| Thu 29 Oct 2009, 9:00 | | FPT - Fountainhead Property Trust Management - Audited Final Results for the |
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FPT
FPT
FPT - Fountainhead Property Trust Management - Audited Final Results for the
year ended 30 September 2009
Fountainhead Property Trust Management Limited
(Reg No 1983/003324/06)
Short name: FPT
Share code: FPT
ISIN: ZAE000097416
FOUNTAINHEAD PROPERTY TRUST
AUDITED FINAL RESULTS for the year ended 30 September 2009
* Final distribution of 26.3 cents per unit
* Distribution growth of 8.1% for the year
* Net asset value of R6.74 per unit
* Gearing of 12%
The directors of Fountainhead Property Trust Management Limited, the manager
of Fountainhead Property Trust, submit their report on the audited results of
Fountainhead Property Trust for the year ended 30 September 2009. These
abridged financial statements have been extracted from the audited financial
statements on which KPMG Inc. have issued an unmodified opinion and which are
available for inspection at the registered office.
BALANCE SHEET
2009 2008
R`000 R`000
ASSETS
Property assets 7 621 090 7 335 119
Investment properties 7 372 551 7 103 135
Straight-line lease accrual 248 539 231 984
Other current assets 380 414 355 697
Trade and other receivables 46 542 38 513
Cash and cash equivalents 333 872 317 184
Total assets 8 001 504 7 690 816
UNITHOLDERS` FUNDS AND LIABILITIES
Unitholders` funds 6 708 418 6 609 335
Capital of the fund 1 933 354 1 933 354
Capital reserve 501 906 501 906
Revaluation reserve 4 024 559 3 942 031
Retained earnings 248 599 232 044
Non-current liabilities
Interest-bearing liability 915 000 731 000
Current liabilities 378 086 350 481
Trade and other payables 116 127 106 450
Unitholders for distribution 261 959 244 031
Total unitholders` funds and liabilities 8 001 504 7 690 816
INCOME STATEMENT
2009 2008
R`000 R`000
Income 785 120 704 091
Contractual rental income 768 565 689 439
Straight-line lease adjustment 16 555 14 652
Expenses (195 004) (173 598)
Administrative expenses (35 921) (35 871)
Property operating expenses (159 083) (137 727)
Operating profit 590 116 530 493
Net finance costs (55 619) (36 744)
Interest received 34 658 37 969
Interest paid (90 277) (74 713)
Deficit on disposal of investment properties - (1 194)
Fair value adjustments to investment properties 82 528 280 791
Profit for the year 617 025 773 346
Basic earnings per unit (cents) 61.9 77.6
Headline earnings and distribution income
reconciliation
Profit for the year 617 025 773 346
Deficit on disposal of investment properties - 1 194
Less: fair value adjustments to investment
properties (82 528) (280 791)
Headline earnings 534 497 493 749
Less: straight-line lease adjustment (16 555) (14 652)
Distribution income 517 942 479 097
Headline earnings per unit (cents) 53.66 49.57
Distribution per unit (cents) 52.00 48.10
Interim distribution per unit (cents) 25.70 23.60
Final distribution per unit (cents) 26.30 24.50
Units in issue 996 043 081 996 043 081
CASH FLOW STATEMENT
2009 2008
R`000 R`000
Cash effects from operating activities
Profit for the year 617 025 773 346
Adjustments for:
Straight-line lease adjustment (16 555) (14 652)
Interest received (34 658) (37 969)
Interest paid 90 277 74 713
Deficit on disposal of investment properties - 1 194
Fair value adjustments to investment properties (82 528) (280 791)
573 561 515 841
Trade and other receivables increased (8 029) (15 226)
Trade and other payables increased 9 677 24 986
Cash generated from the operations 575 209 525 601
Interest received 34 658 37 969
Interest paid (90 277) (74 713)
Income distributions (500 014) (449 414)
Net cash flows from operating activities 19 576 39 443
Cash effects from investing activities
Additions to investment properties (186 888) (252 828)
Proceeds from disposal of investment properties - 5 084
Net cash flows used in investing activities (186 888) (247 744)
Cash effects from financing activities
Long-term loan raised 184 000 244 000
Net cash flows from financing activities 184 000 244 000
Net increase in cash and cash equivalents 16 688 35 699
Cash and cash equivalents at 1 October 317 184 281 485
