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Condensed unaudited consolidated interim financial statements for the six months ended 31 December 2015
RESILIENT REIT LIMITED
(previously Resilient Property Income Fund Limited)
Incorporated in the Republic of South Africa
Reg no 2002/016851/06
JSE share code: RES ISIN ZAE000209557
(Approved as a REIT by the JSE)
(“Resilient” or “the group”)
CONDENSED UNAUDITED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
for the six months ended 31 December 2015
DIRECTORS’ COMMENTARY
1 NATURE OF THE BUSINESS
Resilient is an internally asset managed Real Estate Investment Trust (“REIT”)
listed on the JSE Limited. Its strategy is to invest in dominant regional retail
centres with a minimum of three anchor tenants and let predominantly to national
retailers. A core competency is the successful development of new malls and
extensions to existing malls.
Resilient also invests in listed and offshore property related assets.
2 DISTRIBUTABLE EARNINGS AND COMMENTARY ON RESULTS
The board has declared a dividend of 232,46 cents per share for the interim
period ended December 2015. This represents a 25,2% increase over the 185,62
cents per share declared in December 2014. Of this growth, 7% is attributable to
the impact of capital raisings, particularly the rights issue of June 2015,
which reduced the cost of funding. A further 8% was due to dividends from
Fortress B which were ahead of budget and Nepi and Rockcastle which benefited
from Rand depreciation. To provide additional certainty to investors, Resilient
hedged the projected December 2015 dividend income from its holdings in
Hammerson, Nepi and Rockcastle which limited the benefits from the decline in
the value of the Rand. Currency hedges were entered into at R21,44, R14,27 and
R12,86 against the British Pound, Euro and US Dollar respectively.
Net income from the property portfolio was negatively affected by once-off items
including the marketing campaign which included the Ripley’s Believe It Or Not
roadshow. After adjusting for these, net income grew by 7,6%.
Despite the challenging economic environment, Resilient’s portfolio of retail
properties continues to perform well. Retail sales growth at Resilient malls is
ahead of national retail sales growth and were ahead of the board’s
expectations. Retail sales growth of 9,1% was achieved compared with the six
months ended December 2014. Although Resilient did not own Irene Village Mall
and Jubilee Mall for the full comparative period, sales figures were obtained
from the previous owners. Pick n Pay Hypermarket Klerksdorp was excluded from
this figure as it was sold during the period.
The comparable sales growth per province is set out below:
Percentage of
Comparable SA properties
sales growth by value
Northern Cape (4,6)% 5,6%
Eastern Cape 2,8% 3,5%
Mpumalanga 6,1% 13,4%
KwaZulu-Natal 9,8% 20,5%
Limpopo 10,5% 27,5%
North West 11,6% 5,1%
Gauteng 13,5% 24,4%
The Northern Cape performance was negatively affected by Village Mall Kathu
which experienced a sharp deterioration in trading conditions. This was due to
two grocery anchored convenience centres opening in its immediate catchment area
as well as the distressed conditions in the mining industry which its catchment
area is dependent on. Diamond Pavilion consolidated its dominant position in
Kimberley at the expense of the CBD and smaller centres which enabled it to
achieve respectable growth. Circus Triangle in the Eastern Cape was affected by
another mall opening in its catchment area, however, the impact was less than
anticipated. The performance of North West province was surprisingly strong
albeit off the low base of the previous comparable period.
Thirteen of Resilient’s 28 properties achieved sales growth exceeding 10%
including five properties which exceeded 15%.
3 PROPERTY ACQUISITIONS AND DISPOSALS
Resilient has agreed to acquire an additional 4% (R73 million) in Highveld Mall
which will increase its interest to 64%. Resilient has acquired an additional 5%
(R49 million) interest in I’langa Mall to increase its interest to 90%. A
further 5% (R28,4 million) interest of Soshanguve Crossing was acquired and
Resilient now owns 60% of this centre. After acquiring the remaining 3,5% (R24,6
million) interest in Tubatse Crossing, Resilient is now the sole owner of this
property.
