INDLUPLACE PROPERTIES LIMITED - Unaudited results for six months ended 31 March 2018

Release Date: 09/05/2018 07:07
Code(s): ILU
 
Wrap Text
Unaudited results for six months ended 31 March 2018

INDLUPLACE PROPERTIES LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 2013/226082/06)
JSE share code: ILU ISIN: ZAE000201125
(Approved as a REIT by the JSE)
("Indluplace" or "the company" or "the Group") 


UNAUDITED RESULTS FOR SIX MONTHS ENDED 31 MARCH 2018


Portfolio growth of 82% year on year

Largest focused residential REIT

Diverse and defensive portfolio delivering in difficult market 

Nature of business
Indluplace is the first focused residential REIT listed on the main board of the JSE. In almost three years since listing
it has grown its residential portfolio by over 260% to 9 662 units. It is Indluplace's stated intention to continue growing 
the portfolio aggressively by focusing on acquiring yield enhancing properties and portfolios that provide income from the 
day of acquisition and to pay growing dividends to its shareholders. Indluplace is positioned to assist in overcoming the 
shortage of rental housing in South Africa by providing an exit for developers and owners of residential stock or portfolios 
which may reinvest the capital in new developments. By utilising specialist outsourced property managers for the respective 
portfolios, Indluplace ensures that its growing portfolio remains professionally managed to maintain returns while providing 
value for money accommodation to all its customers.

Summarised distributable income analysis
for the period ended

                                                                     UNAUDITED FOR   UNAUDITED FOR        AUDITED FOR
                                                                      THE 6 MONTHS    THE 6 MONTHS           THE YEAR
                                                                             ENDED           ENDED              ENDED
R                                                                    31 MARCH 2018   31 MARCH 2017  30 SEPTEMBER 2017

Contractual rental income                                              282 522 683     156 784 816        330 048 127   
Net property expenses                                                 (77 624 882)    (36 474 094)       (73 952 618)   
Net property income                                                    204 897 801     120 310 722        256 095 509   
DISTRIBUTABLE INCOME                                                                                                    
Amount available for distribution*                                     154 738 052     117 451 114        266 786 847   
Distributed for the half year/quarter ended:                                                                            
3 months ended 31 December                                                       -    (57 654 491)       (57 654 491)   
3 months ended 31 March                                                          -    (59 796 623)       (59 796 630)   
6 months ended 31 March                                              (154 738 052)   (117 451 114)      (117 451 121)   
3 months ended 30 June                                                           -               -       (71 505 648)   
3 months ended 30 September                                                      -               -       (77 830 078)   
6 months ended 30 September                                                      -               -      (149 335 726)   
Total distributed                                                      154 738 052     117 451 114        266 786 847   
DIVIDEND FOR HALF YEAR ENDED 31 MARCH AND YEAR ENDED 30 SEPTEMBER            CENTS           CENTS              CENTS   
3 months ended 31 December                                                       -        23,82951           23,82951   
3 months ended 31 March                                                          -        24,71489           24,71489   
6 months ended 31 March                                                   48,56125        48,54440           48,54440   
3 months ended 30 June                                                           -               -           24,72452   
3 months ended 30 September                                                      -               -           24,48003   
6 months ended 30 September                                                      -               -           49,20455   
Total distributed per share                                               48,56125        48,54440           97,74895   
Property expense ratio - net (%)                                              27,5            23,3               22,4   
Net asset value per share (cents)                                         1 048,95        1 024,32           1 029,98   
SHARES USED IN CALCULATION OF THE DIVIDENDS FOR THE PERIODS ENDED:                                                      
31 December                                                                      -     241 945 767        241 945 767   
31 March                                                             318 645 117*^     241 945 767       241 945 767#   
30 June                                                                          -               -        289 209 449   
30 September                                                                     -               -        317 932 853   


* In line with the announcement released on SENS on 22 January 2018, dividends will be paid twice a year compared to 
quarterly as in previous periods.
# Includes the 28 723 404 shares issued during October 2017.
^ Per IFRS 2, 22 440 285 shares have been excluded from the number of shares in issue at 31 March 2018. See note under 
investment properties.

