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Unaudited results for the six months ended 31 August 2017
ADRENNA PROPERTY GROUP LIMITED
(Registration Number 1998/012245/06)
Share Code: ANA ISIN: ZAE000163580
("Adrenna" or "the Group")
CONDENSED STATEMENT OF COMPREHENSIVE INCOME
Six months ended Six months ended 12 months ended
31 August 2017 31 August 2016 28 February 2017
R’000 R’000 R’000
(unaudited) (unaudited) (audited)
Revenue 13 076 11 765 26 160
Gross profit 13 076 11 765 26 160
Operating income before interest and revaluations 9 312 6 572 16 226
Fair value adjustments on investment properties 448 4 662 19 018
Investment income 432 498 953
Finance costs (3 032) (3 537) (6 732)
Net income from Non-current Assets Held For Sale - 62 -
Net income before taxation 7 160 8 257 29 465
Taxation (2 542) (2 098) (8 368)
Income after taxation for the period 4 618 6 159 21 097
Non-controlling interest - - -
Income attributable to ordinary shareholders 4 618 6 159 21 097
Total net profit 4 618 6 159 21 097
Other comprehensive income - - -
Total comprehensive income attributable to:
- Ordinary shareholders 4 618 6 159 21 097
- Non-controlling interests - - -
4 618 6 159 21 097
CONDENSED STATEMENT OF FINANCIAL POSITION
31 August 2017 31 August 2016 28 February 2017
R’000 R’000 R’000
(unaudited) (unaudited) (audited)
ASSETS
Non-current assets
Investment properties 231 562 214 795 229 954
Property, plant and equipment 18 - -
Loans owing by third parties 4 912 6 334 5 447
Operating lease assets 6 913 5 235 6 889
Deferred taxation 254 779 289
243 659 227 143 242 579
Current assets
Loans owing by third parties 2 190 1 842 1 873
Inventory 1 430 1 430 1 430
Accounts receivable 2 854 1 363 3 082
Operating lease assets 2 871 2 375 2 871
Current taxation receivable 146 421 40
Cash and cash equivalents 6 554 149 263
16 045 7 580 9 559
Non-current assets held for sale 6 000 6 745 -
Total assets 265 704 241 468 252 138
EQUITY AND LIABILITIES
Equity
Stated capital and reserves 151 139 131 583 146 521
Non-current liabilities
Borrowings 59 913 60 040 54 606
Deferred tax 39 060 33 821 38 435
98 973 93 861 93 041
Current liabilities
Current portion of borrowings 11 030 8 179 9 626
Accounts payable 1 654 1 321 1 280
Taxation payable 1 262 42 313
Bank overdraft 1 646 6 482 1 357
15 592 16 024 12 576
Total equity and liabilities 265 704 241 468 252 138
CONDENSED STATEMENT OF CASH FLOWS
Six months ended Six months ended 12 months ended
31 August 2017 31 August 2016 28 February 2017
R’000 R’000 R’000
(unaudited) (unaudited) (audited)
Cash generated by operations 8 190 7 007 12 687
Finance costs (3 032) (3 537) (6 732)
Investment income – interest 432 498 953
Taxation refunded 130 - 281
Taxation paid (1 170) (264) (1 058)
4 550 3 704 6 131
Cash flows from investing activities
Proceeds from sale of investment property 5 500 - 6 745
Acquisition of investment property (10 959) - (804)
Acquisition of equipment (18) - -
Net movement in loans owing by third parties 219 851 1 708
(5 258) 851 7 649
Cash flows from financing activities
Repayment of borrowings (3 290) (5 010) (8 996)
Raising of bond finance 10 000 - -
6 710 (5 010) (8 996)
Movements in cash and cash equivalents 6 002 (455) 4 784
Cash and cash equivalents at the beginning of the period (1 094) (5 878) (5 878)
Cash and cash equivalents at the end of the period 4 908 (6 333) (1 094)
CONDENSED STATEMENT OF CHANGES IN EQUITY
31 August 2017 31 August 2016 28 February 2017
R’000 R’000 R’000
(unaudited) (unaudited) (audited)
STATED CAPITAL
Ordinary stated capital 567 567 567
RESERVES
Retained earnings 145 954 124 857 124 857
Balance at beginning of period
Comprehensive income attributable to ordinary shareholders 4 618 6 159 21 097
Balance at the end of the period 150 572 131 016 145 954
Total reserves attributable to:
Ordinary shareholders 150 572 131 016 145 954
Non-controlling interests - - -
Total reserves 150 572 131 016 145 954
Total equity and reserves 151 139 131 583 146 521
SUPPLEMENTARY INFORMATION
31 August 2017 31 August 2016 28 February 2017
(unaudited) (unaudited) (audited)
Number of ordinary shares in issue at the beginning of the period (‘000) 55 915 55 915 55 915
Number of ordinary shares in issue at the end of the period (‘000) 55 915 55 915 55 915
Weighted average number of shares in issue during the period (‘000) 55 915 55 915 55 915
Basic earnings:
Net profit per condensed statement of comprehensive income (R’000) 4 618 6 159 21 097
Basic earnings per share (cents) 8,3 11,0 37,7
Headline earnings
Net profit per condensed statement of comprehensive income (R’000) 4 618 6 159 21 097
Profit on sale of investment property (R’000) (1 700) - (355)
Revaluation of investment property (net of taxation) (R’000) (331) (3 357) (13 417)
Headline earnings (R’000) 2 587 2 802 7 325
Headline earnings per share (cents) 4,6 5,0 13,1
Dividends per share (cents) - - -
Net asset value per share (cents) 270,3 235,3 262,0
Net tangible asset value per share (cents) 270,3 235,3 262,0
NOTES: -BASIS OF PREPARATION
These condensed consolidated financial statements have been prepared in accordance with IAS 34: Interim Financial
Reporting, the requirements of the Companies Act of South Africa and the Listings Requirements of the Johannesburg Stock
Exchange. The unaudited condensed consolidated results have been prepared on the going concern basis as the directors
are of the view that the group has adequate resources in place to continue in operation for the foreseeable future. The
accounting policies applied are in compliance with International Financial Reporting Standards and the SAICA Financial
Reporting Guides (formerly the AC 500 Standards) as issued by the Accounting Practices Committee and its successor and
are consistent with those applied in the most recent annual financial statements. These results were prepared by the Financial
Director, Mr H Beukes. These results have not been reviewed or audited.
