Wrap Text
Audited condensed consolidated financial results for the 2month period ended 31 August 2015 and dividend declaration
Ascension Properties Limited
(Incorporated in the Republic of South Africa)
(Registration number: 2006/026141/06)
JSE share code: AIA ISIN: ZAE000204566
(Approved as a REIT by the JSE)
(“Ascension” or “the company” or “the fund” “the group”)
Audited Condensed Consolidated Financial Results
for the 2 month period ended 31 August 2015 and dividend
declaration
29 buildings
at a total value of R3,83 billion at 31 August 2015
DIVIDEND DECLARATION
7.33 cents per A share 4.56 cents per B share
DIVIDEND GROWTH
5.0% on the A share 10.3% on the B share
VACANCIES
Reduced to 5.8% from 6.5%
GEOGRAPHIC SPREAD BY GLA
Gauteng 54.2%
Western Cape 40.6%
Mpumalanga 5.2%
SECTORAL SPREAD BY GLA
Office 83.1%
Retail 7.6%
Industrial 9.3%
Tenant Profile
GOVERNMENT VS. NON-GOVERNMENT
Government 63.9%
Non-government 36.1%
Directors’ Commentary
Introduction
Ascension is a REIT focusing on centrally located commercial
office buildings in South Africa with a strong focus towards
government and other empowerment sensitive tenants.
The two month period saw a shift in the company’s strategic
management with the appointment of a new management team effective
01 October 2015. The group achieved distributable earnings of
R39.81 million for the 2 month period ended 31 August 2015 (30
June 2015: R222.8 million). This represents an increase of 10.2%
on the B share distribution when compared to a 2 month equivalent
period in the previous financial year.
Change in year end
Ascension shareholders are advised that the company has changed
its financial year end from 30 June to 31 August with effect from
31 August 2015 in order to align it to the year end of the holding
company.
Dividend declaration
The board has approved and notice is hereby given of final
dividends (dividends no 5) of 7.33250 cents per A share and
4.55967 cents per B share for the 2 months ended 31 August 2015.
The dividends are payable to Ascension shareholders in accordance
with the timetable set out below:
Last date to trade cum dividend Friday, 13 November 2015
Shares trade ex dividend Monday, 16 November 2015
Record date Friday, 20 November 2015
Payment date Monday, 23 November 2015
Share certificates may not be dematerialised or rematerialised
between Monday, 16 November 2015 and Friday, 20 November 2015,
both days inclusive. In respect of dematerialised shareholders,
the dividends will be transferred to the CSDP accounts/broker
accounts on Monday, 23 November 2015. Certificated shareholders’
dividends payments will be posted on or about Monday, 23 November
2015.
An announcement informing shareholders of the tax treatment of the
dividends will be released separately on SENS.
Property portfolio
At 31 August 2015 the portfolio (including investment properties
and properties under development) consisted of 29 properties
valued at R3.83 billion, with a total gross lettable area (“GLA”)
of 316 570m². This translates to an average building value of
R132.15 million.
The sectoral profile of the portfolio is 83.1% offices, 7.6%
retail and 9.3% other. The group does not own any retail focused
properties and the retail components are typically ground floor
areas of office buildings. The total portfolio is 63.9% tenanted
by government in line with Ascension’s strategic focus on this
market. Total vacancies have decreased to 5.84%. The weighted
average rental escalation remains healthy at 8.6%.
Borrowings
The company’s borrowings at 31 August 2015 amounted to R1.56
billion at a weighted average rate of 8.08% per annum. Borrowings
of R483 million have been fixed at an all-in rate of 7.35% until 1
December 2015. Furthermore, R500 million of borrowings are subject
to a three-month JIBAR interest rate cap at 6.72%. The interest
rate cap expires on 13 January 2017.
Prospects
Despite tough domestic economic conditions, the company believes
that it has a defensive portfolio and that the quality of its
assets, together with healthy lease and escalation profiles,
should ensure that the group continues to deliver good returns to
its shareholders.
