Vukile Property Fund, regarded as a bellwether retail-focused real estate investment trust (Reit) on the JSE, announced on Tuesday its decision to resume paying an interim dividend on the back of a robust recovery of its SA and Spanish portfolios.
Despite ongoing Covid-19 uncertainty globally and the July unrest in parts of SA, the group revealed in its latest half-year results to the end of September 2021 that its “Southern Africa business is now trading ahead of pre-Covid-19 levels”.
Its Southern Africa operations is made up largely of its South African assets, with the group having a small presence in Namibia.
Vukile reported a “rapid recovery” of its major retail portfolio in Spain, which it noted had seen “retail sales ahead of 2019 levels in September 2021”.
The Reit declared a gross interim dividend per share (DPS) of 40.55 cents for the six months ended September 30, 2021.
DPS is the key financial performance measure for SA Reits.
For its comparative half-year (ending September 2020), the group did not declare a dividend due to the financial fallout from the Covid-19 pandemic and initial ‘hard lockdowns’. This was in-line with most of its JSE-listed peers which withheld or deferred dividend payments to bolster balance sheets in the wake of the pandemic.
Vukile said its “continued strong operating results [for its latest half-year] and financial position lay the platform for future growth”.
“Gross property revenue for the period increased from R1.4 billion as at September 30, 2020 to R1.7 billion as at September 30, 2021. The prior interim period was impacted by Covid-19 rent concessions [in both Southern Africa and Spain] to a much greater degree than the period to September 30, 2021,” the group pointed out.
The fund’s profit before finance costs increased to just over R1.18 billion (September 30, 2020: R731 million).
Vukile reported that its direct property investments (located in South Africa, Namibia and Spain) amounted to R32.4 billion at September 30, 2021, compared to R32.6 billion at its full-year end at March 31, 2021.
“Total indirect property holdings [listed property investments, comprising investments in Fairvest Property Holdings and Arrowhead Properties Limited) increased to R1 billion at September 30, 2021 [March 31, 2021: R0.8 billion], due to increases in share prices,” it added.