To view the PDF file, sign up for a MySharenet subscription.

ACUCAP PROPERTIES LIMITED - ACP - Clarification of unaudited simplified financial information in audited results for year ended 31 March 2013

Release Date: 25/07/2013 07:05
Code(s): ACP     PDF:  
Wrap Text
ACP - Clarification of unaudited simplified financial information in audited results for year ended 31 March 2013

ACUCAP PROPERTIES LIMITED
(Reg No. 2001/021725/06)
(Incorporated on 12 September 2001)
(Acucap or the company)
Share Code: ACP
ISIN: ZAE000037651

CLARIFICATION OF UNAUDITED SIMPLIFIED FINANCIAL INFORMATION CONTAINED IN THE 
AUDITED RESULTS FOR THE YEAR ENDED 31 MARCH 2013

Acucap unitholders are referred to the audited results for the year ended 31 March 2013 
published on the Stock Exchange News Service of the JSE Limited on 13 June 2013 
(June Announcement) and are advised to take note of the clarification of the unaudited 
Simplified Financial Information (Simplified Financial Information), as contained in the 
June Announcement, below.

In terms of section 8.15 of the Listings Requirements of the JSE Limited (the JSE) 
(the Listings Requirements), the Simplified Financial Information constitutes pro forma 
financial information and the company is therefore required to comply with the requirements 
of sections 8.16 to 8.34 of the Listings Requirements and the SAICA guide on Pro forma 
Financial Information, revised and issued in September 2012. 

Simplified Financial Information

Basis of preparation and purpose 
The purpose of compiling a Simplified Balance Sheet is to reflect a net asset value per linked 
unit for Acucap. The net asset value aims to (as closely as possible) reflect the fair market 
value of the respective core assets and core liabilities (except where otherwise indicated), 
and to present the more significant assets and liabilities separately. In order to achieve this 
outcome, adjustments have been made to the IFRS accounting where it is not based on fair value, 
to reverse the impact of the debentures (including those held by the BEE parties), and to reclassify 
certain line items. These adjustments are more fully described below. 

The purpose of compiling a Simplified Income Statement is to reflect the calculation of distribution 
per linked unit as presented in the 31 March 2013 financial statements. The Simplified Income Statement 
has prepared using the principles in Debenture Trust Deed, which allows for the distribution of 
items that are income in nature. To achieve this objective, all items of a capital nature have 
been eliminated (as more fully detailed below) and any impact of the BEE unitholders and other 
unitholders have reversed in order to reflect the distributable profit on a per unit basis for 
all legal unitholders.  The format within the income statement has also been adjusted to line up 
the principles of the trust deed.

Directors responsibility 
The Simplified Financial Information is the sole responsibility of the directors of Acucap and has 
been prepared in accordance with the basis stated above, for illustrative purposes only, to 
illustrate the impact on Acucaps financial position and performance following the adjustments.  
Due to its nature, the Simplified Financial Information may not fairly present Acucaps financial 
position subsequent to the adjustments. 

The directors are also responsible for such internal control as the directors determine is 
necessary to enable the preparation of Simplified Financial Information that is free from material 
misstatement, whether due to fraud or error.

KPMG Inc., Acucaps reporting accountant, has provided a reasonable assurance report on 
The Simplified Financial Information which is available for inspection at the registered offices 
of Acucap.


ACUCAP PROPERTIES LIMITED SIMPLIFIED BALANCE SHEET AS AT 31 MARCH 2013 
 
                      As reported                                                    Simplified 
                      at 31 March 2013                                               Balance Sheet
                                                                                     at 31 March 2013
                      Before  1         Reclassification    Other          Notes
                                                            adjustments 
                      R'000

Assets
Property assets       7 948 485         (82 129)                                      7 866 356
Investment properties 7 452 230         (18 857)            -                         7 433 373 
Non-current 
receivable            83 395             -                  -                         83 395 
Current receivable    30 033             -                  -                         30 033 
Investment properties
and related 
receivables           7 565 658         (18 857)            -              2          7 546 801 
Investment properties 
under development*    319 555            -                  -                         319 555 
Owner-occupied 
property              8 920             (8 920)             -              2          - 
Property development 
inventory             54 352            (54 352)            -              2          - 
 
Listed property 
investments*          -                  1 400 892          -              3          1 400 892

Investment in Sycom 
Property Fund 
Managers*                                256 934            353 066        4          610 000

Other non-current 
assets                2 172 406         (1 585 946)                                   586 460