Condensed Consolidated Statement of Profit and other Comprehensive
Income for the 2 months ended 31 August 2015
Audited Audited
31 August 2015 30 June 2015
2 months 12 months
R’000 R’000 R’000
Revenue 83 369 412 333
Contractual rental income 67 362 365 895
Straight-line lease income
adjustment 16 007 46 438
Property operating expenses net of
recoveries (5 341) (35 481)
Net property rental and related
income 78 028 376 852
Other income 36 1 039
Operating expenses (1 568) (4 233)
Asset management fees (3 170) (18 535)
Operating profit 73 326 355 123
Finance income 664 3 563
Fair value adjustments (32 675) (42 368)
Finance costs (18 395) (91 812)
Profit before distribution to
shareholders
and taxation 22 920 224 506
Interest on debentures - (222 796)
Profit before taxation 22 920 1 710
Taxation - -
Profit for the year 22 920 1 710
Other comprehensive income - -
Total comprehensive income for the
year 22 920 1 710
Total comprehensive income
attributable to shareholders 22 920 1 710
Basic and diluted earnings per
share (cents) 3.34 0.25
Headline and diluted headline
earnings per share (cents) 8.04 4.84
Basic and diluted earnings per A
share (cents) 3.34 42.15
Headline and diluted headline
earnings per A share (cents) 8.04 46.74
Basic and diluted earnings per B
share (cents) 3.34 25.06
Headline and diluted headline
earnings per B share (cents) 8.04 29.65
Reconciliation between earnings, headline earnings and
distributable earnings
Audited Audited
31 August 2015 30 June 2015
2 months 12 months
R’000 R’000 R’000
Reconciliation between earnings,
headline earnings and
distributable earnings
Profit for the period 22 920 1 710
Amortisation of discount on
debentures - 728
Fair value adjustment to
investment properties 32 165 30 727
Headline earnings attributable
to shareholders 55 085 33 165
Adjusted for:
Debenture Interest - 222 796
Adjusted headline earning
attributable to shareholders 55 085 255 961
Adjusted for:
Straight-line lease income
adjustment (16 007) (46 438)
Fair value adjustment on
interest rate derivatives 511 11 641
Amortisation of bond raising
fees 220 1 632
Distributable earnings
attributable to shareholders 39 808 222 796
Less: dividend declared
A share - (129 405)
B share - (93 391)
Earnings available for
distribution 39 808 -
Total distribution per share for
the period
Distribution per A share (cents) - 41.90
Distribution per B share (cents) - 24.81
Number of A shares at period end 308 860 859 308 860 859
Number of B shares at period end 376 359 014 376 359 014
Weighted average number of A
shares in issue 308 860 859 308 860 859
Weighted average number of B
shares 1in issue 376 359 014 376 359 014
- The calculation of basic and fully diluted earnings per share is
based on earnings of R22.92 million (30 June 2015: R1.71 million)
and a weighted average number of 685 219 873 (30 June 2015: 685
219 873) shares in issue throughout the financial period.
- The calculation of headline earnings and diluted headline
earnings per share is based on a headline earnings of R55.08
million (30 June 2015: R33.17 million) and a weighted average
number of 685 219 873 (30 June 2015: 685 219 873) shares in issue
throughout the financial period.
