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REDEFINE PROPERTIES LIMITED - Summarised and audited for the year ended 31 August 2015

Release Date: 05/11/2015 07:15
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Summarised and audited for the year ended 31 August 2015

REDEFINE PROPERTIES LIMITED
(Incorporated in the Republic of South Africa)
Registration number: 1999/018591/06
JSE share code: RDF ISIN: ZAE000190252
(“Redefine” or “the company” or “the group”)
(Approved as a REIT by the JSE)


REDEFINE PROPERTIES LIMITED 
GROUP RESULTS
SUMMARISED AND AUDITED FOR THE YEAR ENDED 31 AUGUST 2015

-  Distribution of 80 cents; +7,3% in line with guidance
-  Market cap R54,8 billion; +18,4 billion - Top 40 inclusion
-  Developments of R3,8 billion; projects of R1,4 billion completed
-  Property assets R64,5 billion; +R13,4 billion
-  Acquisitions R11,2 billion; all asset categories expanded
-  Fountainhead merger; shift in sector focus to retail

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME 

                                                                31 August                   31 August 
                                                                     2015                        2014 
                                                                    R’000                       R’000 
Revenue    
Property portfolio                                              6 304 742                   5 372 149 
- Contractual rental income                                     6 141 437                   5 310 428 
- Straight-line rental income accrual                             163 305                      61 721 
Listed security income                                            344 229                     185 742 
Insurance proceeds received                                       119 420                           - 
Fee income                                                         44 800                      35 204 
Trading (loss)/income                                              (1 946)                      1 032 
Total revenue                                                   6 811 245                   5 594 127 
Operating costs                                                (2 084 709)                 (1 907 524)
Administration costs                                             (228 834)                   (202 031)
Net operating profit                                            4 497 702                   3 484 572 
Change in fair value of properties, 
listed securities and 
financial instruments                                           2 242 360                   2 051 245 
Amortisation of intangible assets                                 (62 856)                    (62 856)
Equity accounted profit                                           453 053                     439 766 
Profit from operations                                          7 130 259                   5 912 727 
Net interest                                                   (1 376 835)                 (1 297 768)
- Interest paid                                                (1 683 064)                 (1 457 159)
- Interest received                                               306 229                     159 391 
Foreign exchange loss                                            (223 072)                    (13 638)
Profit before debenture interest                                5 530 352                   4 601 321 
Debenture interest                                                      -                  (1 115 697)
Profit before taxation                                          5 530 352                   3 485 624 
Taxation                                                          170 662                      31 303 
Profit from continuing operations                               5 701 014                   3 516 927 
Profit from discontinued operations                                     -                     369 458 
Profit for the year                                             5 701 014                   3 886 385 
- Redefine shareholders                                         5 425 097                   3 407 818 
- Continuing operations                                         5 425 097                   3 042 122 
- Discontinued operations                                               -                     365 696 
- Non-controlling interest                                        275 917                     478 567 
- Continuing operations                                           275 917                     474 805 
- Discontinued operations                                               -                       3 762 
Other comprehensive loss                                          (90 397)                    (40 817)
Items that are or may be reclassified 
to profit or loss                
Exchange differences on translation of 
foreign continuing/discontinued operations 
- subsidiaries                                                    (70 491)                      93 230 
Exchange differences on translation of 
foreign continuing operations - associates                        (19 906)                     (25 140)
Recycling of exchange differences on translation of 
disposal/deemed disposal of foreign subsidiary                          -                     (108 907)
Total comprehensive income                                      5 610 617                    3 845 568 
- Redefine shareholders                                         5 334 700                    3 363 439 
- Continuing operations                                         5 334 700                    3 016 983 
- Discontinued operations                                               -                      346 456 
- Non-controlling interests                                       275 917                      482 129 
- Continuing operations                                           275 917                      474 805 
- Discontinued operations                                               -                        7 324 


SUMMARISED CONSOLIDATED STATEMENTS OF CASH FLOW 

                                                                31 August                   31 August 
                                                                     2015                        2014 
                                                                    R’000                       R’000 
Cash generated from continuing operations                       4 201 916                   3 612 333 
Net interest paid                                              (1 376 835)                 (1 297 768)
Distributions paid                                             (2 859 144)                 (2 141 093)
Distributions to non-controlling interests                       (264 910)                   (168 460)
Net cash (outflow)/inflow from operating activities   
- Continuing operations                                          (298 973)                      5 012 
Net cash inflow from operating activities   
- Discontinued operations                                               -                     180 979 
Net cash (outflow)/inflow from operating activities              (298 973)                    185 991 
Net cash outflow from investing activities                     (6 371 977)                 (5 871 318)
Net cash outflow from investing activities   
- Continuing operations                                        (6 371 977)                 (6 419 871)
Net cash inflow from investing activities   
- Discontinued operations                                               -                     548 553 
Net cash inflow from financing activities                       6 583 831                   5 558 778 
Net cash inflow from financing activities   
- Continuing operations                                         6 583 831                   5 559 634 
Net cash outflow from financing activities   
- Discontinued operations                                               -                        (856)
Net movement in cash and cash equivalents                         (87 119)                   (126 549)
Cash and cash equivalents at beginning of the year                350 606                     358 908 
Translation effects on cash and cash equivalents 
of foreign operations                                            (133 563)                    118 247 
Cash and cash equivalents at end of the year                      129 924                     350 606 


