Wrap Text
Condensed unaudited consolidated interim financial results for the six months ended 31 December 2018
Attacq Limited
(Incorporated in the Republic of South Africa)
(Registration number 1997/000543/06)
JSE share code: ATT
ISIN: ZAE000177218
(Approved as a REIT by the JSE)
(Attacq or company or group)
CONDENSED UNAUDITED CONSOLIDATED INTERIM FINANCIAL RESULTS
for the six months ended 31 December 2018
Commentary
Highlights
- Dividend per share (DPS) of 40.5 cents declared for the six months ended 31 December 2018
- Growth in distributable earnings per share (DEPS) of 9.5%
- Interest cover ratio improved to 1.77 times from 1.68 times
- Trading density growth in retail portfolio of 6.9%
- During the period, two buildings were completed in Waterfall with a further 12 buildings under construction
Introduction
Attacq is a South African-based REIT, delivering sustainable income and capital growth through a focused approach in real estate
investments and developments.
The company's business model is based on four key value drivers, namely the South African portfolio, Developments at Waterfall,
investment in MAS Real Estate Inc. (MAS) and the Rest of Africa retail investments.
Attacq is listed on the Johannesburg Stock Exchange (JSE) and is included in the FTSE/JSE SAPY Index, FTSE/JSE SA REIT Index
as well as the FTSE/JSE Responsible Investment Index.
The group deconsolidated Nieuwtown Property Development Proprietary Limited (Nieuwtown) and Majestic Offices Proprietary
Limited (Majestic) and as a result restated prior year figures. For more information, refer to the paragraph, restatement of Attacq's
prior year financial statements.
General overview
Attacq's board of directors (the board) is pleased to announce that an interim dividend of 40.5 cents per share (cps) for the six
months ended 31 December 2018 has been declared. Having converted to a REIT in May 2018, Attacq declared its inaugural dividend
in October 2018 for the full year ended 30 June 2018 and therefore there is no prior period comparative for this interim dividend.
In a challenging environment, Attacq's South African portfolio performed well, supported by good trading growth from the Mall of
Africa as well as newly completed buildings in Waterfall. This, combined with strong growth in dividends received from MAS, resulted
in the group's distributable earnings increasing by 9.6% to R316.4 million (31 December 2017: R288.7 million). The investments into
the Rest of Africa remain a challenge and impairments to these investments as well as Attacq paying out a full year dividend in
October 2018, resulted in the net asset value per share (NAVPS) declining by 2.4% from R24.24 at 30 June 2018 to R23.66.
A breakdown of distributable earnings per value driver is tabled below:
Unaudited Restated unaudited
31 December 2018 31 December 2017
Distributable earnings R'000 cps R'000 cps
South African portfolio 205 587 29.3 174 608 24.9
Developments at Waterfall (16 213) (2.3) (2 792) (0.4)
Investment in MAS 95 999 13.6 74 167 10.5
Rest of Africa retail investments 31 004 4.4 42 747 6.1
Total 316 377 45.0 288 730 41.1
South African Portfolio
Overview
Attacq's high-quality operational portfolio consists of retail, office and mixed-use, light industrial and hotel properties. During the
six months ended 31 December 2018, the distributable earnings from the South African portfolio increased by 17.7% to 29.3 cps
(31 December 2017: 24.9 cps). The value of the existing South African portfolio is R21.0 billion (30 June 2018: R21.0 billion), comprising
75.1% (30 June 2018: 75.2%) of total gross assets.
The portfolio's weighted average lease expiry profile is 6.8 years as at 31 December 2018 (30 June: 7.0 years). The average growth
in trading densities in the retail portfolio for the year ended 31 December 2018 was 6.9% (31 December 2017: (0.8%)). The Mall
of Africa's trading density growth is 12.7% (31 December 2017: 11.0%) for the 2018 calendar year ended and its rent to sales ratio
improved to 9.2% (31 December 2017: 9.8%).
During the six months ended 31 December 2018, two buildings were completed in Waterfall, increasing the total South African
portfolio primary gross lettable area (PGLA) to 731 945m2 (30 June 2018: 722 730m2). Attacq's attributable share of the total newly
completed 19 268m2 PGLA is 9 634m2:
Lease Effective Total Effective share
commencement PGLA PGLA Occupancy valuation
Completed properties date m2 m2 % R'000
Waterfall City
Waterfall Corporate Campus - Accenture(+) 1 December 2018 1 985 3 970 100.0% 66 159
Waterfall Logistics Hub
Cummins South Africa's Regional Office(+) 1 March 2019 7 649 15 298 100.0% 114 267
(+) Attacq has a 50.0% co-ownership
Rental income
Rental income increased by 12.4% to R1.0 billion (31 December 2017: R893.5 million) mainly due to the additional rental income from
the buildings completed during the FY17 and FY18 years. Like-for-like rental growth was 0.4%, negatively impacted by the beneficial
occupation period granted to Transnet and vacancies at 2 Eglin.
Leases expiring over the last 12 months amounted to 110 171m2 (15.1% of total rentable area of the space). During this period, 92 861m2
was renewed at a reversion rate of negative 4.1% and a weighted average escalation rate of 7.1%.
Expired PGLA
Lease renewals m2 Success rate % Reversion rate % Escalation rate %
Office 61 421 91.5 (8.1) 7.8
Retail 48 751 75.5 (0.1) 6.5
Total 110 171 84.4 (4.1) 7.1
Property expenses
Property expenses increased by 8.0% on a like-for-like basis. The increase of 17.0% on total property expenses to R365.3 million
(31 December 2017: R312.4 million) was due to newly completed buildings and an increase in municipal rates, impacted by increases
in municipal valuations in Johannesburg. Municipal charges increased by 19.7% to R233.0 million (31 December 2017: R194.6 million),
not all of which were recoverable from all tenants. This, combined with vacancies, resulted in a reduction in the municipal charge
recovery ratio to 89.5% (31 December 2017: 93.1%).
Property cost-to-income ratio
The property cost-to-income ratio calculated below is based on best practice recommendations issued by the SA REIT Association.
The Waterfall portfolio's ratios include the land lease rental obligation.
Restated
Unaudited unaudited
31 December 2018 31 December 2017
Property cost-to-income ratio % %
Waterfall portfolio
Net cost-to-income ratio 21.0 21.2
Gross cost-to-income ratio 35.9 36.1
Non-Waterfall portfolio
Net cost-to-income ratio 18.0 15.8
Gross cost-to-income ratio 37.0 33.9
Vacancies
Overall portfolio vacancies, measured in terms of PGLA, decreased by 19 168m2 to 36 494m2 when compared with 30 June 2018
mainly due to the Dis-Chem warehouse lease commencement and the leases concluded in Gateway West with Sage and Spaces.
Subsequent to 31 December 2018, 3 077m2 of this vacant space was let, reducing the overall vacancy rate to 4.6%. Vacancies not
yet filled mainly refer to 2 Eglin, Brooklyn Bridge Office Park and Gateway West.
Unaudited 31 December 2018 Restated unaudited 30 June 2018
Sector vacancies % PGLA m2 % PGLA m2
Retail 2.6 7 539 1.7 4 946
Office and mixed-use 11.3 28 955 16.7 42 198
Light industrial - - 5.3 8 518
Hotel - - - -
Period end portfolio vacancy 5.0 36 494 7.7 55 662
Less: filled post period-end 0.4 3 077 3.0 21 791
Less: 2 Eglin 2.8 20 732 2.9 20 732
Adjusted portfolio vacancy 1.7 12 685 1.8 13 139
Waterfall 0.5 3 574 0.6 4 573
Other 1.2 9 111 1.2 8 566
Edcon restructure
From a South African operational point of view (including 50.0% of Newtown Junction), Attacq's effective Edcon Limited (Edcon)
exposure will settle at 22 945m2 of PGLA by 1 October 2019 (with an effective gross monthly rental of R3.2 million), which is
estimated at 3.0% of the effective PGLA. This follows a reduction from 29 262m2 based on PGLA (with an effective gross monthly
rental of R4.1 million) at 30 June 2018 to 25 499m2 by 31 December 2018 (with an effective gross monthly rental of R3.6 million).
Attacq is participating in Edcon's announced recapitalisation programme. The impact of the recapitalisation programme on Attacq's
property valuations has been incorporated by reducing the gross rental income for the 24 months commencing 1 April 2019. On
implementation, the impact on the distributable earnings for the 2019 financial year will be a R4.2 million reduction.
Valuations
The capitalisation and discount rates for the 31 December 2018 valuations remained largely unchanged when compared with
the 30 June 2018 valuations. Fair value adjustments were negatively impacted mainly by an impairment on 2 Eglin, due to high
vacancies and lower market rental projections.
Property valuations on completed properties for the interim reporting period are directors' valuations which are in the main
supported by external desktop valuations performed by Sterling Valuation Specialists CC and Wolffs Valuations Services Proprietary
Limited in association with Mills Fitchet Cape Proprietary Limited.
Developments at Waterfall
Overview
Waterfall's location and ease of access creates an attractive value proposition for the continued development of a new city and
logistics hub in the centre of Gauteng. Waterfall has 953 036m2 (30 June 2018: 957 008m2) of remaining developable bulk.
Distributable earnings are impacted by the holding costs relating to developments under construction, infrastructure and
development rights. Holding costs refer to spend on rates and taxes, marketing, security, and Property Owners Association levies.
For the period ended 31 December 2018, this has had a negative 2.3 cents impact on the distributable earnings.
The total asset value of Developments at Waterfall, including the value of the Attacq Sanlam joint venture, increased to R2.6 billion
(30 June 2018: R2.3 billion). The increase is a result of capital expenditure and fair value adjustments on developments under
construction due to the progress of the developments.
Restated
Unaudited unaudited
31 December 2018 30 June 2018
Developments at Waterfall R'000 R'000
Developments under construction 758 849 527 592
Development rights 879 179 901 428
Infrastructure and services 766 462 685 875
Attacq Sanlam joint venture 145 648 143 803
Total 2 550 138 2 258 698
Whilst these assets are currently not contributing to distributable earnings, they create the platform for future economic benefits
through the utilisation of developable bulk in the development of new properties.
