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FPT
FPT
FPT - Fountainhead - Unaudited Interim Results For The Six Months Ended
31 March 2010
Fountainhead Property Trust
A Collective Investment Scheme in property registered in terms of the Collective
Investment Schemes Control Act, No.45 of 2002 and managed by Fountainhead
Property Trust Management Limited
(Registration number 1983/003324/06)
Share code: FPT
ISIN code: ZAE000097416
("Fountainhead")
UNAUDITED INTERIM RESULTS for the six months ended 31 March 2010
* 6% distribution growth of 27.25 cents per unit
* Gearing of 13.6%
* Net asset value of R6.74 per unit
* Market capitalisation of R6.8 billion up 9%
The directors of Fountainhead Property Trust Management Limited, the manager of
Fountainhead Property Trust, submit their report on the unaudited results of
Fountainhead Property Trust for the six months ended 31 March 2010.
STATEMENT OF FINANCIAL POSITION
Unaudited Audited Unaudited
as at as at as at
31 Mar 2010 30 Sep 2009 31 Mar 2009
R`000 R`000 R`000
ASSETS
Property assets 7 760 981 7 621 090 7 431 695
Investment properties 7 511 003 7 372 551 7 187 259
Straight-line lease accrual 249 978 248 539 244 436
Current assets 394 784 380 414 365 807
Trade and other receivables 43 019 46 542 31 997
Cash and cash equivalents 351 765 333 872 333 810
Total assets 8 155 765 8 001 504 7 797 502
UNITHOLDERS` FUNDS AND
LIABILITIES
Unitholders` funds 6 708 418 6 708 418 6 609 335
Capital of the fund 1 933 354 1 933 354 1 933 354
Capital reserve 501 906 501 906 501 906
Revaluation reserve 4 023 120 4 024 559 3 929 579
Retained earnings 250 038 248 599 244 496
Non-current liabilities
Interest-bearing liability 1 060 000 915 000 831 000
Current liabilities 387 347 378 086 357 167
Trade and other payables 115 925 116 127 101 184
Unitholders for distribution 271 422 261 959 255 983
Total unitholders` funds and
liabilities 8 155 765 8 001 504 7 797 502
STATEMENT OF COMPREHENSIVE INCOME
Unaudited Audited Unaudited
6 months to 12 months to 6 months to
31 Mar 2010 30 Sep 2009 31 Mar 2009
R`000 R`000 R`000
Income 411 467 785 120 387 841
Contractual rental income 410 028 768 565 375 389
Straight-line lease
adjustment 1 439 16 555 12 452
Expenses (106 077) (195 004) (92 103)
Administrative expenses (20 250) (35 921) (16 844)
Property operating expenses (85 827) (159 083) (75 259)
Operating profit 305 390 590 116 295 738
Net finance costs (32 529) (55 619) (27 303)
Interest received 13 257 34 658 19 962
Interest paid (45 786) (90 277) (47 265)
Fair value adjustments to
investment properties (1 439) 82 528 (12 452)
Profit for the period 271 422 617 025 255 983
Total comprehensive income
for the period 271 422 617 025 255 983
Basic earnings per unit (cents) 27.25 61.95 25.70
Headline earnings and
distribution income
reconciliation
Profit for the period 271 422 617 025 255 983
Adjust for:
Fair value adjustments to
investment properties 1 439 (82 528) 12 452
Headline earnings 272 861 534 497 268 435
Less: straight-line lease
adjustment (1 439) (16 555) (12 452)
Distribution income 271 422 517 942 255 983
Headline earnings per unit (cents) 27.39 53.66 26.95
Distribution per unit (cents) 27.25 52.00 25.70
Interim distribution per unit
(cents) 27.25 25.70 25.70
Final distribution per unit (cents) - 26.30 -
Units in issue 996 043 081 996 043 081 996 043 081
STATEMENT OF CASH FLOWS
Unaudited Audited Unaudited
6 months to 12 months to 6 months to
31 Mar 2010 30 Sep 2009 31 Mar 2009
R`000 R`000 R`000
Cash effects from operating
activities
Profit for the period 271 422 617 025 255 983
Adjustments for:
Straight-line lease
adjustment (1 439) (16 555) (12 452)
Interest received (13 257) (34 658) (19 962)
Interest paid 45 786 90 277 47 265
Fair value adjustments to
investment properties 1 439 (82 528) 12 452
Operating profit before
changes in working capital 303 951 573 561 283 286
Trade and other receivables
decreased/(increased) 3 523 (8 029) 6 516
Trade and other payables
(decreased)/increased (202) 9 677 (5 266)
Cash generated from the
operations 307 272 575 209 284 536
Interest received 13 257 34 658 19 962
Interest paid (45 786) (90 277) (47 265)
Income distributions (261 959) (500 014) (244 031)
Cash flows from operating
activities 12 784 19 576 13 202
Cash effects from investing
activities
Additions to investment
properties (139 891) (186 888) (96 576)
(139 891) (186 888) (96 576)
Cash effects from financing
activities
