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Preliminary summarised audited consolidated financial statements for the year ended 30 June 2016
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
(“Resilient” or “the group”) (Approved as a REIT by the JSE)
PRELIMINARY SUMMARISED AUDITED CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 2016
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
Total distributions for the financial year of 488,73 cents (interim: 232,46 cents and final 256,27 cents) per
share is an increase of 25,1% over the previous financial year.
Of this growth, 9% is attributable to the impact of capital raisings, particularly the rights issue of June
2015, which reduced the cost of funding. A further 7% 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 June 2016 dividend income from its holdings in Greenbay, Hammerson,
Nepi and Rockcastle.
In an economy characterised by low growth, Resilient’s property portfolio performed well with comparable sales
growth of 7,7%. The performance was again mixed with a wide disparity between provinces and malls. Malls
affected by mining and resources, particularly platinum mining, showed some recovery. Net property income
reflected this strong trading performance but was negatively affected by increased operating costs
(administered costs), the Ripley’s Believe It Or Not marketing campaign and increased expenditure on
refurbishments as well as tenant installation costs. After adjusting for these, net income grew by 7,4%.
The comparable annual sales growth per province is set out below:
Percentage of
Comparable SA properties
sales growth by value
Northern Cape (4,9)% 5,9%
Eastern Cape 0,3% 3,5%
Mpumalanga 4,9% 13,2%
KwaZulu-Natal 7,0% 20,0%
Limpopo 10,0% 28,0%
Gauteng 12,0% 24,3%
North West 12,0% 5,1%
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 year.
Resilient’s malls are all modern, relevant and well positioned to provide growth into the future. With the
exception of Limpopo Mall, none of the malls require upgrading or refurbishment. Limpopo Mall is currently
being reconfigured, extended and refurbished which is expected to be completed by September 2017.
3 PROPERTY ACQUISITIONS AND DISPOSALS
Resilient acquired an additional 4% (R73 million) in Highveld Mall which will increase its interest to 64%.
This transfer was effected in July 2016. Resilient 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.
In December 2015 Resilient sold Pick n Pay Hypermarket Klerksdorp for R164,5 million against a carrying value
of R164,4 million. Resilient provided mezzanine funding of R7,5 million to the seller which is repayable over
five years and bears interest at prime.
4 EXTENSIONS
Diamond Pavilion is being expanded to accommodate the enlargement of Edgars and Woolworths and a net
additional 187 parking bays. The 2 855m2 GLA extension will achieve a yield of 4,4% on the cost of R127,6
million. The extension is on schedule for completion in November 2016. An improvement in trading and the
positive impact on rentals are not included in the forecast yield.
The 2 753m2 GLA extension to Boardwalk Inkwazi has commenced and is scheduled for completion in November 2016.
The project 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 first phase,
accommodating Pick n Pay, will open in October 2016 and the final phase is scheduled for completion in
September 2017. The expansion will introduce a substantial entertainment offering and a number of new fashion
tenants, including H&M, 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.
As the conditions precedent have been met, transfer of the 50% interest in Mams Mall at a cost of R210 million
is expected in October 2016. Construction is scheduled to commence in November 2016. The existing shopping
centre with a GLA of 17 333m2 will be extensively redeveloped. A total GLA of 70 000m2 is planned which will
include at least four anchor tenants and major national retailers. Resilient will partially finance the co-
developer. The preliminary feasibility study indicates that a yield of approximately 8% will be achieved.
Resilient is awaiting transfer of the last portion of land which will facilitate the extension of the existing
29 644m2 GLA Irene Village Mall to an 80 000m2 GLA regional mall. Transfer is now expected in August 2016. To
take advantage of major roadworks in the immediate vicinity which require landfill, the board has agreed to
the commencement of earthworks at a cost of R45 million. The board previously approved the development at a
yield of 7% at an anticipated cost of R1,3 billion.