Developments under construction
The following developments were under construction as at 31 December 2018. Attacq's attributable share of the total of 83 896m2
PGLA is 57 431m2.
Anticipated
practical Lease Effective Total Pre-let
Land completion commencement PGLA PGLA % based on
Developments parcel date date m2* m2* total PGLA
Waterfall City
Waterfall Corporate 10B Q3 FY19 - 3 215 6 430 -
Campus - building 2(+)
Waterfall Point 15 Q3 FY19 Sectional 9 356 9 356 40.0(#)
title sales
The Ingress - PSG Wealth 10 Q1 FY20 1 August 2019 4 371 4 371 100.0
The Ingress - building 2 10 Q2 FY20 - 4 360 4 360 -
Deloitte head office(+) 10 Q3 FY20 1 April 2020 21 250 42 500 100.0
Waterfall Logistics Hub
Pirtek 8 Q3 FY19 1 May 2019 2 926 2 926 100.0
Superga/Kappa warehouse 8 Q4 FY19 1 June 2019 4 657 4 657 100.0
Midi warehouse 8 Q4 FY19 - 5 296 5 296 -
Zimmer Biomet(+) 8 Q4 FY19 1 June 2019 2 000 4 000 100.0
Total 57 431 83 896 >73.0%
* Estimated PGLA of development. Subject to change upon final re-measurement post completion
(+) Attacq has a 50.0% ownership
(#) Based on pre-sales
Waterfall Point - land parcel 15
Waterfall Point, located at the corner of Waterfall and Woodmead Drive, is an A-grade office park with four buildings of 2 339m2
of PGLA each. The office park is structured as a sectional title scheme, to cater for companies with the need to invest in their own
premises. It is the intention for Attacq to retain at least one full building as investment property, for rental. Three buildings have
been classified as inventory, with 40.0% pre-sold. Recognition of the revenue, and cost of sales, on the pre-sold inventory is on a
percentage completion basis.
Valuations
The valuations of developments under construction as at 31 December 2018 are directors' valuations, valuing the development
at completion, less the costs to complete. These valuations are supported by external desktop valuations performed by Sterling
Valuation Specialists CC and Wolffs Valuations Services Proprietary Limited in association with Mills Fitchet Cape Proprietary
Limited.
Development rights
Development rights relate to the notarially secured leasehold rights held by Attacq Waterfall Investment Company Proprietary
Limited (AWIC), a 100.0% subsidiary of Attacq.
As at 31 December 2018, AWIC had 953 036m2 of remaining developable bulk. The heart of the development portfolio is 776 484m2
of remaining developable bulk in Waterfall City, zoned for mixed-use developments. The Logistics Hub, which is well positioned for
light industrial tenants, comprises 176 552m2 of remaining developable bulk. In addition, AWIC has access to a further 686 054m2 of
developable bulk in the joint venture with Sanlam Properties, a division of Sanlam Life Insurance Limited (Sanlam).
The development rights valuation is a directors' valuation, supported by an external desktop valuation performed by Sterling
Valuation Specialists CC. The external valuation is carried out using a residual land valuation model on a freehold, fully serviced
basis. The valuation is adjusted downwards to take into account, inter alia, the costs required to complete the servicing of the
development rights as well as the obligations pursuant to the leasehold nature of the development rights.
Infrastructure and services
The net increase in the value of infrastructure and services, held at cost, compared to prior year is as a result of infrastructure and
pre-development spend of R75.7 million, offset against the reallocation to developments under construction of R4.8 million.
Development pipeline
Anticipated Anticipated
practical lease Effective Total Pre-let
Land completion commencement PGLA* PGLA* % based on
Developments parcel date date m2 m2 total PGLA
Waterfall City
Waterfall Corporate Campus -
ContinuitySA(+) 10B Q2 FY20 1 January 2020 2 765 5 530 100.0
Courtyard Hotel(+) 10 Q2 FY21 1 January 2021 3 119 6 237 100.0
The Ellipse 10 - Sectional n/a n/a Phase I >60.0%
title unit sales pre-sold
* Estimated PGLA of development. Subject to change upon final re-measurement post completion
(+) Attacq has a 50.0% ownership
Waterfall Corporate Campus Office Park (Corporate Campus) - land parcel 10B
Corporate Campus is a 50/50 joint venture with Zenprop Property Holdings Proprietary Limited (Zenprop), with an approximate
total development cost of R880.0 million. The development, on completion, will comprise six multi-tenanted office buildings with an
estimated total PGLA of 30 000m2. Building 1 (5 868m2) and the Accenture building (3 970m2) have been completed and are fully
tenanted. Building 2 will be completed during the third quarter of the 2019 financial year. Building 5 (phase III) will be fully tenanted
by ContinuitySA with a total construction cost estimated at R126.6 million. The estimated practical completion date of Building 5 is
the second quarter of the 2020 financial year, with the lease commencement date being 1 January 2020.
Courtyard Hotel - land parcel 10
Attacq and Barrow Properties Proprietary Limited (Barrow Properties) have established a 50/50 joint venture to develop this
mixed-use precinct adjacent to the Mall of Africa which comprises four office buildings and a "new concept" 4 star Courtyard
Hotel by the City Lodge Hotel Group. The total PGLA is estimated at 32 000m2 at an estimated total development cost of R800.0
million. The basement beneath building 1 has been completed with the construction of the remainder of the super-basement to
commence in March 2019. The construction of the top structure of the 168 key Courtyard Hotel is estimated to commence 1 June
2019 at an approximate development cost of R229.1 million (cost per key: R1.3 million). Construction of the remaining precinct will
be in a phased approach subject to leasing. Transfer of Barrow Properties share of development rights is pending and R56.0 million
(30 June 2018: R46.7 million) is classified as non-current assets held for sale.
The Ellipse - land parcel 10
Attacq intends to roll out residential developments to create a "live, work, play" urban environment in Waterfall City. The proposed
inaugural residential development will comprise four towers of approximately 620 residential units, west of the Mall of Africa.
The development is a 50/50 joint venture with Portstone Developments Proprietary Limited. Phase I will consist of two towers
of 272 units. The estimated development cost of R520.0 million for phase I includes infrastructure that will benefit phase II. The
commencement of construction is subject to achieving a certain level of secured pre-sales.
Investment in MAS
Overview
Distributable earnings of R96.0 million (31 December 2017: R74.2 million), was generated by the investment in MAS, comprising the
cash dividend received of R97.3 million, a realised profit of R2.3 million on forward exchange contracts less the tax impact of realised
and unrealised hedges of R3.6 million.
Attacq's shareholding in MAS remained unchanged at 22.8%. The market value of Attacq's investment, based on 31 December 2018
MAS share price of R21.20 (30 June 2018: R21.00), equates to R3.1 billion (30 June 2018: R3.1 billion). Attacq's equity accounted
investment at 31 December 2018 is R3.2 billion (30 June 2018: R3.1 billion).
MAS' income-producing portfolio achieved a 55.7% increase in net rental income to EUR23.8 million and MAS recorded a 40.0%
increase in distributable earnings per share from 2.70 euro cents per share to 3.78 euro cents per share, driven by acquisitions of
investment property, its Prime Kapital joint venture and its listed REIT portfolio. Investment property (including assets held for sale)
increased by 21.6% to EUR769.8 million from EUR632.8 million.
MAS' management focus on the recycling of capital out of mature assets into higher-yielding properties resulted in the disposal
of its Whitbread hotel assets at New Waverley, Edinburgh, for EUR43.3 million at yields of 4.1%. During the period, three income-
producing properties were acquired adding a total of 110 340m2 gross lettable area (GLA) to MAS' property portfolio.
Acquisition
GLA valuation
Property Location m2 EUR million
Flensburg Galerie Shopping Centre Flensburg, Germany 25 540 62.5
Militari Shopping Centre Bucharest, Romania 56 200 95.0
Atrium Mall Shopping Centre Arad, Romania 28 600 40.5
The Prime Kapital development joint venture completed the first two of its larger retail developments in November 2018 and
December 2018, respectively, with the opening of the 18 808m2 Roman Value Centre and the 21 318m2 Baia Mare Value Centre, both
located in Romania. A total of nine developments totalling 67 950m2 of GLA have been completed by the joint venture at a net
initial yield of 10.6%.
The development joint venture pipeline comprises ten assets with an estimated total development cost of EUR737.8 million and
totalling 498 300m2 of GLA. Development of seven of these assets will commence shortly and two are expected to be completed
by December 2019.
In addition, plans are underway to extend and refurbish the retail assets of the investment joint venture between MAS and Prime
Kapital, namely Nova Park (Poland), Burgas Mall and Stara Zagora Mall (both Bulgaria). Approximately 57 000m2 of GLA can be
added at an estimated cost of EUR134.5 million in order to expand the fashion and leisure offerings of the centres and entrench
their regionally dominant nature.
Subsequent to period end, MAS entered into a transaction via the investment joint venture with Prime Kapital, to acquire the nine
completed developments in Romania from the Prime Kapital development JV for an aggregate value of EUR108 million. It was also
agreed that the existing development joint venture would be extended by a further two years, taking the exclusivity period with
Prime Kapital to 2023.
Hedging of MAS dividends
Attacq hedged a portion of the final MAS dividend received on 17 October 2018 and realised a foreign exchange profit of R2.3 million.
Additional hedges currently in place in respect of expected future MAS dividends are as follows:
Financial
Amount hedged period Forward
EUR million received rate
4.5 2019 R17.9895
5.1 2020 R18.0962
2.7 2020 R17.2850
Rest of Africa Retail Investments
Overview
The Rest of Africa Retail Investments generated distributable earnings of R31.0 million (31 December R42.7 million) during the
period, comprising R33.6 million of interest received from AttAfrica, R7.2 million of interest received from Gruppo Investment
Nigeria Limited (Gruppo) less the cost of external debt service of R9.4 million and associated tax paid of R0.4 million.
