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Summarised Unaudited Consolidated Financial Statements For The Quarter Ended 30 September 2015, Changes To The Board
ROCKCASTLE GLOBAL REAL ESTATE COMPANY LIMITED
Incorporated in the Republic of Mauritius
Reg no 108869 C1/GBL
ISIN MU0364N00003
Primary listing SEM and JSE
SEM code Rock.N0000
JSE code ROC
(“Rockcastle” or “the Group” or “the Company”)
SUMMARISED UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
for the quarter ended 30 September 2015
AND CHANGES TO THE BOARD
DIRECTORS’ COMMENTARY
STRUCTURE AND LISTING
Rockcastle is a Category One Global Business License Company registered in
Mauritius. The Company has primary listings on both the Stock Exchange of
Mauritius Ltd (“SEM”) and the Johannesburg Stock Exchange (“JSE”). Its
objectives are investing in direct property in growing economies as well
as listed real estate securities globally.
During the quarter ended 30 September 2015, Rockcastle successfully raised
USD86.5 million through the issue of 41.3 million shares by way of a
private placement and a vendor placement which was substantially
oversubscribed. Rockcastle‘s shareholders were provided with the option to
receive shares in lieu of cash for the 2015 final dividend. Over 92% of
shareholders opted to take the scrip dividend resulting in the issue of
17.3 million new shares.
REVIEW
Despite the slowdown in global growth, and increasing economic uncertainty
reflected in extreme foreign exchange, commodity and interest rate
volatility, Rockcastle’s geographic positioning and focus on quality,
high-growth counters resulted in an increase in the net asset value from
USD1.46 per share at 30 June 2015 to USD1.48 per share at 30 September
2015, after the payment of the semi-annual distribution of 4.42 USD cents
per share. Rockcastle continues to focus on growing its net asset value
and dividend-paying capacity as significant progress is being made on the
direct property strategy.
LISTED SECURITIES
The portfolio’s top ten holdings changed during the period, as the planned
increase in exposure to direct properties has provided an opportunity to
reduce the number of investments that meet Rockcastle’s distribution
growth, market capitalisation and liquidity requirements. While the
relative rankings of the holdings have fluctuated, seven of the top ten
holdings continued from the prior period. In addition, Rockcastle changed
its geographic and sector allocations during the period due to an
assessment of the macro-economic conditions, stock valuations, investment
opportunities and geographic risk factors. Whilst low long-term interest
rates and healthy real estate fundamentals provide general support to
investment in REITs, the exposure to Singapore was reduced and the
investments in Canada and Hong Kong have all been sold.
DIRECT PROPERTY
POLAND
During the quarter, Rockcastle concluded an agreement to acquire Platan
Shopping Centre (“Platan”) located in the city of Zabrze for EUR51.84
million.
Zabrze is a city in Southern Poland with a population of approximately
178,000 residents and is part of the Katowice Agglomeration which is the
largest urban area in Poland. The shopping centre has a Gross Lettable
Area (“GLA”) of 25 336 m2, is anchored by a 14 091 m2 Auchan hypermarket
with a remaining lease term of 12 years and consists of 78 other retail
units. The centre benefits from a free and extensive surface car parking
area for its customers.
The tenant mix in Platan provides a balanced offering of Fashion &
Footwear, Health & Beauty and a Hypermarket, complimented by supporting
services and a food court. The centre houses numerous international and
national brands such as Auchan, Carry, CCC, Cropp, Deichmann, Diverse,
GoSport, House, KFC, Orsay, Reserved, Rossmann, RTV Euro AGD, Sephora and
Sinsay. The weighted-average unexpired lease term is 4.9 years. It is
Rockcastle’s intention to expand the existing centre to meet current and
future tenant demand.
Following the Platan acquisition, Rockcastle will have EUR320 million
invested in four shopping centres in Poland, three of which will be
transferred in the next quarter.
In addition, a Private Public Partnership (“PPP”) was signed with the City
of Opole in October 2015 allowing for the extension of Solaris Shopping
Centre by approximately 8 000m2 and the construction of a basement parking
garage increasing the available parking by 300 parking bays.
Together with the development projects in Tomaszow Mazowiecki and Wolomin,
the Company now has a development pipeline of approximately EUR100
million.
Numerous other potential acquisitions are at various stages of negotiation
and Rockcastle continues to actively pursue both existing centres as well
as development projects.
