been prepared in accordance with the
requirements of International Financial Reporting Standards, the AC 500 series of interpretations, IAS 34: Interim
Financial Reporting, the JSE Limited (JSE) Listings Requirements and the requirements of the South African
Companies Act, 2008. These results have been prepared by the Financial Director, Brigitte de Bruyn CA(SA).
The accounting policies adopted in the preparation of these results are consistent with those applied in the
preparation of the financial statements for the year ended 31 August 2012.
The directors are not aware of any matters of circumstances arising subsequent to 28 February 2013 that require
any additional disclosure or adjustments to the financial statements.
These results have not been audited or reviewed by the company's auditors, PKF (Jhb) Inc.
2. Summary of financial performance
Unaudited Unaudited Audited
28 February 29 February 31 August
2013 2012 2012
R'000 R'000 R'000
Distribution per A-linked unit (cents) 41,669 39,685 79,370
Interim 41,669 39,685 39,685
Final N/A N/A 39,685
Distribution per B-linked unit (cents) 29,804 27,741 60,821
Interim 29,804 27,741 27,741
Final N/A N/A 33,080
A-linked units in issue 143 499 683* 105 532 393* 105 532 393*
B-linked units in issue 143 499 683* 105 532 393* 105 532 393*
Net asset value per combined linked unit (cents)** 1 438,26 1 292,63 1 378,97
Net asset value per A-linked unit (cents) 719,13 646,31 689,48
Net asset value per B-linked unit (cents) 719,13 646,31 689,48
Gearing ratio*** (%) 30,1 33,7 38,1
* Excluding treasury shares.
** Net asset value includes total equity attributable to equity holders and linked debentures.
*** The gearing ratio is calculated by dividing interest-bearing liabilities, excluding short-term portion of bank funding
and excluding linked debenture liabilities, by total assets.
3. Current bank debt facilities
Rate
Margin below
over jibar prime
for for
Utilised Fixed floating floating
Facility amount Expiry rate facility facility
R'million R'million % % %
Provider and type of loan
Standard Bank Fixed 506,7 506,7 2015 8,63
Standard Bank Fixed 100,0 100,0 2016 9,26
Standard Bank Floating 118,1 118,1 2016 2,38
Standard Bank Floating 99,4 99,4 2016 0,95
Nedbank Fixed 125,0 125,0 2017 8,95
Nedbank Floating 400,0 5 years
from date
of first
drawdown
Standard Bank Floating 23,5 5 years
from date
of first
drawdown
Standard Bank Floating 58,0 5 years
from date
of first
drawdown
Nedbank Floating 77,0 5 years
from date
of first
drawdown
1 507,7 949,2
4. Payment of interim distributions
The Board has approved and notice is hereby given of interim cash interest distributions (distribution no 4) of
41,669 cents per A-linked unit and 29,804 cents per B-linked unit for the period ended 28 February 2013 in
accordance with the abbreviated timetable set out below:
Last date to trade cum distribution Thursday, 13 June 2013
Linked units trade ex distribution Friday, 14 June 2013
Record date Friday, 21 June 2013
Payment date Monday, 24 June 2013
Linked unit certificates may not be dematerialised or rematerialised between Friday, 14 June 2013 and Friday,
21 June 2013, both days inclusive.
Directors:
ZJ Matlala (Chairperson)*
IS Petersen (CEO)
BH Azizollahoff*#
B de Bruyn (FD)
NS Gumede
E Links*
Y Waja*
* Independent non-executive # British
Registered office:
Block B Dunkeld Park
6 North Road, Dunkeld West, 2196
PO Box 875, Parklands, 2121
Transfer secretaries:
Link Market Services South Africa (Pty) Ltd
Sponsor:
Java Capital
Company secretary:
Probity Business Services (Pty) Ltd
Commentary
1. PROFILE
Dipula is a property loan stock company that has been listed on the Financial Services Real Estate sector
of the JSE since 17 August 2011.
2. FINANCIAL RESULTS
During the period under review, R473 million of properties were transferred. These properties were
acquired at an aggregate yield of 10,0% which contributed positively to the increases in revenue and net
operating profit.
Property expenses were positively impacted as a result of certain over-provisions that were released.
On a normalised basis, property expenses have been contained at 21,9% of revenue.
Finance income included R13,6 million of antecedent income relating to the private placement.
3. DISTRIBUTABLE EARNINGS
During the six months ended 28 February 2013 Dipula achieved total distribution growth per combined
unit of 6,0% over the prior comparable period. Of the total distribution for the interim period, 41,669 cents
accrues to the A-linked units and 29,804 cents to the B-linked units, representing distribution growth of
5,0% and 7,4% per unit respectively.