Pick n Pay Hypermarket Klerksdorp was sold for R164,5 million against a carrying
value of R164,4 million. Transfer was effected during December 2015. Resilient
provided mezzanine funding of R7,5 million to the seller which is repayable over
five years.
4 EXTENSIONS
Diamond Pavilion is being expanded to accommodate an enlargement of Edgars and
Woolworths and a net additional 149 parking bays. The 2 855m2 GLA extension will
achieve a yield of 4,4% on the cost of R104,5 million. The extension is within
budget and on schedule for completion in September 2016.
The anticipated improvement in trading densities resulting from the extension
and parking is not included in the forecast yield.
Village Mall Kathu is being extended to accommodate the expansion of the Spar
Superstore and Woolworths. The 2 089m2 GLA extension is projected to yield 8,0%
on the cost of R33 million and is scheduled for completion in April 2016. In
view of the difficult trading conditions in the region and the increased grocery
offering in Kathu, the addition of Food Lover’s Market will not proceed at this
stage.
The 2 753m2 GLA extension to Boardwalk Inkwazi has commenced and is scheduled
for completion in November 2016. The extension will accommodate the expansion of
Truworths and Woolworths and air-conditioning upgrades. The projected yield is
5,5% on the cost of R76 million.
Construction of the 17 396m2 GLA expansion to I’langa Mall commenced in October
2015. The expansion will introduce a substantial entertainment offering and a
number of new fashion tenants to ensure the mall’s dominance in the region for
the foreseeable future. The expansion is projected to yield 5% on Resilient’s
90% cost of R478 million.
The transfer of a 50% interest in Mams Mall is awaiting fulfilment of
outstanding conditions. It is anticipated that the conditions will be met by
June 2016.
Resilient is awaiting transfer of the last portion of land which will facilitate
the extension of the existing 31 818m2 GLA Irene Village Mall to an 80 000m2 GLA
regional mall. Transfer is expected in July 2016. The board has approved capital
expenditure of R1,5 billion at a yield of 7%.
Major extensions that are at various stages of planning include Limpopo Mall,
Mafikeng Mall, The Galleria, The Grove and Tzaneen Lifestyle Centre. The timing
of these extensions is dependent on various approvals, particularly plan
approvals by local authorities.
5 RESILIENT AFRICA
Resilient owns 60,94% of this joint venture for the development of malls in
Nigeria in partnership with Shoprite Checkers.
At December 2015 Resilient had advanced R712 million to Resilient Africa with
additional commitments totalling R397 million. The investment in Nigeria is
relatively small and business risks have increased. There are obvious downside
risks to the country’s rating and currency. The distressed economic conditions
have and will continue to yield attractive investment opportunities which will
be pursued providing investment criteria are met.
The decline in the oil price has had a negative impact on the Nigerian economy.
Although oil exports historically only accounted for 35% of Nigeria’s GDP, it
made up 95% of export earnings and 70% of government revenue. In an attempt to
limit the depreciation of the Naira against the US Dollar, the Nigerian
government introduced wide ranging import controls. This has negatively impacted
both the local and South African clothing retailers who are highly dependent on
imports.
The clothing retailers, which occupy 22% of the Delta Mall GLA, are experiencing
difficult trading conditions and unless the import controls are relaxed, the
larger clothing tenants are all expected to cease trading. Remaining tenants are
reporting strong trading conditions. Although currencies make comparisons
difficult, the Shoprite store achieves the highest trading densities of any
grocery store in Resilient’s portfolio. In the short to medium term vacancies
are anticipated to increase from 6% to 18% of GLA and the development yield will
decrease to 7% in US Dollars. The Resilient Africa board has resolved to re-let
the space to small Nigerian retailers who pay rentals in Naira.
Owerri Mall and Asaba Mall were reduced in size to strictly convenience centres
and the plight of clothing retailers will have a limited impact. The reduced
size will, however, reduce the projected US Dollar yields achievable to 7,7% and
9% respectively. These changes have, at least for the medium term, eliminated
the anticipated positive revaluation of these properties.