ZAMBIA
Rockcastle has entered into an agreement with Delta Africa Property
Holdings Limited to dispose of its 50% effective interest in two Zambian
retail assets. The selling price of USD40.6 million reflects a yield on
the income producing portfolio of 7.67% with the land holdings sold at
cost.
Rockcastle has agreed to finance USD19 million of the purchase price for a
period of 12 months at a rate of 5% per annum. The sale is subject to
completion of due diligence with the effective date being 1 December
2015.This disposal facilitates a sharper focus on the Central and Eastern
European strategy.
CHANGES TO THE BOARD
With effect from 5 November 2015, Karen Bodenstein has been appointed to
the Board as an executive director based in Mauritius and Paul Pretorius
has resigned from the Board. Paul will remain employed by the Company to
facilitate the handover to Karen and sale of the Zambian investments.
OUTLOOK
The Board forecasts growth in dividends of between 8% and 10% for the 2016
financial year. The foregoing forecast statement and the forecasts
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 macroeconomic
environment will prevail and no failures of listed REITs will occur.
By order of the Board
Intercontinental Trust Limited
Company Secretary
5 November 2015
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Unaudited as at Audited as at Unaudited as at
30 Sep 2015 30 Jun 2015 30 Sep 2014
USD'000 USD'000 USD'000
ASSETS
Non-current assets 2 046 117 2 295 139 1 574 726
Investment property 59 730 58 708 -
Straight-lining of
rental revenue adjustment 86 415 -
Investment property
under development 26 018 7 436 -
Listed security investments 1 880 756 2 161 724 1 552 419
Investment in and
loans to joint ventures 41 688 41 727 5 601
Rockcastle management
incentive loans 37 839 25 129 16 706
Current assets 50 540 31 366 15 884
Investment income receivable - 7 589 -
Cash and cash equivalents 36 386 3 035 841
Trade and other receivables 2 674 15 410 198
Loans to development partners 11 480 5 332 14 845
Total assets 2 096 657 2 326 505 1 590 610
EQUITY AND LIABILITIES
Total equity attributable
to equity holders 1 350 747 1 241 128 896 228
Stated capital 1 313 346 1 180 670 871 154
Retained income 177 729 183 601 106 530
Non-distributable reserves (140 471) (123 947) (81 456)
Currency translation reserve 143 804 -
Total liabilities 745 910 1 085 377 694 382
Non-current liabilities 16 618 16 614 243 243
Interest-bearing borrowings 16 618 16 614 243 243
Current liabilities 729 292 1 068 763 451 139
Trade and other payables 6 496 4 966 9 027
Interest-bearing borrowings 722 601 1 063 777 441 389
Income tax payable 195 20 723
Total equity and liabilities 2 096 657 2 326 505 1 590 610
Total number of
shares in issue 912 540 104 847 862 018 705 500 000
Net asset value
per share (USD) 1,48 1,46 1,27
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Unaudited for Unaudited for
the quarter the quarter
ended ended
30 Sep 2015 30 Sep 2014
USD'000 USD'000
Net rental and related revenue 1 369 -
Dividends received from
listed security investments 13 912 9 872
Income from joint ventures 814 71
Fair value gain/(loss) on investment
property and listed security investments 6 618 (38 478)
Foreign exchange gain/(loss) 7 212 (18 264)
Operating expenses (652) (343)
Profit before net finance costs 29 273 (47 142)
Net finance costs (15 284) (10 207)
Finance income 588 539
Finance costs (15 872) (10 746)
Profit/(loss) before income tax expense 13 989 (57 349)
Income tax expense (175) (117)
Profit/(loss) for the period
attributable to equity holders of the company 13 814 (57 466)
OTHER COMPREHENSIVE INCOME NET OF TAX
Items that may be reclassified
subsequently to profit or loss
Exchange differences on translation
of foreign operations (661) -
Total comprehensive income/(loss)
for the period attributable to equity holders
of the company 13 153 (57 466)
Weighted average number of shares in issue 850 647 067 705 500 000
Basic earnings/(loss) per share
from continuing operations (USD cents) 1,62 (8,15)
Basic earnings per share and headline earnings per share are based on the weighted average of 850 647 067 shares in issue for the quarter ended 30 September 2015 (quarter ended 30 September 2014: 705 500 000 shares).