Condensed Consolidated Statement of Financial Position at 31
August 2015
Audited Audited
31 August 2015 30 June 2015
2 months 12 months
R’000 R’000
Assets
Non-current assets
Investment property 3 832 400 3 832 400
Property, plant & equipment 76 12
Interest rate derivative 4 021 4 532
3 836 497 3 836 944
Current assets
Trade and other receivables 50 953 58 320
Cash and cash equivalents 16 380 50 276
67 333 108 596
Total assets 3 903 830 3 945 540
Equity and Liabilities
Equity
Stated Capital 1 727 146 322 603
Retained income 574 761 551 841
2 301 907 874 444
Non-current liabilities –
Debenture capital - 1 404 543
Total shareholders’ interest 2 301 907 2 278 987
Liabilities
Other non-current liabilities
Other financial liabilities 1 426 656 1 499 981
1 426 656 1 499 981
Current liabilities
Other financial liabilities 136 548 -
Trade and other payables 38 719 50 936
Shareholders for distribution - 115 636
175 267 166 572
Total liabilities 1 601 923 3 071 096
Total equity and liabilities 3 903 830 3 945 540
Number of A shares in issue 308 860 859 308 860 859
Number of B shares in issue 376 359 014 376 359 014
TNAV and NAV per combined share* 335.0 –
TNAV and NAV per A share (cents)# 545.0 569.3
TNAV and NAV per B share (cents) 164.3 169.1
* Net asset value includes total equity attributable to equity
holders
# 60-day volume weighted average trading price at reporting date
limited to net asset value
Condensed Consolidated Statement of Cash Flows for the two months
ended 31 August 2015
Audited Audited
31 August 2015 30 June 2015
2 months 12 months
R’000 R’000
Cash generated from operations 52 471 300 656
Finance income 664 3 563
Finance costs (18 175) (89 452)
Net cash from operating activities 34 960 214 767
Purchase of investment property
and cost improvements (16 158) (109 989)
Purchase of financial assets (65) -
Net cash from investing activities (16 223) (109 989)
Proceeds from other financial
liabilities 63 003 121 210
Distributions paid (115 636) (214 874)
Net cash from financing activities (52 633) (93 664)
Total cash movement for the period (33 896) 11 114
Cash at the beginning of the
period 50 276 39 162
Total cash at the end of the
period 16 380 50 276
Condensed Consolidated Statement of Changes in Equity for the two
months ended 31 August 2015
R’000 Stated Retained Total
capital income equity
Group
Balance at 30 June 2014 322 603 550 131 872 734
Total comprehensive income
for the year ended 30 June
2015 - 1 710 1 710
Balance at 30 June 2015 322 603 551 841 874 444
Conversion of capital
structure 1 404 543 - 1 404 543
Total comprehensive income
for the2 months ended 31
August 2015 - 22 920 22 920
Balance at 31 August 2015 1 727 146 574 761 2 301 907
Notes
1. Basis of preparation and accounting policies
The audited condensed consolidated financial statements for the
2 months ended 31 August 2015 are prepared in accordance with the
requirements of the JSE Listings Requirements for provisional
reports and the requirements of the Companies Act of South Africa.
The JSE Listings Requirements require provisional reports to be
prepared in accordance with the framework concepts and the
measurement and recognition requirements of International
Financial Reporting Standards (IFRS) and the SAICA Financial
Reporting Guides as issued by the Accounting Practices Committee
and Financial Pronouncements as issued by Financial Reporting
Standards Council and to also, as a minimum, contain the
information required by IAS 34 Interim Financial Reporting. These
financial statements have been prepared by Lebogang Semono, CA
(SA), General Manager Finance.
All accounting policies applied in the preparation of these
audited condensed results are in terms of IFRS and are consistent
with those applied in the prior year. There were no new standards
adopted in the two month period.
The directors are not aware of any matters or circumstances
arising subsequent to 31 August 2015 that require any additional
disclosure or adjustment to the financial statements, other than
as disclosed in this announcement.
These audited condensed consolidated financial results for the
period ended 31 August 2015 have been audited by Grant Thornton
Johannesburg Partnership, who expressed an unmodified audit
opinion thereon. A copy of the auditor’s report is available for
inspection at the company’s registered office together with the
financial statements identified in the auditor’s report. The
auditor’s report does not necessarily report on all the
information contained in this announcement. Shareholders are
therefore advised that in order to obtain a full understanding of
the nature of the auditor’s engagement they should obtain a copy
of the auditor’s report together with the accompanying financial
information from the issuer’s registered office. The directors
take full responsibility for the preparation of these results and
confirm that the financial information has been correctly
extracted from the underlying financial statements.