As at 31 December 2018, Attacq's Rest of Africa Investments were held via its:
- 25.0% shareholding in Gruppo, the owner of Ikeja City Mall, located in Lagos, Nigeria; and
- 31.8% shareholding in AttAfrica Limited (AttAfrica), which is invested in four retail properties in Ghana and one retail property in
Zambia.
As at 31 December 2018, the value of Attacq's Rest of Africa retail investments was R806.9 million comprising 2.9% (30 June 2018: 4.2%)
of its total gross assets.
The group's equity accounted investment into and loan to Gruppo totalled R253.0 million (30 June 2018: R305.2 million). The decrease in
the investment value is a result of an impairment of R66.1 million offset by a 4.9% weakening of the rand against the US dollar.
Attacq's investment in AttAfrica, through its shareholder loan, amounted to R553.9 million (30 June 2018: R787.3 million), being its gross
loan of R1.0 billion (30 June 2018: R953.9 million), net of an aggregate impairment of R484.0 million (30 June 2018: R166.6 million). An
impairment of R304.1 million was recognised against the loan in the current period (31 December 2017: R3.5 million) due to the increase
in the negative net asset value position of AttAfrica.
AttAfrica capital structure
Currently Attacq is not receiving regular cash distributions from AttAfrica, due to the unfavourable trading conditions and as a
consequence of the capital structure of Attacq's investment in AttAfrica. The capital structure, inter alia, gives Attacq a 31.8%
shareholding in AttAfrica which is in excess of its obligation to contribute 25.0% of the funding requirements and therefore Attacq
has a share of any capital growth in the underlying portfolio in excess of its capital contributions. However, Hyprop Investments
Limited has first right to operational income flows generated by the portfolio, resulting in irregular cash distributions to Attacq.
As reported in prior periods, AttAfrica shareholders are investigating options to create liquidity in the portfolio in advance of the
June 2020 shareholder liquidity event; failing which the existing capital structure will be restructured.
Malls and performance
At 31 December 2018, the retail properties in which Attacq has an interest, together with the vacancy rates were as follows:
Attacq's
effective Vacancy % Vacancy %
Property Location Owner PGLA m2 interest % Dec 2018 June 2018
Manda Hill Lusaka, Zambia AttAfrica 42 002 15.9 7.2 4.1
Accra Mall Accra, Ghana AttAfrica 21 311 15.0 6.3 6.8
West Hills Mall Accra, Ghana AttAfrica 28 272 14.3 15.6 10.4
Achimota Retail Centre Accra, Ghana AttAfrica 15 534 23.9 3.4 1.9
Kumasi City Mall Kumasi, Ghana AttAfrica 18 604 23.9 12.8 13.0
Ikeja City Mall Lagos, Nigeria Gruppo 22 223 25.0 3.1 3.1
The Ghana, Zambia and Nigeria economies remain under pressure with continued local currency depreciation and policy uncertainty.
Tenant depth challenges will be exacerbated by the loss of a number of South African clothing retailers who are unlikely to renew
their leases. AttAfrica shareholders are reviewing this investment with the view to a reduction in exposure.
Assets held for sale
Restated
Unaudited unaudited
31 December 2018 30 June 2018
R'000 R'000
Waterfall City/Barrow Properties 56 026 46 668
Cummins South Africa's regional office/Zenprop 108 204 63 372
Stenham European Shopping Centre Fund Limited ? 2 947
Rainprop Proprietary Limited 763 775
Zimmer Biomet/Sanlam 11 751 5 109
Total 176 744 118 871
Attacq classified 50.0% of the development rights as well as infrastructure and service costs relating to Cummins South Africa's
regional office as held for sale due to the 50/50 joint venture arrangement between Attacq and Zenprop. The 31 December 2018
value of R108.2 million was settled during February 2019 when the property transferred to Zenprop. Similarly, amounts outstanding
from Barrow Properties and Sanlam will be settled upon transfer.
Borrowings
Total interest-bearing borrowings increased by 4.4% to R10.5 billion (30 June 2018: R10.1 billion). Gearing, calculated as total interest-
bearing debt less unrestricted cash on hand as a percentage of total assets less cash on hand, increased from 33.5% (30 June 2018)
to 36.3% (31 December 2018). The increase of the gearing ratio is largely as a result of paying out a full year dividend in October
2018 and impairments to the investments in Africa. Attacq has provided a guarantee of R286.0 million in respect of external
interest-bearing debt on behalf of Nieuwtown a 50.0% equity accounted associate. Should Nieuwtown Precinct be proportionally
consolidated, the group's gearing ratio would increase to 37.6% There are committed but undrawn facilities as at 31 December 2018
of R720.5 million which are all rand-denominated (30 June 2018: R676.4 million).
Restated
Unaudited unaudited
31 December 2018 30 June 2018
Total drawn facilities (R'000) 10 510 399 10 065 586
Total weighted average loan term (years) 3.8 4.2
ZAR-denominated interest-bearing borrowings
Committed facilities available (R'000) 9 755 753 9 312 162
Drawn facilities (R'000) 9 038 478 8 634 578
Weighted average loan term (years) 4.1 4.7
EUR-denominated interest-bearing borrowings
Committed facilities available (R'000) 1 475 166 1 431 123
Drawn facilities (R'000) 1 471 921 1 431 008
Weighted average loan term (years) 1.1 1.4
Gearing (%) 36.3 33.5
In order to mitigate interest rate risk, as at 31 December 2018, approximately 89.0% (30 June 2018: 94.2%) of total committed
facilities of R11.2 billion (30 June 2018: R10.7 billion) were hedged by way of fixed interest rate loans or interest rate swaps which is
higher than the group's minimum hedging policy of 70.0%.
Unaudited unaudited
31 December 2018 30 June 2018
Total hedged as a % of total committed facilities (%) 89.0 94.2
Total weighted average hedges term (years) 3.3 3.7
Rand-denominated hedges
Total hedged as a % of total committed facilities (%) 93.9 99.9
Weighted average hedges term (years) 3.6 4.0
EUR-denominated hedges
Total hedged as a % of total committed facilities (%) 56.8 56.8
Weighted average hedges term (years) 0.3 0.8
The weighted average cost of funding remained unchanged over the last six months at 8.9% (30 June 2018: 8.9%). For rand-
denominated funding, the weighted average floating interest rate increased from 8.8% (30 June 2018) to 9.0% (31 December 2018),
which is in line with the increase in the three-month JIBAR rate over the same period.
Restated
Unaudited unaudited
31 December 2018 30 June 2018
% %
Total weighted average cost of debt 8.9 8.9
Rand-denominated weighted average cost of debt
Weighted average floating interest rate 9.0 8.8
Premium for hedging 0.9 1.2
Weighted average cost of debt 9.9 10.0
EUR-denominated weighted average cost of debt
Weighted average floating interest rate 2.3 2.3
Premium for hedging 0.1 0.1
Weighted average cost of debt 2.4 2.4
The interest cover ratio has improved to 1.77 times (31 December 2017: 1.68 times) due to escalations in contractual rental income
and an increase in the cash dividend received from MAS.
R503.1 million (30 June 2018: R538.1 million) of the group's interest-bearing debt is due for repayment over the next 12 months.
Of the R503.1 million, R398.3 million relates to one of the tranches in the Attacq Retail Fund and Lynnwood Bridge Office Park
syndicated loan and the group has started discussions with funders to refinance this tranche and is confident that the tranche will
be refinanced.
During the six months ended 31 December 2018, a facility of R330.3 million was refinanced.
An increase in other financial liabilities of R15.9 million (30 June 2018: decrease R40.7 million) was recorded on the mark-to-market
valuation of interest rate swaps.
Restatement of Attacq's prior year financial statements
Deconsolidation of Nieuwtown and Majestic
The group has a 50.0% shareholding in Nieuwtown and Majestic.
The group was considered to have control over both Nieuwtown and Majestic because of its 50.0% ownership as well as performing
the asset management function on behalf of both companies. As a result, Nieuwtown and Majestic were consolidated in the group
financial statements for all previous reporting dates since inception.
When Attacq relinquished the asset management function, Nieuwtown and Majestic were deconsolidated by the group with effect
from 1 July 2018.
The decision to consolidate Nieuwtown and Majestic in prior years was reviewed together with the accounting treatment appropriate
with the change in asset managers referred to above. Following the review, it was determined that the performance of the asset
management function in conjunction with a 50.0% shareholding does not by itself result in control. It was therefore concluded that
Attacq had joint control with its co-shareholder prior to 1 July 2018.
The impact of this error is that the group has restated the prior year financial statements by deconsolidating Nieuwtown and
Majestic and accounting for these investments as associates in terms of IFRS 11: Joint Arrangements.
Error in treatment of non-controlling interest of Nieuwtown in calculating distributable earnings
While preparing the restated prior year financial statements as referred to above, it was observed that the non-cash intercompany
transactions attributable to the non-controlling interest in respect of Nieuwtown were not adjusted for in the calculation
of distributable earnings. This error was corrected by effecting the prior year restatement of deconsolidating Nieuwtown and
accounting for this investment as an associate in terms of IFRS 11: Joint Arrangements.