Resilient Africa accepted a 3-year facility of USD55 million from Stanbic that
is secured against Delta Mall and Owerri Mall. The interest rate is 90-day USD
Libor plus 6,25%. This interest rate includes Nigerian country risk and there is
no recourse to South African balance sheets. Drawdown of this facility is
expected in March 2016 which will reduce Resilient’s exposure to Resilient
Africa.
6 LISTED PORTFOLIO
Following the merger of Capital with Fortress, Resilient received 68 094 240
Fortress A and Fortress B shares. Strong demand for Fortress A shares was
experienced following Fortress’ inclusion in a number of indices after the
merger. Resilient sold a total of 36 794 240 Fortress A shares at an average
price of R17,25 per share into this demand.
In line with the board’s strategy of increasing Resilient’s exposure to hard
currency assets, Resilient acquired an interest in Hammerson, a UK listed retail
REIT. Management has extensively researched Hammerson’s assets, its strategy and
growth prospects and considers the position an attractive long-term investment.
Dec 2015 Jun 2015
Counter Number of Fair value Number of Fair value
shares R’000 shares R’000
Capital (CPF) - - 195 900 000 2 801 369
Fortress A (FFA) 31 300 000 503 304 - -
Fortress B (FFB) 160 150 000 5 578 025 92 675 355 2 363 221
Nepi (NEP) 27 900 000 4 960 899 26 217 896 3 607 583
11 042 228 8 772 173
Hammerson (HMSO UK)# 17 956 553 2 476 561 - -
Rockcastle (ROC)^ 187 550 000 6 545 495 175 322 584 4 728 450
20 064 284 13 500 623
# The Hammerson position is held through equity derivatives.
^ Rockcastle was treated as an associate (equity accounted) and was thus not
fair valued in the financial statements. The carrying value of Rockcastle was R3
232 million and R3 343 million at December 2015 and June 2015 respectively. The
net asset value of Resilient will increase to R83,75 (Jun 2015: R72,52) if the
investment in Rockcastle is fair valued.
The board’s policy is to hedge a maximum of 35% of its foreign currency exposure
to equity investments (Hammerson, Nepi and Rockcastle). At the date of this
report the following hedges were in place:
Foreign
ZAR fair exchange Foreign
value of fair value exchange
investment of investment hedged Exchange
'000 '000 '000 rate
Hammerson R2 476 561 GBP107 739 GBP67 021 GBP - R20,90
Nepi R4 960 899 EUR292 983 EUR32 000 EUR - R15,24
Rockcastle R6 545 495 USD421 493 USD140 911 USD - R15,32
R13 982 955
In total, 28,9% of Resilient’s offshore equity exposure is hedged. The main
purpose is to align the funding risk profile to both the currency and income
streams of the group’s offshore holdings. The result is that 28,9% of these
investments are funded at the interest rates applicable to the currencies of the
investments.
7 VACANCIES
Vacancies reduced from 2,0% at June 2015 to 1,7% at December 2015. Vacancies at
Arbour Crossing and The Galleria remain high at 14,2% and 6,0% respectively.
Management is currently in negotiations for the introduction of an anchor tenant
at Arbour Crossing which will involve the partial redevelopment of the property
and that will significantly reduce the vacant space.
8 FACILITIES AND INTEREST RATE DERIVATIVES
Following the June 2015 rights issue, no new facilities were entered into. Notes
totalling R515 million issued under Resilient’s Domestic Medium Term Note
Programme matured and were repaid.
