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Unaudited condensed consolidated interim results for the six months ended 31 March 2016
ARROWHEAD PROPERTIES LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2011/000308/06)
JSE share code: AWA ISIN: ZAE000203105
(Approved as a REIT by the JSE)
("Arrowhead" or "the company")
UNAUDITED CONDENSED CONSOLIDATED INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 MARCH 2016
- Dividend of 40,79 cents per share. Growth of 9,52% for the six months
- Dividend of 20,76 cents per share. Growth of 11,01% for the quarter
- Core property portfolio growth of 8,5%
- Forecast dividend expected at upper end of previous guidance
NATURE OF BUSINESS
Arrowhead is a Real Estate Investment Trust ("REIT") holding a diverse portfolio of office, retail and industrial properties and, through its 60,1% owned subsidiary Indluplace
Properties Limited ("Indluplace"), residential properties. The total portfolio, located in all provinces of South Africa, is valued at R9,5 billion. The company's main focus is on paying
growing income returns to its investors. This is achieved through escalating rentals in terms of leases with tenants, satisfactory renewal of leases with existing tenants, renting of vacant space
within the property portfolio, managing and reducing, where possible, costs associated with the property portfolio and by acquiring revenue enhancing properties and investments in other
REITS. The company also owns an 11,0% interest in Dipula Income Fund Limited ("Dipula"). During the period under review the company acquired an interest of 10,5% in Rebosis Property
Fund Limited ("Rebosis").
Condensed consolidated financial performance for the six months ended 31 March 2016
R'000 2016 2015
Revenue (excluding straight line rental income) 743 681 555 644
Listed securities income 20 097 18 926
Property expenses (270 655) (177 732)
Administration and corporate costs (15 333) (12 782)
Finance expenses (111 003) (104 598)
Finance income 27 337 13 423
Non-controlling interest profits elimination (net of antecedent income) (40 765) -
Distributable income 353 359 292 881
Antecedent income 26 145 21 171
Antecedent income - subsidiary 2 316 -
Accrued distribution on listed securities 32 220 -
Listed securities income recognised in previous reporting period (19 796) -
Total distribution 394 244 314 052
Distribution to the Arrowhead Charitable Trust* 12 645 -
Total distribution after effects of Arrowhead Charitable Trust 406 889 314 052
* Distribution to the Arrowhead Charitable Trust is added back as it is eliminated on consolidation
Property expenses as a percentage of revenue - gross 36,0% 32,0%
Property expenses as a percentage of revenue - net 13,0% 11,6%
Distribution for the quarter ended 31 December 198 995 156 370
Distribution for the quarter ended 31 March^ 207 894 157 682
Total distribution 406 889 314 052
Dividend per share (cents) for the quarter ended 31 December 2015 # 20,03 18,55
Dividend per share (cents) for the quarter ended 31 March 2016 ^# 20,76 18,70
Net asset value per share (cents) 876,47 727,05
40,79 37,25
^ The dividend was declared on 18 May 2016
# In the prior period, Arrowhead's linked unit capital structure was converted into an ordinary share structure comprising of A- and B-
ordinary shares. Subsequently, the B-ordinary shares were converted into A-ordinary shares which were then reclassified as ordinary
shares. Shareholders' distributions have not been affected by the reclassification as the net income distributions to A- and B- ordinary
shareholders were the same.
COMMENTARY
REVENUE
Revenue includes rental income and expenditure that is recoverable from tenants.
The substantial increase in revenue is due to the full effect of the acquisitions concluded during the previous financial year, annual escalations to existing leases and partially the impact of
acquisitions concluded during the current financial year.
At 30 September 2015, Arrowhead owned 157 properties and 95 residential properties. At 31 March 2016, Arrowhead owned 155 properties (by value retail 46%, offices 42% and industrial 12%) and
109 residential properties. The average gross monthly rental per m(2) per sector is R111 for retail, R113 for office and R38 for industrial. Vacancies are down from 7,3% at 30 September 2015
to 7,2% at 31 March 2016 (retail 7,0%, office 10,4% and industrial 3,1%).