The impact of these restatements on the key metrics is as follows:
31 December 2017 30 June 2018
Impact on As reported Restatement Restated As reported Restatement Restated
Net asset value per share (cps) 2 056.0 2.0 2 058.0 2 424.0 - 2 424.0
Distributable earnings per share (cps) 38.9 2.2 41.1 75.0 5.7 80.7
A restatement is required in terms of IAS 8: Accounting Policies, Changes in Accounting Estimates and Errors because of the
material adjustments to individual line items of the financial statements as detailed below:
Condensed consolidated statement of financial position
As reported Restated
unaudited unaudited As reported Restated
31 31 audited unaudited
December December 30 June 30 June
2017 Restatement 2017 2018 Restatement 2018
R'000 R'000 R'000 R'000 R'000 R'000
ASSETS
Non-current assets
Property and equipment 47 130 (1 501) 45 629 42 667 (1 446) 41 221
Investment properties 20 323 153 (1 480 370) 18 842 783 21 234 085 (1 442 940) 19 791 145
Per valuation 21 165 270 (1 558 148) 19 607 122 22 166 318 (1 533 150) 20 633 168
Straight-line lease debtor (842 117) 77 778 (764 339) (932 233) ) 90 210 (842 023)
Straight-line lease debtor 842 117 (77 778) 764 339 932 233 (90 210) 842 023
Investment in associates and joint ventures 3 179 281 12 404 3 191 685 3 328 852 16 710 3 345 562
Total non-current assets 25 117 175 (1 547 245) 23 569 930 26 255 538 (1 517 886) 24 737 652
Current assets
Trade and other receivables 183 124 (12 672) 170 452 212 563 (9 548) 203 015
Loans to associates and joint ventures 1 070 696 346 370 1 417 066 1 190 590 320 295 1 510 885
Cash and cash equivalents 725 244 (19 989) 705 255 1 239 631 (18 505) 1 221 126
Total current assets 2 154 087 313 709 2 467 796 2 704 290 292 242 2 996 532
Total assets 28 164 232 (1 233 536) 26 930 696 29 078 699 (1 225 644) 27 853 055
EQUITY AND LIABILITIES
Equity
Distributable reserves 7 215 581 10 665 7 226 246 9 544 296 (9 521) 9 534 775
Available-for-sale reserve 286 152 9 525 295 677 279 845 9 526 289 371
Equity attributable to owners of the
holding company 14 452 122 20 190 14 472 312 17 042 125 5 17 042 130
Non-controlling interests (66 057) 66 057 - 16 705 (16 705) -
Total equity 14 386 065 86 247 14 472 312 17 058 830 (16 700) 17 042 130
Non-current liabilities
Long-term borrowings 10 372 429 (1 020 589) 9 351 840 10 527 029 (999 539) 9 527 490
Deferred tax liabilities 2 079 216 (2 541) 2 076 675 178 924 (1) 178 923
Other financial liabilities 214 106 (1 832) 212 274 127 869 (1 004) 126 865
Finance lease obligation 85 983 (85 983) - 88 914 (88 914) -
Total non-current liabilities 12 752 606 (1 110 945) 11 641 661 10 923 295 (1 089 458) 9 833 837
Current liabilities
Other financial liabilities 158 002 (146 069) 11 933 74 060 (53 011) 21 049
Trade and other payables 301 382 (22 368) 279 014 403 550 (20 046) 383 504
Short-term portion of long-term
borrowings 214 888 (40 401) 174 487 584 525 (46 429) 538 096
Total current liabilities 694 985 (208 838) 486 147 1 096 574 (119 486) 977 088
Total liabilities 13 778 167 (1 319 783) 12 458 384 12 019 869 (1 208 944) 10 810 925
Total equity and liabilities 28 164 232 (1 233 536) 26 930 696 29 078 699 (1 225 644) 27 853 055
The following information does not form
part of the statement of financial position
Net asset value per share (cents) 2 056 2 2 058 2 424 - 2 424
Net asset value per share adjusted for
deferred tax (cents) 2 351 3 2 354 2 449 - 2 449
Condensed consolidated statement of comprehensive income
As reported Restated
unaudited unaudited As reported Restated
31 31 audited unaudited
December December 30 June 30 June
2017 Restatement 2017 2018 Restatement 2018
R'000 R'000 R'000 R'000 R'000 R'000
Gross revenue 1 001 983 (89 152) 912 831 2 138 961 (186 452) 1 952 509
Rental income 980 055 (86 583) 893 472 2 035 494 (171 452) 1 864 042
Straight-line lease income adjustment 21 928 (2 569) 19 359 103 467 (15 000) 88 467
Property expenses (348 163) 35 782 (312 381) (724 726) 70 878 (653 848)
Net rental income 653 820 (53 370) 600 450 1 414 235 (115 574) 1 298 661
Other income 38 445 (176) 38 269 157 675 (112 705) 44 970
Operating expenses (75 039) 1 (75 038) (170 256) 2 (170 254)
Operating profit 549 754 (53 545) 496 209 1 253 939 (228 277) 1 025 662
Fair value adjustments 213 406 11 417 224 823 370 265 50 621 420 886
Investment properties 252 882 11 197 264 079 328 970 51 228 380 198
Other financial assets and liabilities (39 476) 220 (39 256) 41 295 (607) 40 688
Net income from associates and joint
ventures 38 020 - 38 020 81 706 (52 560) 29 146
Investment income 82 830 19 146 101 976 194 447 38 868 233 315
Finance costs (456 060) 68 674 (387 386) (950 501) 136 633 (813 868)
Profit before taxation 414 305 45 692 459 997 961 569 (54 715) 906 854
Income tax expense (173 170) 247 (172 923) 1 749 765 (2 293) 1 747 472
Profit for the period/year 241 135 45 939 287 074 2 711 334 (57 008) 2 654 326
Attributable to:
Owners of the holding company 264 105 22 969 287 074 2 651 542 2 784 2 654 326
Non-controlling interests (22 970) 22 970 - 59 792 (59 792) -
Total comprehensive income for the
period/year 244 958 45 939 290 897 2 706 686 (57 008) 2 649 678
Attributable to:
Owners of the holding company 267 928 22 969 290 897 2 646 894 2 784 2 649 678
Non-controlling interests (22 970) 22 970 - 59 792 (59 792) -
Earnings per share (cents)
Basic 37.6 3.2 40.8 377.2 0.4 377.6
Diluted 37.3 3.2 40.5 374.2 0.4 374.6
Reconciliation between earnings and headline earnings
As reported Restated
unaudited unaudited As reported Restated
31 31 audited unaudited
December December 30 June 30 June
2017 Restatement 2017 2018 Restatement 2018
R'000 R'000 R'000 R'000 R'000 R'000
Profit for the period/year 264 105 22 969 287 074 2 651 542 2 784 2 654 326
Headline earnings adjustments (206 079) (4 423) (210 502) (426 476) 43 788 (382 688)
Impairment of associates and other
investments 6 435 - 6 435 51 197 16 624 67 821
Fair value adjustments (213 406) (11 417) (224 823) (370 265) (50 621) (420 886)
Net income from associates and joint
ventures (38 020) - (38 020) (33 270) 52 560 19 290
Tax effect on adjustments 53 248 2 570 55 818 4 975 (170) 4 805
Non-controlling interests' share (4 424) 4 424 - (25 395) 25 395 -
Headline earnings 58 026 18 546 76 572 2 225 066 46 572 2 271 638
Headline earnings per share (cents)
Basic 8.3 2.6 10.9 316.5 6.6 323.1
Diluted 8.2 2.6 10.8 314.0 6.6 320.6
Condensed consolidated statement of cash flows
As reported Restated
unaudited unaudited As reported Restated
31 31 audited unaudited
December December 30 June 30 June
2017 Restatement 2017 2018 Restatement 2018
R'000 R'000 R'000 R'000 R'000 R'000
Cash flow generated from operating
activities 54 890 8 881 63 771 380 762 3 827 384 589
Cash generated from operations 339 737 (48 096) 291 641 1 019 788 (108 193) 911 595
Investment income 106 605 (868) 105 737 290 129 (1 790) 288 339
Finance costs (378 159) 57 845 (320 314) (899 312) 113 810 (785 502)
Cash flow (utilised in) generated from
investing activities (237 968) 367 (237 601) (119 105) 2 729 (116 376)
Property and equipment acquired (640) 238 (402) (2 874) - (2 874)
Investment properties acquired (455 870) 129 (455 741) (738 927) 2 729 (736 198)
Cash flow generated from financing
activities 460 476 1 048 461 524 530 128 5 224 535 352
Long-term borrowings repaid (1 496 779) 7 116 (1 489 663) (2 895 275) 21 439 (2 873 836)
Loans to associates and joint ventures
repaid (advanced) 135 484 (6 068) 129 416 130 649 (16 215) 114 434
Total cash movement for the period/year 277 398 10 296 287 694 791 785 11 780 803 565
Cash at the beginning of the period/year 447 846 (30 285) 417 561 447 846 (30 285) 417 561
Total cash at the end of the period/year 725 244 (19 989) 705 255 1 239 631 (18 505) 1 221 126
Reconciliation of profit for the year to distributable earnings
As reported Restated
unaudited unaudited As reported Restated
31 31 audited unaudited
December December 30 June 30 June
2017 Restatement 2017 2018 Restatement 2018
R'000 R'000 R'000 R'000 R'000 R'000
Profit for the period/year 264 105 22 969 287 074 2 651 542 2 784 2 654 326
Fair value adjustments (213 406) (11 417) (224 823) (370 265) (50 621) (420 886)
Net income from associates and joint
ventures (38 020) - (38 020) (81 706) 52 560 (29 146)
Non-controlling interests' share of
fair value adjustments (4 424) 4 424 - (25 395) 25 395 -
Straight-line lease income adjustments (20 644) 1 285 (19 359) (95 967) 7 500 (88 467)
Adjustment for net non-cash interest
from associates - - - (87 613) (40 658) (128 271)
Depreciation and amortisation 20 031 (357) 19 674 40 335 (571) 39 764
Finance lease interest 1 799 (1 799) - 3 784 (3 784) -
Write-off of other trade and receivable - - - 52 492 (4 520) 47 972
Write-off of loan by APD net of
non-controlling interest - - - (56 178) 56 178 -
Non-cash interest accrued - - - 7 536 (7 536) -
Deferred taxation 150 396 (247) 150 149 (1 771 676) 2 293 (1 769 383)
Actual finance lease payments (378) 378 - (773) 773 -
Distributable earnings for the period/
year 273 494 15 236 288 730 527 384 39 793 567 177
Distributable earnings per share (cents)
Basic 38.9 2.2 41.1 75.0 5.7 80.7
Prospects
Attacq expects its total dividend per share for the full year ending 30 June 2019 to be between 79.6 cps and 81.0 cps which would
result in growth of between 7.5% and 9.5% on the 2018 full year dividend. This is in line with the guidance provided in
September 2018.
