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Abridged unaudited consolidated financial statements for the three months and the nine months ended 31 March 2015
ROCKCASTLE GLOBAL REAL ESTATE COMPANY LIMITED
Incorporated in the Republic of Mauritius
Reg no 108869 C1/GBL
ISIN MU0364N00003
Listed on the SEM and JSE
SEM code Rock.N0000
JSE share code ROC
(“Rockcastle” or “the Group” or “the Company”)
ABRIDGED UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
for the three months and the nine months ended 31 March 2015
DIRECTORS’ COMMENTARY
STRUCTURE AND LISTINGS
Rockcastle was established on 30 March 2012 in Mauritius as a Category One
Global Business License Company. Rockcastle has primary listings on both the
Stock Exchange of Mauritius Ltd (“SEM”) and the Johannesburg Stock Exchange
(“JSE”). The primary objective of the Group is investment in listed global
real estate as well as direct property.
Given the group’s acquisition and development strategy, and following
requests from shareholders, Rockcastle offered shareholders the option to
receive the December 2014 interim dividend either in cash or as a scrip
dividend. In excess of 97% of shareholders elected the scrip dividend option
and 14 669 955 new shares were issued during this quarter. Subsequent to the
quarter end, Rockcastle successfully raised USD 163.3 million through the
issue of 63,4 million shares by way of a book build which was significantly
over-subscribed.
LISTED SECURITIES
Global listed property counters continued their strong performance as a
result of strong growth in distributions being achieved and improved
prospects. Rockcastle’s focus on investing in high-growth, market dominant
property stocks has resulted in a further increase in the net asset value
from USD1.50 per share at 31 December 2014 to USD1.61 per share at 31 March
2015. The Company has increased its position in Hammerson plc and this
decision has been validated by the strong performance of its share price.
FINANCING AND HEDGING
The group utilises interest rate swaps to hedge its interest rate exposure.
The swap profile was increased and extended during the quarter and all bond
short positions were closed. Rockcastle’s reporting currency is the US Dollar
and the group’s policy is not to hedge its capital exposures. The group has,
however, implemented currency hedging of its distributable income.
Rockcastle is in negotiations to further diversify its funding and also
intends utilising term funding from local banks for its direct property
investments in Poland. The loan-to-value ratio was 44.5% at 31 March 2015.
POLAND
Rockcastle’s strategy is to acquire retail assets in Poland. Preference will
be given to investments with further development potential and the requisite
fundamentals to remain defensive in the long term. During the course of March
2015, Rockcastle acquired Solaris Centre in Opole, Poland for EUR52 million
and at a yield of 7.7%. The mall is anchored by an upmarket grocer and
includes major international fashion brands. Rockcastle is negotiating a
Public-private partnership agreement with the city of Opole to secure
additional retail bulk on an adjoining property to extend the mall.
The construction of the 16 500m2 mall development in Tomaszow Mazowiecki is
expected to commence in September 2015.
Rockcastle continues to explore various retail investment opportunities,
however, only properties with strong long term fundamentals and growth
prospects are being considered.
AFRICAN DEVELOPMENTS
Mukuba Mall in Kitwe, Zambia, opened on schedule in April 2015 and enjoyed a
very successful opening. The mall has a strong tenant profile and is fully
let. A number of smaller tenants, however, have not yet opened for trading.
Construction of Cosmopolitan Mall in Lusaka, Zambia, is progressing well and
the mall is now expected to open ahead of schedule in March 2016. The tenant
profile has further improved to include Shoprite, Game, Edgars, Truworths,
Foschini Group, Mr Price and Woolworths.
OUTLOOK
The Board remains confident that the forecast dividend growth of 5% will be
met for the year ending June 2015.
The aforegoing forecast statement and the information underlying such
statement are the responsibility of the Board and have not been reviewed or
reported on by the Group’s external auditors. The forecast is based on the
assumptions that a stable global macro-economic environment will prevail and
no failures of listed REITs will occur.