DISTRIBUTABLE INCOME ANALYSIS 

                                                                                  Inter- 
                                                    Redefine   Fountainhead     national         Total  
                                                       R’000          R’000        R’000         R’000 
Net property income 
(excluding straight-line rental accrual)           3 161 867        894 861            -     4 056 728 
Listed security income                               138 541              -      205 688       344 229 
Fee income                                            44 800              -            -        44 800 
Trading loss                                          (1 946)             -            -        (1 946)
Administration costs                                (146 639)       (66 932)     (15 263)     (228 834)
Distributable income from interest in 
associates and joint ventures                              -              -      384 448       384 448 
Realised foreign exchange gains                            -              -       10 776        10 776 
Net interest                                      (1 236 819)      (173 323)      33 307    (1 376 835)
Distributable income before taxation               1 959 804        654 606      618 956     3 233 366 
Taxation (excluding deferred tax)                     (7 185)             -      (64 636)      (71 821)
Distributable income after taxation                1 952 619        654 606      554 320     3 161 545 
Non-controlling interests’ share of 
Fountainhead distribution                                  -       (223 266)           -      (223 266)
Distributable income before distributable 
income adjustments                                 1 952 619        431 340      554 320     2 938 279 
Below the line-distributable income adjustments: 
- Pre-acquisition listed security income                   -              -        6 565         6 565 
- Antecedent distribution                            209 474              -            -       209 474 
- Emira distribution accrual 
  (July and August 2015)                              13 751              -            -        13 751 
- Pre-acquisition distribution 
  received from Leaf                                  14 955              -            -        14 955 
- Transactions costs relating   
  to business acquisitions                             4 874              -            -         4 874 
- Fountainhead’s NCI portion   
  of distribution for period   
  1 March 2015 to 3 August 2015                            -        101 917            -       101 917 
Distributable income                               2 195 673        533 257      560 885     3 289 815 


CONSOLIDATED STATEMENTS OF FINANCIAL POSITION 

                                                                31 August                   31 August 
                                                                     2015                        2014 
                                                                    R’000                       R’000 
Non-current assets                                             67 465 410                  55 007 339 
Investment properties                                          49 898 869                  40 906 077 
- Fair value of investment properties                          46 589 717                  37 710 045 
- Straight-line rental income accrual                           1 436 762                   1 213 985 
- Properties under development                                  1 872 390                   1 982 047 
Listed securities                                                 988 793                   2 750 900 
Goodwill and intangible assets                                  5 367 047                   5 328 676 
Interest in associates and joint ventures                       9 823 319                   4 173 173 
Interest rate swaps                                                93 150                           - 
Loans receivable                                                1 184 924                   1 727 212 
Other financial assets                                                  -                      23 510 
Guarantee fees receivable                                          73 760                      50 000 
Property, plant and equipment                                      35 548                      47 791 
Current assets                                                  1 422 776                     992 697 
Properties held-for-trading                                         1 080                      21 349 
Trade and other receivables                                       617 964                     580 021 
Loans receivable                                                  587 440                       2 050 
Listed security income receivable                                  86 368                      38 671 
Cash and cash equivalents                                         129 924                     350 606 
Non-current assets held-for-sale                                1 289 612                   1 490 128 
Total assets                                                   70 177 798                  57 490 164 
EQUITY AND LIABILITIES      
Shareholders' interest                                         45 145 459                  32 720 342 
Stated capital                                                 33 738 010                  22 558 039 
Reserves                                                       11 407 449                  10 162 303 
Non-controlling interests (NCI)                                         -                   3 015 595 
Total shareholders’ interest                                   45 145 459                  35 735 937 
Non-current liabilities                                        21 894 566                  14 997 245 
Interest-bearing liabilities                                   21 602 140                  14 355 324 
Interest rate swaps                                                     -                      95 192 
Other financial liabilities                                        17 507                      36 731 
Deferred taxation                                                 274 919                     509 998 
Current liabilities                                             3 137 773                   6 756 982 
Trade and other payables                                        1 106 230                   1 294 307 
Interest-bearing liabilities                                    1 980 226                   5 401 205 
Interest rate swaps                                                10 488                         926 
Other financial liabilities                                        18 437                      12 872 
Taxation payable                                                   22 392                      47 672 
Total equity and liabilities                                   70 177 798                  57 490 164 
Net asset value per share   
(excluding deferred tax and NCI) (cents)                         1 021.00                      976.03 
Net tangible asset value per share   
(excluding deferred tax and NCI) (cents)                           900.35                      819.52 


