Rebosis reports 9% rise in distributions on ‘strong results’
Rebosis Property Fund, the first black-managed real estate fund to list on JSE, on Thursday reported its interim results with a 9% growth in distributions to 48.5 cents per linked unit for the six-month period ending February 2014.
The company said in a statement that the growth was driven by better portfolio fundamentals, a decrease in the overall cost of funding from 8,5% to 8,0% and continued operating efficiencies across the portfolio.
Established by the Billion Group in 2010, Rebosis diluted headline earnings per linked unit rose to 54.79c from 66.79c previously. An interim distribution of 48.50c per share linked unit was declared.
“We have a very good portfolio with high quality assets. So when the cycle is down, our portfolio which is evenly split between retail and office space makes it easier for us to make predictions,” Sisa Ngebulana, Rebosis Property Fund Limited 's chief executive officer.
The company’s net operating profit rose from R202 million in 2013 to R293 million in 2014, according to the company’s unaudited results.
Profit from operations also rose to R423 million in 2014 from R280 million in 2013.
“Our property portfolio continued to grow over the past six months, supported by the transfer of the Nthwese portfolio which has a positive impact on our office portfolio,” he added.
The portfolio has a total GLA of 414 398 m² and is located in Gauteng, the Eastern Cape, KwaZulu Natal and the North West Province. The portfolio comprises 45% retail, 53% office and 2% industrial, by value.
The property was valued at R6,592 billion, an increase of R175,2 million since 31 August 2013.
In February Rebosis announced the acquisition of Ascension Property Management (Pty) Ltd for an aggregate purchase price of R150 million. In addition to this, the fund acquired 29,05% of Ascension’s B linked unit capital, which represents 15,96% of Ascension’s total issued linked unit capital.
The take-over saga has taken an intriguing turn, with Rebosis, Delta and Ascension agreeing to explore a three-way merger, which will create a mega-fund with assets valued at R16.5bn and a market capitalisation of nearly R9.5bn.
It emerged that Rebosis CEO Sisa Ngebulana and Delta CEO Sandile Nomvete both believed they were entering into an exclusive agreement with Ascension co-founder and executive director Shaun Rai to buy Ascension’s management company. But they had seemingly been two-timed, with the two CEOs unknowingly bidding against each other for Ascension’s management company.
“We think that a merger of the funds makes strategic sense, especially in light of the fact that we were effectively aiming to attain the similar objectives for our respective funds,” said Ngebulana.
The company said that despite a tougher economic environment, it forecast distribution of between 97c and 99c per linked unit for the year ending August 2014.