COMMENTARY

In a period characterised by difficult market conditions; delays with resolving the partial rent boycott in Windsor; 
and a complex handover of the very large Buffet portfolio, Indluplace was again able to demonstrate the defensive nature 
of its diverse residential portfolio, and, despite a tough first period, remains on track to deliver dividends for the 
full year in line with the lower end of guidance.  

Although vacancies increased over the period, spiking during December and January, our active asset management, including an 
intensive marketing strategy, had reduced these by the end of March 2018, and vacancies have fallen further since the period end. 
Solid progress has been made in resolving Windsor  and we are now in a position to begin re-letting units - with the benefits 
of this expected to start reflecting in the second  half of the year. We were also able to negotiate a short-term rental guarantee 
over the Buffet portfolio to cater for certain  handover issues, with the result that these issues have not effected Indluplace's 
income during the period.  Given the headwinds experienced, we are happy with the performance of the portfolio over the period, and 
satisfied that we are  on a solid base to continue to provide sustainable, defensive income in the coming years.

Revenue
Total revenue includes contractual rental income and expenditure that is recoverable from tenants. Revenue, excluding straight 
line rental income, has increased from R195,0 million to R334,7 million for the period ended 31 March 2018 as the full effect 
of the acquisitions concluded during the current and previous financial year, as well as rental escalations are taken into account. 

Property portfolio

                                                                     6 MONTHS ENDED    6 MONTHS ENDED     12 MONTHS ENDED
                                                                      31 MARCH 2018     31 MARCH 2017   30 SEPTEMBER 2017
Residential                                           Buildings                 171               117                 125
                                                      Units                   9 662             5 511               6 859
                                                      Vacancy (%)               6,3               4,5                 3,5
Retail                                                GLA - m2               17 764            12 647              14 803
                                                      Vacancy (%)               1,5               9,6                 1,0

RESIDENTIAL UNIT SPREAD                             %    RESIDENTIAL UNIT CATEGORY    %    RESIDENTIAL BUILDING TYPE    %
Johannesburg suburbs                               48    Rooms                        5    High rise                   29
Johannesburg inner city                            32    Bachelors                   14    Walk-up                     71
Pretoria/Midrand                                   10    One bed                     22
Witbank                                             5    Two Bed                     48
Vanderbijlpark                                      5    Three bed                    9
                                                         Other                        2
                                                  100                               100                               100

Vacancies have increased from 4,5% at 31 March 2017, being the comparable reporting period, to 6,3%. There has been an improvement 
to the end of March 2018. 

Property expenses
Property expenses have increased from R74,7 million to R129,8 million for the period ended 31 March 2018, which is in line with the
increased property portfolio. The net property expense ratio of 27,5% is in line with expectations and the nature of the current portfolio.

Administration costs
Administration costs have increased from R5,9 million to R7,4 million for the period ended 31 March 2018, which is in line with the increased
expansion of the company's management team.

Finance income
                                                                    6 MONTHS ENDED     6 MONTHS ENDED     12 MONTHS ENDED
R                                                                    31 MARCH 2018      31 MARCH 2017   30 SEPTEMBER 2017
Interest on indluplace share purchase and option scheme                 10 263 766          9 365 374          18 662 768
Interest received on cash balances                                       4 342 174          1 992 222          12 728 274
                                                                        14 605 940         11 357 596          31 391 042

Finance income has increased from R11,4 million to R14,6 million for the period ended 31 March 2018. The interest received
on cash balances has increased as a result of increased billings and the placing of excess funds in deposit facilities.

Finance charges

                                                                   6 MONTHS ENDED     6 MONTHS ENDED      12 MONTHS ENDED
R                                                                   31 MARCH 2018      31 MARCH 2017    30 SEPTEMBER 2017
Interest paid on secured financial liabilities & swaps                 57 866 129          8 332 679           17 897 726
Interest paid on cash balances                                             40 057                  -            8 109 271
                                                                       57 906 186          8 332 679           26 006 997

Finance charges increased from R8,3 million to R57,9 million for the period ended 31 March 2018, as a result of the Buffet 
transaction. The transaction was funded by way of a joint loan facility of R1,3 billion by ABSA and Investec Bank, in
addition to a R200 million Standard Bank facility. The details of the facilities have been included below.