The extensions, reconfiguration and substantial improvement to the tenant mix at The Galleria should be
completed ahead of the holiday season in November 2016. New tenants include the first H&M store in KwaZulu-
Natal, Pick n Pay and Toys “R” Us. A number of tenants, including Edgars and Mr Price apparel, are being
extended.
Major extensions that are at various stages of planning include Mafikeng Mall, 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.
Business risks in Nigeria have increased. The government continues to move away from the previous policy of
“managing” the currency, however, restrictions on clothing imports remain in force with severe consequences
for clothing retailers. Nigeria is an under-developed market with attractive medium and long term development
and investment opportunities. Resilient Africa continues to pursue investments providing strict criteria are
met. The Resilient Africa board has conditionally approved small retail developments in Port Harcourt and Uyo,
anchored by Shoprite supermarkets. Two further developments are currently being evaluated.
Resilient’s investment in Nigeria is relatively small. At June 2016, Resilient had advanced R850 million to
Resilient Africa with additional commitments totalling R265 million. A strong platform has, however, been
established which can be expanded once economic conditions improve.
Delta Mall continues to trade well. Despite the closure of Truworths and the failure of a Nigerian clothing
retailer, the 13 766m2 GLA mall is only 6,9% vacant. Owerri Mall opened in March 2016 and Shoprite reports
that their store is trading ahead of expectations. Although the mall has a GLA of only 9 206m2, letting has
been disappointing with 2 878m2 (31%) remaining unlet. There is tenant demand for the remaining space but at
rentals below the previously budgeted levels.
Asaba Mall is scheduled to open in November 2016. A total of 3 613m2 of the 7 534 m2 GLA has been let,
however, this is expected to improve significantly prior to opening.
Resilient Africa accepted a 3-year facility of USD27,5 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 the premium for
Nigerian country risk and there is no recourse to Resilient’s South African balance sheet.
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.
Due to concerns over the reliance on derivatives, particularly IDX positions, Resilient reduced its holding in
Hammerson from 17 956 553 shares at December 2015 to 16 000 000 shares at June 2016 at an average price of
GBP5,72 per share. Resilient acquired 671 300 000 shares in Greenbay at an average price of R1,20 per share.
The increases in the Nepi and Rockcastle holdings were the result of electing scrip dividends.
Jun 2016 Jun 2015
Number of Fair value Number of Fair value
Counter shares R’000 shares R’000
Capital (CPF) - - 195 900 000 2 801 369
Fortress A (FFA) 27 670 000 436 909 - -
Fortress B (FFB) 165 400 000 5 927 936 92 675 355 2 363 221
Greenbay (GRP) 671 300 000 926 394 - -
Nepi (NEP) 28 290 000 4 752 720 26 217 896 3 607 583
12 043 959 8 772 173
Hammerson (HMSO UK)# 16 000 000 1 688 356 - -
Rockcastle (ROC)^ 191 450 000 6 606 940 175 322 584 4 728 450
20 339 255 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 789 million and R3 343 million at June 2016 and June 2015
respectively. The net asset value of Resilient will increase to R84,47 (Jun 2015: R72,52) if the investment in
Rockcastle is fair valued.
The board’s policy is to hedge its foreign currency exposure to equity investments (Greenbay, Hammerson, Nepi
and Rockcastle) to achieve a neutral effect on the first year’s distribution. At the date of this report, the
following hedges were in place:
Foreign
exchange Foreign
ZAR fair value fair value of exchange
of investment investment hedged
'000 '000 '000 Exchange rate
Greenbay R926 394 GBP47 232 GBP67 021 GBP - R20,90
Hammerson R1 688 356 GBP86 080
Nepi R4 752 720 EUR290 921 EUR32 000 EUR - R17,25
Rockcastle R6 606 940 USD448 640 USD140 911 USD - R15,24
R13 974 410
In total, 28,0% 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
28,0% of these investments are funded at the interest rates applicable to the currencies of the investments.
