Spear REIT final results February 2018
The following results are the maiden full twelve month results since listing therefore are incomparable. Total revenue came to R316.6 million whilst net operating profit was R211.6 million. Profit attributable to equity holders of R383.2 million was recorded. In addition, headline earnings per share were 92.6 cents per share.
Notice is hereby given of the declaration of a final distribution (number 3) of 41.54992 cents per share for the year ended 28 February 2018 from income reserves.
Company prospects and guidance
The Western Cape property sector has for the most part continued to outperform the rest of South Africa and management's continued focus on regional investment has provided a level of insulation from the tougher trading conditions experienced in regions outside of the Western Cape. Spear continues to have a healthy pipeline of greenfield and brownfield development opportunities within the portfolio, which will unlock further value for the group in time.
Management remains confident that demand for its high-quality rental properties across the various sectors within the Western Cape will continue given its tenant-centric approach and hands-on asset management skills. In light of the recent acquisitions, improved cost of debt and other operational efficiencies created within the company, management advises that distribution per share for the year ending 28 February 2019 is anticipated to be 9-11% higher than the total distribution for the year ended 28 February 2018. The latter revision is premised upon the following assumptions:
* That a relatively stable macroeconomic environment will prevail
* That lease renewals are concluded as per the company forecast
* That no major tenant failures will take place and improved hospitality trading conditions
* That tenants will successfully absorb rising costs associated with utility consumption charges and municipal rates
* That the Western Cape experiences a wet winter that breaks the current drought.