Amount Average margin
Facility expiry R' million over Jibar
Jun 2017 1 975 1,43%
Jun 2018 2 179 1,50%
Jun 2019 2 992 1,52%
Jun 2020 1 553 1,55%
Jun 2021 900 1,72%
9 599 1,52%
Interest rate swap expiry Amount R' million Average swap rate
Jun 2017 100 8,26%
Jun 2018 900 7,52%
Jun 2019 1 100 7,28%
Jun 2020 880 6,31%
Jun 2021 820 7,88%
Jun 2022 500 8,09%
Jun 2023 - -
Jun 2024 - -
Jun 2025 100 7,78%
4 400 7,37%
Interest rate cap expiry Amount R' million Average cap rate
Jun 2018 400 5,90%
Jun 2019 200 7,38%
Jun 2020 300 7,54%
Jun 2021 300 7,92%
Jun 2022 - -
Jun 2023 500 7,77%
Jun 2024 900 7,81%
2 600 7,46%
Variable rate instruments Amount R'000
Loans to BEE vehicles (2 835 793)
Loans to co-owners (294 546)
Cash and cash equivalents (77 684)
Hammerson equity derivative margin (492 425)
Interest-bearing borrowings (including gross-up of Hammerson
equity derivative) 9 443 431
Currency derivatives (gearing in foreign currency) (4 047 175)
Capital commitments contracted for 1 491 533
3 187 341
Total interest rate derivatives 7 000 000
Percentage hedged 219,6%
Capital expenditure approved by the board 2 102 500
Percentage hedged inclusive of approved capital expenditure 132,3%
The all-in weighted average cost of funding of Resilient was 8,77% at December
2015 and the average hedge term was 4,4 years.
The information contained in notes 2, 7 and 8 and the “Fair value information”
section of note 9 has been compiled using proportionate consolidation. This
results in Resilient accounting for its share of the assets and liabilities of
Resilient Africa and property investments that are not held in undivided shares
(Arbour Crossing, The Galleria, Irene Village Mall and Mafikeng Mall). It
furthermore recognises the Rockcastle investment at fair value and the Hammerson
equity derivative position on a gross basis.
9 SUMMARY OF FINANCIAL PERFORMANCE
Dec 2015 Jun 2015 Dec 2014 Jun 2014
Dividend (cents per share) 232,46 205,05 185,62 168,35
Shares in issue and used
for dividend per share
calculation 385 443 448 376 747 796 342 209 172 312 569 839
Fair value information
Net asset value
per share R83,75 R72,52 R63,85 R54,29
Interest-bearing debt to
asset ratio* 21,0% 17,1% 27,0% 28,3%
Net property expense ratio 17,4% 14,0% 14,5% 14,5%
Gross property expense
ratio 37,2% 34,2% 33,9% 33,9%
Net total expense ratio 15,8% 14,5% 14,3% 17,6%
Gross total expense ratio 30,8% 29,9% 29,2% 32,6%
IFRS accounting
Net asset value per share R75,16 R68,85 R59,02 R53,06
* The interest-bearing debt to asset ratio is calculated by dividing total
interest-bearing borrowings adjusted for cash on hand by the total of
investments in property, listed securities and loans advanced.
Fair value information
SUMMARISED STATEMENT Dec 2015 Jun 2015 Dec 2014
OF FINANCIAL POSITION R'000 R'000 R'000
ASSETS
Investment property 17 453 067 16 853 389 16 104 385
Investment property under development 1 023 975 1 059 389 697 732
Investments 20 064 284 13 500 623 11 598 270
Resilient Share Purchase Trust loans 563 012 659 392 592 307
Loans to BEE partners 2 835 793 1 714 551 1 697 971
Loans to co-owners 294 546 301 277 244 681
Current assets 525 534 357 506 374 362
Total assets 42 760 211 34 446 127 31 309 708
EQUITY AND LIABILITIES
Total equity attributable
to equity holders 32 282 158 27 322 814 21 849 546
Minority interest 25 325 20 470 16 301
Interest-bearing borrowings
net of cash on hand 8 873 322 5 834 443 8 351 722
Deferred tax 758 008 863 318 689 038
Amounts owing to minorities 143 575 112 622 77 177
Current liabilities 677 823 292 460 325 924
Total equity and liabilities 42 760 211 34 446 127 31 309 708
SUMMARISED STATEMENT OF
COMPREHENSIVE INCOME (6 months) (12 months) (6 months)
Recoveries and contractual
rental revenue 1 026 233 1 822 401 876 604
Property operating expenses (381 446) (622 705) (297 291)
Distributable income from investments 290 777 510 654 217 453
Fair value gain on investment property,
investments and currency derivatives 4 667 677 5 637 170 3 288 079
Administrative expenses (42 030) (87 213) (36 405)
Foreign exchange gains 7 217 1 592 536
Profit on sale of associates and
economic interest in Proptrax 25 493 207 283 2 500
Profit before net finance costs 5 593 921 7 469 182 4 051 476
Net finance income/(costs) 177 518 (302 608) (201 133)
Profit before income tax 5 771 439 7 166 574 3 850 343
Income tax 105 857 (310 216) (129 426)
Profit for the period 5 877 296 6 856 358 3 720 917
Minority interest 528 (3 400) (401)
Profit for the period attributable to
equity holders 5 877 824 6 852 958 3 720 516
10 PROSPECTS
With increased levels of uncertainty, the volatility in financial markets both
in South Africa and internationally is anticipated to continue. Resilient’s
conservative gearing and interest rate hedge profile, quality retail assets and
international exposure places the group in a strong position to weather the
storm. Resilient is also well placed to take advantage of attractive investment
opportunities that may arise.