7 BROAD-BASED BLACK ECONOMIC EMPOWERMENT (“BBBEE”)
In line with shareholders’ approval, Resilient provided R1 billion of financial assistance to The Siyakha
Education Trust to enable it to acquire 8 695 652 Resilient shares at a price of R115 per share. The Trust is
a charitable trust established for the promotion of black education and is a registered public benefit
organisation.
The final tranche of the Eagle’s Eye Investments BBBEE initiative matured. Although the holding was sold by
way of a bookbuild, many of the participants re-invested the net proceeds in Resilient shares. In addition to
Siyakha’s 25% share, 31 individuals, mainly black women from Gauteng, the Eastern Cape and
Limpopo province, participated in this initiative. On average the participants received a post-tax dividend of
R13,2 million each over the three tranches.
The board has debated the challenges encountered by black-owned businesses in obtaining funding. It has
resolved to support the establishment of the Katlego Trust which has as its objective the provision of
financial support to black-owned businesses. The intention is to register the trust as a public benefit
organisation.
8 VACANCIES
Vacancies reduced from 2,0% at June 2015 to 1,8% at June 2016. Vacancies at Arbour Crossing remain high at
13,7%, however, negotiations are underway to relocate Food Lover’s Market and to redevelop the southern wing
of the property for Virgin Active. The Galleria’s vacancy reduced to 5,1% from 6,2% in the previous year.
Negotiations with a number of tenants are advanced which will result in a further reduction in vacancies.
9 FACILITIES AND INTEREST RATE DERIVATIVES
Resilient has accepted a 3-year unsecured facility of R500 million from Standard Bank. Notes totaling R691
million issued under Resilient’s Domestic Medium Term Note Programme were repaid.
Average
Amount margin
Facility expiry R' million over Jibar
Jun 2017 1 799 1,43%
Jun 2018 2 179 1,50%
Jun 2019 3 042 1,52%
Jun 2020 2 053 1,64%
Jun 2021 900 1,72%
9 973 1,54%
Amount Average
Interest rate swap expiry R' million swap rate
Jun 2018 400 7,21%
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%
3 800 7,30%
Amount Average
Interest rate cap expiry R' million 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 1 100 7,98%
Jun 2025 - -
2 800 7,55%
Variable rate instruments Amount R'000
Loans to BEE vehicles (2 750 986)
Loans to co-owners (375 769)
Cash and cash equivalents (28 905)
Hammerson equity derivative (324 128)
Interest-bearing borrowings
(including gross-up of Hammerson equity derivative) 9 441 159
Currency derivatives (4 100 223)
Capital commitments contracted for 1 518 698
3 379 846
Total interest rate derivatives 6 600 000
Percentage hedged 195,3%
Capital expenditure approved by the board 1 989 600
Percentage hedged inclusive of approved capital expenditure 122,9%
The all-in weighted average cost of funding of Resilient was 8,75% at June 2016 and the average hedge term was
4,25 years.
10 ISSUE OF SHARES
In addition to the 8 695 652 shares issued to The Siyakha Education Trust on 13 November 2015, Resilient
placed 8 527 132 shares at R129,00 per share by way of a bookbuild on 18 May 2016.
The information contained in notes 2, 5, 8, 9 and the “Fair value information” section of note 11 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 and Mafikeng Mall). It furthermore recognises the Rockcastle investment at fair value
and the Hammerson equity derivative position on a gross basis.