By order of the Board
Intercontinental Trust Limited
Company Secretary
12 May 2015
STATEMENT OF FINANCIAL POSITION
Unaudited as at Audited as at Unaudited as at
31 Mar 2015 30 Jun 2014 31 Mar 2014
USD'000 USD'000 USD'000
ASSETS
Non-current assets 2 250 178 1 587 451 1 108 145
Investment property 59 523 - -
Investment property
under development 8 048 - -
Listed security investments 2 146 323 1 565 259 1 085 203
Rockcastle management
incentive loans 25 091 17 000 16 790
Loan to associate company 5 000 - -
Investment in associate company 6 193 5 192 -
Loans to development partners - - 6 152
Current assets 18 288 19 125 666
Investment income receivable - 6 934 -
Cash and cash equivalents 1 079 486 541
Trade and other receivables 803 3 125
Loans to development partners 16 406 11 702 -
Total assets 2 268 466 1 606 576 1 108 811
EQUITY AND LIABILITIES
Total equity attributable
to equity holders 1 254 512 983 184 641 689
Stated capital 1 017 378 871 154 630 978
Non-distributable reserves (121 468) (19 684) (519)
Retained income 358 602 131 714 11 230
Total liabilities 1 013 954 623 392 467 122
Non-current liabilities 5 000 340 057 290 972
Interest-bearing borrowings 5 000 340 057 290 972
Current liabilities 1 008 954 283 335 176 150
Trade and other payables 4 906 6 832 2 034
Interest-bearing borrowings 1 003 635 275 896 173 555
Income tax payable 413 607 561
Total equity and liabilities 2 268 466 1 606 576 1 108 811
Total number of
shares in issue 784 369 955 705 500 000 530 000 000
Net asset value
per share (USD) 1,60 1,39 1,21
STATEMENT OF COMPREHENSIVE INCOME
Unaudited Unaudited Unaudited Unaudited
for the nine for the nine for the three for the three
months ended months ended months ended months ended
31 Mar 2015 31 Mar 2014 31 Mar 2015 31 Mar 2014
USD’000 USD’000 USD’000 USD’000
Net rental and
related revenue 252 - 236 -
Dividends received
from listed security
investments 50 284 27 131 19 469 12 155
Income/(loss)
from associate 756 - (807) -
Fair value gain on listed
security investments 252 004 22 553 126 775 47 515
Foreign exchange
(loss)/gain (79 561) 380 (35 397) 311
Operating expenses (1 565) (865) (697) (385)
Profit before net
finance costs 222 170 49 199 109 579 59 596
Net finance costs (34 145) (7 947) (9 935) (12 025)
Finance income 1 893 231 683 170
Interest on Rockcastle
management
incentive loans 838 231 311 170
Interest on development
partner loan 1 055 - 372 -
Finance costs (36 038) (8 178) (10 618) (12 195)
Interest on borrowings (12 634) (7 372) (2 700) (3 537)
Unrealised fair value
loss on interest
rate derivatives (11 992) (746) (5 344) (1 799)
Fair value loss on
bond shorts (11 412) (60) (2 574) (6 859)
Profit before income
tax expense 188 025 41 252 99 644 47 571
Income tax expense (413) (560) (150) (305)
Income for the period
attributable to
equity holders 187 612 40 692 99 494 47 266
Total comprehensive
income for the period 187 612 40 692 99 494 47 266
Weighted average
number of shares
in issue 768 942 172 441 318 681 770 337 824 530 000 000
Basic earnings per
share* and headline
earnings per share*
(USD cents) 24,40 9,22 12,92 8,92
Basic earnings per share and headline earnings per share are based on the
weighted average of 768 942 172 shares in issue for the nine months ended 31
March 2015 (nine months ended 31 March 2014: 441 318 681 shares).
There are no reconciling items between basic earnings and headline earnings.
*Rockcastle has no dilutionary instruments in issue.