HEADLINE EARNINGS AND DISTRIBUTABLE EARNINGS RECONCILIATION 

                                                                31 August                   31 August 
                                                                     2015                        2014 
                                                                    R’000                       R’000 
Profit for the year attributable to 
Redefine shareholders                                           5 425 097                   3 407 818 
Change in fair value of properties 
(net of deferred taxation)                                     (2 111 739)                 (1 108 787)
Insurance proceeds received                                      (119 420)                          - 
Profit on disposal/deemed disposal 
of subsidiaries                                                         -                    (340 949)
Profit on deemed disposal of interest in   
an associate (net of deferred tax)                                      -                    (726 919)
Headline profit attributable to 
Redefine shareholders                                           3 193 938                   1 231 163 
Debenture interest                                                      -                   1 115 697 
Headline earnings attributable to 
Redefine shareholders                                           3 193 938                   2 346 860 
Change in fair value of listed securities and 
financial instruments (net of deferred taxation)                 (532 016)                   (238 302)
Amortisation of intangible assets 
(net of deferred taxation)                                         45 256                      45 256 
Emira distribution accrual for July and August 2015                13 751                           - 
Fountainhead’s NCI portion of distribution for period 
  1 March 2015 to 3 August 2015                                   101 917                           - 
Straight-line rental income accrual                              (163 305)                    (61 721)
Unrealised foreign exchange loss                                  233 848                      29 945 
Fair value adjustments of associates and NCI 
(other than investment property)                                  160 558                      53 448 
Debt restructure costs and unrealised 
interest received                                                       -                     110 414 
Pre-acquisition distribution received from annuity                      -                      36 454 
Pre-acquisition distribution received from Leaf                    14 955                           - 
Transaction costs relating to business acquisitions                 4 874                      14 423 
Antecedent distribution                                           209 474                      77 446 
Pre-acquisition listed security income                              6 565                           - 
Distributable earnings                                          3 289 815                   2 414 223 
Six months ended 28 February                                    1 465 880                   1 115 697 
Six months ended 31 August                                      1 823 935                   1 298 526 
Total distributions                                             3 289 815                   2 414 223 
Actual number of shares in issue (000)*                         4 448 623                   3 404 630 
Weighted number of shares in issue (000)*                       3 798 575                   3 090 599 
Diluted number of shares in issue (000)*                        3 798 575                   3 654 675 
Basic earnings per share (cents)                                   142.82                      146.36 
- Continuing operations per share (cents)                          142.82                      134.53 
- Discontinued operations per share (cents)                             -                       11.83 
Diluted earning per share (cents)                                  142.82                      123.78 
- Continuing operations per share (cents)                          142.82                      113.77 
- Discontinued operations per share (cents)                             -                       10.01 
Headline earnings per share (cents)                                 84.08                       75.94 
- Continuing operations per share (cents)                           84.08                       75.48 
- Discontinued operations per share (cents)                             -                        0.46 
Diluted headline earnings per share (cents)                         84.08                       64.22 
- Continuing operations per share (cents)                           84.08                       63.83 
- Discontinued operations per share (cents)                             -                        0.39 
Distribution per share (cents)                                      80.00                       74.54 
*Excludes 305 876 766 (2014: 5 876 766) treasury shares 


SUMMARISED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY 

                                                                31 August                   31 August 
                                                                     2015                        2014 
                                                                    R’000                       R’000 
Opening balance                                                35 735 937                  24 073 923 
Issue of shares                                                11 179 971                   3 663 579 
Conversion of debentures to stated capital                              -                   5 915 414 
Total comprehensive income for the year                         5 610 617                   3 845 568 
Transactions with non-controlling interests                    (4 529 930)                 (1 686 423)
Changes in ownership interests in subsidiaries                          -                     (84 004)
Share-based payment reserve                                         8 008                       7 880 
Distributions paid                                             (2 859 144)                          - 
Total stated capital, reserves and   
non-controlling interests                                      45 145 459                  35 735 937 


CONDENSED SEGMENTAL ANALYSIS 

                                 Office       Retail  Industrial Specialised  Fountainhead        Total 
                                  R’000        R’000       R’000       R’000         R’000        R’000 
Year ended   
31 August 2015  
Contractual rental income^    2 009 643    1 859 390     886 976       3 646     1 381 782    6 141 437 
Operating costs                (669 542)    (733 126)   (230 003)         (5)     (452 033)* (2 084 709)
Net property income           1 340 101    1 126 264     656 973       3 641       929 749    4 056 728 
Investment property 
portfolio#                   18 355 620   20 622 822   9 917 549     420 100             -   49 316 091 

Year ended  
31 August 2014 
Contractual rental income^    1 597 514    1 520 780     633 521           -     1 558 613    5 310 428 
Operating costs                (551 164)    (619 196)   (183 896)          -      (553 268)  (1 907 524)
Net property income           1 046 350      901 584     449 625           -     1 005 345    3 402 904 
Investment property 
portfolio#                   11 781 330   11 302 104   5 162 643           -    12 168 081   40 414 158 
^ Excluding straight-line rental income accrual. 
# Excluding properties under development and held-for-trading. Properties classified as held-for-sale 
  are included. 
* Fountainhead results are for 11 months and exclude property management fees reversed on consolidation 
  of R34,9 million. 