11 SUMMARY OF FINANCIAL PERFORMANCE
Jun 2016 Dec 2015 Jun 2015 Dec 2014
Dividend (cents per share) 256,27 232,46 205,05 185,62
Shares in issue and
used for dividend
per share
calculation 393 970 580 385 443 448 376 747 796 342 209 172
Fair value information
Net asset value per share R84,47 R83,75 R72,52 R63,85
Loan-to-value ratio* 21,0% 21,0% 17,1% 27,0%
Net property expense ratio 16,0% 17,4% 14,0% 14,5%
Gross property expense ratio 36,2% 37,2% 34,2% 33,9%
Net total expense ratio 15,0% 15,8% 14,5% 14,3%
Gross total expense ratio 30,0% 30,8% 29,9% 29,2%
IFRS accounting
Net asset value per share R77,31 R75,16 R68,85 R59,02
* The loan-to-value 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
Jun 2016 Jun 2015
SUMMARISED STATEMENT OF FINANCIAL POSITION R'000 R'000
ASSETS
Investment property 18 555 006 16 853 389
Investment property under development 834 371 1 059 389
Investments 20 339 255 13 500 623
Resilient Share Purchase Trust loans 479 610 659 392
Loans to BEE vehicles 2 750 986 1 714 551
Loans to co-owners 375 769 301 277
Current assets 466 522 357 506
Total assets 43 801 519 34 446 127
EQUITY AND LIABILITIES
Total equity attributable to equity holders 33 276 865 27 322 814
Non-controlling interests 38 445 20 470
Interest-bearing borrowings net of cash on hand 9 088 126 5 834 443
Deferred tax 918 245 863 318
Amounts owing to non-controlling shareholders 98 867 112 622
Current liabilities 380 971 292 460
Total equity and liabilities 43 801 519 34 446 127
SUMMARISED STATEMENT OF COMPREHENSIVE INCOME
Recoveries and contractual rental revenue 2 079 081 1 822 401
Property operating expenses (751 751) (622 705)
Distributable income from investments 618 251 510 654
Fair value gain on investment property,
investments and currency derivatives 5 076 217 5 841 953
Administrative expenses (96 131) (87 213)
Foreign exchange (losses)/gains (17 060) 1 592
Profit on sale of economic interest in PropTrax - 2 500
Profit before net finance costs 6 908 607 7 469 182
Net finance costs (98 921) (302 608)
Profit before income tax 6 809 686 7 166 574
Income tax (54 451) (310 216)
Profit for the year 6 755 235 6 856 358
Non-controlling interests (14 056) (3 400)
Profit for the year attributable to equity holders 6 741 179 6 852 958
12 PROSPECTS
Resilient’s conservative approach to gearing, sources and tenure of funding as well as interest rate hedging
will be maintained albeit at a cost to short-term distribution growth. Resilient’s quality retail property
portfolio and its offshore exposure will continue to buffer the group from the volatility in the economy and
at the same time enable the group to take advantage of opportunities that arise.
Resilient took advantage of the sharp deterioration of the Rand to forward hedge its income from its offshore
investments at rates substantially higher than the prevailing market rates. Distributions are forecast to
increase by between 14% and 16% for the 2017 financial year.
The projected dividend income from the group’s offshore holdings is hedged at the following exchange rates:
Greenbay Hammerson Nepi Rockcastle
GBP GBP EUR USD
Forward rate against ZAR:
Dec 2016 R22,28 R23,60 R16,84 R14,97
Forward rate against ZAR:
Jun 2017 R22,73 R22,23 R18,67 R16,73
The forecast 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.
The claim instituted against the company relating to the Clairwood Racecourse that was considered to be
without merit, was withdrawn.