SEGMENTAL REPORTING
Unaudited Unaudited
for the nine for the nine
months ended months ended
31 Mar 2015 31 Mar 2014
USD'000 USD'000
Profit before income tax expense
Australia 37 347 (705)
Canada 7 222 6 170
Europe 41 054 5 859
UK 39 309 13 801
Hong Kong 14 538 1 357
Singapore 26 538 245
USA 100 494 14 654
Zambia 756 -
Corporate (79 233) (129)
188 025 41 252
Unaudited Audited Unaudited
as at as at as at
31 Mar 2015 30 Jun 2014 31 Mar 2014
USD'000 USD'000 USD'000
Total assets
Australia 85 534 125 174 83 223
Canada 141 779 209 459 147 736
Europe 292 527 193 275 176 443
UK 313 032 143 045 95 040
Hong Kong 99 659 79 592 58 110
Singapore 198 099 192 218 137 807
USA 1 084 722 629 916 387 384
Zambia 11 193 5 192 -
Corporate 41 921 28 705 23 068
2 268 466 1 606 576 1 108 811
STATEMENT OF CHANGES IN EQUITY
Non-
Stated Retained distributable
capital income reserves Total
USD'000 USD'000 USD'000 USD'000
Audited for the year ended
30 June 2014
Opening balance–1/07/2013 409 771 - (8 410) 401 361
Issue of shares 235 207 235 207
Total comprehensive
income for the period 40 692 40 692
Reclassification of
stated capital
Recategorisation of
Reserves (14 000) 14 000 -
Distribution paid (35 571) (35 571)
Transfer to
non-distributable reserves (7 891) 7 891 -
Balance at
31 March 2014 630 978 11 230 (519) 641 689
Issue of shares 240 176 240 176
Total comprehensive
income for the period 101 319 101 319
Transfer from
non-distributable reserves 19 165 (19 165) -
Balance at 30 June 2014 871 154 131 714 (19 684) 983 184
Unaudited for the nine months
ended 31 March 2015
Opening balance–1/07/2014 871 154 131 714 (19 684) 983 184
Total comprehensive
income for the period 187 612 187 612
Issue of shares 113 950 113 950
Dividend paid (30 234) (30 234)
Scrip dividend 32 274 (32 274) -
Transfer from
non-distributable reserves 101 784 (101 784) -
Balance at 31 March 2015 1 017 378 358 602 (121 468)1 254 512
STATEMENT OF CASH FLOWS
Unaudited for the Unaudited for the
nine months ended nine months ended
31 Mar 2015 31 Mar 2014
USD'000 USD'000
Cash inflow from operating activities 43 890 23 165
Cash outflow from investing activities (519 695) (391 567)
Cash inflow from financing activities 476 398 368 748
Increase in cash and cash equivalents 593 346
Cash and cash equivalents at
beginning of period 486 195
Cash and cash equivalents
at end of period 1 079 541
Current accounts 1 079 541
NOTES
The Group is required to publish financial results for the three months and
the nine months ended 31 March 2015 in terms of the Listing Rule 12.19 of the
SEM. Accordingly,this announcement presents the financial results of the Group
in respect of the three month period from 1 January 2015 to 31 March 2015, the
nine month period from 1 July 2014 to 31 March 2015, as well as the comparative
results from the prior period.
The accounting policies which have been applied are consistent with those
used in the preparation of the audited financial statements for the year
ended 30 June 2014. Non-distributable reserves arise from any accumulated
losses pertaining to changes in the fair value of the assets and liabilities
in the Group on a US Dollar basis. The Group does not consider such reserves
to be distributable.
The abridged unaudited consolidated financial statements for the three months
and the nine months ended 31 March 2015 (“financial statements”) have been
prepared in accordance with the measurement and recognition requirements of
IFRS, the requirements of IAS 34: Interim Financial Reporting, the JSE Listings
Requirements, the SEM Listing Rules and the Securities Act of Mauritius 2005.
The financial statements have not been reviewed or reported on by the Group’s
external auditors.
These financial statements were approved by the Board on 12 May 2015.
Copies of the financial statements and the Statement of direct and indirect
interests of each officer of the Group, pursuant to rule 8(2)(m) of the
Securities (Disclosure Obligations of Reporting Issuers) Rules of Mauritius
2007, are available free of charge, upon request at Rockcastle’s registered
address.
Contact person: Mr Kesaven Moothoosamy
This communiqué is issued pursuant to SEM Listing Rule 12.20 and section 88
of the Securities Act of Mauritius 2005. The Board accepts full
responsibility for the accuracy of the information contained in these
financial statements. The directors are not aware of any matters or
circumstances arising subsequent to the period ended 31 March 2015 that
require any additional disclosure or adjustment to the financial statements.
Directors
Mark Olivier (chairman); Spiro Noussis (CEO)*; Nick Matulovich*; Andries de
Lange; Rory Kirk; Andre van der Veer; Yan Ng; Paul Pretorius* (*executive
director)
Company secretary
Intercontinental Trust Limited
Registered address
c/o Intercontinental Trust Limited, Level 3, Alexander House, 35 Cybercity,
Ebene, 72201, Mauritius
Transfer secretary in South Africa
Link Market Services South Africa Proprietary Limited
JSE sponsor
Java Capital
SEM sponsor
Capital Markets Brokers Limited
www.rockcastleglobalre.mu
Date: 12/05/2015 02:30:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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