Hyprop total distribution up 7.3% to 382c
Hyprop Investments (HYP) has declared a total distribution for the year ended December of 383 cents per combined unit, an increase of 7.3% on the previous year.
The final distribution of 137 cents, together with the special distribution of 65 cents paid on 17 October 2011, reflects aggregate growth of 10,4% compared with the corresponding period in 2010.
Headline earnings per combined unit for the half-year were 406.3 cents versus 465.8 cents previously.
Like-for-like growth from Hyprop's shopping centres in revenue and distributable earnings was 8.0% and 7.4%, respectively. Property expenses increased by 9%. Canal Walk and The Glen performed particularly well during the year, with distributable earnings growth of 9% and 10%, respectively.
Distributable earnings from hotels reduced due to a net loss at The Grace (prior to sale) as well as underperformance at Southern Sun Hyde Park.
Distributable earnings from listed property securities increased by 10% as a result of improved distribution growth from Sycom and due to the addition of 8.9 million Sycom units, acquired in terms of the Attfund Retail acquisition.
Distributable earnings in the second half include a once-off benefit amounting to 3.7 cents resulting from a deferred payment in respect of the 15 million Attfund Retail consideration units which were re-purchased by the company.
Non-core income includes Hyprop's investment in Word4Word Marketing (Pty) Limited and fee income from Vunani Property Investment Fund (VPIF).
Income from associate relates to distributions received from VPIF. This income reduced due to Hyprop selling 50% of its interest in VPIF concurrently with VPIF's listing on the JSE.
Notwithstanding the larger portfolio, total arrears at 31 December 2011 were R41 million (2010: R41 million). Total provision for doubtful debts at year-end amounted to R17.4 million (2010: R20.8 million).
Total vacancies in the portfolio at 31 December 2011 were 4,1% (2010: 3,9%).
With regards to developments, Hyprop said the planned redevelopment of The Mall of Rosebank had progressed further with the commencement of demolitions on the Rosebank Gardens site.
"Redevelopment of The Mall itself will commence once town-planning approvals have been received and letting requirements have been met. It is anticipated that construction will start during 2012. Further information will be communicated to unitholders in due course," Hyprop said.
Further extensions to Canal Walk, to meet tenant demand, and the refurbishment of Willowbridge South were also planned to commence in the next 12 months, the group said.
Looking ahead, Hyprop said it would continue to focus on the disposal of non-core assets, the expansion and redevelopment of existing centres and improvement of operational efficiencies. Attention would also be given to alternative forms of finance to further reduce the overall cost of debt.
"Hyprop will continue to invest in high quality, sizable shopping centres. The board will consider investment in shopping centres elsewhere, including in the rest of Africa.
"Taking into account the implementation of the Attfund Retail acquisition and short term dilution due to higher gearing, Hyprop expects to show distribution growth of between 4% and 6% for 2012," the group added.