PROFILE

Redefine is a diversified Real Estate Investment Trust (REIT) with a market capitalisation of 
R54,8 billion and is classified as one of the Top 40 companies listed on the Johannesburg Stock Exchange 
(JSE). Redefine manages a property asset base with a market value of R64,5 billion, comprising local and 
international property investments. Redefine’s core focus is to deliver sustained value to all 
stakeholders by achieving its primary goal of growing and improving cash flow. Redefine’s shares are 
actively traded on the JSE, making it a highly liquid investment choice for gaining exposure to the 
domestic and international commercial real estate markets.

At 31 August 2015, Redefine’s diversified, local property portfolio was valued at R53,4 billion. The 
group’s international investments, valued at R11,1 billion represent 17,3% of total property assets and 
provide geographic diversification into the UK, German and Australian property markets. Redefine has a 
30,1% equity interest, with a market value of R4,9 billion, in Redefine International PLC (RI PLC) which 
is listed on both the London Stock Exchange and the JSE. During the year Redefine acquired a German 
retail portfolio in a co-investment with RI PLC valued at R653 million. In addition, Redefine has a 
R5,6 billion presence in the Australian property market through a direct 50% interest in North Sydney’s 
landmark tower, Northpoint, as well as a holding of 25,6% in Cromwell Property Group (Cromwell), which is 
listed on the Australian Stock Exchange.

FINANCIAL RESULTS

Redefine’s Board has declared a dividend of 41,00000 (2014: 38,14000) cents per share for the six months 
ended 31 August 2015, an increase of 7,5% on the comparable period, which is in line with market 
guidance. This brings the full year distribution to 80,00000 (2014: 74,54000) cents per share resulting 
in year-on-year growth of 7,3% (2014: 8.5%). In Rand terms, distributable income for the year increased 
by 36,3% (2014: 19,9%) benefiting from a number of substantial quality acquisitions made in recent years.

Property portfolio income for the year contributed 94,2% (2014: 96,0%) of total revenue (excluding 
insurance proceeds received), income from listed securities 5,1% (2014: 3,3%), and fee and trading income 
were 0,7% (2014: 0.6%).

Operating costs were 33.9% (2014: 35,9%) of contractual rental income (excluding straight-line rental 
income accruals) – with the decrease resulting mainly from reduced municipal charges following successful 
valuation objections. Net of electricity and utility recoveries, operating costs were 18,0% (2014: 18,8%) 
of contractual rental income. Redefine’s international property investments contributed 17,0% (2014: 
17,2%) of distributable income.

CHANGES IN FAIR VALUES

The group’s property portfolio was independently valued at 31 August 2015 producing a net increase in 
value of R1,9 billion (2014: R1,2 billion). In terms of IAS 40 and IFRS 7, Redefine’s investment 
properties are measured at fair value and are categorised as level 3 investments. There were no transfers 
between levels 1, 2 and 3 during the year. The investment in listed securities increased in value by 
R160 million (2014: R297 million) during the year. The balance of R146,4 million relates mainly to the 
mark-to-market of the group’s interest rate swaps, which protect the group against adverse interest rate 
movements. In terms of IAS 39 and IFRS 7, Redefine’s listed securities and interest rate swaps are 
measured at fair value through profit or loss and are categorised as level 1 and level 2 investments 
respectively. There were no transfers between levels 1, 2 and 3 during the year.

PROPERTY PORTFOLIO

PORTFOLIO SPLIT BY TENANT TYPE
Multi            60,8%
Single           39,2%

SECTORAL SPREAD BY VALUE
Office           38,0%
Retail           40,7%
Industrial       20,5%
Specialised       0,8%

GEOGRAPHIC SPREAD BY GLA
Gauteng          64,8%
Cape Town        17,3%
KwaZulu-Natal     8,4%
Other             9,5%

Letting activity: The overall portfolio vacancy rate improved during the year by 0,1% to 5,4%. Leases 
covering 510 649m2 were renewed at an average rental decrease of 3,0%, with the retention rate a pleasing 
87%. A further 338 294m2 was let across the portfolio. Vacancies are set out below as a percentage of 
gross lettable area (GLA):

                                                    31 August             31 August 
Vacancy per sector                                      2015*                  2014 
Office                                                   8,5%                  7,2% 
Retail                                                   4,3%                  3,9% 
Industrial                                               3,8%                  5,3% 
Specialised                                                -%                    -% 
                                                         5,4%                  5,5% 
* Adjusted for properties-held-for-sale and properties under development. 

Net arrears remained stable at R42 million (31 August 2014: R42 million). Net arrears represent 8.3% of 
gross monthly rental. 

REDEFINE’S PROPERTY PORTFOLIO STRATEGY

Redefine continues to deliver on its strategy of diversifying, growing and improving the quality of it’s 
property portfolio. In acquisitions the emphasis, wherever possible, is on securing fully repairing 
leases with blue-chip tenants.

Leaf Property Fund (Leaf): Redefine acquired a portfolio of 14 high-quality commercial property assets, 
valued at R4,1 billion, situated in the key nodes of the Western Cape and Gauteng from Leaf. The 
acquisition added 213 155m2 to the office portfolio and has an expected yield of 7,8%. The acquisition is 
in line with Redefine’s strategy of improving the quality of its core property portfolio by acquiring 
high-quality assets that offer cash flow comfort and low vacancy levels. Black River Park is the first 
office complex to be awarded a six-star Green Star SA rating in terms of the existing building 
accreditation. This clearly supports and reaffirms Redefine’s commitment to sustainable business 
practices.