Distributions are forecast to increase by approximately 24% for the 2016
financial year. The projected dividend income from the group’s holdings in
Hammerson, Nepi and Rockcastle for the June 2016 dividend is hedged at the
following exchange rates.
GBP EUR USD
Forward rate against ZAR R22,06 R14,84 R13,34
The growth is further based on the assumptions that a stable macro-economic
environment will prevail, no major corporate failures will occur and that
tenants will be able to absorb the recovery of rising utility costs and
municipal rates. Budgeted rental income was based on contractual escalations and
market-related renewals. This forecast has not been audited or reviewed by
Resilient’s auditors.
By order of the board
Des de Beer Nick Hanekom
Managing director Financial director
Johannesburg - 3 February 2016
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Unaudited Audited Reviewed
Dec 2015 Jun 2015 Dec 2014
R'000 R'000 R'000
ASSETS
Non-current assets 37 600 749 33 409 633 29 304 082
Investment property 18 173 608 17 037 004 13 914 762
Straight-lining of rental
revenue adjustment 334 488 313 608 261 713
Investment property
under development 1 339 429 1 484 715 921 142
Investment in and loans to associate
and joint ventures 3 231 812 3 343 041 4 566 222
Investments 11 042 228 8 772 173 7 273 730
Resilient Share Purchase Trust loans 547 096 642 581 575 748
Loans to BEE vehicles 2 788 713 1 658 623 1 637 998
Loans to co-owners 143 375 157 888 152 767
Current assets 1 348 593 780 101 731 536
Investment property held for sale - 158 012 -
Straight-lining of rental
revenue adjustment - 6 421 -
Resilient Share Purchase Trust loans 15 916 16 811 16 559
Loans to BEE vehicles 47 080 55 928 59 973
Loans to co-owners 139 074 110 734 74 257
Trade and other receivables 549 826 387 029 403 897
Hammerson equity derivative 492 425 - -
Cash and cash equivalents 104 272 45 166 176 850
Total assets 38 949 342 34 189 734 30 035 618
EQUITY AND LIABILITIES
Total equity attributable to
equity holders 28 968 475 25 937 405 20 197 022
Stated capital 11 616 582 10 616 875 7 664 387
Currency translation reserve 287 073 40 113 14 276
Reserves 17 064 820 15 280 417 12 518 359
Minority interest 399 777 279 340 33 730
Total equity 29 368 252 26 216 745 20 230 752
Total liabilities 9 581 090 7 972 989 9 804 866
Non-current liabilities 7 977 937 7 091 406 8 956 424
Interest-bearing borrowings 6 097 007 5 333 721 7 878 290
Deferred tax 752 647 857 657 695 271
Amounts owing to minorities 1 128 283 900 028 382 863
Current liabilities 1 603 153 881 583 848 442
Trade and other payables 694 019 307 098 323 606
Income tax payable 839 839 2 341
Interest-bearing borrowings 908 295 573 646 522 495
Total equity and liabilities 38 949 342 34 189 734 30 035 618
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Unaudited Reviewed
for the six Audited for the six
months for the year months
ended ended ended
Dec 2015 Jun 2015 Dec 2014
Income statement R'000 R'000 R'000
Net rental and related revenue 688 090 1 276 535 573 660
Recoveries and contractual
rental revenue 1 074 525 1 755 229 770 318