During the period under review, 101 461m(2) of gross lettable area ("GLA"), in the property portfolio, expired of which 82,0% was renewed. Rental escalations of 8,4% have been achieved
on lease renewals across the property portfolio and the average lease profile across the portfolio is 3,72 years.
Six month letting report for the period ended 31 March 2016 (excluding residential portfolio)
Total m(2) Let m(2) Vacant m(2) Let(%) Vacant (%)
As at 1 October 2015 886 775 822 287 64 488 93 7
Acquisitions 36 294 34 650 1 644
Disposals (11 862) (8 781) (3 081)
Net adjustments (275) (275) -
Adjusted totals 910 932 847 881 63 051 93 7
Net (loss)/gain - (2 270) 2 270
As at 31 March 2016 910 932 845 611 65 321 93 7
LISTED SECURITIES INCOME
Listed securities income comprises income received on shares held in Dipula and Rebosis. In this reporting period, Arrowhead has recognised the anticipated dividends received in respect of
Dipula and Rebosis in the form of an adjustment in the distributable earnings reconciliation.
PROPERTY EXPENSES
Municipal expenses have increased in line with the increased revenue. The gross cost to income ratio achieved has increased from 32,0% to 36,0%.
ADMINISTRATIVE EXPENSES AND CORPORATE COSTS
R'000 2016 % of total 2015 % of total
Salaries 11 431 75 7 200 56
Professional service fees 1 791 12 1 996 16
Other 2 111 13 3 586 28
Total 15 333 100 12 782 100
The largest contributor to administrative expenses is salaries, which has increased as a result of the additional staff complement in line with the enlarged portfolio and additional headcount in
Indluplace. The decrease in professional fees was due to concerted effort made by management to reduce these costs.
FINANCE INCOME
R'000 2016 % of total 2015 % of total
Interest on group share purchase and option schemes 24 428 89 10 014 75
Interest on cash balances and tenants 2 598 10 2 843 21
Interest received - interest rate swaps 311 1 - -
Other - - 566 4
Total 27 337 100 13 423 100
Interest on the group share purchase and option schemes is in respect of interest charged on outstanding balances of the loans granted to participants of both the Arrowhead Unit Purchase Trust
and the Indluplace Share Purchase and Option Scheme.
FINANCE CHARGES
R'000 2016 % of total 2015 % of total
Interest paid - secured financial liabilities 101 073 91 92 046 88
Interest paid - interest rate swaps 8 038 7 11 904 11
Amortisation of structuring fee and other interest paid 1 892 2 648 1
Total 111 003 100 104 598 100
Finance charges increased from R104,6 million to R111,0 million which is line with the growth of the portfolio, and taking current interest rate increases into consideration.
INVESTMENT PROPERTIES
The company owns a portfolio of 155 retail, industrial and office properties, and indirectly through Indluplace 109 residential properties, valued at R9,5 billion, and located in all 9
provinces in South Africa. The average value per property at 31 March 2016 was R46,7 million.
Analysis of movement in investment property
Property portfolio Residential portfolio* Total
No. of buildings R'000 No. of buildings R'000 No. of buildings R'000
Balance at the beginning of the year 157 6 934 850 95 1 711 457 252 8 646 307
Acquisitions, additions and fair value adjustments 1 498 544 14 495 686 15 994 230
Disposals (3) (108 200) - - (3) (108 200)
Balance at the end of the period 155 7 325 194 109 2 207 143 264 9 532 337
* The residential portfolio is a seperately listed fund on the JSE. Arrowhead's shareholding in Indluplace was 60,1% at 31 March 2016.
Investment property has increased from R8,6 billion at 30 September 2015 to R9,5 billion at 31 March 2016. The increase was attributable to acquisitions and additions of R1,0 billion
(including Indluplace) and disposals of R108,2 million.
