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Fri 13 Jun 2025
Close: 1 015c 
Day's move: -5c (-0.49%)
Volume: 164 665
Trades: 44
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Revenue for the period rose to R1.1 billion (R1.0 billion) with profit before finance cost increasing to R438.6 million (R299.1 million). Profit for the period and total comprehensive profit attributable to shareholders leaped to R227.8 million (R99.0 million). Additionally, headline earnings per share ended higher at 76.42c per share (73.05c per share).
Dividends
The board of Octodec has declared a cash dividend of 62.00000 cents per share for the six months ended 28 February 2025, payable out of the company's distributable income.
Company outlook and prospects
The formation of the GNU supported an increase in business confidence and optimism, with expectations of increased economic activity to follow. The start of an interest rate reduction cycle in September 2024 undoubtedly stimulated the property market, with more potential buyers showing interest in those of our properties earmarked for sale. Additionally, the interest rate cut also supports our tenants, particularly the smaller businesses that require third-party funding for their working capital purposes, which will ultimately support the sustainability of rental to Octodec and the growth thereof. The 75 basis points cut in interest rates since September 2024 also contributes positively to Octodec, with the weighted average cost of funding expected to reduce, which creates the possibility of unlocking value through acquisitions or redevelopment opportunities. Unemployment, however, continues to be a significant problem for South Africa and, in particular, affects the residential sector in which we operate.
Geopolitical tensions with the US, and the US government's decision to levy tariffs on multiple countries, including South Africa, have led to global uncertainty and concerns around inflation rising, dampening prospects for further rate cuts. The sustainability of renewed business confidence and the financial health of our tenants operating within this challenging trading environment therefore continue to be tested.
As previously reported, the Board has mandated management to embark on a more aggressive approach to the disposal of non-core assets. The proceeds from those properties that no longer yield the necessary returns for shareholders will be recycled into yield-enhancing investments or reduce borrowings, with the objective of strengthening the balance sheet.
The insurance claim associated with Lilian Ngoyi Street, has progressed with an interim agreement of loss payment of 20% of the R20.0 million policy limit signed in April 2025. The process to agree and settle on the balance of the claim continues as, whilst Lilian Ngoyi remains under repair, the claim will remain open for a period of up to 36 months from the date of the event.
The change in the geopolitical landscape is expected to affect trading conditions which, together with a recent notice from the City of Tshwane to vacate 12 086m2 of office space in the Pretoria CBD, and the ongoing risk of the GNU not being maintained, negatively impacts our outlook for the year ending 31 August 2025.
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| Closing price data source: JSE Ltd. All other statistics calculated by ProfileData. |
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