Straight-lining of rental
revenue adjustment 14 459 121 443 63 127
Rental revenue 1 088 984 1 876 672 833 445
Property operating expenses (400 894) (600 137) (259 785)
Income from investments 178 711 328 292 142 417
Fair value gain on investment
property, investments and currency
derivatives 1 897 620 3 597 590 1 578 865
Fair value gain on
investment property 124 557 030 -
Adjustment resulting from
straight-lining of rental revenue (14 459) (121 443) (63 127)
Fair value gain on investments 2 825 309 3 350 820 1 753 069
Fair value loss on
currency derivatives (913 354) (188 817) (111 077)
Administrative expenses (45 101) (89 172) (38 216)
Profit on disposal of economic
interest in PropTrax - 2 500 2 500
Foreign exchange gains 11 843 2 612 880
Profit on sale of interest
in associate 25 493 204 783 -
Income from associate
and joint ventures (446 019) 768 822 136 112
- distributable 112 066 249 860 142 534
- non-distributable (558 085) 518 962 (6 422)
Profit before net finance costs 2 310 637 6 091 962 2 396 218
Net finance income/(costs) 169 246 (303 223) (199 645)
Finance income 465 581 357 464 75 300
Interest received 219 123 308 395 75 300
Fair value adjustment on
interest rate derivatives 246 458 49 069 -
Finance costs (296 335) (660 687) (274 945)
Interest on borrowings (339 362) (737 247) (304 754)
Capitalised interest 43 027 76 560 31 121
Fair value adjustment on
interest rate derivatives - - (1 312)
Profit before income tax 2 479 883 5 788 739 2 196 573
Income tax 105 857 (304 654) (130 990)
Profit for the period 2 585 740 5 484 085 2 065 583
Other comprehensive income net of tax
Items that may subsequently be
reclassified to profit or loss
Exchange differences on translation of
foreign operations 359 749 68 253 27 627
Total comprehensive income for the
period 2 945 489 5 552 338 2 093 210
Profit for the period attributable to:
Equity holders of the company 2 564 141 5 467 549 2 067 992
Minority interest 21 599 16 536 (2 409)
2 585 740 5 484 085 2 065 583
Total comprehensive income for the
period attributable to:
Equity holders of the company 2 803 884 5 505 494 2 082 390
Minority interest 141 605 46 844 10 820
2 945 489 5 552 338 2 093 210
Basic earnings per share (cents) 676,44 1 630,11 633,22
RECONCILIATION OF PROFIT FOR THE PERIOD TO HEADLINE EARNINGS
Unaudited Reviewed
for the six Audited for the six
months for the year months
ended ended ended
Dec 2015 Jun 2015 Dec 2014
R'000 R'000 R'000
Basic earnings - profit for
the period attributable to
equity holders 2 564 141 5 467 549 2 067 992
Adjusted for: 13 646 (458 855) 70 686
- fair value loss/(gain) on investment
property 14 335 (435 587) 63 127
- fair value loss on investment property of
joint ventures - 1 480 1 480
- income tax effect (689) (24 733) 6 094
- income tax effect - joint ventures - (15) (15)
Headline earnings 2 577 787 5 008 694 2 138 678
Headline earnings per share (cents) 680,04 1 493,31 654,87
Basic earnings per share and headline earnings per share are based on the
weighted average of 379 063 486 (Jun 2015: 335 409 974; Dec 2014: 326 581 631)
shares in issue during the period.