By order of the board
Des de Beer Nick Hanekom
Managing director Financial director
Johannesburg – 4 August 2016
SUMMARISED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Audited Audited
Jun 2016 Jun 2015
R’000 R'000
ASSETS
Non-current assets 40 051 411 33 409 633
Investment property 19 499 061 17 037 004
Straight-lining of rental revenue adjustment 378 036 313 608
Investment property under development 955 803 1 484 715
Investment in associate Rockcastle 3 788 851 3 343 041
Investments 12 043 959 8 772 173
Resilient Share Purchase Trust loans 466 510 642 581
Loans to BEE vehicles 2 750 986 1 658 623
Loans to co-owners 168 205 157 888
Current assets 1 054 725 780 101
Investment property held for sale - 158 012
Straight-lining of rental revenue adjustment - 6 421
Resilient Share Purchase Trust loans 13 100 16 811
Loans to BEE vehicles - 55 928
Loans to co-owners 178 647 110 734
Trade and other receivables 493 724 387 029
Hammerson equity derivative 324 128 -
Cash and cash equivalents 45 126 45 166
Total assets 41 106 136 34 189 734
EQUITY AND LIABILITIES
Total equity attributable to equity holders 30 458 776 25 937 405
Stated capital 12 712 894 10 616 875
Currency translation reserve 193 838 40 113
Reserves 17 552 044 15 280 417
Non-controlling interests 386 354 279 340
Total equity 30 845 130 26 216 745
Total liabilities 10 261 006 7 972 989
Non-current liabilities 8 308 255 7 091 406
Interest-bearing borrowings 6 235 994 5 333 721
Deferred tax 918 215 857 657
Amounts owing to non-controlling shareholders 1 154 046 900 028
Current liabilities 1 952 751 881 583
Trade and other payables 396 681 307 098
Income tax payable 839 839
Interest-bearing borrowings 1 555 231 573 646
Total equity and liabilities 41 106 136 34 189 734
SUMMARISED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Audited Audited
for the year for the year
ended ended
Jun 2016 Jun 2015
Income statement R’000 R’000
Net rental and related revenue 1 448 858 1 276 535
Recoveries and contractual rental revenue 2 185 226 1 755 229
Straight-lining of rental revenue adjustment 58 263 121 443
Rental revenue 2 243 489 1 876 672
Property operating expenses (794 631) (600 137)
Income from investments 364 619 328 292
Fair value gain on investment property,
investments and currency derivatives 2 321 652 3 597 590
Fair value gain on investment property 566 290 557 030
Adjustment resulting from straight-lining
of rental revenue (58 263) (121 443)
Fair value gain on investments 2 484 186 3 350 820
Fair value loss on currency derivatives (670 561) (188 817)
Administrative expenses (104 575) (89 172)
Profit on sale of economic interest in PropTrax - 2 500
Foreign exchange (losses)/gains (27 995) 2 612
Profit on sale of interest in associate Rockcastle 105 365 204 783
Income from associate and joint ventures 60 448 768 822
- distributable 253 632 249 860
- non-distributable (193 184) 518 962
Profit before net finance costs 4 168 372 6 091 962
Net finance costs (121 237) (303 223)
Finance income 528 490 357 464
Interest received 525 493 308 395
Fair value adjustment on interest
rate derivatives 2 997 49 069
Finance costs (649 727) (660 687)
Interest on borrowings (730 505) (737 247)
Capitalised interest 80 778 76 560
Profit before income tax 4 047 135 5 788 739
Income tax (59 827) (304 654)
Profit for the year 3 987 308 5 484 085
Other comprehensive income net of tax
Items that may subsequently be reclassified to profit or loss
Exchange differences on translation of
foreign operations 256 463 68 253
Total comprehensive income for the year 4 243 771 5 552 338
Profit for the year attributable to:
Equity holders of the company 3 923 090 5 467 549
Non-controlling interests 64 218 16 536
3 987 308 5 484 085
Total comprehensive income for the year attributable to:
Equity holders of the company 4 093 875 5 505 494
Non-controlling interests 149 896 46 844
4 243 771 5 552 338
Basic earnings per share (cents) 1 023,61 1 630,11
RECONCILIATION OF PROFIT FOR THE YEAR TO HEADLINE EARNINGS
Audited Audited
for the year for the year
ended ended
Jun 2016 Jun 2015
R’000 R’000
Basic earnings - profit for the year attributable to
equity holders 3 923 090 5 467 549
Adjusted for: (590 034) (663 638)
- fair value gain on investment property (508 027) (435 587)
- profit on sale of interest in associate Rockcastle (105 365) (204 783)
- fair value loss on investment property
of joint ventures - 1 480
- income tax effect 23 358 (24 733)
- income tax effect - joint ventures - (15)
Headline earnings 3 333 056 4 803 911
Headline earnings per share (cents) 869,66 1 432,25
Basic earnings per share and headline earnings per share are based on the weighted average of 383 261 155 (Jun
2015: 335 409 974) shares in issue during the year.