Investment property
The increase in investment property relates to the acquisition for R1,4 billion of the Buffet Group residential portfolio 
(as announced on Sens on 20 June 2017) comprising 2 803 units spread over 48 properties, including the two properties where 
the 50% not already owned by Indluplace, were acquired. This increased the number of residential properties in the portfolio to 171. 
In addition to the 12 495 936 vendor shares issued to the Buffet Group of entities to discharge the purchase price, an additional 
22 440 285 shares valued at R240,8 million were issued to the Buffet Group pursuant to the transaction. Indluplace provided the 
funding to the Buffet Group for the purchase of these 22 440 285 shares. The funding is secured by the pledge of shares issued 
to the Buffet Group and bears interest at a rate equal to the dividends received on those shares. The security will be released 
on the payment of the outstanding amounts which can take place from year 3, but the loans must be settled by year 10. The issue 
of shares using the proceeds of a loan made by the share issuer, when the loan is recourse only to the shares, is treated as an 
option grant in which options are exercised on the date or dates when the loan is repaid. This is based on an International Financial 
Reporting Interpretations Committee agenda decision issued in November 2005. This option grant is accounted for in terms of IFRS 2, 
more specifically as an equity-settled share-based payment, valued using a Black Scholes option pricing model. The issue of these options 
to the Buffet Group was considered to be part of the acquisition costs of the properties and has therefore been capitalised to the cost of 
the investment property. A further impact of this is that the shares are not treated as in issue, until such time as the debt is settled. 

Trade and other receivables
Trade and other receivables increased from R68,7 million to R133,7 million for the period ended 31 March 2018, which is in line with
the increased size of the portfolio. Of this amount, net trade receivables amounts to R4,8 million which is comparable to 30 September 2017.
The remaining balance comprises municipal deposits, amounts receivable from property managers and the interest element relating
to the loans to participants of the Indluplace share purchase and option scheme. Cash in excess of R80,8 million, held by the 
company's property managers in trust accounts, is included in the aforesaid balance.

Cash and cash equivalents
Cash and cash equivalents decreased from R40,9 million to R4,4 million as at 31 March 2018. The decrease in cash is due to
excess funds being deposited into debt facilities.

Secured financial liabilities and derivative instruments
Loan facility in terms of which Indluplace entered into a R1,3 billion facility, comprising a R100,0 million access facility, a 
R685,7 million 3 year loan and a R514,3 million 5 year loan. In total Indluplace is able to draw on a R1,5 billion facility, when 
taking into account the R200 million Standard Bank 3 year facility. At 31 March 2018, Indluplace had drawn only R1,3 billion of total 
facilities to date. 

The fair value adjustment of the interest rate swaps amounting to R10,8 million is included in secured financial liabilities.

MATURITY         FIXED RATE %   3 MONTH JIBAR %   PRIME MARGIN %         CAPITAL
September 2019         10,11                 -                 -     150 000 000
October 2020               -                 -            (1,35)       7 000 000
October 2020            9,28                 -                 -     550 050 042
October 2020            9,51                 -                 -      56 969 975
October 2020               -              2,05                 -      78 694 268
October 2022            9,94                 -                 -     289 958 763
October 2022               -              2,20                 -     163 274 955
                                                                   1 295 948 003

Trade and other payables
Trade and other payables increased from R65,3 million to R101,2 million as at 31 March 2018, mainly as a result of
the Buffet portfolio acquisition. The balance comprises trade payables and accruals of R42,1 million, prepayment of tenant rentals
of R16,6 million and deposits from tenants amounting to R42,5 million.

Change in directorate
As published on SENS on 13 October 2017, Yondela Silimela was appointed to the board of directors with effect from 1 November 2017.

Prospects
The board of directors acknowledges the difficult environment in which Indluplace operates. Given the defensive nature of it's diverse 
residential portfolio, coupled with strong, hands-on management and with the strong fundamentals in this sector, Indluplace expects to 
deliver full year dividend growth of around 4% which is in line with previous guidance. The board of directors is confident that ample 
opportunities for acquisitions exist and that Indluplace will grow the portfolio substantially over the next few years. 

This forecast has not been reviewed or reported on by the company's auditors. Given the nature of its business, Indluplace uses dividend 
per share as its key performance measure as it is considered to be a more relevant performance measure than earnings or headline earnings 
per share. 

