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Abridged Summarised Consolidated Annual Financial Results for the year ended 30 June 2020
Texton Property Fund Limited
Registration number: 2005/019302/06
Approved as a REIT by the JSE
Share code: TEX ISIN: ZAE000190542
(“Texton” or “the group” or “the company”)
ABRIDGED SUMMARISED CONSOLIDATED ANNUAL FINANCIAL RESULTS FOR THE YEAR ENDED 30 JUNE 2020
ABOUT TEXTON
Texton Property Fund Limited is a Real Estate Investment Trust (“REIT”) listed on the JSE Limited. The
company internally manages its R4,5 billion portfolio of retail, office and industrial property assets
located in South Africa (“SA”) and the United Kingdom (“UK”).
HEADLINES
South Africa
- The macro-economic environment remains challenging with further declines in the economy
expected due to measures enacted by the Government to manage the 2019 coronavirus
disease (“COVID-19”) pandemic
- Vacancy of 12,7% (2% increase) due to poor market conditions experienced in 2020
- Letting performance remained strong, with 90% of expiring gross lettable area (“GLA”) being
re-let
- Nine properties were sold, with transfers delayed due to closures of deeds offices, the inability
to obtain municipal clearances and a poorly functioning debt market
- Collection rate of 90% during the COVID-19 lockdown period (April to June), improving to 93%
after year end.
United Kingdom
- UK economy contracted by a record 20,4% in the second quarter of the 2020 calendar year,
following a 2,2% contraction in the previous quarter, as a result of the COVID-19 pandemic
- Collection rate of 97% on wholly-owned properties during the COVID-19 pandemic
- Sale of Tesco Chobe completed in July 2019 resulting in the continued repositioning of the
property portfolio continuing towards industrial and logistic properties
- Wholly owned property portfolio is 100% let with a weighted average lease expiry (“WALE”) of
9,23 years.
Broad Street Mall joint venture(1)
- Refinanced debt in the joint venture
- Four major asset management initiatives
o New cinema and entertainment venue
o New serviced office and co-working centre
o New food hall
o Extended the lease of the main anchor tenant TK Maxx
- Transformation project underway to reposition the Broad Street Mall as a diversified mixed-
use property in Reading, a top 20 town in the United Kingdom
o Hotel development expected to start on site during Q2 FY2021
o Residential planning consent achieved for the development of 422 flats in the
precinct.
Footnote:
(1) A 50% share in a joint venture with Moorgarth Holdings (Luxembourg) s.a.r.l (“Moorgarth”), a
subsidiary of JSE-listed Tradehold Limited.
Effective balance sheet management
- Loan-to-value (“LTV”) improved to 46,2% at year end
- De-risking of balance sheet by the closing out of £7,5 million of cross-currency interest rate
swaps (“CCIRS”) and the conversion of £2,5 million loan secured over SA assets into ZAR
debt
- Refinanced 100% of the Standard Bank debt with a weighted average margin of 2,08% and a
weighted average tenure of 2,45 years
- Refinanced 100% of the UK wholly-owned portfolio debt with HSBC for five years with a
weighted average margin of 2,25%
- Entities adhered to interest cover and LTV covenants.
EXECUTIVE SUMMARY
Texton owns 53 properties located in South Africa and the UK. The geographic split of the portfolio by
value is 55,9% (2019: 58,5%) in South Africa and 44,1% (2019: 41,5%) in the UK (including our portion
of Broad Street Mall). The portfolio in South Africa consists of 76,8% office, 8,6% industrial and 14,6%
retail properties. The UK portfolio is made up of 9,6% office, 38,6% industrial and 51,8% retail.
The South African portfolio vacancy increased to 12,7% (2019: 10,8%) with 90,0% (2019: 83,6%) of
leases expiring during the year being renewed. The UK portfolio is fully occupied.
KEY FINANCIAL RESULTS
Year ended Year ended Change
30 June 2020 30 June 2019 %
Property revenue (R’000) 521 905 558 025 (6.5)
Distributable earnings (R’000) 124 988 268 395 (53.4)
Headline earnings per share (cents) (23.35) 55.62 (141.9)
Earnings per share (cents) (37.35) (153.96) 75.7
Net asset value per share (cents) 580.62 611.96 (4.8)
This short-form announcement is the responsibility of the Board and does not include full or complete
details. Any investment decision should be based on the condensed audited consolidated
results (“full announcement”), which may be downloaded from:
https://senspdf.jse.co.za/documents/2020/jse/isse/TEX/abridged.pdf
The full announcement is available for inspection at the registered offices of the company at no charge,
during office hours for a period of 30 calendar days following the date of this announcement. The full
announcement is also available on the company’s website at:
http://www.texton.co.za/company-information/PRESENTATION
The short-form announcement has not been audited or reviewed by the company’s external auditor.
The abridged summarised consolidated annual financial results are extracted from the financial
statements but is not itself audited. The consolidated financial statements for the year ended 30 June
2020 were audited by SNG GT, who expressed an unmodified opinion thereon. The audited
consolidated financial statements for the year ended 30 June 2020 and the auditor’s report includes
communication of key audit matters. Key audit matters are those matters that, in their professional
judgement, were of most significance in their audit of the consolidated financial statements of the current
period. The full report is available for inspection at the company’s registered office and on the
company’s website.
The directors take full responsibility for the preparation of these abridged summarised consolidated
annual financial results and that the financial information has been correctly extracted from the
consolidated financial statements.
The auditor’s report does not necessarily report on all of the information contained in these abridged
summarised consolidated annual financial results. 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 the
auditor’s report together with the accompanying financial information from the company’s registered
office or on the company’s website.
By order of the Board
23 September 2020
Directors and Prescribed Officers
MAJ Golding (Non-executive chairman) MH Muller*# (Chief executive officer) IF Pick*$ (Chief
financial officer) AJ Hannington (Independent non-executive) JR Macey (Lead independent non-
executive) S Thomas (Independent non-executive) RA Franco ^ (Non-executive) WC van der Vent^
(Independent non-executive) PM Hack*&
HSP Welleman• (Interim chief executive officer)
* Executive director
# Resigned as chief executive officer and executive director effective 31 March 2020
$ Resigned as chief financial officer and executive director on 4 December 2019
^ Appointed on 29 November 2019
• Appointed as interim chief executive officer on 1 July 2020
& Appointed as Chief financial officer on 12 June 2020
Company secretary
Motif Capital Partners, 173 Oxford Road, Rosebank, 2196
Registered office and business address
Block C, Investment Place, 10th Road, Hyde Park, 2196.
Transfer secretaries
Computershare Investor Services Proprietary Limited
2nd Floor, Rosebank Towers
15 Biermann Avenue, Rosebank
Sponsor
Investec Bank Limited
100 Grayston Drive
Sandown, Sandton 2196
Auditor
SizweNtsalubaGobodo Grant Thornton Inc., 20 Morris Street East, Woodmead, 2191
Date: 23-09-2020 09:40:00
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