All conditions precedent were fulfilled on 15 April 2015 and the transaction had a commercial effective 
date of 1 March 2015. Pre-acquisition income of R14,9 million has been recognised for distributable 
income purposes as 139,6 million Redefine shares were issued ranking for distribution from the commercial 
effective date. The acquired businesses contributed revenues of R163,6 million and net loss after tax of 
R20,4 million to the group for the five months since acquisition. These amounts have been calculated 
using the group’s accounting policies. If the businesses had been acquired on 1 September 2014, 
management estimates that the revenue and profit after tax from the businesses would have been 
R421,2 million and R245,1 million respectively.

The assets and liabilities as at 15 April 2015 arising from the acquisition are as follows: 

                                                      Fair value 
                                                           R’000 
Investment properties                                  4 119 392 
Net working capital*                                      41 152 
Other assets                                             155 664 
Interest bearing borrowings                           (1 887 561)
Fair value of net assets                               2 428 647 
Goodwill**                                               101 227 
Shareholders loans acquired                             (164 146)
Total purchase consideration                           2 365 728 
Purchase consideration:                                2 365 728 
- Settled in Redefine shares                           1 735 358 
- Settled in cash                                        630 370 
Cash and cash equivalents in subsidiary acquired         (65 678)
Cash outflow on acquisition                              564 692 

*  The trade receivables comprise gross contractual amounts due of R24,9 million, the group’s best 
   estimate of the contractual cash flow not expected to be collected is R0,5 million. 
** The goodwill arises as a result of the expected synergies from the acquisition. 

The distributions received from the sellers amounting to R54,4 million, relating to the accounting period 
before they obtained Redefine shares, were reimbursed to Redefine per the acquisition agreements. 

Fountainhead Property Trust (Fountainhead): On 24 July 2015, Fountainhead unitholders voted in favour of 
the acquisition by Redefine of all of Fountainhead’s assets, including its entire property portfolio, in 
exchange for 85 Redefine consideration shares for every 100 Fountainhead units in issue, and the 
assumption by Redefine of all Fountainhead’s liabilities, including its interest-bearing debt. The 
transaction was implemented on 3 August 2015, with the consideration shares issued directly to 
Fountainhead unitholders cum entitlement to the full Redefine income distribution for the six months 
ended 31 August 2015. Notwithstanding the implementation date, the commercial effective date of the 
transaction was 1 March 2015, from which date Redefine became entitled to all of the income received by 
or accruing to Fountainhead. Accordingly, and as more fully detailed in the joint announcement released 
by Redefine and Fountainhead on SENS on 25 June 2015, R101,9 million (being the minority shareholders’ 
portion of Fountainhead’s distributable income for the period 1 March 2015 to the date on which the 
transaction was implemented) has been included in Redefine’s distributable income. 

Acquisitions: In addition to the Leaf and Fountainhead portfolio’s, Redefine acquired and transferred 
34 properties, with a GLA of 637 867m2, during the year for an aggregate consideration of R3,6 billion, 
at an initial yield of 8,5%. Redefine also acquired a 45% undivided share in vacant industrial land in 
Germiston for R312 million, with a gross building area of 1 285 903m2 (Redefine’s share 578 656m2). 
Subject to conditions precedent, agreements also have been concluded for the acquisition of properties, 
for an aggregate consideration of R415 million, at an initial yield of 9,9% and GLA of 12 135m2. 
Properties with an aggregate consideration of R354 million transferred subsequent to the reporting 
period.

Developments: New development projects covering 195 055m2 of GLA with an approved value of R2,2 billion 
at an average yield of 8,6%, are presently in progress. Redevelopment projects in the existing portfolio 
with an approved value of R1,6 billion at an average yield of 6,1% are also in progress. Projects 
totalling R1,4 billion were completed during the year.

Disposals: 35 properties with a GLA of 339 000m2, which no longer met Redefine’s investment criteria, 
were sold during the year to various buyers for an aggregate consideration of R2,2 billion, at an average 
yield of 9,3%. In addition, agreements, subject to conditions precedent, were concluded for the disposal 
of properties for an aggregate consideration of R1,2 billion, with a GLA of 164 707m2 at an average 
yield of 8.3%.

Government tenanted office portfolio: Discussions with a number of interested parties have continued 
regarding the disposal of this portfolio through a structured process in order to manage the potential 
dilution of distributable income. As there is a high degree of deal risk, the properties remain in the 
active portfolio.

Sustainability: As part of Redefine’s focus on sustainability and cost efficiency, various energy-
efficient and sustainable building technologies are being implemented in new developments as well as on 
existing buildings, including installation of solar PV and smart metering of electricity and water. 
To protect income, Redefine is taking steps to ensure that there is uninterrupted electricity supply at a 
number of its key properties.