This guidance is based on the following assumptions:
- achieving forecasted rental income based on contractual terms and anticipated market-related renewals
- the proposed Edcon restructure commencing on 1 April 2019
- the expected roll-out of the current and budgeted development portfolio
- MAS paying its 2019 interim dividend
- no unforeseen circumstances such as major corporate tenant failures or macro-economic instability occurring.
The prospects has not been reviewed or reported on by Attacq's auditors.
Declaration of a cash dividend
The board declared an interim gross cash dividend of 40.50000 cents per share, for the six months ended 31 December 2018, out
of the company's distributable income.
The dividend is payable to Attacq shareholders in accordance with the timetable set out below:
Last day of trade in order to be eligible to receive the cash dividend Tuesday, 26 March
Shares trade ex-dividend Wednesday, 27 March
Record date to receive the cash dividend Friday, 29 March
Accounts credited by Central Securities Depository Participant (CSDP)
or broker to dematerialised shareholders with cash dividend payment Monday, 1 April
Cash dividend payment to certificated shareholders on or about Monday, 1 April
Notes:
1. Shares may not be dematerialised or rematerialised between Wednesday, 27 March 2019 and Friday, 29 March 2019, both days
inclusive.
2. Where the transfer secretaries do not have the banking details of any certificated shareholders, the cash dividend will be held
in trust by the transfer secretaries pending receipt of the relevant certificated shareholder's banking details whereafter the cash
dividend will be paid via electronic transfer into the personal bank accounts of certificated shareholders.
In accordance with Attacq's status as a REIT with effect from 29 May 2018, 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 dividend on the shares will be deemed to be a taxable dividend for South African tax purposes in terms of section 25BB of the
Income Tax Act.
Tax implications for South African resident shareholders
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 it is a dividend distributed by a REIT. This dividend is, however, exempt from
dividend withholding tax (dividend tax) in the hands of South African tax resident shareholders, provided that the South African tax
resident shareholders provide the following forms to their 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.
Tax implications for non-resident shareholders
Dividends received by non-resident shareholders will not be taxable as income and instead will be treated as an ordinary dividend
which is exempt from income tax in terms of the general dividend exemption in section 10(1)(k)(i) of the Income Tax Act. Any
distribution received by a non-resident from a REIT will be subject to dividend withholding tax at 20.0%, 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 shareholder. Assuming dividend withholding tax will be withheld at a rate of 20.0%, the net dividend amount due to non-
resident shareholders is 32.40000 cents per share.
A reduced dividend withholding rate in terms of the applicable DTA may only be relied on if the non-resident shareholder has
provided the following forms to their 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 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 arrange for the
abovementioned documents to be submitted prior to payment of the dividend if such documents have not already been submitted,
if applicable.
The number of shares in issue as at 31 December 2018 and as at the date of this announcement is 749 822 777 ordinary shares of
no par value which includes 46 427 553 treasury shares. Attacq's tax reference number is 9241/038/64/6.
Subsequent events
In line with IAS 10: Events after the reporting period, the declaration of the dividend occurred after the six months period under review,
resulting in a non-adjusting event which is not recognised in the financial statements. There are no further subsequent events noted.
Commitments
Please refer to developments under construction and developments in the pipeline for future capital commitments. Future
commitments will be funded by undrawn banking facilities, cash on hand and proceeds from capital recycling activities.
Issue of shares
During the period under review, 240 000 shares were issued in terms of long-term incentive awards.
Change in directors
There were no changes in directors during the reporting period.
Basis of preparation and accounting policies
The condensed unaudited consolidated interim financial statements for the six months ended 31 December 2018 have been
prepared in accordance with International Financial Reporting Standards (IFRS), IAS 34: Interim Financial Reporting, the SAICA
Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Reporting Pronouncements as issued
by the Financial Reporting Standards Council, the JSE Listings Requirements and the requirements of the Companies Act of South
Africa. These interim results was compiled under the supervision of R Nana CA(SA), CFO of Attacq.
The accounting policies applied in the preparation of the condensed unaudited consolidated interim financial statements are in
terms of IFRS and are consistent with the accounting policies applied in the preparation of the previous consolidated annual
financial statements for the year ended 30 June 2018, with the exception of the adoption of new and revised standards i.e.
IFRS 9: Financial Instruments and IFRS 15: Revenue from contracts with customers which became effective during the period.
Based on management's assessment, the amendments to the applicable accounting standards and adoption thereof do not have a
material impact on the group's interim financial statements.
The group's investment properties are valued internally by the directors at interim reporting periods and externally by independent
valuers for year-end reporting. In terms of IAS 40: Investment Property and IFRS 7: Financial Instruments: Disclosures, the group's
investment properties are measured at fair value and are categorised as level 3 investments. In terms of IAS 39: Financial Instruments:
Recognition and measurement and IFRS 7: Financial Instruments: Disclosures, the group's interest rate derivatives are measured at
fair value through profit or loss and are categorised as level 2 investments. In terms of IAS 39, listed investments are measured at
fair value, being the quoted closing price at the reporting date, and are categorised as level 1 investments. Unlisted investments are
categorised as level 3 investments. There were no transfers between levels 1, 2 and 3 investments during the period. The valuation
methods applied are consistent with those applied in preparing the previous consolidated financial statements.
The condensed interim financial statements have not been audited or reviewed by Attacq's auditors.
On behalf of the board
P Tredoux M Hamman
Chairman CEO
5 March 2019
Condensed consolidated statement of financial position
Restated Restated
Unaudited unaudited unaudited
31 December 31 December 30 June
2018 2017 2018
R'000 R'000 R'000
ASSETS
Non-current assets
Property and equipment 37 083 45 629 41 221
Investment properties 20 369 160 18 842 783 19 791 145
Per valuation 21 292 503 19 607 122 20 633 168
Straight-line lease debtor (923 343) (764 339) (842 023)
Straight-line lease debtor 923 343 764 339 842 023
Deferred initial lease expenditure 8 129 7 079 9 275
Intangible assets 256 520 276 894 266 502
Goodwill 67 774 67 774 67 774
Investment in associates and joint ventures 3 329 163 3 191 685 3 345 562
Other financial assets 388 307 361 280 373 651
Other investments 488 12 456 488
Deferred tax assets - 11 11
Total non-current assets 25 379 967 23 569 930 24 737 652
Current assets
Taxation receivable 2 713 - 2 714
Trade and other receivables 225 707 170 452 203 015
Inventory 93 078 34 592 42 484
Loans to associates and joint ventures 1 283 417 1 417 066 1 510 885
Other financial assets 26 822 140 431 16 308
Cash and cash equivalents 728 347 705 255 1 221 126
Total current assets 2 360 084 2 467 796 2 996 532
Non-current assets held for sale 176 744 892 970 118 871
Total assets 27 916 795 26 930 696 27 853 055
EQUITY AND LIABILITIES
Equity
Stated capital 6 462 389 6 458 912 6 460 108
Distributable reserves 9 052 751 7 226 246 9 534 775
Available-for-sale reserve 283 506 295 677 289 371
Share-based payment reserve 106 511 107 738 117 390
Foreign currency translation reserve 839 868 487 954 744 701
Acquisition of non-controlling interests reserve (104 215) (104 215) (104 215)
Equity attributable to owners of the holding company 16 640 810 14 472 312 17 042 130
Total equity 16 640 810 14 472 312 17 042 130
Non-current liabilities
Long-term borrowings 10 007 313 9 351 840 9 527 490
Deferred tax liabilities 185 367 2 076 675 178 923
Other financial liabilities 141 955 212 274 126 865
Cash-settled share-based payments 376 872 559
Total non-current liabilities 10 335 011 11 641 661 9 833 837
Current liabilities
Other financial liabilities 38 668 11 933 21 049
Taxation payable 3 354 16 195 1 496
Cash-settled share-based payments 329 1 873 747
Trade and other payables 361 735 279 014 383 504
Provisions 33 802 2 645 32 196
Short-term portion of long-term borrowings 503 086 174 487 538 096