Payment of dividend for the 6 months ended 31 March 2018
The board of directors has declared a gross dividend of 48,56125 cents per share (dividend number 11) for the six months ended 31 March 2018, 
in accordance with the timetable set out below:

Last date to trade cum dividend
Tuesday, 29 May 2018
Shares trade ex dividend
Wednesday, 30 May 2018
Record date
Friday, 1 June 2018
Payment date
Monday, 4 June 2018

Shares may not be dematerialised or rematerialised between Wednesday, 30 May 2018 and Friday, 1 June 2018, both days inclusive. Payment of the 
dividend will be made to shareholders on Monday, 4 June 2018. In respect of dematerialised shares, the dividend will be transferred to the CSDP/
broker accounts on Monday, 4 June 2018. Certificated shareholders' dividend payment will be deposited on or about Monday, 4 June 2018.

Tax treatment of dividend
In accordance with Indluplace's status as a REIT, shareholders are advised that the dividend meets 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 distribution on shares will be 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 shareholders 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 dividend is, however, exempt from dividends 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. Dividends received
by non-resident shareholders will not be taxable as income and instead will be treated as dividends which are exempt from income tax in terms of 
the general dividend exemption in section 10(1)(k)(i) of the Income Tax Act. From 22 February 2017, any dividend received by a non-resident from
a REIT is subject to dividends withholding tax at 20%, 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 20%, the net dividend amount due to non- resident shareholders is 38,84900 cents per share. A reduced dividend withholding rate in terms 
of the applicable DTA, may only be relied on if the non- resident shareholders have provided the following forms to their CSDP or broker, as
the case may be, in respect of uncertificated  shareholders, or the company, in respect of certificated shareholders:
    
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 arrangefor the abovementioned documents 
    to be submitted prior to payment of the dividend if such documents have not already been submitted, if applicable. 
    Shares in issue at the date of declaration of this dividend: 341 085 402. 
    Indluplace's income tax reference number: 9390/649/177

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.

Dividends
As published on SENS on 22 January 2018, the board of directors has resolved to change the frequency of dividend declarations and payments from 
quarterly for the three months ended 30 September, 31 December, 31 March and 30 June of each year, to bi-annual dividends for the six
months ended 31 March and 30 Septemberof each year, with immediate effect.

Litigation statement
There are no legal or arbitration proceedings, including any proceedings that are pending or threatened, of which Indluplace is aware, that may have 
or have had in the recent past, being the previous 12 months, a material effect on the group's financial position.

Basis of preparation
The unaudited interim group financial statements for the six months ended 31 March 2018 have not been reviewed or reported on by the company's 
independent  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 Financial Practices Committee and the Financial Reporting pronouncement
as issued by the Financial Reporting Standard Council, IAS 34: Interim Financial Reporting, the JSE Listings Requirements and the requirements of the
South African Companies Act, 2008. The accounting policies are consistent with those of the audited results for the year ended 30 September 2017. 
These results have been prepared under the supervision of Terry Kaplan CA (SA), Indluplace's Financial Director.

Condensed consolidated statement of comprehensive income

                                                                                                   UNAUDITED       UNAUDITED            AUDITED
                                                                                                 FOR THE SIX     FOR THE SIX            FOR THE
                                                                                                MONTHS ENDED    MONTHS ENDED    12 MONTHS ENDED
R                                                                                              31 MARCH 2018   31 MARCH 2017  30 SEPTEMBER 2017
PROPERTY PORTFOLIO REVENUE                                                                                                                    
Contractual rental income                                                                        282 552 683     156 784 816        330 048 127   
Recoveries                                                                                        52 167 572      38 207 087         79 328 680   
Straight line rental income accrual                                                                        -               -            513 434   
Total revenue                                                                                    334 720 255     194 991 903        409 890 241   
Operating costs                                                                                (129 792 454)    (74 681 181)      (153 281 298)   
Administration costs                                                                             (7 399 896)     (5 884 525)       (13 409 923)   
Net operating profit                                                                             197 527 905     114 426 197        243 199 020   
Changes in fair values                                                                          (10 826 641)        (18 103)         35 723 690   
Profit from operations                                                                           186 701 264     114 408 094        278 922 710   
Net finance (charges)/income                                                                    (43 300 246)       3 024 917          5 384 045   
Finance charges                                                                                 (57 906 186)     (8 332 679)       (26 006 997)   
Finance income                                                                                    14 605 940      11 357 596         31 391 042   
Profit before taxation                                                                           143 401 018     117 433 011        284 306 755   
Taxation                                                                                                   -               -                  -   
Total comprehensive income for the period                                                        143 401 018     117 433 011        284 306 755   
RECONCILIATION OF EARNINGS TO HEADLINE EARNINGS                                                                           
Profit for the year attributable to shareholders                                                 143 401 018     117 433 011        284 306 755   
Change in fair value of properties                                                                         -               -       (36 881 197)   
Deferred tax thereon                                                                                       -               -                  -   
Headline earnings attributable to shareholders                                                   143 401 018     117 433 011        247 425 558   
Number of shares in issue at period-end                                                        318 645 117 *     241 945 767        289 209 449   
Number of shares in issue used for the calculation of distribution per share (last quarter)    318 645 117 *     241 945 767        317 932 853   
Weighted average number of shares in issue used for the calculation of earnings and headline                                                      
earnings per share                                                                             317 307 598 *     240 612 882        253 384 729   
Basic and diluted earnings per share (cents)                                                           45,19           48,81             112,20   
Headline earnings per share (cents)                                                                    45,19           48,81              97,65   
Dividends per share (cents)                                                                            48,56           48,54              97,75   