Arrowhead made the following acquisitions and disposals during the six months under review:
Property acquisitions
Property name Acqusition yield (%) Province Sector Transfer date/effective date R
Cleary Park 10,5 Eastern Cape Retail 1 December 2015 466 377 000
Property disposals
Property Name Province Sector Sold R
Beyers Naude (Blackheath) Gauteng Office 5 November 2015 27 200 000
Gradner Street (Roggebaai) Western Cape Office 22 February 2016 51 000 000
Benoni Rynfield Shopping Centre Gauteng Retail 17 December 2015 30 000 000
108 200 000
NET INCOME GROWTH ON PROPERTIES OWNED AT 1 OCTOBER 2014 AND STILL OWNED ON 31 MARCH 2016
Description 1 October 2015 to 1 October 2014 to Growth (%)
31 March 2016 31 March 2015
R'000 R'000
Revenue 549 946 508 210 8,21
Property Expenses (198 441) (178 344) 11,27
Net Operating Income 351 505 329 866 6,56
Assuming a gearing ratio on the portfolio of 25% and an annual effective interest rate of 9%, the total growth in distributable income for the six months ending 30 September 2016,
should be 8,5%. The core portfolio now includes all properties except the residential properties and the new acquisitions Cleary Park and Matsulu Shopping Centre. The core portfolio
represents 92,8% of the retail, industrial and office portfolio (by value).
LOANS TO PARTICIPANTS OF GROUP SHARE PURCHASE AND OPTION SCHEMES
The loans to the participants of both the Arrowhead and Indluplace share option schemes increased from R433,9 million to R542,9 million. The recipients include the executive directors and
staff of Arrowhead and Indluplace. The loans bear interest at the company's effective rate of borrowings (in respect of Arrowhead) and bear interest at a rate equal to the dividend of the
company (in respect of Indluplace) and are secured by a cession of the shares.
TRADE AND OTHER RECEIVABLES
Trade receivables, deposits, other receivables and payments in advance increased from R61,1 million to R80,0 million. The balance outstanding has increased from the prior year as a result of
the enlarged property portfolio. Bad debts amounting to R0,5 million have been written off during the period under review, whilst the provision for bad debt increased from R6,9 million at
year end to R7,0 million. The combined amounts are less than 1% of revenue.
SECURED FINANCIAL LIABILITIES
The loans of R2,4 billion (2015: R2,3 billion) measured against investment properties of R9,5 billion (2015: R8,6 billion) represents a loan to value of 23,2% (2015: 27,9%). The interest rate
swaps of R1,8 billion and the fixed rate loan of R387,0 million results in interest on R2,2 billion of the total R2,4 billion being fixed. This equates to 90% of the total borrowings.
Excess funds are placed in an access facility to reduce the overall interest charge. The effective interest rate for the period ended 31 March 2016 was 9,05% (30 September 2015: 8,96%).
Capital 2016 Capital 2015
Maturity Fixed rate(%) 3 month Jibar margin(%) Prime rate margin R'000 R'000
August 2017 - - Minus 1,5 200 000 200 000
March 2018 - - Minus 1,4 170 000 55 700
March 2018 - 2,10 - 280 000 280 000
December 2018 - 1,77 - 300 000 300 000
April 2019 - 1,77 - 270 000 270 000
April 2019 - 2,10 - 60 000 60 000
June 2019 - - Minus 1,4 51 000 -
August 2019 - 1,75 - - 610 000
November 2019 - 1,75 - 610 000 -
March 2020 9,37 - - 387 284 387 284
March 2020 - 2,54 - 92 716 92 716
March 2020 - - Minus 1,3 2 910 -
Total exposure 2 423 910 2 255 700
(Excluding loan initiation fees and fair value adjustments on swaps)
Arrowhead has further entered into interest rate swaps to hedge its exposure to fluctuations in interest rates of its debt as follows:
- an interest rate swap over R140 million until 15 August 2017;
- an interest rate swap over R35 million until 15 August 2017;
- an interest rate swap over R189 million until 31 May 2018;
- an interest rate swap over R73 million until 31 May 2018;
- an interest rate swap over R629 million until 31 March 2019;
- an interest rate swap over R113 million until 17 June 2019; and
- an interest rate swap over R595 million until 2 September 2019.