Resilient has no dilutionary instruments in issue.
SUMMARISED CONSOLIDATED STATEMENT OF CASH FLOWS
Audited Audited
for the year for the year
ended ended
Jun 2016 Jun 2015
R’000 R’000
Cash outflow from operating activities (294 616) (17 911)
Cash outflow from investing activities (3 685 301) (3 196 973)
Cash inflow from financing activities 3 979 877 3 196 933
Decrease in cash and cash equivalents (40) (17 951)
Cash and cash equivalents at beginning of year 45 166 63 117
Cash and cash equivalents at end of year 45 126 45 166
Cash and cash equivalents consist of:
Current accounts 45 126 45 166
SUMMARISED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Equity
Currency attributable Non-
Stated translation to equity controlling Total
capital reserve Reserves holders interests equity
Audited 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 5 022 320 5 022 320 5 022 320
Equity contributed
by non-controlling
shareholders 343 343
Acquisition of
non-controlling
interest (640) (640)
Obtaining control of
joint ventures 253 089 253 089
Exchange
differences on
translation of
foreign operations 37 945 37 945 30 308 68 253
Profit for the year 5 467 549 5 467 549 16 536 5 484 085
Dividends paid (1 174 573) (1 174 573) (43 756) (1 218 329)
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
shares 2 096 019 2 096 019 2 096 019
- issue of 8 695 652
shares on
13 Nov 2015 999 707 999 707 999 707
- issue of 8 527 132
shares on
18 May
2016 1 096 312 1 096 312 1 096 312
Equity contributed
by non-controlling
shareholders 209 209
Exchange
differences on
translation of
foreign operations 170 785 170 785 85 678 256 463
Profit for the year 3 923 090 3 923 090 64 218 3 987 308
Dividends paid (1 668 523) (1 668 523) (43 091) (1 711 614)
Transfer to
currency
translation reserve (17 060) 17 060 - -
Balance at
Jun 2016 12 712 894 193 838 17 552 044 30 458 776 386 354 30 845 130
NOTES
1 PREPARATION, ACCOUNTING POLICIES AND AUDIT OPINION
The preliminary summarised audited consolidated financial statements have been prepared in accordance with the
requirements of the JSE Listings Requirements for preliminary reports and the requirements of the Companies
Act of South Africa applicable to summary financial statements. The JSE Listings Requirements require
preliminary reports to be prepared in accordance with the framework concepts and the measurement and
recognition requirements of International Financial Reporting Standards (“IFRS”), the SAICA Financial
Reporting Guides as issued by the Accounting Practices Committee and Financial Pronouncements as issued by the
Financial Reporting Standards Council, and to also, as a minimum, contain the information required by IAS 34:
Interim Financial Reporting. 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 consolidated financial statements, from which the
summarised consolidated financial statements were derived, 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 year.
The group’s investment properties were externally valued by an independent valuer. In terms of IAS 40:
Investment Property and IFRS 7: Financial Instruments: Disclosure, investment properties are measured at fair
value and are categorised as level 3 investments. The revaluation of investment property requires judgement in
the determination of future cash flows from leases and an appropriate capitalisation rate which varies between
7,50% and 8,75% (Jun 2015: 7,25% and 9,00%). Changes in the capitalisation rate attributable to changes in
market conditions can have a significant impact on property valuations. A 25 basis points increase in the
capitalisation rate will decrease the value of investment property by R645,8 million (Jun 2015: R601,2
million). A 25 basis points decrease in the capitalisation rate will increase the value of investment property
by R688,2 million (Jun 2015: R641,5 million). 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
derivate 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 year.