LISTED SECURITIES

Redefine currently owns 11,5% of Emira Property Fund (Emira). During the year, Redefine sold 11 million 
shares and realised a gain of R22 million. Redefine also disposed of 18,7 million Dipula A and B units 
which realised a profit of R49,1 million. These shares were held for less than a year and as a result the 
realised taxable profit has been included in listed security income. 

INTERESTS IN ASSOCIATES AND JOINT VENTURES

RI PLC: On 3 March 2015, RI PLC undertook a capital raise in which Redefine participated and acquired 
39,5 million additional RI PLC shares for a consideration of R384 million. During the year, Redefine also 
participated in RI PLC’s dividend re-investment scheme and elected to receive 14,4 million shares. 
Currently Redefine owns 30,1% of RI PLC, which is equity accounted. The market value of RI PLC is 
R749 million more than the equity accounted carrying value. 

German portfolio: During the year, Redefine entered into a joint venture arrangement with RI PLC to 
acquire a 50% interest in a portfolio of 56 retail properties in Germany. Redefine’s aggregate 
consideration for the acquisition was R704 million at an initial yield of 7,5%. 

Cromwell: On 31 August 2015, Redefine acquired a further 9,7% interest in Cromwell for R1,6 billion, 
increasing it’s holding in Cromwell to 25,6%. Redefine now has significant influence over Cromwell and, 
as a consequence, the investment has been transferred to interest in associates. 

FUNDING

Redefine’s debt represented 36,8% (2014: 38,0%) of the value of its property assets as at 31 August 2015. 
Redefine’s average cost of funding is 8,4% (2014: 8,2%) – interest rates are fixed on 81,3% (2014: 78,3%) 
of borrowings for an average period of 2,8 years (2014: 3,6 years). The interest cover ratio (which 
includes equity accounted profit and listed security income) is 3.2 (2014: 3.0).

During the year, Redefine issued 297,6 million shares through accelerated book builds for R3,1 billion 
in cash, issued 246,5 million shares to various vendors for the acquisition of assets totalling 
R2,6 billion, issued 337,1 million shares to Fountainhead’s minority investors representing R3,8 billion, 
issued 300 million shares to the Redefine Empowerment Trust on loan account for R3,1 billion and 
conserved R1,6 billion in cash through the issue of 162,7 million shares under the distribution 
reinvestment alternative. The number of shares in issue increased by 1 343,9 million shares (an increase 
of 41,5%) representing equity of R14,2 billion.

Moody’s credit rating: The rating was refreshed during August 2015 and remains unchanged as follows: 
Global long-term Baa3           Global short-term P-3 
National long-term A3.za        National short-term P-2.za

CONTINGENCIES AND COMMITMENTS

At 31 August 2015, Redefine had guarantees and suretyships in respect of its Black Economic Empowerment 
initiatives amounting to R195 million (2014: R218 million). Capital commitments outstanding accounted to 
R2,2 billion (2014: R2,5 billion) and committed property acquisitions totalled R415 million 
(2014: R3,0 billion). Redefine has undertaken to underwrite R1,4 billion (£70,0 million) of RI PLC’s 
planned capital raise to fund part of the second phase of the Aegon portfolio acquisition. Should the 
equity raise not proceed, Redefine has provided a R2,8 billion (£135,0 million) loan facility to RI PLC, 
which may be utilised to fully fund this phase of the transaction. The loan facility must be repaid 
within three months of drawdown, or it will convert into a 50% equity interest in the Aegon portfolio, 
which will be co-owned with RI PLC.  The future commitments will be funded by the issue of Redefine 
shares and undrawn banking facilities.

BROAD-BASED BLACK ECONOMIC EMPOWERMENT INITIATIVE

As part of Redefine’s commitment to sustainable, long-term economic and social development the Redefine 
Empowerment Trust (the Trust) was established. On 17 July 2015 Redefine issued 300 million shares to the 
Trust, which was funded by a loan advanced by Redefine. The Trust will primarily focus on activities to 
improve education and training through the provision of scholarships and bursaries and community 
development programmes. The Trust is constituted as a capital-preserving Trust and as such will not be 
entitled to dispose of the shares not used to redeem the loan from Redefine. The Trust will therefore 
continue in perpetuity. The 300 million shares issued to the Trust have been accounted for as treasury 
shares. 

PROSPECTS

The domestic economic outlook remains bleak. The manufacturing sector is in contractionary territory and 
confidence is low. Neither the business cycle nor structural factors are likely to provide much support 
to drive growth. There is therefore no compelling reason to believe that prevailing local trading 
conditions (stagnant local economic growth and volatile financial markets) will change materially during 
the coming financial year. In fact, expected interest rate hikes, a generally soft currency, a very 
challenging leasing market, cash flow and cost pressures are business factors we anticipate having to 
contend with during 2016. This calls for extra vigilance on risks and opportunities as well as a 
relentless focus on disciplined and decisive execution of Redefine’s strategic priorities. Despite the 
local trading pressures, Redefine anticipates that it will be able to leverage its geographically 
diversified asset base to achieve distribution growth of between 6% and 7% per share for the full 2016 
year.

This forecast is predicated on the assumption that current trading conditions will prevail. Forecast 
rental income is based on contractual terms and anticipated market-related renewals. The forecast has not 
been reviewed or reported on by the group’s independent external auditors.