SYNERGY TRANSACTION
As announced on SENS on 10 March 2016, Arrowhead, Synergy Income Fund Limited ("Synergy") and Vukile Property Fund Limited ("Vukile") are in advanced discussions about,
and have reached broad consensus on, the terms of a transaction in terms of which:
- Synergy's asset management will be internalised;
- Vukile will acquire all or the bulk of Synergy's retail assets in return for the sale by Vukile to Synergy of the majority of Vukile's office and industrial assets; and
- Synergy will acquire 100% of the shares in Cumulative Properties Limited, a subsidiary of Arrowhead that will house its portfolio of higher yielding retail, office
and industrial properties, in return for the issue of Synergy B shares to Arrowhead.
PROSPECTS
The company previously issued a guidance that for the financial year ending 30 September 2016, it expected a growth in dividends on those declared in its previous financial year,
of between 8% and 10%. The company expects to come in at the upper end of its guidance. The projections have not been reviewed or reported on by Grant Thornton.
SUMMARY OF FINANCIAL PERFORMANCE
Unaudited for the three months Unaudited for the three months Audited for the year
ended 31 March 2016 ended 31 March 2015 ended 30 September 2015
Dividend per share (cents) 20,76 18,70 75,15
Arrowhead ordinary shares in issue *993 483 619 - -
A- shares in issue^ - 421 607 408 437 607 408
B- shares in issue^ - 421 607 408 437 607 408
Net asset value per share/linked unit at reporting date (cents) 876,47 727,00 870,22
Loan to value ratio 23% 32% 28%
^ Includes shares issued to the Arrowhead Charitable Trust.
* After the reporting period an additional 7 934 996 Arrowhead shares were issued.
PAYMENT OF DIVIDEND FOR THE QUARTER ENDED 31 MARCH 2016
The board of directors ("Board") has approved a gross dividend (dividend number 18) of 20,76000 cents per share for the quarter ended 31 March 2016 in accordance with the timetable set
out below:
2016
Last date to trade cum distribution Friday, 3 June
Shares trade ex distribution Monday, 6 June
Record date Friday, 10 June
Payment date Monday, 13 June
Share certificates may not be dematerialised or rematerialised between Monday, 6 June 2016 and Friday 10 June 2016, both days inclusive. The dividend will be transferred to dematerialised
shareholders' CSDP/broker accounts on Monday, 13 June 2016. Certificated shareholders' dividend payments will be paid to certificated shareholders' bank accounts on or about
Monday, 13 June 2016.
In accordance with Arrowhead's status as a REIT, shareholders are advised that the dividend meet the requirements of a "qualifying distribution" for the purposes of section 25BB of the
Income Tax Act, No. 58 of 1962 ("Income Tax Act"). The dividend on the shares is deemed to be a dividend, for South African tax purposes, in terms of section 25BB of the Income Tax Act.
The dividend received by or accrued to South African tax residents must be included in the gross income of such shareholder and will not be exempt from income tax (in terms of the exclusion
to the general dividend exemption, contained in paragraph (aa) of section 10(1)(k)(i) of the Income Tax Act) because they are dividends distributed by a REIT. This is, however, exempt from
dividend withholding tax in the hands of South African tax resident shareholders, provided that the South African resident shareholders provided the following forms to their Central Securities
Depository Participant ("CSDP") or broker, as the case may be, in respect of uncertificated shares, or the company, in respect of certificated shares:
a) a declaration that the dividend is exempt from dividends tax; and
b) 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 abovementioned documents to be submitted prior to payment of the dividend, if such documents have not already been submitted.
The dividend received by non-resident shareholders will not be taxable as income and instead will be treated as an ordinary dividend which is exempt from income tax in terms of the general
dividend exemption in section 10(1)(k)(i) of the Income Tax Act. It should be noted that up to 31 December 2013 distributions received by non-residents from a REIT were not subject to
dividend withholding tax. From 1 January 2014, any distributions received by a non-resident from a REIT will be subject to dividend 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 shareholders. Assuming dividend withholding tax will be
withheld at a rate of 15%, the net dividend amount due to non-resident shareholders is 17,64600 cents per share. A reduced dividend withholding rate in terms of the applicable DTA, may only
be relied on 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) a declaration that the dividend is subject to a reduced rate as a result of the application of a DTA; and
b) 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 abovementioned documents to be submitted prior to payment of the dividend if such documents have not already been submitted, if applicable.
Shareholders are encouraged to consult their professional advisors should they be in any doubt as to the appropriate action to take.