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 June 2016 that require any
additional disclosure or adjustment to the financial statements.
The auditors, Deloitte & Touche, have issued their opinion on the consolidated financial statements for the
year ended June 2016. The audit was conducted in accordance with International Standards on Auditing. They
have issued an unmodified audit opinion. These preliminary summarised consolidated financial statements have
been derived from the consolidated financial statements and are consistent, in all material respects, with the
consolidated financial statements. This preliminary report has been audited by Deloitte & Touche and an
unmodified audit opinion has been issued. Copies of their audit reports and the consolidated financial
statements are available for inspection at Resilient’s registered address. 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 that report together with the accompanying financial information from Resilient’s registered
address.
2 LEASE EXPIRY PROFILE
Based on
Based on contractual
Lease expiry: South Africa rentable area rental revenue
Vacant 1,8%
Jun 2017 15,5% 15,2%
Jun 2018 17,2% 17,6%
Jun 2019 15,2% 17,7%
Jun 2020 15,2% 16,9%
Jun 2021 17,5% 19,7%
> Jun 2021 17,6% 12,9%
100,0% 100,0%
3 SEGMENTAL ANALYSIS
Audited Audited
for the year for the year
ended Jun 2016 ended Jun 2015
R’000 R’000
Total assets
Retail: South Africa 18 986 266 18 013 539
Retail: Nigeria 1 880 638 1 023 979
Corporate: South Africa 20 131 192 15 047 960
Corporate: Nigeria 108 040 104 256
41 106 136 34 189 734
Rental revenue
Retail: South Africa 2 162 237 1 874 351
Retail: Nigeria 81 252 2 321
Profit for the year
Retail: South Africa 1 765 566 1 812 346
Retail: Nigeria 171 886 (11 161)
Corporate: South Africa 2 141 904 3 682 991
Corporate: Nigeria (92 048) (91)
3 987 308 5 484 085
Reconciliation of profit for the year to dividend declared
Profit for the year 3 987 308 5 484 085
Fair value gain on investment property (566 290) (557 030)
Fair value gain on investments (2 484 186) (3 350 820)
Fair value loss on currency derivatives 670 561 188 817
Profit on sale of economic interest in PropTrax - (2 500)
Foreign exchange losses/(gains) 27 995 (2 612)
Profit on sale of interest in
associate Rockcastle (105 365) (204 783)
Non-distributable loss/(income)
from associate and joint ventures 193 184 (518 962)
Fair value adjustment on interest
rate derivatives (2 997) (49 069)
Income tax 59 827 304 654
Non-controlling interests (32 048) (20 219)
Antecedent dividend 31 497 95 614
Dividends accrued 126 144 40 555
Amount available for distribution
under best practice 1 905 630 1 407 730
Dividend declared - interim (896 002) (635 209)
Dividend declared - final (1 009 628) (772 521)
- -
The methodology applied in calculating the dividend is consistent with that of the prior year.
4 PAYMENT OF FINAL DIVIDEND
The board has approved and notice is hereby given of a final dividend of 256,27 cents per share for the six
months ended 30 June 2016.
The dividend is payable to Resilient shareholders in accordance with the timetable set out below:
Last date to trade cum dividend Tuesday, 30 August 2016
Shares trade ex dividend Wednesday, 31 August 2016
Record date Friday, 2 September 2016
Payment date Monday, 5 September 2016
Share certificates may not be dematerialised or rematerialised between Wednesday, 31 August 2016 and Friday, 2
September 2016, both days inclusive.
In respect of dematerialised shareholders, the dividend will be transferred to the CSDP accounts/broker
accounts on Monday, 5 September 2016. Certificated shareholders’ dividend payments will be posted on or about
Monday, 5 September 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*; Dawn Marole; 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. Dawn Marole was appointed on 10 May 2016.
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: 04/08/2016 05:05:00 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
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