Cash and cash equivalents at 30 September 333 872 317 184
STATEMENT OF CHANGES IN UNITHOLDERS` FUNDS
Capital of Capital Revaluation
(R`000) the fund reserve reserve
Balance as at 1 October 2007 1 933 354 498 517 3 665 823
Profit/total income and
expenses for the year
Loss and revaluation reserve
realised on sale of properties
transferred to capital reserve 3 389 (4 583)
Fair value adjustment on
investment properties
transferred to revaluation reserve 280 791
Income distributions
Balance at 30 September 2008 1 933 354 501 906 3 942 031
Profit/total income and
expenses for the year
Fair value adjustment on
investment properties
transferred to revaluation reserve 82 528
Income distributions
Balance at 30 September 2009 1 933 354 501 906 4 024 559
Total
Retained unitholders`
(R`000) earnings funds
Balance as at 1 October 2007 217 392 6 315 086
Profit/total income and
expenses for the year 773 346 773 346
Loss and revaluation reserve
realised on sale of properties
transferred to capital reserve 1 194 -
Fair value adjustment on
investment properties
transferred to revaluation reserve (280 791) -
Income distributions (479 097) (479 097)
Balance at 30 September 2008 232 044 6 609 335
Profit/total income and
expenses for the year 617 025 617 025
Fair value adjustment on
investment properties
transferred to revaluation reserve (82 528) -
Income distributions (517 942) (517 942)
Balance at 30 September 2009 248 599 6 708 418
COMMENTARY
1. BASIS OF PREPARATION AND ACCOUNTING POLICIES
The annual results have been prepared in accordance with International
Financial Reporting Standards (IFRS) and the requirements of the Collective
Investment Schemes Control Act. The accounting policies are consistent in all
material respects with those applied in prior years.
2. DISTRIBUTION PER UNIT
Fountainhead Property Trust`s net distribution income for the six months ended
September 2009 amounts to 26.3 cents per unit, 7.3 percent greater than the
comparable period last year. The net distribution for the financial year ended
September 2009 is 52 cents per unit, which is 8.1 percent greater than the
comparable period last year.
3. BORROWINGS
The interest-bearing liability comprises:
Term Loan A - A R465 000 000 interest only facility at a rate of prime less
2.3% payable by 24 June 2012. An additional R275 000 000 of this facility is
still available for access.
Term Loan B - A R250 000 000 interest only facility fixed at a rate of 11.07%
until 15 February 2013. This facility is payable by 24 June 2012, with the
fixed interest rate transferable to any subsequent facility.
Term Loan C - A R200 000 000 interest only facility fixed at a rate of
10.72% until 22 July 2012. This facility is payable by 22 July 2012.
4. MAJOR CAPITAL PROJECTS
Significant capital projects are:
Kenilworth Centre
The redevelopment of the centre is practically complete. The centre now has a
larger Checkers, a new Game store, a food court and a new Virgin Active gym.
The centre also had an aesthetic upgrade with new tiles and lighting. The cost
of the redevelopment was R122 million at an initial yield of 8.3 percent.
Since the redevelopment, turnover has increased by 20 percent and foot count
by 6 percent.
Benmore Gardens Shopping Centre
The development of the parking decks is progressing well. The first deck will
be opened by November and the second deck will be completed during the first
quarter of 2010. There will now be 1 019 parking bays at the centre. The total
project cost for the centre is R195 million at an 8.5 percent initial yield.
Centurion Mall
The Edgars expansion is complete and has been handed over for beneficial
occupation. The enlarged store should commence trading during November 2009.
The cost is R19 million at an initial yield of 11.8 percent. The cinema
redevelopment is progressing well with four of the six cinemas opening for
the Christmas holiday season. The remaining two cinemas will open during the
first quarter of next year. The cost of the cinemas is R10.9 million at an
initial yield of 4.4 percent. This yield does not take into account
additional income which will be received from parking and the benefits
derived from supporting the total entertainment offering of the mall.