2. Debt facilities
Nominal
Loan expiry (R’000) Maturity Date amount Interest rate
Investec Bank Limited 13 March 2018 526 805 Prime – 0.50%
Standard Bank of SA 31 August 2017 160 035 Prime – 1.50%
Standard Bank of SA 31 August 2017 392 911 3-month
JIBAR + 1.80%
Nedbank 7 March 2019 152 901 Prime – 1.50%
Nedbank 12 September
2016 151 034 Prime – 1.50%
Nedbank 18 July 2016 26 216 Prime – 1.50%
Nedbank 23 April 2018 45 083 Prime – 0.85%
Nedbank 30 August 2016 34 187 Prime – 1.50%
Nedbank 30 August 2016 25 976 Prime – 1.50%
Nedbank 28 June 2016 50 169 Prime – 1.50%
The weighted average cost of debt at 31 August 2015 is 8.08%
(30 June 2015: 8.08%).
3. Interest rate derivatives
Average
Facility all-in swap
Rate (R million) rate Expiry date
Interest
rate swap 3-month
JIBAR 5,55% 483 7.35% 1-Dec-15
Interest
rate cap 3-month
JIBAR 6,72% 500 – 13-Jan-17
4. Trade and other receivables
Audited Audited
31-Aug-15 30-Jun-15
2 months 12 months
R’000 R’000
Trade receivables (net of
impairment provisions) 23 412 34 909
Debtor accruals (including consumption
charges not yet invoiced) 11 416 9 650
Deposits 1 471 1 548
Amounts due on acquisition
adjustment accounts 885 827
Sundry debtors, prepayments and VAT 13 769 11 386
50 953 58 320
5. Lease expiry profile (Based on GLA)
TOTAL OFFICE RETAIL Other
Vacant 5.8% 6.5% 0.0% 1.5%
Monthly 1.5% 1.7% 0.1% 1.0%
31/08/2016 29.4% 30.5% 5.7% 40.2%
31/08/2017 4.7% 4.4% 3.2% 8.1%
31/08/2018 19.8% 21.4% 16.4% 8.6%
31/08/2019 14.0% 15.9% 2.4% 4.2%
31/08/2020 12.8% 10.7% 9.2% 36.3%
After
31/08/2020 12.0% 8.9% 62.7% 0.1%
100.0% 100.0% 100.0% 100.0%
6. Tenants: Government vs. non-government
Based on
monthly
Based on GLA contracted
revenue
Government 63.9% 60.0%
Non-Government 36.1% 40.0%
Total 100.0% 100.0%
7. Operating segments
The group classifies segments based on the type of property i.e.
Commercial, Retail, Industrial and Other. Properties can be mixed
use properties. In this instance, the property will be classified
according to its principle use. Accordingly, the group only has
one reporting segment, namely Commercial property as the principle
use of all properties in the portfolio is for commercial office
space. Most of the buildings do have a small retail component
(normally at street level), but this seldom exceeds 10% of the
total GLA per building.
8. Changes to the board of directors
Following engagement and required dispensation obtained from the
JSE regarding the appointment of a new CEO, Kameel Keshav
currently the Chief Financial Officer of Rebosis Property Fund
Limited, has taken on the role of CEO of Ascension along with
maintaining his role at Rebosis. This change to the board has
taken effect from 01 October 2015.
Shareholders are also advised that Mr N Gugushe has been appointed
as an independent non-executive director to the board with effect
from 27 October 2015.
The board has embarked on a process to make the appointment of a
new financial director. A further announcement in this regard will
be released on SENS in due course.
By order of the board
Johannesburg
27 October 2015
Directors
S Ngebulana (Chairman) / K Keshav * / Dr M Renene / M Burton / N
Gugushe/ H Takolia
* (executive director)
Company secretary
M Ndema
Business address
3rd Floor, Palazzo Towers West, Montecasino Boulevard, Forways,
2191
Transfer secretaries
Computershare Investor Services Proprietary Limited, 70 Marshall
Street, Johannesburg, 2001
Sponsor
Java Capital, 6A Sandown Valley Crescent, Sandton, 2196
Date: 27/10/2015 05:45:00 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 