Total current liabilities 940 974 486 147 977 088
Liabilities directly associated with non-current assets held for sale - 330 576 -
Total liabilities 11 275 985 12 458 384 10 810 925
Total equity and liabilities 27 916 795 26 930 696 27 853 055
The following information does not form part of the statement
of financial position
Net asset value per share (cents) 2 366 2 058 2 424
Net asset value per share adjusted for deferred tax (cents) 2 392 2 354 2 449
Condensed consolidated statement of comprehensive income
Restated Restated
Unaudited unaudited unaudited
31 December 31 December 30 June
2018 2017 2018
R'000 R'000 R'000
Gross revenue 1 085 320 912 831 1 952 509
Rental income 1 004 001 893 472 1 864 042
Straight-line lease income adjustment 81 319 19 359 88 467
Property expenses (365 346) (312 381) (653 848)
Net rental income 719 974 600 450 1 298 661
Sale of inventory 21 746 - 29 865
Cost of sales (21 121) - (24 918)
Other income 39 523 38 269 44 970
Operating expenses (83 508) (75 038) (170 254)
Other expenses (422 904) (67 472) (152 662)
Operating profit 253 710 496 209 1 025 662
Amortisation of intangible asset (9 982) (13 645) (24 037)
Fair value adjustments 71 103 224 823 420 886
Investment properties 86 962 264 079 380 198
Other financial assets and liabilities (15 859) (39 256) 40 688
Gain on available-for-sale financial assets - - 35 750
Net income from associates and joint ventures 24 007 38 020 29 146
Investment income 138 552 101 976 233 315
Finance costs (435 576) (387 386) (813 868)
Profit before taxation 41 814 459 997 906 854
Income tax (expense)/credit (10 482) (172 923) 1 747 472
Profit for the period/year 31 332 287 074 2 654 326
Attributable to:
Owners of the holding company 31 332 287 074 2 654 326
Other comprehensive income
Items that will be reclassified subsequently to profit and loss
(Loss) gain on available-for-sale financial assets (5 867) 3 822 27 686
Taxation relating to components of other comprehensive income 3 1 2
Realisation of available-for-sale financial assets - - (32 336)
Other comprehensive (loss)/income for the period/year net of taxation (5 864) 3 823 (4 648)
Total comprehensive income for the period/year 25 468 290 897 2 649 678
Attributable to:
Owners of the holding company 25 468 290 897 2 649 678
Earnings per share (cents)
Basic 4.5 40.8 377.6
Diluted 4.4 40.5 374.6
Reconciliation between earnings and headline earnings
Restated Restated
Unaudited unaudited unaudited
31 December 31 December 30 June
2018 2017 2018
R'000 R'000 R'000
Profit for the period/year 31 332 287 074 2 654 326
Headline earnings adjustments 169 696 (210 502) (382 688)
Profit on disposal of subsidiary - - (5 633)
Loss on disposal of associate 2 597 - -
(Profit)/loss on disposal of other investments (2 180) - 2 612
Profit on disposal of investment property - (9 912) (14 947)
Impairment of associates and other investments 389 617 6 435 67 821
Realisation of available-for-sale financial assets - - (35 750)
Fair value adjustments (71 103) (224 823) (420 886)
Net (income)/loss from associates and joint ventures (79 055) (38 020) 19 290
Tax effect of adjustments (70 180) 55 818 4 805
Headline earnings 201 028 76 572 2 271 638
Number of shares in issue* 703 395 224 703 055 224 703 155 224
Weighted average number of shares in issue* 703 178 702 702 838 702 702 989 909
Diluted weighted average number of shares in issue* 711 327 206 708 544 674 708 584 902
Headline earnings per share (cents)
Basic 28.6 10.9 323.1
Diluted 28.3 10.8 320.6
* Adjusted for 46 427 553 treasury shares
Condensed consolidated statement of cash flows
Restated Restated
Unaudited unaudited unaudited
31 December 31 December 30 June
2018 2017 2018
R'000 R'000 R'000
Cash flow generated from operating activities 227 943 63 771 384 589
Cash generated from operations 466 061 291 641 911 595
Investment income 197 028 105 737 288 339
Finance costs (432 980) (320 314) (785 502)
Taxation paid (2 166) (13 293) (29 843)
Cash flow utilised in investing activities (554 218) (237 601) (116 376)
Property and equipment acquired (1 545) (402) (2 874)
Property and equipment disposed - - 284
Investment properties acquired (528 600) (455 741) (736 198)
Investment properties disposed - - 62 584
Associates and joint ventures acquired - - (2 667)
Associates and joint ventures disposed - 23 620 253 977
Other investments disposed - - 11 969
Other financial assets (repaid)/raised (25 170) (3 753) 98 074
Additions to deferred initial lease adjustments (4 030) (3 601) (3 804)
Cash flow relating to non-current assets held for sale 5 127 202 276 202 279
Cash flow (utilised in)/generated from financing activities (166 504) 461 524 535 352
Capital raised 2 281 2 279 3 475
Dividends paid (520 334) - -
Settlement of share-based payment (14 389) 2 236 (13 678)
Long-term borrowings raised 384 445 1 848 047 3 358 695
Long-term borrowings repaid (8 966) (1 489 663) (2 873 836)
Loans to associates and joint ventures (advanced) repaid (26 391) 129 416 114 434
Other financial liabilities raised (repaid) 16 850 (30 791) (53 738)
Total cash movement for the period/year (492 779) 287 694 803 565
Cash at the beginning of the period/year 1 221 126 417 561 417 561
Total cash at the end of the period/year 728 347 705 255 1 221 126
Condensed consolidated statement of changes in equity
Acquisition Equity
Foreign of non- attributable
Available- Share-based currency controlling to owners of Non-
Stated Distributable for-sale payment translation interests the holding controlling Total
capital reserves reserve reserve reserve reserve company interests equity
R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000
Audited balance as
reported at 1 July 2017 6 456 633 6 945 483 282 329 128 216 238 254 (104 215) 13 946 700 (43 087) 13 903 613
Restatement - (12 304) 9 525 - - - (2 779) 43 087 40 308
Balance at 1 July 2017
- restated 6 456 633 6 933 179 291 854 128 216 238 254 (104 215) 13 943 921 - 13 943 921
Total comprehensive
income - 287 074 3 823 - - - 290 897 - 290 897
Profit for the period - 287 074 - - - - 287 074 - 287 074
Other comprehensive
profit - - 3 823 - - - 3 823 - 3 823
Foreign currency
translation reserve - - - - 249 700 - 249 700 - 249 700
Issue of shares 2 279 - - - - - 2 279 - 2 279
Transfer between reserves - 5 993 - (15 304) - - (9 311) - (9 311)
Settlement of share-based
payment transaction - - - (11 198) - - (11 198) - (11 198)
Recognition of share-
based payment reserve - - - 6 024 - - 6 024 - 6 024
Unaudited balance at
31 December 2017 -
restated 6 458 912 7 226 246 295 677 107 738 487 954 (104 215) 14 472 312 - 14 472 312
Total comprehensive
income - 2 367 252 (8 471) - - - 2 358 781 - 2 358 781
Profit for the period - 2 367 252 - - - - 2 367 252 - 2 367 252
Other comprehensive
loss - - (8 471) - - - (8 471) - (8 471)
Issue of shares 1 196 - - - - - 1 196 - 1 196
Derecognition of reserves
due to sale of subsidiary - (59 698) 2 164 - - - (57 534) - (57 534)
Transfer between reserves - 976 - 227 - - 1 203 - 1 203
Settlement of share-based
payment transaction - - - (3 763) - - (3 763) - (3 763)
Recognition of share-
based payment reserve - - - 13 188 - - 13 188 - 13 188
Unaudited balance at
30 June 2018 - restated 6 460 108 9 534 775 289 371 117 390 744 701 (104 215) 17 042 130 - 17 042 130
Total comprehensive
income - 31 332 (5 864) - - - 25 468 - 25 468
Profit for the period - 31 332 - - - - 31 332 - 31 332
Other comprehensive
loss - - (5 864) - - - (5 864) - (5 864)
Foreign currency
translation reserve - - - - 95 167 - 95 167 - 95 167
Issue of shares 2 281 - - - - - 2 281 - 2 281
Settlement of share-based
payment transaction - - - (14 865) - - (14 865) - (14 865)
Dividends - (520 334) - - - - (520 334) - (520 334)
Transfer between reserves - 6 977 - (6 977) - - - - -
Recognition of share-
based payment reserve - - - 10 963 - - 10 963 - 10 963
Unaudited balance at
31 December 2018 6 462 389 9 052 751 283 506 106 511 839 868 (104 215) 16 640 810 - 16 640 810
Unaudited condensed segmental analysis
31 December 2018
Office and
mixed use Retail Industrial Hotel
R'000 R'000 R'000 R'000
STATEMENT OF FINANCIAL POSITION
Investment property 6 693 022 9 778 866 1 402 250 318 587
Waterfall developments - - - -
Developments under construction - - - -
Waterfall development rights - - - -
Infrastructure and services - - - -
Straight-line lease debtor 553 808 239 034 116 352 14 149
Intangible assets and goodwill - - - -
Investments in associates and joint ventures 978 37 619 91 025 -
Other financial assets 352 526 22 394 6 913 -
Loans to associates and joint ventures - - 69 -
Trade and other receivables 43 240 75 980 13 180 1 230
Cash and cash equivalents 44 740 106 900 7 164 54
Inventory - - - -
Non-current assets held for sale - - 108 204 -
Other assets 2 673 - - -
Total assets 7 690 987 10 260 793 1 745 157 334 020
Interest-bearing borrowings - - - -
Other financial liabilities - - 12 807 -
Deferred tax liabilities - - - -
Trade and other payables 101 119 151 932 25 723 1 091
Other liabilities - - - -
Total liabilities 101 119 151 932 38 530 1 091
STATEMENT OF COMPREHENSIVE INCOME
Rental income 356 074 551 073 72 574 19 165
Straight-line lease income adjustment 62 380 3 366 16 775 (1 202)
Property expenses (121 907) (214 682) (22 049) (6 061)
Net rental income 296 547 339 757 67 300 11 902
Sale of inventory 32 267 - (10 521) -