DECLARATION OF A CASH DIVIDEND WITH THE ELECTION TO REINVEST THE CASH DIVIDEND IN RETURN FOR REDEFINE SHARES

The Board of directors of Redefine has declared a final cash dividend of 41,00000 cents per share, for 
the six months ended 31 August 2015, out of the company’s distributable income (the cash dividend).

Shareholders will be entitled, in respect of all or part of their shareholdings, to elect to reinvest the 
cash dividend in return for Redefine shares (the share reinvestment alternative), failing which they will 
receive the cash dividend of 41,00000 cents per share that will be paid to those shareholders not 
electing to participate in the share reinvestment alternative.

A circular providing further information in respect of the cash dividend and share reinvestment 
alternative will be posted to Redefine shareholders on 6 November 2015.

Shareholders who have dematerialised their shares through a Central Securities Depository Participant 
(CSDP) or broker should instruct their CSDP or broker with regard to their election in terms of the 
custody agreement entered into between them and their CSDP or broker.

SALIENT DATES AND TIMES 

The salient dates and times for the cash dividend and share reinvestment alternative are as set out 
below. 

Salient dates and times                                                                          2015 
Circular and form of election posted to shareholders                               Friday, 6 November 
Finalisation information including the share ratio and 
price per share published on SENS                                                 Friday, 13 November 
Last day to trade in order to participate in the election 
to receive shares in terms of the share reinvestment alternative 
or to receive a cash dividend (LDT)                                               Friday, 20 November 
Shares trade ex-dividend                                                          Monday, 23 November 
Listing of maximum possible number of shares under the share 
reinvestment alternative                                                       Wednesday, 25 November 
Last day to elect to receive shares in terms of the share 
reinvestment alternative or to receive a cash dividend   
 (no late forms of election will be accepted) at 12:00 (SA time)                  Friday, 27 November 
Record date for the election to receive shares in terms of the share 
reinvestment alternative or to receive a cash dividend (record date)              Friday, 27 November 
Announcement of results of cash dividend and share reinvestment 
alternative released on SENS                                                      Monday, 30 November 
Cash dividend cheques posted to certificated shareholders on or about             Monday, 30 November 
Accounts credited by CSDP or broker to dematerialised shareholders 
with the cash dividend payment                                                    Monday, 30 November 
Share certificates posted to certificated shareholders on or about              Wednesday, 2 December 
Accounts updated with the new shares (if applicable) by CSDP or 
broker to dematerialised shareholders                                           Wednesday, 2 December 
Adjustment to shares listed on or about                                            Friday, 4 December 

Notes: 
- Shareholders electing the share reinvestment alternative are alerted to the fact that the new shares 
  will be listed on LDT + 3 and that these new shares can only be traded on LDT + 3, due to the fact that 
  settlement of the shares will be three days after the record date, which differs from the conventional 
  one day after record date settlement process. 
- Shares may not be dematerialised or rematerialised between Monday, 23 November 2015 and Friday, 
  27 November 2015, both days inclusive. 
- The above dates and times are subject to change. Any changes will be released on SENS. 

TAX IMPLICATIONS

Redefine was granted REIT status by the JSE with effect from 1 September 2013 in line with the REIT 
structure as provided for in the Income Tax Act, 58 of 1962, as amended (the Income Tax Act) and section 
13 of the JSE Listings Requirements.

The REIT structure is a tax regime that allows a REIT to deduct qualifying distributions paid to 
investors, in determining its taxable income.

The cash dividend of 41,00000 cents per share meets the requirements of a qualifying distribution for the 
purposes of section 25BB of the Income Tax Act (a qualifying distribution) with the result that:

-  Qualifying distributions received by resident Redefine shareholders must be included in the gross 
   income of such shareholders (as a non-exempt dividend in terms of section 10(1)(k)(aa) of the Income 
   Tax Act), with the effect that the qualifying distribution is taxable as income in the hands of the 
   Redefine shareholder. These qualifying distributions are however exempt from dividends withholding 
   tax, provided that the South African resident shareholders provided the following forms to their CSDP 
   or broker, as the case may be, in respect of uncertificated shares, or the company, in respect of 
   certificated shares:

   -  a declaration that the dividends are exempt from dividends tax; and
   -  a written undertaking to inform the CSDP, broker or the company, as the case may be, should the 
      circumstances affecting the exemption change or the beneficial owner cease to be the beneficial 
      owner, both in the form prescribed by the Commissioner for the South African Revenue Service. 
      Shareholders are advised to contact their CSDP, broker or the company, as the case may be, to 
      arrange for the above mentioned documents to be submitted prior to payment of the distribution, if 
      such documents have not already been submitted.