* Per IFRS 2, 22 440 285 shares have been excluded from the above number of shares in issue at 31 March 2018. See note under investment properties 
above.

Condensed consolidated statement of financial position
AS AT 31 MARCH 2018

                                                                                                   UNAUDITED       UNAUDITED            AUDITED
                                                                                                 FOR THE SIX     FOR THE SIX            FOR THE
                                                                                                MONTHS ENDED    MONTHS ENDED    12 MONTHS ENDED
R                                                                                              31 MARCH 2018   31 MARCH 2017  30 SEPTEMBER 2017
ASSETS                                                                                                                 
Non-current assets                                                                             4 615 932 614   2 614 194 018      3 137 624 685   
Investment property                                                                            4 406 592 316   2 422 356 232      2 945 718 828   
Fair value of investment property                                                              4 403 342 002   2 419 619 352      2 942 468 514   
Straight line rental income accrual                                                                3 250 314       2 736 880          3 250 314   
Computer software                                                                                    177 334         133 158            201 229   
Loans to participants of Indluplace share purchase and option scheme                             209 162 964     191 704 628        191 704 628   
Current assets                                                                                   138 077 238      74 761 514        109 686 991   
Trade and other receivables                                                                      133 678 368      55 607 325         68 738 896   
Cash and cash equivalents                                                                          4 398 870      19 154 189         40 948 095   
Total assets                                                                                   4 754 009 852   2 688 955 532      3 247 311 676   
EQUITY AND LIABILITIES                                                                                                                            
Shareholders' interest                                                                         3 342 441 976   2 478 310 813      2 978 791 568   
Stated capital                                                                                 3 033 288 346   2 290 271 465      2 755 180 753   
Reserves                                                                                         309 153 630     188 039 348        223 610 815   
Non-current liabilities                                                                        1 310 387 193     160 967 536        203 211 727   
Secured financial liabilities                                                                  1 295 948 003     158 494 392        199 599 178   
Derivative instruments                                                                            14 439 190       2 473 144          3 612 549   
Current liabilities                                                                              101 180 683      49 677 183         65 308 381   
Trade and other payables                                                                         101 180 683      49 677 183         65 308 381   
Total equity and liabilities                                                                   4 754 009 852   2 688 955 532      3 247 311 676   
Number of shares in issue for the period ended                                                   318 645 117     241 945 767        289 209 449   
Net asset value per ordinary share (cents)                                                          1 048,95        1 024,32           1 029,98   


* Per IFRS 2, 22 440 285 shares have been excluded from the above number of shares in issue at 31 March 2018. See note under investment properties 
above.