Shares in issue at the date of declaration of dividend: 1 001 418 615
Arrowhead's income tax reference number: 9779/439/15/8
EVENTS AFTER REPORTING PERIOD END
On 1 April 2016, Vividend Income Fund Limited, a subsidiary of Arrowhead acquired the remaining 10% holding in Access Park, Kenilworth for a purchase consideration of R79,7 million,
resulting in Arrowhead having full ownership of the building effective 1 April 2016.
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.
BASIS OF PREPARATION
The interim consolidated results for the six months ended 31 March 2016 have not been reviewed or reported on by the groups' auditors, Grant Thornton.
The financial statements have been prepared in accordance with the requirements of International Financial Reporting Standards, the SAICA Financial Reporting Guides as issued by the
Accounting Practices Committee, IAS 34: Interim Financial Reporting, the JSE Listings Requirements and the requirements of the South African Companies Act, 2008. These results have
been prepared under the supervision of I Suleman, CA (SA), Arrowhead's Chief Financial Officer.
The accounting policies adopted are consistent with those applied in the preparation of the financial statements for the year ended 30 September 2015.
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Unaudited for six months Unaudited for six months Audited for year
ended 31 March ended 31 March ended 30 September
R'000 2016 2015 2015
Rental income 743 681 555 644 1 217 913
Straight line rental income accrual 8 339 18 040 19 341
Listed securities income 20 097 18 926 19 115
Total revenue 772 117 592 610 1 256 369
Property expenses (270 655) (177 732) (411 883)
Administration and corporate costs (15 333) (12 782) (31 130)
Net operating profit 486 129 402 096 813 356
Changes in fair values (84 220) 149 046 640 713
Profit from operations 401 909 551 142 1 454 069
Finance charges (111 003) (104 598) (219 679)
Finance income 27 337 13 423 32 650
Profit before debenture interest and taxation 318 243 459 967 1 267 040
Debenture interest - (261 313) (278 137)
Profit before taxation 318 243 198 654 988 903
Taxation - - -
Total comprehensive income for the period 318 243 198 654 988 903
Profit for the period attributable to:
Equity shareholders of Arrowhead 277 478 198 654 945 118
Non-controlling interest 40 765 - 43 785
318 243 198 654 988 903
Reconciliation of earnings, headline earnings and distributable earnings Unaudited for six months Unaudited for six months Audited for year
ended 31 March ended 31 March ended 30 September
R'000 2016 2015 2015
Reconciliation of earnings, headline earnings and distributable earnings
Profit for the period attributable to Arrowhead shareholders 277 478 198 654 945 118
Debenture interest - 261 313 -
Earnings 277 478 459 967 945 118
Changes in fair value of investment property - - (498 214)
Changes in fair value of investment property - non-controlling interest - - 26 672
Profit on sale of property - - (596)
Headline profit attributable to shareholders/linked unitholders 277 478 459 967 472 980
Debenture interest at effective interest rates - prior to de-linking* - - 278 137
Changes in fair values of listed securities and financial instruments 84 220 (149 046) (141 903)
Straight line rental income accrual (8 339) (18 040) (19 341)
Straight line rental income accrual - non-controlling interest - - 425
Interest received on loan to the Arrowhead Charitable Trust (eliminated on group level) 12 645 - 11 749
Income from listed securities distributed in prior period (19 796) - -
Accrued distribution on listed securities 32 220 - 22 587
Antecedent income 26 145 21 171 21 169
Antecedent income - subsidiary 2 316 - -
Distributable earnings attributable to shareholders/linked unitholders 406 889 314 052 645 803
Number of Arrowhead ordinary shares in issue 1 001 419 - -
Number of A-shares/linked units in issue - 421 607 437 607
Number of B-shares/linked units in issue - 421 607 437 607
Weighted average number of Arrowhead ordinary shares in issue 902 020 - -
Weighted average number of A-shares/linked units in issue - 391 134 405 621
Weighted average number of B-shares/linked units in issue - 391 134 405 621
Basic and diluted earnings per Arowhead ordinary share (cents) 61,52 - -
Basic and diluted earnings per A-share/linked unit (cents) - 58,80 116,50
Basic and diluted earnings per B-share/linked unit (cents) - 58,80 116,50
Headline and diluted headline earnings per Arrowhead ordinary share (cents) 61,52 - -
Headline and diluted headline earnings per A-share/linked unit (cents) - 58,80 58,30
Headline and diluted headline earnings per B-share/linked unit (cents) - 58,80 58,30
* In the prior year the debenture interest paid has been excluded from headline earnings as the linked units have been de-linked resulting in disclosure of earnings per share
compared to earnings per linked unit in the prior year. This resulted in a significant decrease in the basis and dilituted earnings per share as well as the headline earnings per
share.