Loans in respect of 
unit purchase scheme  390 771            -                   -                        390 771 
Equipment             1 400              -                   -                        1 400 
Intangible assets 
and goodwill          256 934           (256 934)            -             4          - 
Interest in jointly 
controlled entities   153 078            -                   -                        153 078 
Listed investments    1 356 789         (1 356 789)          -             3          - 
Owner occupied 
property              -                  8 920               -             2          8 920 
Deferred lease 
expenditure                              18 857                            2          18 857  
Deferred tax assets   13 434             -                   -                        13 434 
 
Other current assets  227 772            10 249              12 859                   250 880

Trade and other 
receivables           203 511           (44 103)             12 859        3,7        172 267 
Tax receivable        1 265              -                   -                        1 265 

Property development 
inventory             -                  54 352              -             2          54 352 
Cash and 
cash equivalents      22 996             -                   -                        22 996 
 
Total assets          10 348 663         -                   365 925                  10 714 588
 
*at fair value in simplified balance sheet

Equity and liabilities

Shareholders interest 4 856 731          1 797 131           758 311                  7 412 173

Share capital and 
share premium         2 212 903          1 749 150           -            8           3 962 053
Non-distributable 
reserve               3 020 133          -                   353 066      4           3 373 199
Accumulated loss     (376 305)           47 981              405 245      6,7         76 921
 
Non-current 
liabilities           4 666 723         (1 389 052)         (404 256)                 2 873 415

Debentures            1 749 150         (1 749 150)          -            8           - 
Financial 
liabilities           2 633 303          423 849            (183 737)     6,7         2 873 415
Financial 
instruments           47 981            (47 981)             -            6           - 
BEE instrument        220 519            -                  (220 519)     7           - 
Deferred tax 
liabilities           15 770            (15 770)             -            5           -
 
Deferred tax          -                  15 770              -            5           15 770

Current 
liabilities           825 209           (423 849)            11 870                   413 230

Trade and other 
payables              127 834            -                  (1 285)       7           126 549
Financial 
liabilities           423 849           (423 849)            -            6           - 
Debenture interest 
payable               273 526            -                   13 155       7           286 681
 
Total equity and 
liabilities           10 348 663                             365 925                  10 714 588

Net asset value per 
linked unit           37.73                                                           40.39 

Net tangible asset 
per linked unit       36.26                                                           37.07 

 
Notes and Assumptions
1. The audited financial information in the Before column has been extracted, without adjustment, 
from the published audited results of Acucap for the year ended 31 March 2013 (specifically the 
consolidated Statement of Financial Position).

Reclassifications

2. Property Assets are reclassified as follows, so that after this reclassification the total of 
Property Assets is equal to the external valuers valuation: 
i. deferred lease expenditure (R18 857 000) and owner-occupied property (R8 920 000) to other 
non-current assets; 
ii. property inventory (R54 352 000) to other current assets.
3. The line item Listed property Investments represents the investments at fair value 
(R1 400 892 000), and results from reclassifying the investment of R1 356 789 000 from other 
non-current assets, together with the accrued distribution of R44 103 000 reflected in current assets. 
4. The line Investment in Sycom Property Fund Managers (R610 000 000) reflects the investment at fair 
value (note 9 of the annual financial statements). The line item comprises a transfer from the line 
item intangible assets and goodwill (R256 934 000), together with a fair value adjustment of R353 066 000 
(consequential adjustment is reflected in equity in the non-distributable reserve). 
5. The line item Deferred Tax liability results from reclassifying the same line item from non-current 
liabilities in order to reflect it separately. 
6. These adjustments relate to the reclassification of current liabilities to non-current liabilities 
on the basis that these liabilities are hedged and are effectively non-current (R423 849 000), 
and reclassification of interest rates swops to equity (R47 981 000) on the basis that this is a hedge 
of future distributions.

Fair value adjustments

Refer to note 4 above for the explanation of the Sycom Property Fund Managers fair value adjustment.

Reversal of unitholder liabilities (presented thereafter as shareholders interest)
7. These adjustments related to reversing the balances in respect of the BEE transaction 
(refer note 18 to the financial statements) and comprise (i) raising of a receivable of R 17 186 000, 
reversal of trade and other receivables of R4 327 000 (net R12 859 000) (ii), reversal of trade and 
other payables of R1 283 000 and (iii) raising a debenture interest liability of R 13 155 000, 
(iv) reversing the BEE instrument reflected under non-current liabilities (R220 519 000), (v) reversing 
non-current financial liabilities in respect of the BEE instrument (R184 527 000).