Condensed consolidated statement of changes in equity

R                                                                                                STATED CAPITAL        RESERVES           TOTAL   
Balance at 30 September 2016                                                                      2 274 536 709     184 353 830   2 458 890 539   
Issue of shares                                                                                      15 734 756               -      15 734 756   
Total comprehensive income for the 6 months                                                                   -     117 433 011     117 433 011   
Dividends                                                                                                     -   (113 747 493)   (113 747 493)   
Balance at 31 March 2017                                                                          2 290 271 465     188 039 348   2 478 310 813   
Issue of shares                                                                                     464 909 288               -     464 909 288   
Total comprehensive income for the 6 months                                                                   -     166 873 744     166 873 744   
Dividends                                                                                                     -   (131 302 277)   (131 302 277)   
Balance at 30 September 2017                                                                      2 755 180 753     223 610 815   2 978 791 568   
Issue of shares                                                                                     286 833 433               -     286 833 433   
Share buyback                                                                                       (8 725 840)               -     (8 725 840)   
Total comprehensive income for the 6 months                                                                   -     143 401 018     143 401 018   
Share based payments                                                                                          -      19 971 854      19 971 854   
Dividends                                                                                                     -    (77 830 057)    (77 830 057)   
Balance at 31 March 2018                                                                          3 033 288 346     309 153 630   3 342 441 976   


Consolidated statements of cash flow

                                                                                                     FOR SIX         FOR SIX             FOR 12
                                                                                                MONTHS ENDED    MONTHS ENDED       MONTHS ENDED
R                                                                                              31 MARCH 2018   31 MARCH 2017  30 SEPTEMBER 2017
Net cash generated/(utilised) from operating activities                                           47 375 165     (6 448 082)        (4 383 862)   
Cash generated from operations                                                                   168 505 468     104 274 494        235 281 863   
Dividends paid                                                                                  (77 830 057)   (113 747 493)      (245 049 770)   
Finance charges paid                                                                            (57 906 186)     (8 332 679)       (26 006 997)   
Finance income received                                                                           14 605 940      11 357 596         31 391 042   
Net cash utilised in investing activities                                                    (1 301 661 591)    (30 632 982)      (516 705 648)   
Net acquisition and additions to investment property                                         (1 301 640 750)    (30 594 232)      (516 562 197)   
Net acquisition of computer software                                                                (20 841)        (38 750)          (143 451)   
Net cash generated from financing activities                                                   1 217 737 201       9 968 490        515 770 842   
Proceeds from share issue                                                                        130 114 216        (69 307)        464 733 045   
Proceeds from secured financial liabilities                                                    1 239 348 825       9 000 000         50 000 000   
Share buyback                                                                                    (8 725 840)               -                  -   
Repayment of secured financial liabilities                                                     (143 000 000)               -                  -   
Loan from shareholder                                                                                      -       1 037 797          1 037 797   
Net movement in cash and cash equivalents                                                       (36 549 225)    (27 112 574)        (5 318 668)   
Cash and cash equivalents at the beginning of the period                                          40 948 095      46 266 763         46 266 763   
Cash and cash equivalents at the end of the period                                                 4 398 870      19 154 189         40 948 095   


Condensed consolidated segmental analysis
The entity has increased to four reportable segments based on the geographic split of the country which are the entity's strategic business segments.  
For each strategic business segment, the entity'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 entity's reportable segments.

                                                                                                                            UNAUDITED FOR THE SIX
                                                                                                                                  MONTHS ENDED
                                                   UNAUDITED FOR THE SIX MONTHS ENDED 31 MARCH 2018                               31 MARCH 2017
R                                               GAUTENG  MPUMALANGA KWA-ZULU NATAL FREE STATE        TOTAL        GAUTENG   MPUMALANGA          TOTAL
PROPERTY PORTFOLIO REVENUE                                                                                                                                
Rental income and recoveries                309 511 233  20 462 512   3 170 151    1 576 359    334 720 255    172 643 434   22 348 469    194 991 903   
Straight line rental income accrual                   -           -           -            -              -              -            -              -   
Total revenue                               309 511 233  20 462 512   3 170 151    1 576 359    334 720 255    172 643 434   22 348 469    194 991 903   
Operating costs                           (123 942 850) (3 980 660) (1 434 726)    (434 218)  (129 792 454)   (67 944 086)  (6 737 095)   (74 681 181)   
Administration costs                                                                            (7 399 896)                                (5 884 525)   
Net operating profit                                                                            197 527 905                                114 426 197   
Changes in fair values                                                                         (10 826 641)                                   (18 103)   
Profit from operations                                                                          186 701 264                                114 408 094   
Net finance (charges)/income                                                                   (43 300 246)                                  3 024 917   
Finance charges                                                                                (57 906 186)                                (8 332 679)   
Finance income                                                                                   14 605 940                                 11 357 596   
Profit before taxation                                                                          143 401 018                                117 433 011   
Taxation                                                                                                  -                                          -   
Total comprehensive income for the period                                                       143 401 018                                117 433 011   
Reportable segment assets                 4 143 982 806 328 075 660  44 405 468   25 158 554  4 541 622 488  2 155 906 529  318 220 890  2 474 127 419   
Corporate segment assets                                                                        212 387 364                                214 828 113   
Reportable segment liabilities             (90 115 581) (8 494 907) (1 269 498)  (1 300 697)  (101 180 683)   (46 111 107)  (4 599 960)   (50 711 067)   
Corporate segment liabilities                                                               (1 310 387 193)                              (159 933 652)   
                                                                                              3 342 441 976                              2 478 310 813   