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Unaudited at Unaudited at Audited at
31 March 31 March 30 September
R'000 2016 2015 2015
ASSETS
Non-current assets 11 253 554 8 226 474 9 649 996
Investment property 9 532 337 7 258 399 8 538 107
Fair value of property portfolio for accounting purposes 9 436 103 7 258 399 8 450 213
Straight line rental income accrual 96 234 - 87 894
Property, plant and equipment 233 253 284
Loans to participants of group share purchase and option schemes 542 914 255 047 433 886
Goodwill 176 830 176 830 176 830
Financial assets 970 163 513 236 482 420
Derivative instruments 31 077 22 709 18 469
Current assets 80 040 529 815 148 307
Trade and other receivables 80 040 36 603 61 119
Cash and cash equivalents - 493 212 87 188
Non-current assets held for sale - - 108 200
Total assets 11 333 594 8 756 289 9 906 503
EQUITY AND LIABILITIES
Shareholders' interest 8 707 614 1 027 347 7 346 537
Stated capital 6 142 446 1 027 347 5 128 005
Non-controlling interest 966 420 - 576 127
Reserves 1 598 748 - 1 642 405
Non-current liabilities - debentures - 5 103 285 -
Shareholders'/linked unitholders' interest 8 707 614 6 130 632 7 346 537
Other non-current liabilities 2 429 961 2 268 725 2 426 048
Secured financial liabilities 2 419 313 2 250 498 2 408 033
Derivative instruments 10 648 18 227 18 015
Current liabilities 196 019 356 932 133 918
Trade and other payables 177 732 199 250 133 918
Bank overdraft 18 287 - -
Unitholders for distibution - 157 682 -
Total equity and liabilities 11 333 594 8 756 289 9 906 503
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Non-controlling
R'000 Stated capital Reserves interest Total
Balance at 30 September 2014 - 828 693 - 828 693
Issue of shares - - 564 110 564 110
Transfers between equityholders - 28 194 (28 194) -
REIT conversion 5 128 005 - - 5 128 005
Dividends paid - (159 600) (3 574) (163 174)
Total comprehensive income for the year - 945 118 43 785 988 903
Balance at 30 September 2015 5 128 005 1 642 405 576 127 7 346 537
Issue of shares 1 040 586 - 398 377 1 438 963
Transfers between equityholders - 5 479 (5 479) -
Antecedent income (26 145) 26 145 - -
Dividends paid - (352 759) (43 370) (396 129)
Total comprehensive income for the period - 277 478 40 765 318 243
Balance at 31 March 2016 6 142 446 1 598 748 966 420 8 707 614
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Unaudited for six months Unaudited for six months Audited for year
ended 31 March ended 31 March ended 30 September
R'000 2016 2015 2015
Net cash generated from operating activities 30 393 47 264 (34 690)
Net cash utilised in investing activities (1 018 069) (235 208) (1 101 324)
Net cash generated from financing activities 882 201 598 081 1 140 127
Net movement in cash and cash equivalents (105 475) 410 137 4 113
Cash and cash equivalents at the beginning of the year 87 188 83 075 83 075
Cash and cash equivalents at the end of the period (18 287) 493 212 87 188
CONSOLIDATED CONDENSED SEGMENTAL ANALYSIS
GEOGRAPHICAL
The company has three reportable segments based on the geographic split of the country which are the company's strategic business segments.
For each strategic business segment, the company's executive directors review internal management reports on a monthly basis. All segments
are located in South Africa. There are no single major tenants. The following summary describes the operations in each of the company's
reportable segments.