The combined distribution for the A and B units is 71,473 cents compared to the total distribution of
67,426 cents for the prior comparable period.
4. PROPERTY PORTFOLIO
Dipula owns 170 investment properties with a gross lettable area of 482 888m2 and a value of R2,9 billion.
The segmental and geographic breakdown of property holdings as at 28 February 2013 was as follows:
5. VACANCIES
Vacancies declined from 10,4% at 31 August 2012 to a current 9,8%. The sectoral split is offices 12,1%,
retail 10,1% and industrial 6,7%.
Dipula continues to successfully execute its strategy of improving the quality of its portfolio and income.
With the acquisitions and sales it is anticipated that the vacancy factor will decline further over time.
6. ACQUISITIONS
Since listing Dipula has acquired R2,3 billion worth of properties, of which R843 million has been
transferred to date, a further R946 million is awaiting transfer and R499 million will transfer as
developments are completed, with Tower Mall expected to be completed at the end of September 2013.
The aggregate yield of these acquisitions is approximately 10%.
7. DISPOSALS
Sixteen properties totalling R42,8 million were disposed of during the period under review. A further
24 properties that no longer fit the profile of Dipula have been earmarked for sale.
8. REFURBISHMENTS, EXTENSIONS AND REDEVELOPMENTS
The refurbishment of Arbeid Street was completed during the period and the property was re-let from
1 March 2013.
The following properties have been identified for refurbishments, extensions or redevelopment:
Refurbishment/
Extension/ Estimated
PROPERTY SECTOR LOCATION GLA Redevelopment cost
Kopanong Retail Thembisa, Gauteng 4 024 Refurbishment/Extension R5 million
Score Ivory Park Retail Ivory Park, Gauteng 1 504 Refurbishment/Extension R4 million
6 Old Pretoria
Main Road Retail Midrand, Gauteng 5 760 Redevelopment R23 million
Belle Ombre Retail Pretoria, Gauteng 7 838 Refurbishment R16 million
Nquthu Plaza Retail Nquthu, KwaZulu-Natal 14 942 Extension R10 million
Bochum Plaza Retail Bochum, Limpopo 11 557 Extension R4 million
Kuilsriver, Extension/
Range Road Industrial Western Cape 10 979 Refurbishment R25 million
Crownwood
Corner Redevelopment/
(formerly Metcash) Office Ormonde, Gauteng 7 273 Refurbishment R20 million
9. FUNDING
Dipula had an all-in blended rate of 8,47% at 28 February 2013 and has fixed interest debt of R506 million
for 2,5 years, R100 million for 3,5 years and R125 million for 4,5 years respectively. A floating facility of
R217,5 million expires in approximately 3,5 years.
Additional unutilised facilities of R558,5 million have been secured for five years from date of first draw
down. Once accessed, the majority of these facilities will be fixed.
10. PRIVATE PLACEMENT
On 21 November 2012, Dipula successfully raised R650 million in terms of a private placement that was
oversubscribed. In terms of the offer, 37 967 290 A-linked units were issued at a price of R10,45 and
37 967 290 B-linked units were issued at a price of R6,67. This increased the number of A-linked and
B-linked units in issue to 143 524 183 respectively.
The issue prices included an accrued distribution for the six months ended 31 August 2012 of
72,765 cents combined, which translated into 39,685 cents for the A-linked units and 33,080 cents
for the B-linked units, and an accrued distribution of 35,735 cents combined for the period
1 September 2012 to 20 November 2012. This translated to 20,834 cents for the A-linked units
and 14,9 cents for the B-linked units. Excluding the accrued distribution, the private placement
linked units were issued at a price of R9,485 per A-linked unit and R6,19 per B-linked unit.
The purpose of the private placement was to fund announced acquisitions. As a result of delays
in the transfer of certain properties, the opportunity cost of holding cash amounted to approximately
R2 million.
11. PROSPECTS
Based on the assumptions that the macro-economic environment will not deteriorate further,
no major corporate failures will occur and that tenants will be able to absorb rising operating costs,
the Board forecasts that Dipula will achieve growth in distributions of between 6,5% and
7,5% for the full 2013 financial year.
This forecast has not been audited or reviewed by Dipula's auditors.
By order of the Board
Johannesburg
28 May 2013
Website: www.dipula.co.za
Date: 28/05/2013 12:13:00 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
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
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,
information disseminated through SENS.
Sharenet Sites 