-  Qualifying distributions received by non-resident Redefine shareholders will not be taxable as income 
   and instead will be treated as ordinary dividends but which are exempt in terms of the usual dividend 
   exemptions per section 10(1)(k) of the Income Tax Act. It should be noted that until 31 December 2013 
   qualifying distributions received by non-residents were not subject to dividends withholding tax. From 
   1 January 2014 any qualifying distribution will be subject to dividends withholding tax at 15%, unless 
   the rate is reduced in terms of any applicable agreement for the avoidance of double taxation (DTA) 
   between South Africa and the country of residence of the shareholder. Assuming dividends withholding 
   tax will be withheld at a rate of 15%, the net dividend amount due to non-resident shareholders is 
   34,85000 cents per share. A reduced dividend withholding rate in terms of the applicable DTA, may only 
   be relied upon if the non-resident shareholder has provided the following forms to their CSDP or 
   broker, as the case may be, in respect of uncertificated shares, or the company, in respect of 
   certificated shares:
   -  a declaration that the dividend is subject to a reduced rate as a result of the application of a 
      DTA; and
   -  a written undertaking to inform their CSDP, broker or the company, as the case may be, should the 
      circumstances affecting the reduced rate change or the beneficial owner cease to be the beneficial 
      owner, both in the form prescribed by the Commissioner for the South African Revenue Service. Non- 
      resident shareholders are advised to contact their CSDP, broker or the company, as the case may be, 
      to arrange for the above mentioned documents to be submitted prior to payment of the dividend if 
      such documents have not already been submitted, if applicable.

Shareholders are advised that in electing to participate in the share reinvestment alternative, pre-
taxation funds are utilised for the reinvestment purposes and that taxation will be due on the total cash 
dividend amount of 41,00000 cents per share.

OTHER INFORMATION

-  The ordinary issued share capital of Redefine is 4 754 499 789 ordinary shares of no par value before 
   any election to reinvest the cash dividend.
-  Income tax reference number of Redefine: 917/852/484/0.

The cash dividend or share reinvestment alternative may have tax implications for resident as well as 
non-resident shareholders. Shareholders are therefore encouraged to consult their professional advisers 
should they be in any doubt as to the appropriate action to take.

DIVIDEND DECLARATION AFTER REPORTING DATE

In line with IAS 10 Events after the Reporting Period, the declaration of the dividend occurred after the 
end of the reporting period, resulting in a non-adjusting event which is not recognised in the financial 
statements. In prior periods, the distribution consisted of debenture interest which accrued on a daily 
basis.

BOARD AND SECRETARIAL APPOINTMENTS

Phumzile Langeni was appointed to the Board as an independent non-executive director, with effect from 
6 May 2015. Marius Barkhuysen and Nthombi Langa-Royds are appointed to the Board as independent non-
executive directors with immediate effect. Bronwyn Baker was appointed as company secretary with effect 
from 1 August 2015.

BASIS OF PREPARATION

The financial statements for the year ended 31 August 2015 have been audited by the group’s independent 
external auditors, Grant Thornton. Their unqualified audit opinion is available for inspection at the 
company’s registered office. The summarised results have been prepared in accordance with International 
Financial Reporting Standards, IAS 34 Interim Financial Reporting, the SAICA Financial Reporting Guides 
as issued by the Accounting Practices Committee and Financial Pronouncements as issued by the Financial 
Reporting Standards Council, the JSE Listings Requirements and the requirements of the South African 
Companies Act, 2008 (as amended). This summarised report is extracted from audited financial information, 
but is not itself audited. The auditor’s report does not necessarily report on all of 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 company’s registered office. The directors 
take full responsibility for the preparation of this summarised report and confirm that the financial 
information has been correctly extracted from the underlying audited results for the year ended 
31 August 2015.

Except for the new standards and interpretations adopted as set out below, all accounting policies 
applied by the group in the preparation of these consolidated annual financial statements are consistent 
with those applied by the group in its consolidated annual financial statements as at and for the year 
ended 31 August 2014. The group has adopted the following new standards and interpretation:

-  Investment entities (Amendments to IFRS 10, IFRS 12 and IAS 27)
-  Offsetting financial assets and financial liabilities (Amendments to IAS 32)
-  Recoverable amount disclosure for non-financial assets (Amendments to IAS 36)
-  Novation of derivatives and continuation of hedge accounting (Amendments to IAS 39)
-  Annual improvements to IFRS 2010 – 2012
-  Annual improvements to IFRS 2011 – 2013

There was no material impact on the financial statements identified based on management’s assessment of 
these standards. 

The results were prepared under the supervision of Leon Kok CA (SA), Redefine’s Financial Director.

By order of the Board
Redefine Properties Limited
4 November 2015


Executive Directors: 
M Wainer (Chairman)
A J Konig (CEO)
L C Kok (FD)
D H Rice† (COO)
M J Ruttell@ 

Non-Executive Directors: 
M Barkhuysen*
N B Langa-Royds*
H K Mehta
P Langeni*
B Nackan (Lead independent)*
D A Nathan*
G Z Steffens#*
M J Watters
*Independent 
" British 
@Irish 
#German 

Registered office: 
3rd Floor, Redefine Place, 2 Arnold Road, Rosebank, 2196. 
(PO Box 1731, Parklands, 2121) 

Transfer secretaries: 
Computershare Investor Services Proprietary Limited 

Sponsor: 
Java Capital 

Company secretary: 
B Baker

5 November 2015 


Date: 05/11/2015 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
 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.

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