CONDENSED SEGMENT RESULTS
Six months ended Six months ended 12 months ended
31 August 2017 31 August 2016 28 February 2017
R’000 R’000 R’000
(unaudited) (unaudited) (audited)
Revenue
Investment Property Holding 12 852 11 765 26 160
Property-related Services - - -
Property Held for Resale - - -
Head Office Administration 224 - -
Non-current Assets Held For Sale - - -
13 076 11 765 26 160
Income/(Loss) before taxation
Investment Property Holding 9 797 10 718 34 184
Property-related Services - - -
Property Held for Resale - - -
Head Office Administration (2 637) (2 523) (4 719)
Non-current Assets Held For Sale - 62 -
7 160 8 257 29 465
Total assets
Investment Property Holding 240 669 225 078 241 677
Property-related Services - - -
Property Held for Resale 1 430 1 430 1 430
Head Office Administration 17 605 8 215 9 031
Non-current Assets Held For Sale 6 000 6 745 -
265 704 241 468 252 138
Total liabilities
Investment Property Holding 112 894 103 174 104 137
Property-related Services - - -
Property Held for Resale - - -
Head Office Administration 1 671 6 711 1 480
Non-current Assets Held For Sale — - -
114 565 109 885 105 617
GENERAL REVIEW AND FINANCIAL RESULTS
In accordance with the directors’ intention to maximise asset value, the group decided to embark on a focused restructuring within the portfolio.
During the interim period being reported on, the group successfully converted and exchanged non-contributing assets into a single value-generating asset.
To assist with facilitation of the restructuring, an additional flexi-facility of R 10 million was raised with ABSA Bank Ltd during the period.
Revenue for the period ended 31 August 2017 reflects an increase of 11.1% on the comparable results for 2016. The positive revenue-generating effects of
the restructuring exercise, together with escalations effected on certain large tenants within the portfolio, have combined to result in this increase.
After exclusion of accounting profits yielded on disposals, operating profits before interest and revaluations for the period ended 31 August 2017 reflect
an increase of 15.8% on the comparable period for 2016. Maximisation of revenue-generating activities and continued focus on cost limitation have produced
these results.
The group continued to decrease its existing bank overdraft with First National Bank, and through effective treasury management the group now
finds itself in a positive cash position. Elimination of interest incurred on the overdraft balance has reduced the group’s overall finance cost when
compared with the comparable period for 2016.
Activities within the period ended 31 August 2017 have produced an improvement in Net Asset Value per share of 8.3 cents since the financial year ending
28 February 2017. The group has experienced a marginal decrease in Headline Earnings per Share of 0.4 cents in comparison with the previous period ended
31 August 2016.
RELATED PARTY INFORMATION R
Rental charged – RMS Property and Facilities Management Pty Ltd 180 000
Rental charged – RMS Corporate Solutions Pty Ltd 75 000
Asset management fees paid – RMS Corporate Solutions Pty Ltd (1 735 386)
Director emoluments (335 226)
Professional and consulting fees paid to companies associated with directors (1 109 700)
DIVIDENDS
The directors have resolved to retain cash in the group to ensure future growth, thus no dividend has been recommended.
JOHANNESBURG
30 November 2017
DIRECTORS: W P Alcock† (Chairman), R P Fertig (Chief Executive Officer), H Beukes CA(SA) (Financial Director), B Mothelesi*,
M Moela*, R Watson* (†Non-executive) (*Independent non-executive)
COMPANY SECRETARY: B W Kaiser
TRANSFER SECRETARIES: Computershare Investor Services (Pty) Limited, Rosebank Towers, 15 Biermann Avenue, Rosebank, 2196
REGISTERED OFFICE: 2969 William Nicol Drive, Wedgewood Link, Bryanston, 2021
SPONSOR: Arbor Capital Sponsors (Pty) Limited
REGISTERED AUDITORS: RSM South Africa Incorporated
Date: 30/11/2017 10:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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