R/AUDITED - 30 SEPTEMBER 2017                                      GAUTENG     MPUMALANGA     FREE STATE           TOTAL
PROPERTY PORTFOLIO REVENUE                                                                                                 
Rental income and recoveries                                   363 098 186     45 495 171        783 450     409 376 807   
Straight line rental income accrual                                513 434              -              -         513 434   
Total revenue                                                  363 611 620     45 495 171        783 450     409 890 241   
Operating costs                                              (139 820 967)   (13 262 190)      (198 141)   (153 281 298)   
Administration costs                                                                                        (13 409 923)   
Net operating profit                                                                                         243 199 020   
Changes in fair values                                                                                        35 723 690   
Profit from operations                                                                                       278 922 710   
Net finance income/(charges)                                                                                   5 384 045   
Finance charges                                                                                               31 391 042   
Finance income                                                                                              (26 006 997)   
Profit before taxation                                                                                       284 306 755   
Taxation                                                                                                               -   
Total comprehensive income for the year                                                                      284 306 755   
Reportable segment assets                                    2 851 959 169    325 902 763     23 338 558   3 201 200 490   
Corporate segment assets                                                                                      46 111 186   
Reportable segment liabilities                                (16 988 203)    (8 622 615)   (23 338 558)    (48 949 376)   
Corporate segment liabilities                                                                              (219 570 732)   
                                                                                                           2 978 791 568   


                                                                        UNAUDITED FOR   UNAUDITED FOR                                     
                                                                              THE SIX         THE SIX    AUDITED FOR THE                            
                                                                         MONTHS ENDED    MONTHS ENDED    12 MONTHS ENDED                                    
R                                                                       31 MARCH 2018   31 MARCH 2017  30 SEPTEMBER 2017
RECONCILIATION OF COMPREHENSIVE INCOME TO DISTRIBUTABLE EARNINGS                                                      
Total comprehensive income for the period                                 143 401 018    117 433 011         284 306 755   
Change in fair value of derivative instruments                             10 826 641         18 103           1 157 508   
Change in fair value of properties                                                                          (36 881 197)   
Straight line rental income accrual                                                 -              -           (513 434)   
Antecedent dividends                                                          510 393              -          18 717 215   
Amount avaliable for distribution                                         154 738 052    117 451 114         266 786 847   
RECONCILIATION OF AMOUNT AVAILABLE FOR DISTRIBUTION FOR THE SIX MONTHS/                                                    
PER QUARTER                                                                                                                
Amounts available for distribution to shareholders                        154 738 052    117 451 114         266 786 847   
3 months ended 31 December                                                          -   (57 654 491)        (57 654 491)   
3 months ended 31 March                                                             -              -        (59 796 630)   
3 months ended 30 June                                                              -              -        (71 505 648)   
Amount available for distribution for the six months/year ended:          154 738 052     59 796 623          77 830 078    
Dividend per share (cents)                                                      48,56          48,54               97,55   


By order of the Board
9 May 2018

Directors
T Adler (Chairperson)*, C Abrams*^, C de Wit (CEO), M Kaplan,
T Kaplan (FD), G Kinross*^ (Lead independent director), S Noik*,
A Rehman*^, Y Silimela* , I Suleman.
*Non-executive, ^ Independent. All directors are South African.

Registered office
3rd Floor, 1 Sturdee Avenue, Rosebank, 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.indluplace.co.za



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