Resilient has no dilutionary instruments in issue.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Equity
Currency attributable
Stated translation to equity Minority Total
capital reserve Reserves holders interest equity
Unaudited R'000 R'000 R'000 R'000 R'000 R'000
Balance at
Jun 2014 5 594 555 (122) 10 989 731 16 584 164 23 460 16 607 624
Issue of
shares 2 069 832 2 069 832 2 069 832
Equity contributed
by minorities - 89 89
Acquisition of
minority interest - (639) (639)
Exchange
differences on
translation of
foreign operations 14 398 14 398 13 229 27 627
Profit/(loss) for the
period 2 067 992 2 067 992 (2 409) 2 065 583
Dividends paid (539 364) (539 364) - (539 364)
Balance at
Dec 2014 7 664 387 14 276 12 518 359 0 197 022 33 730 20 230 752
Issue of
shares 2 952 488 2 952 488 2 952 488
Equity contributed
by minorities - 254 254
Acquisition of
minority interest - (1) (1)
Obtaining control
of joint ventures - 253 089 253 089
Exchange
differences on
translation of
foreign operations 23 547 23 547 17 079 40 626
Profit for the period 3 399 557 3 399 557 18 945 3 418 502
Dividends paid (635 209) (635 209) (43 756) (678 965)
Transfer to
currency
translation reserve 2 290 (2 290) - -
Balance at
Jun 2015 10 616 875 40 113 15 280 417 25 937 405 279 340 26 216 745
Issue of 8 695 652
shares on
13 Nov 2015 999 707 999 707 999 707
Exchange
differences on
translation of
foreign operations 239 743 239 743 120 006 359 749
Profit for the period 2 564 141 2 564 141 21 599 2 585 740
Dividends paid (772 521) (772 521) (21 168) (793 689)
Transfer to
currency
translation reserve 7 217 (7 217) - -
Balance at
Dec 2015 11 616 582 287 073 17 064 820 28 968 475 399 777 29 368 252
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Unaudited Reviewed
for the six Audited for the six
months for the year months
ended ended ended
Dec 2015 Jun 2015 Dec 2014
R'000 R'000 R'000
Cash inflow/(outflow) from
operating activities 70 048 (17 911) (144 791)
Cash outflow from investing activities (2 108 584) (3 196 973) (2 948 973)
Cash inflow from financing activities 2 097 642 3 196 933 3 207 497
Increase/(decrease) in cash and cash
equivalents 59 106 (17 951) 113 733
Cash and cash equivalents at beginning
of period 45 166 63 117 63 117
Cash and cash equivalents at
end of period 104 272 45 166 176 850
Cash and cash equivalents consist of:
Current accounts 104 272 45 166 176 850
NOTES
1 PREPARATION AND ACCOUNTING POLICIES
The condensed unaudited consolidated interim financial statements have been
prepared in accordance with International Financial Reporting Standards
(“IFRS”), IAS 34: Interim Financial Reporting, the SAICA Financial Reporting
Guides as issued by the Accounting Practices Committee and Financial Reporting
Pronouncements as issued by the Financial Reporting Standards Council, the JSE
Limited Listings Requirements and the requirements of the Companies Act of South
Africa. This report complies with the SA REIT Association Best Practice
Recommendations. This report was compiled under the supervision of Nick Hanekom
CA(SA), the financial director.
The accounting policies applied in the preparation of the condensed consolidated
interim financial statements are in terms of IFRS and are consistent with the
accounting policies applied in the preparation of the previous consolidated
financial statements, with the exception of the adoption of new and revised
standards which became effective during the period.
The group’s investment properties are valued internally by the directors at
interim reporting periods and externally by an independent valuer for year-end
reporting. In terms of IAS 40: Investment Property and IFRS 7: Financial
Instruments: Disclosure, the group’s investment properties are measured at fair
value and are categorised as level 3 investments. In terms of IAS 39: Financial
Instruments: Recognition and measurement and IFRS 7, the group’s currency and
interest rate derivatives as well as the Hammerson equity derivative are
measured at fair value through profit or loss and are categorised as level 2
investments. In terms of IAS 39, investments are measured at fair value being
the quoted closing price at the reporting date and are categorised as level 1
investments. There were no transfers between levels 1, 2 and 3 during the
period. The valuation methods applied are consistent with those applied in
preparing the previous consolidated financial statements.