5. SEGMENTAL INFORMATION
Sep 2009
Net
Revenue income % of
Rm Rm total
Retail 549 436 84
Office blocks 114 88 17
Industrial 79 62 12
Specialised 26 26 5
Corporate - (94) (18)
Total 768 518 100
Sep 2008
Net
Revenue income % of
Rm Rm total
Retail 497 400 83
Office blocks 101 77 16
Industrial 66 51 11
Specialised 25 25 5
Corporate - (74) (15)
Total 689 479 100
6. VACANCY LEVELS
Vacancy levels in terms of rentable area at 30 September were as follows:
Sector 2009 2008
% %
Retail 6 6
Office blocks 7 8
Industrial 8 6
Specialised - -
Total 6 6
By value, the vacancies equated to 4 percent of potential rental income, the
same as at half-year.
In the retail sector 74 percent of the vacancies remain at The Boulders, The
Brightwater Commons and at Centurion Mall. Approximately 25 percent of the
total retail vacant area has been let for future occupation.
The office sector had a vacancy of 7 percent, mainly at Grayston Ridge, AMR
Office Park and The Ambridge.
The industrial sector had a vacancy of 8 percent compared with 7 percent at
half-year.
The increase in the vacancy is reflective of the depressed economic conditions
within the manufacturing and distribution sectors.
7. LEASE EXPIRY PROFILE
The lease expiry profile by rentable area as at 30 September 2009 is as follows
(%):
Building Vacant 2010 2011 2012 2013 2014 >2014
Retail 6 23 13 14 11 16 17
Offices 7 22 23 25 2 3 18
Industrial 8 34 22 22 12 2 0
Specialised 0 0 52 0 0 0 48
Total 6 25 18 17 10 10 14
8. PORTFOLIO VALUATIONS
The composition of Fountainhead Property Trust`s portfolio, as valued by the
independent valuer, Rode and Associates CC, as at 30 September 2009, is as
follows:
Sector Value Cents/ Forward % of portfolio
(Rm) unit EY (%) 2009 2008
Retail 5 764 579 8.4 76 74
Office blocks 983 99 8.9 13 13
Industrial 616 62 10.3 8 9
Specialised 258 26 11.3 3 4
Total property 7 621 766 8.7 100 100
Long-term borrowings (915) (92)
Net current assets 2 -
6 708 674
The net asset value of R6.74 per unit is 1 percent higher than a year ago.
9. PROSPECTS
Management believes that distribution growth will continue into the year ahead.
This information has not been reviewed or reported on by the Trust`s auditors.
10. INCOME DISTRIBUTION ANNOUNCEMENT
Notice is hereby given of distribution No. 53 of 26.3 cents per unit for the
six months ended 30 September 2009.
The last date to trade cum distribution will be Friday, 13 November 2009. The
units of Fountainhead Property Trust will commence trading ex-distribution on
Monday, 16 November 2009 and the record date will be Friday, 20 November 2009.
The distribution will be paid on Monday, 23 November 2009.
Unit certificates may not be dematerialised or rematerialised between Monday,
16 November 2009 and Friday, 20 November 2009, both dates inclusive.
BY ORDER OF THE BOARD
Fountainhead Property Trust Management Limited
(Reg No 1983/003324/06)
28 October 2009
Directors: WM Kirchmann (Chairman), AE Raubenheimer (Managing), VA Christian,
HY Laher, DS Ogbu, JD Rainier, SJ Segar, S Shaw-Taylor
Transfer secretaries:
Computershare Investor Services (Pty) Ltd
70 Marshall Street
Johannesburg, 2001
(PO Box 61051, Marshalltown, 2107)
Secretary and registered office:
Broll Property Group (Pty) Ltd
Broll House, 27 Fricker Road, Illovo
Johannesburg, 2196
(PO Box 1455, Saxonwold, 2132)
Sponsor: Standard Bank
E-mail: fountainhead@standardbank.co.za
Website: www.fountainheadproperty.co.za
Date: 29/10/2009 09:00:21 Produced by the JSE SENS Department.
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