There are no reconciling items between basic earnings and headline earnings.
Rockcastle has no dilutionary instruments in issue.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Non- Currency
Stated Retained distributable translation
capital income reserves reserve Total
USD'000 USD'000 USD'000 USD'000 USD'000
Unaudited for the
quarter ended
30 September 2014
Opening balance 871 154 131 714 (19 684) - 983 184
Total comprehensive
loss for
the period (57 466) (57 466)
Dividend paid (29 490) (29 490)
Transfer to
non-distributable reserves 61 772 (61 772) -
Balance at
30 September 2014 871 154 106 530 (81 456) - 896 228
Audited for the nine
months ended
30 June 2015
Opening balance 871 154 106 530 (81 456) - 896 228
Issue of shares 277 242 277 242
Dividends declared 32 274 (62 508) (30 234)
Total comprehensive
income for the period 97 088 97 088
Transfer to
non-distributable
reserves 42 491 (42 491) -
Exchange differences
on translation of
foreign operations 804 804
Balance at
30 June 2015 1 180 670 183 601 (123 947) 804 1 241 128
Unaudited for
the quarter ended
30 September 2015
Opening balance 1 180 670 183 601 (123 947) 804 1 241 128
Total comprehensive
income for the period 13 814 13 814
Shares issued
during the period 96 049 3 378 99 427
Dividends declared 36 627 (39 588) (2 961)
Transfer to
non-distributable
reserves 16 524 (16 524) -
Exchange differences
on translation of
foreign operations (661) (661)
Balance at
30 September 2015 1 313 346 177 729 (140 471) 143 1 350 747
CONSOLIDATED STATEMENT OF CASH FLOWS
Unaudited for the Unaudited for the
quarter ended quarter ended
30 Sep 2015 30 Sep 2014
USD'000 USD'000
Cash inflow from operating activities 21 047 11 464
Cash inflow/(outflow) from
investing activities 257 010 (50 298)
Cash (outflow)/inflow from
financing activities (244 706) 39 189
Increase in cash and
cash equivalents 33 351 355
Cash and cash equivalents
at beginning of period 3 035 486
Cash and cash equivalents
at end of period 36 386 841
Current accounts 36 386 841
NOTES
1 PREPARATION, ACCOUNTING POLICIES AND AUDIT OPINION
The Group is required to publish financial results for the quarter ended
30 September 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 3 month period from 1 July 2015 to 30 September 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 2015.
The summarised unaudited consolidated financial statements (“financial
statements”) for the quarter ended 30 September 2015 have been prepared in
accordance with the measurement and recognition requirements of
International Financial Reporting Standards (“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 5 November 2015.
Copies of the financial statements and the statement of direct and
indirect interests of each officer of the Company, pursuant to rule
8(2)(m) of the Securities (Disclosure Obligations of Reporting Issuers)
Rules 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 Mauritian Securities Act 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 30 September 2015
that require any additional disclosure or adjustment to the financial
statements.
2 SEGMENTAL ANALYSIS
Unaudited for the Unaudited for the
quarter ended quarter ended
30 Sep 2015 30 Sep 2014
USD'000 USD'000
Profit/(loss) before income tax expense
Australia 6 923 2 535
Canada (3 404) (10 117)
Europe 5 646 (12 213)
UK (575) (791)
Hong Kong (3 887) 3 761
Singapore (17 215) (3 438)
USA 18 424 (19 089)
Zambia 814 71
Corporate 7 263 (18 068)
13 989 (57 349)
Unaudited for the Audited for the Unaudited for the
quarter ended year ended quarter ended
30 Sep 2015 30 Jun 2015 30 Sep 2014
USD'000 USD'000 USD'000
Total assets
Australia 56 351 69 835 107 903
Canada - 105 231 187 790
Europe 288 105 276 235 157 465
UK 376 925 376 507 149 262
Hong Kong 6 581 91 756 83 029
Singapore 112 458 199 308 185 748
USA 1 158 202 1 135 445 682 078
Zambia 41 688 41 727 5 601
Corporate 56 347 30 461 31 734
2 096 657 2 326 505 1 590 610
Directors
Mark Olivier (chairman); Spiro Noussis (CEO)*; Nick Matulovich*; Barry
Stuhler; Rory Kirk; Andre van der Veer; Yan Ng; Karen Bodenstein* (*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: 05/11/2015 02:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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