8. The adjustment relates to reversing the debenture holder liability to equity (R 1 749 150 000). 

ACUCAP PROPERTIES LIMITED SIMPLIFIED INCOME STATEMENT 


                      As Reported       Reclassifications   Other         Notes      for the year
                      Before                                adjustments              ended 
                      for the year                                                   31 March 2013
                      ended                                               
                      31 March 2013
                      R'000

Revenue               650 790                               (12 434)                 638 356
- Contractual         644 410           -                   (6 054)        2         638 356
- Straight lining     6 380             -                   (6 380)        3         -
Net operating  
(expenses)/income    (39 604)          (25 547)              -             2,6      (65 151)
Loss on disposal 
of investment 
properties           (962)              -                    962           3         -
Amortisation of 
intangible assets    (25 559)           -                    25 559        3         -

Profit before fair 
value adjustments, 
interest and 
taxation              584 665          (25 547)              14 087                  573 205 

Income from listed 
investments           -                 80 121               -             4         80 121

Income from investment 
in Sycom Property Fund 
Managers              -                 57 472               -             5,6       57 472
Other operating 
expenses              -                (20 891)              -             5        (20 891)

Fair value adjustment 
to investment 
properties            441 276           -                   (441 276)      3         -
Fair value adjustment 
to BEE instrument    (82 745)           -                    82 745        9         -

Profit before interest 
and taxation          943 196           91 155              (344 444)                689 907 
Interest income       126 429          (111 544)             -             4,10      14 885
Interest received on 
Unit Purchase Trust   -                 25 055               -             4         25 055
Notional interest on 
units issued          -                 7 674                -             4         7 674
Interest expense
- debentures         (535 476)          -                    535 476       7         -
- other              (195 893)          -                    19 716        2,8      (176 177)
Share of profit of 
equity accounted 
investee 
(net of income tax)   18 701            -                   (18 701)       3         -

Profit before 
taxation              356 957           12 340               192 047                 561 344 

Interest paid on debentures                                                          561 344

Earnings per linked 
unit                  738.31                                                         520.06

Headline earnings per 
linked unit           481.86                                                         519.96

Distribution per 
linked unit           307.22                                                         307.22 

Weighted average number
of linked units       171 768 394                                                    180 189 388

Notes and Assumptions: 

1. The audited financial information in the Before column has been extracted, without adjustment, from the 
published audited results of Acucap for the year ended 31 March 2013 (specifically the consolidated Statement 
of Financial Position).
2. Profits, expenses and related distributions recorded in different accounting periods  Contractual 
development revenue of R6 054 000, related development expenses of R2 034 000 and a distribution of 
R3 003 000 were included in the calculation of distributions in the prior period. These amounts were only 
accounted for in terms of IFRS in the current year. These items have been reversed from the IFRS numbers in 
order to determine the current year distribution.

Capital (non-distributable) items eliminated
3. These items are considered to be capital in nature and in accordance with the principles of the trust deeds 
do not enter into the calculation of distributable profit. (i) Loss on disposal of investment properties (R962 000); 
(ii) Amortisation of intangible assets (R25 559 000); (iii) Fair value adjustments on investment properties 
(R441 276 000); (iv) straight line rental adjustment required by IFRS (R6 380 000), (v) Equity accounted profit 
of R18 701 000. As a result they have been reversed.

Reclassifications to detailed line items 
4. Interest income has been further subdivided into (i) Income from listed investments (R80 121 000); 
(ii) Interest received on unit purchase trust (R25 055 000); (iii) Notional interest on units issued (R7 674 000); 
5.  Net operating income /(expenses) has been subdivided into (i) income from Sycom Property Fund Managers 
(R48 472 000); (ii) other operating expenses (R20 891 000), a further reduction in costs of (R2 034 000) has been 
accounted for (refer note 2 above). The aim is to reflect in this line only net operating expenses relating to 
property rentals (as detailed Retail, Office, Industrial and Storage Segments in the segmental report in the 
annual financial statements).

Income not accrued under IFRS
6. Income from Investment in Sycom Property Fund Managers has been increased by R9 000 000 in respect of an 
underwriting fee on the Sycom rights issue. This amount was not accrued for under IFRS, but is distributable 
in accordance with the principles of the debenture trust deed.
7. Reversal of the debenture interest to allow the simplified income statement to reflect the amount available for 
distribution.
8. Other interest paid by the Black Economic Empowerment vehicle amounting to R16 713 000, which was included in 
terms of IFRS, is now eliminated (refer note 18 to the 31 March 2013 financial statements).
9. The fair value adjustment in respect of the BEE instrument is eliminated (R82 745 000).
10. Interest earned in respect of the BEE transaction not accounted for under IFRS has been accrued, amounting 
to R1 306 000. 

24 July 2013

Sponsor
Absa Bank Limited (acting through its Corporate and Investment Banking division)



Date: 25/07/2013 07:05:00 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.

Share This Story