The directors are not aware of any matters or circumstances arising subsequent
to December 2015 that require any additional disclosure or adjustment to the
financial statements.
The interim financial statements have not been audited or reviewed by
Resilient’s auditors.
2 LEASE EXPIRY PROFILE
Based on Based on contractual
Lease expiry rentable area rental revenue
Vacant 1,7%
Jun 2016 12,3% 11,6%
Jun 2017 10,6% 11,5%
Jun 2018 17,4% 18,9%
Jun 2019 15,0% 18,1%
Jun 2020 15,8% 18,3%
> Jun 2020 27,2% 21,6%
100,0% 100,0%
3 SEGMENTAL ANALYSIS
Unaudited Reviewed
for the six Audited for the six
months for the year months
ended ended ended
Dec 2015 Jun 2015 Dec 2014
R'000 R'000 R'000
Total assets
Retail 20 047 488 19 142 237 15 391 171
Corporate 18 901 854 15 047 497 14 644 447
38 949 342 34 189 734 30 035 618
Rental revenue
Retail 1 088 984 1 876 672 833 445
Profit before net finance costs
Retail 673 755 1 779 635 578 046
Corporate 1 636 882 4 312 327 1 818 172
2 310 637 6 091 962 2 396 218
Reconciliation of profit for the period to
dividend declared
Profit for the period 2 585 740 5 484 085 2 065 583
Fair value gain on
investment property (124) (557 030) -
Fair value gain on investments (2 825 309) (3 350 820) (1 753 069)
Fair value loss on currency derivatives 913 354 188 817 111 077
Profit on disposal of economic interest
in PropTrax - (2 500) (2 500)
Foreign exchange gains (11 843) (2 612) -
Profit on sale of interest in associate (25 493) (204 783) -
Non-distributable income from associate
and joint ventures 558 085 (518 962) 6 422
Fair value adjustment on interest rate
derivatives (246 458) (49 069) 1 312
Income tax expense (105 857) 304 654 127 329
Minority interest (17 383) (20 219) 2 409
Antecedent dividend 14 870 95 614 29 202
Dividends accrued 56 420 40 555 47 444
Amount available for distribution under
best practice 896 002 1 407 730 635 209
Dividend declared – interim (896 002) (635 209) (635 209)
Dividend declared – final (772 521)
- - -
The methodology applied in calculating the dividend is consistent with that of
the prior periods.
4 PAYMENT OF INTERIM DIVIDEND
The board has approved and notice is hereby given of an interim dividend of
232,46 cents per share for the six months ended 31 December 2015.
The dividend is payable to Resilient shareholders in accordance with the
timetable set out below:
Last date to trade cum dividend Friday, 26 February 2016
Shares trade ex dividend Monday, 29 February 2016
Record date Friday, 4 March 2016
Payment date Monday, 7 March 2016
Share certificates may not be dematerialised or rematerialised between Monday,
29 February 2016 and Friday, 4 March 2016, both days inclusive.
In respect of dematerialised shareholders, the dividend will be transferred to
the CSDP accounts/broker accounts on Monday, 7 March 2016. Certificated
shareholders’ dividend payments will be posted on or about Monday, 7 March 2016.
An announcement informing shareholders of the tax treatment of the dividend will
be released separately on SENS.
Directors JJ Njeke (Chairman); Des de Beer*; Thembi Chagonda; Andries de Lange*;
Marthin Greyling; Nick Hanekom*; Bryan Hopkins; Johann Kriek*; Protas Phili;
Umsha Reddy; Barry Stuhler^; Barry van Wyk (*executive director; ^non-
independent)
Changes to the board of directors Spiro Noussis resigned from the board on 11
December 2015 and Protas Phili and Barry Stuhler were appointed on the same day.
Company secretary Monica Muller
Registered address 4th Floor, Rivonia Village, Rivonia Boulevard, Rivonia, 2191
Transfer secretaries Link Market Services South Africa Proprietary Limited, 13th
Floor, Rennie House, 19 Ameshoff Street, Braamfontein, 2001
Sponsor Java Capital
Date: 03/02/2016 03:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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