Cost of sales (29 517) - 8 396 -
Other income - - - -
Operating expenses (16 721) (16 082) (3 510) (288)
Other expenses - - - -
Operating profit (loss) 282 576 323 675 61 665 11 614
Amortisation of intangible assets - - - -
Fair value adjustments (58 956) 74 344 (12 466) 6 110
Net income from associates 24 (2 502) 3 463 -
Investment income 19 273 2 990 44 12
Finance costs - - - -
Profit (loss) before tax 242 917 398 507 52 706 17 736
Taxation - - - -
Profit (loss) for the period attributable to owners 242 917 398 507 52 706 17 736
Waterfall Head office
developments Head office SA Total SA MAS Rest of Africa Global Total
R'000 R'000 R'000 R'000 R'000 R'000 R'000
STATEMENT OF FINANCIAL POSITION
Investment property - 5 000 18 197 725 - - - 18 197 725
Waterfall developments 2 171 435 - 2 171 435 - - - 2 171 435
Developments under construction 597 594 - 597 594 - - - 597 594
Waterfall development rights 857 075 - 857 075 - - - 857 075
Infrastructure and services 716 766 - 716 766 - - - 716 766
Straight-line lease debtor - - 923 343 - - - 923 343
Intangible assets and goodwill - 324 294 324 294 - - - 324 294
Investments in associates and joint ventures 963 15 748 146 333 3 182 830 - - 3 329 163
Other financial assets - 22 771 404 604 10 525 - - 415 129
Loans to associates and joint ventures 144 685 331 680 476 434 - 806 983 - 1 283 417
Trade and other receivables 72 071 19 987 225 688 - - 19 225 707
Cash and cash equivalents 129 502 985 661 972 - - 66 375 728 347
Inventory 93 078 - 93 078 - - - 93 078
Non-current assets held for sale 67 777 763 176 744 - - - 176 744
Other assets - 45 740 48 413 - - - 48 413
Total assets 2 550 138 1 268 968 23 850 063 3 193 355 806 983 66 394 27 916 795
Interest-bearing borrowings - 9 038 478 9 038 478 - - 1 471 921 10 510 399
Other financial liabilities - 166 765 179 572 - - 1 051 180 623
Deferred tax liabilities - 46 996 46 996 138 371 - - 185 367
Trade and other payables 55 412 26 418 361 695 - - 40 361 735
Other liabilities 27 029 10 424 37 453 - - 408 37 861
Total liabilities 82 441 9 289 081 9 664 194 138 371 - 1 473 420 11 275 985
STATEMENT OF COMPREHENSIVE INCOME
Rental income - 5 115 1 004 001 - - - 1 004 001
Straight-line lease income adjustment - - 81 319 - - - 81 319
Property expenses - (647) (365 346) - - - (365 346)
Net rental income - 4 468 719 974 - - - 719 974
Sale of inventory - - 21 746 - - - 21 746
Cost of sales - - (21 121) - - - (21 121)
Other income - 2 816 2 816 12 848 21 221 2 638 39 523
Operating expenses - (46 907) (83 508) - - - (83 508)
Other expenses (16 213) (24 581) (40 794) - (382 110) - (422 904)
Operating profit (loss) (16 213) (64 204) 599 113 12 848 (360 889) 2 638 253 710
Amortisation of intangible assets - (9 982) (9 982) - - - (9 982)
Fair value adjustments 77 930 (16 552) 70 410 - - 693 71 103
Net income from associates (795) (1 280) (1 090) 41 683 (16 586) - 24 007
Investment income - 48 044 70 363 - 68 189 - 138 552
Finance costs - (417 705) (417 705) - - (17 871) (435 576)
Profit (loss) before tax 60 922 (461 679) 311 109 54 531 (309 286) (14 540) 41 814
Taxation - 1 831 1 831 (11 912) - (401) (10 482)
Profit (loss) for the period attributable to owners 60 922 (459 848) 312 940 42 619 (309 286) (14 941) 31 332
31 December 2017
Office and
mixed use Retail Industrial Hotel
R'000 R'000 R'000 R'000
STATEMENT OF FINANCIAL POSITION
Investment property 6 011 433 9 522 341 1 286 167 309 043
Waterfall developments - - - -
Developments under construction - - - -
Waterfall development rights - - - -
Infrastructure and services - - - -
Straight-line lease debtor 475 055 213 643 59 631 16 010
Intangible assets and goodwill - - - -
Investments in associates and joint ventures 932 37 621 90 564 -
Other financial assets 42 636 71 860 - -
Loans to associates and joint ventures - - 138 859 -
Trade and other receivables 28 904 55 531 3 543 1 255
Cash and cash equivalents 31 047 80 293 1 487 2
Inventory 27 726 - 6 866 -
Non-current assets held for sale 550 548 - - -
Other assets - - - -
Total assets 7 168 281 9 981 289 1 587 117 326 310
Interest-bearing borrowings - - - -
Other financial liabilities - - 9 685 -
Deferred tax liabilities - - - -
Trade and other payables 84 386 135 022 23 657 1 861
Liabilities held for sale - - - -
Other liabilities - - - -
Total liabilities 84 386 135 022 33 342 1 861
STATEMENT OF COMPREHENSIVE INCOME
Rental income 294 776 527 096 47 059 18 340
Straight-line lease income adjustment 9 765 6 578 3 332 (316)
Property expenses (75 720) (209 519) (13 154) (5 982)
Net rental income 228 821 324 155 37 237 12 042
Other income 10 014 33 - -
Operating expenses (17 743) (21 334) (3 012) (339)
Other expenses - - - -
Operating profit (loss) 221 092 302 854 34 225 11 703
Amortisation of intangible assets - - - -
Fair value adjustments 11 804 203 333 11 592 12 504
Net income from associates - (6 664) (1 026) -
Investment income 4 899 5 060 4 -
Finance costs - - - -
Profit (loss) before tax 237 795 504 583 44 795 24 207
Taxation - - - -
Profit (loss) for the period attributable to owners 237 795 504 583 44 795 24 207
Waterfall Head office
developments Head office SA Total SA MAS Rest of Africa Global Total
R'000 R'000 R'000 R'000 R'000 R'000 R'000
STATEMENT OF FINANCIAL POSITION
Investment property - 5 000 17 133 984 - - - 17 133 984
Waterfall developments 1 708 799 - 1 708 799 - - - 1 708 799
Developments under construction 138 070 - 138 070 - - - 138 070
Waterfall development rights 937 779 - 937 779 - - - 937 779
Infrastructure and services 632 950 - 632 950 - - - 632 950
Straight-line lease debtor - - 764 339 - - - 764 339
Intangible assets and goodwill - 344 668 344 668 - - - 344 668
Investments in associates and joint ventures - 12 404 141 521 2 950 461 59 115 40 588 3 191 685
Other financial assets - 385 740 500 236 - 1 475 - 501 711
Loans to associates and joint ventures - 347 365 486 224 - 892 840 38 002 1 417 066
Trade and other receivables 44 692 36 395 170 320 - - 132 170 452
Cash and cash equivalents - 482 565 595 394 - - 109 861 705 255
Inventory - - 34 592 - - - 34 592
Non-current assets held for sale 152 982 775 704 305 - 185 951 2 714 892 970
Other assets - 53 206 53 206 - - 11 969 65 175
Total assets 1 906 473 1 668 118 22 637 588 2 950 461 1 139 381 203 266 26 930 696
Interest-bearing borrowings - 8 091 810 8 091 810 - - 1 434 517 9 526 327
Other financial liabilities - 212 465 222 150 - - 2 057 224 207
Deferred tax liabilities - 1 956 047 1 956 047 86 324 34 304 - 2 076 675
Trade and other payables 20 230 13 835 278 991 - - 23 279 014
Liabilities held for sale - 330 576 330 576 - - - 330 576
Other liabilities - 21 561 21 561 - - 24 21 585
Total liabilities 20 230 10 626 294 10 901 135 86 324 34 304 1 436 621 12 458 384
STATEMENT OF COMPREHENSIVE INCOME
Rental income - 6 201 893 472 - - - 893 472
Straight-line lease income adjustment - - 19 359 - - - 19 359
Property expenses - (8 006) (312 381) - - - (312 381)
Net rental income - (1 805) 600 450 - - - 600 450
Other income - 10 423 20 470 - 17 799 - 38 269
Operating expenses - (30 935) (73 363) - - (1 675) (75 038)
Other expenses (2 792) (10 284) (13 076) - (54 396) - (67 472)
Operating profit (loss) (2 792) (32 601) 534 481 - (36 597) (1 675) 496 209
Amortisation of intangible assets - (13 645) (13 645) - - - (13 645)
Fair value adjustments 24 846 (38 536) 225 543 - - (720) 224 823
Net income from associates - - (7 690) 41 801 (7 551) 11 460 38 020
Investment income 79 28 129 38 171 - 60 723 3 082 101 976
Finance costs - (371 111) (371 111) - - (16 275) (387 386)
Profit (loss) before tax 22 133 (427 764) 405 749 41 801 16 575 (4 128) 459 997
Taxation - (123 359) (123 359) (49 538) - (26) (172 923)
Profit (loss) for the period attributable to owners 22 133 (551 123) 282 390 (7 737) 16 575 (4 154) 287 074
30 June 2018
Office and
mixed use Retail Industrial Hotel
R'000 R'000 R'000 R'000
STATEMENT OF FINANCIAL POSITION
Investment property 6 674 605 9 639 616 1 286 827 312 477
Waterfall developments - - - -
Developments under construction - - - -
Waterfall development rights - - - -
Infrastructure and services - - - -
Straight-line lease debtor 491 428 235 667 99 577 15 351
Intangible assets and goodwill - - - -
Investments in associates and joint ventures 954 40 121 91 619 -
Other financial assets 22 920 13 288 - -
Loans to associates and joint ventures - - 143 247 -
Trade and other receivables 106 650 63 070 23 286 2 367
Cash and cash equivalents 67 398 89 325 5 862 151
Inventory 42 484 - - -
Non-current assets held for sale - - - -
Other assets 3 000 - - -
Total assets 7 409 439 10 081 087 1 650 418 330 346
Interest-bearing borrowings - - - -
Other financial liabilities - - 12 807 -
Deferred tax liabilities - - - -
Trade and other payables 186 261 135 957 33 113 2 630
Other liabilities - - - -
Total liabilities 186 261 135 957 45 920 2 630
STATEMENT OF COMPREHENSIVE INCOME
Rental income 650 477 1 058 450 107 598 34 880
Straight-line lease income adjustment 17 561 28 604 43 278 (976)
Property expenses (202 340) (422 464) (32 000) (10 248)
Net rental income 465 698 664 590 118 876 23 656
Sale of inventory 19 344 - 10 521 -
Cost of sales (16 522) - (8 396) -
Other income 16 708 31 - -
Operating expenses (30 848) (31 927) (5 972) (562)
Other expenses (7 918) (13 395) (2 231) -
Operating profit (loss) 446 462 619 299 112 798 23 094