CONDENSED SEGMENTAL ANALYSIS
31 MARCH 2016
R'000 Gauteng Western Cape Other Total
Contractual rental income 486 791 87 573 169 317 743 681
Straight line rental income - - 8 339 8 339
Listed securities income - - 20 097 20 097
Operating and administration costs (179 862) (28 899) (77 227) (285 988)
Net operating profit 306 929 58 674 120 526 486 129
Finance income 548 111 26 678 27 337
Finance charges (123) (2) (110 878) (111 003)
Net operating income 307 354 58 783 36 326 402 463
Changes in fair values - - (84 220) (84 220)
Reportable segment profit before tax 307 354 58 783 (47 894) 318 243
Taxation - - - -
Reportable segment profit after tax 307 354 58 783 (47 894) 318 243
Reportable segment assets 5 068 257 1 248 316 5 017 021 11 333 594
Reportable segment liabilities (79 587) (17 017) (2 529 376) (2 625 980)
4 988 670 1 231 299 2 487 645 8 707 614
CONDENSED SEGMENTAL ANALYSIS
31 MARCH 2015
R'000 Gauteng KwaZulu-Natal Eastern Cape Other Total
Contractual rental income 337 488 63 163 29 607 125 386 555 644
Straight line rental income - - - 18 040 18 040
Listed securities income - - - 18 926 18 926
Operating and administration costs (109 617) (23 251) (8 742) (48 904) (190 514)
Net operating profit 227 871 39 912 20 865 113 448 402 096
Finance income 409 37 18 12 959 13 423
Finance charges (22) - - (104 576) (104 598)
Net operating income 228 258 39 949 20 883 21 831 310 921
Changes in fair values - - - 149 046 149 046
Reportable segment profit before debenture interest and tax 228 258 39 949 20 883 170 877 459 967
Debenture interest - - - (261 313) (261 313)
Taxation - - - - -
Reportable segment profit after debenture interest and tax 228 258 39 949 20 883 (90 436) 198 654
Reportable segment assets 4 695 276 1 004 736 475 489 2 580 788 8 756 289
Reportable segment liabilities (774 095) (309 257) (74 489) (6 571 101) (7 728 942)
3 921 181 695 479 401 000 (3 990 313) 1 027 347
CONDENSED SEGMENTAL ANALYSIS
30 September 2015
R'000 Gauteng KwaZulu-Natal Eastern Cape Other Total
Contractual rental income 893 760 126 487 57 941 139 725 1 217 913
Straight line rental income - - - 19 341 19 341
Listed securities income - - - 19 115 19 115
Operating and administration costs (311 392) (48 191) (17 296) (66 134) (443 013)
Net operating profit 582 368 78 296 40 645 112 047 813 356
Finance income 1 063 78 19 31 490 32 650
Finance charges (13) - (1) (219 664) (219 679)
Net operating income/(loss) 583 418 78 374 40 663 (76 127) 626 327
Changes in fair values - - - 640 713 640 713
Reportable segment profit before debenture interest and tax 583 418 78 374 40 663 564 585 1 267 040
Debenture interest - - - (278 137) (278 137)
Taxation - - - - -
Reportable segment profit after debenture interest and tax 583 418 78 374 40 663 286 448 988 903
Reportable segment assets 4 490 347 829 676 374 610 4 211 870 9 906 503
Reportable segment liabilities (73 383) (14 040) (5 034) (2 467 509) (2 559 966)
4 416 964 815 636 369 576 1 744 361 7 346 537
By order of the Board
18 May 2016
Directors: M Nell * (Chairperson), G Leissner (CEO), I Suleman (CFO), M Kaplan (COO), T Adler*, S Noik*, E Stroebel*
* Independent non-executive
All directors are South African.
There were no changes to the Board during this period.
Registered office
2nd Floor, 18 Melrose Boulevard, Melrose Arch, Melrose, Johannesburg, 2196
PO Box 685, Melrose Arch, 2076
Transfer secretaries
Computershare Investor Services Proprietary Limited
Sponsor
Java Capital
Company secretary
CIS Company Secretaries Proprietary Limited
Website
www.arrowheadproperties.co.za
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