Amortisation of intangible assets - - - -
Fair value adjustments 99 784 263 650 (10 842) 15 939
Gain on available for sale financial assets - - - -
Net income from associates 36 (4 164) 9 668 -
Investment income 3 119 7 779 13 6
Finance costs - - - -
Profit (loss) before tax 549 401 886 564 111 637 39 039
Taxation - - - -
Profit (loss) for the year attributable to owners 549 401 886 564 111 637 39 039
Waterfall Head office
developments Head office SA Total SA MAS Rest of Africa Global Total
R'000 R'000 R'000 R'000 R'000 R'000 R'000
STATEMENT OF FINANCIAL POSITION
Investment property - 5 000 17 918 525 - - - 17 918 525
Waterfall developments 1 872 620 - 1 872 620 - - - 1 872 620
Developments under construction 346 441 - 346 441 - - - 346 441
Waterfall development rights 879 324 - 879 324 - - - 879 324
Infrastructure and services 646 855 - 646 855 - - - 646 855
Straight-line lease debtor - - 842 023 - - - 842 023
Intangible assets and goodwill - 334 276 334 276 - - - 334 276
Investments in associates and joint ventures - 19 092 151 786 3 145 828 47 948 - 3 345 562
Other financial assets - 353 751 389 959 - - - 389 959
Loans to associates and joint ventures - 323 109 466 356 - 1 044 529 - 1 510 885
Trade and other receivables - 7 587 202 960 - - 55 203 015
Cash and cash equivalents - 990 152 1 152 888 - - 68 238 1 221 126
Inventory - - 42 484 - - - 42 484
Non-current assets held for sale 115 149 775 115 924 - - 2 947 118 871
Other assets - 50 709 53 709 - - - 53 709
Total assets 1 987 769 2 084 451 23 543 510 3 145 828 1 092 477 71 240 27 853 055
Interest-bearing borrowings - 8 634 578 8 634 578 - - 1 431 008 10 065 586
Other financial liabilities - 133 393 146 200 - - 1 714 147 914
Deferred tax liabilities - 48 840 48 840 130 083 - - 178 923
Trade and other payables - 25 532 383 493 - - 11 383 504
Other liabilities 25 476 8 026 33 502 - - 1 496 34 998
Total liabilities 25 476 8 850 369 9 246 613 130 083 - 1 434 229 10 810 925
STATEMENT OF COMPREHENSIVE INCOME
Rental income - 12 637 1 864 042 - - - 1 864 042
Straight-line lease income adjustment - - 88 467 - - - 88 467
Property expenses - 13 204 (653 848) - - - (653 848)
Net rental income - 25 841 1 298 661 - - - 1 298 661
Sale of inventory - - 29 865 - - - 29 865
Cost of sales - - (24 918) - - - (24 918)
Other income - 23 017 39 756 - 5 214 - 44 970
Operating expenses - (95 767) (165 076) - - (5 178) (170 254)
Other expenses (39 500) (1 773) (64 817) - (83 490) (4 355) (152 662)
Operating profit (loss) (39 500) (48 682) 1 113 471 - (78 276) (9 533) 1 025 662
Amortisation of intangible assets - (24 037) (24 037) - - - (24 037)
Fair value adjustments 11 667 40 887 421 085 - - (199) 420 886
Gain on available for sale financial assets - 35 750 35 750 - - - 35 750
Net income from associates - (57 150) (51 610) 68 774 908 11 074 29 146
Investment income - 97 997 108 914 - 120 619 3 782 233 315
Finance costs - (779 960) (779 960) - - (33 908) (813 868)
Profit (loss) before tax (27 833) (735 195) 823 613 68 774 43 251 (28 784) 906 854
Taxation - 1 842 193 1 842 193 (93 297) - (1 424) 1 747 472
Profit (loss) for the year attributable to owners (27 833) 1 106 998 2 665 806 (24 523) 43 251 (30 208) 2 654 326
Reconciliation of profit
for the year to distributable earnings
Office and
Dec 2018 mixed use Retail Industrial
Unaudited distributable earnings R'000 R'000 R'000 R'000
Profit/(loss) for the period 31 332 242 917 398 507 52 706
Loss on disposal of associate 2 597 - - -
Profit on disposal of other investments (2 180) - - -
Impairment of associates, other investments
and loans 389 617 - - -
Fair value adjustments (71 103) 58 956 (74 344) 12 466
Net income from associates and joint ventures (24 007) (24) 2 502 (3 463)
Straight-line lease income adjustments (81 319) (62 380) (3 366) (16 775)
Adjustment for net non-cash interest from Africa (64 786) - - -
Net cash interest received from Africa 31 405 - - -
Depreciation and amortisation 18 631 - - -
Foreign currency translation effect (19 867) - - -
Dividends received from associates 99 600 - - 2 300
Deferred taxation 6 457 - - -
Distributable earnings 316 377 239 469 323 299 47 234
Waterfall Head office
Hotel developments Head office SA Total SA MAS Rest of Africa Global
Unaudited distributable earnings R'000 R'000 R'000 R'000 R'000 R'000 R'000
Profit/(loss) for the period 17 736 60 922 (460 047) 312 741 42 619 (309 286) (14 742)
Loss on disposal of associate - - 2 597 2 597 - - -
Profit on disposal of other investments
Impairment of associates, other investments - - - - - - (2 180)
and loans - - 19 335 19 335 - 370 282 -
Fair value adjustments (6 110) (77 930) 16 552 (70 410) - - (693)
Net income from associates and joint ventures - 795 1 280 1 090 (41 683) 16 586 -
Straight-line lease income adjustments 1 202 - - (81 319) - - -
Adjustment for net non-cash interest from Africa - - (13 760) (13 760) - (68 189) 17 163
Net cash interest received from Africa - - - - - 40 825 (9 420)
Depreciation and amortisation - - 18 631 18 631 - - -
Foreign currency translation effect - - - - (10 525) (9 342) -
Dividends received from associates - - - 2 300 97 300 - -
Deferred taxation - - (1 831) (1 831) 8 288 - -
Distributable earnings 12 828 (16 213) (417 243) 189 374 95 999 40 876 (9 872)
Office and
Dec 2017 mixed use Retail Industrial
Restated unaudited distributable earnings R'000 R'000 R'000 R'000
Profit/(loss) for the period 287 074 237 874 504 583 44 795
Profit on disposal of investment property (9 912) (9 912) - -
Impairment of associates, other investments
and loans 6 435 - - -
Fair value adjustments (224 823) (11 804) (203 333) (11 592)
Net income from associates and joint ventures (38 020) - 6 664 1 026
Straight-line lease income adjustments (19 359) (9 765) (6 578) (3 332)
Depreciation and amortisation 19 674 - - -
Foreign currency translation effect 33 014 - - -
Dividends received from associates 84 498 - - -
Deferred taxation 150 149 - - -
Distributable earnings 288 730 206 393 301 336 30 897
Waterfall Head office
Hotel developments Head office SA Total SA MAS Rest of Africa Global
Restated unaudited distributable earnings R'000 R'000 R'000 R'000 R'000 R'000 R'000
Profit/(loss) for the period 24 207 22 054 (555 351) 278 162 (7 737) 20 803 (4 154)
Profit on disposal of investment property - - - (9 912) - - -
Impairment of associates, other investments
and loans - - 10 162 10 162 - 3 586 (7 313)
Fair value adjustments (12 504) (24 846) 38 536 (225 543) - - 720
Net income from associates and joint ventures - - - 7 690 (41 801) 7 551 (11 460)
Straight-line lease income adjustments 316 - - (19 359) - - -
Depreciation and amortisation - - 19 674 19 674 - - -
Foreign currency translation effect - - - - - 33 014 -
Dividends received from associates - - 10 331 10 331 74 167 - -
Deferred taxation - - 100 611 100 611 49 538 - -
Distributable earnings 12 019 (2 792) (376 037) 171 816 74 167 64 954 (22 207)
Segmental analysis
Reconciliation of profit for the period/year to distributable earnings
Restated Restated
Unaudited unaudited unaudited
31 December 31 December 30 June
2018 2017 2018
R'000 R'000 R'000
Profit for the period/year 31 332 287 074 2 654 326
Profit on disposal of subsidiary - - (5 633)
Loss on disposal of associate 2 597 - -
(Loss)/profit on disposal of other investments (2 180) - 2 612
Profit on disposal of investment property - (9 912) (14 947)
Impairment of associates, other investments and loans 389 617 6 435 51 197
Realisation of available-for-sale financial assets - - (35 750)
Fair value adjustments (71 103) (224 823) (420 886)
Net income from associates and joint ventures (24 007) (38 020) (29 146)
Straight-line lease income adjustments (81 319) (19 359) (88 467)
Adjustment for net non-cash interest from associates (64 786) - (128 271)
Net cash interest received from associates 31 405 - 42 425
Depreciation and amortisation 18 631 19 674 39 764
Unrealised foreign currency translation effect (19 867) 33 014 50 698
Dividends received from associates 99 600 84 498 166 723
Write-off of other trade and receivable - - 47 972
Movement in provision - - 3 943
Deferred taxation 6 457 150 149 (1 769 383)
Distributable earnings for the period/year 316 377 288 730 567 177
Number of shares in issue* 703 395 224 703 055 224 703 155 224
Weighted average number of shares in issue* 703 178 702 702 838 702 702 989 909
Distributable earnings per share (cents)
Basic 45.0 41.1 80.7
Dividends (cents)
Interim 284 875 - -
Final - - 520 334
Dividend per share (cents)
Interim 40.5 - -
Final - - 74.0
* Adjusted for 46 427 553 treasury shares
Independent non-executive directors
P Tredoux (Chairman)
HR El Haimer (Lead independent)
MM du Toit
IN Mkhari
KR Moloko
BT Nagle
S Shaw-Taylor
JHP van der Merwe
Executive directors
M Hamman (CEO)
R Nana (CFO)
JR van Niekerk (COO)
Company secretary
T Kodde
Registered office
ATT House, 2nd Floor
Maxwell Office Park
37 Magwa Crescent
Waterfall City
2090
Postal address
PostNet suite 016
Private Bag X81
Halfway House
1685
Transfer secretaries
Computershare Investor Services Proprietary Limited
Rosebank Towers, 15 Biermann Avenue, Rosebank, 2196
(PO Box 61051, Marshalltown, 2107)
Sponsor
Java Capital
Date: 05/03/2019 08:22:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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