Long-term loan raised 145 000 184 000 100 000
145 000 184 000 100 000
Net increase in cash and
cash equivalents 17 893 16 688 16 626
Cash and cash equivalents
at beginning of period 333 872 317 184 317 184
Cash and cash equivalents
at end of the period 351 765 333 872 333 810
STATEMENT OF CHANGES IN UNITHOLDERS` FUNDS
Capital of Capital Revaluation
(R`000) the fund reserve reserve
Balance at 1 October 2008 1 933 354 501 906 3 942 031
Total comprehensive income for the
period
Profit and total comprehensive
income for the period - - -
Transactions with unitholders,
recorded directly in equity
Fair value adjustment on
investment properties transferred
to revaluation reserve (12 452)
Income distributions
Total transactions with
unitholders - - (12 452)
Balance as at 31 March 2009 1 933 354 501 906 3 929 579
Balance at 1 October 2009 1 933 354 501 906 4 024 559
Total comprehensive income for
the period
Profit and total comprehensive
income for the period - - -
Transactions with unitholders,
recorded directly in equity
Fair value adjustment on
investment properties transferred
to revaluation reserve (1 439)
Income distributions
Total transactions with
unitholders - - (1 439)
Balance as at 31 March 2010 1 933 354 501 906 4 023 120
Total
Retained unitholders`
(R`000) earnings funds
Balance at 1 October 2008 232 044 6 609 335
Total comprehensive income for the period
Profit and total comprehensive
income for the period 255 983 255 983
Transactions with unitholders,
recorded directly in equity
Fair value adjustment on investment
properties transferred to revaluation reserve 12 452 -
Income distributions (255 983) (255 983)
Total transactions with unitholders (243 531) (255 983)
Balance as at 31 March 2009 244 496 6 609 335
Balance at 1 October 2009 248 599 6 708 418
Total comprehensive income for the period
Profit and total comprehensive
income for the period 271 422 271 422
Transactions with unitholders,
recorded directly in equity
Fair value adjustment on investment
properties transferred to revaluation reserve 1 439 -
Income distributions (271 422) (271 422)
Total transactions with unitholders (269 983) (271 422)
Balance as at 31 March 2010 250 038 6 708 418
COMMENTARY
1. BASIS OF PREPARATION AND ACCOUNTING POLICIES
The unaudited interim results have been prepared in accordance with
International Financial Reporting Standards (IFRS), IAS 34 - Interim Financial
Reporting and the requirements of the Collective Investment Schemes Control
Act. The accounting policies are consistent in all respects with those applied
in the prior year.
2. DISTRIBUTION PER UNIT
Fountainhead Property Trust`s net distributable income for the first six months
of the financial year amounts to 27.25 cents per unit, 6 percent greater than
the comparable period last year.
3. MAJOR CAPITAL PROJECTS
Significant capital and planned projects are:
Blue Route Mall
The Board has approved the redevelopment of Blue Route Mall at a total cost of
approximately R780 million. Construction is expected to commence in June 2010
and will take approximately two years to complete. In line with IAS 23
(revised) - Borrowing Costs, qualifying borrowing costs of this project will be
capitalised during the construction period. It is the intention of management
to continue with the policy of expensing interest on other short-term
construction projects.
Benmore Gardens Shopping Centre
The construction of the parking decks is complete and in operation. The
construction of the tunnel linking the two parking areas has commenced and will
be completed when Eskom completes the cable relocation, anticipated in
September 2010.
4. ACQUISITIONS
The Trust has purchased an office building called 18 The Boulevard located in
Westway, Durban. The purchase consideration was R75 000 000 with an initial
yield of 9 percent. Transfer was effective 1 March 2010.
The Trust is currently concluding purchase agreements on other prospective
office buildings with long leases in place.
5. SEGMENTAL INFORMATION
Mar 2010
6 months
Net
Revenue income % of
Rm Rm total
Retail 294 231 85
Office blocks 60 47 17
Industrial 41 32 12
Specialised 15 15 6
Corporate - (54) (20)
Total 410 271 100
Sep 2009
12 months
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
Mar 2009
6 months
Net
Revenue income % of
Rm Rm total
Retail 268 215 84
Office blocks 56 44 17
Industrial 38 29 12
Specialised 13 13 5
Corporate - (45) (18)
Total 375 256 100
6. VACANCY LEVELS
Vacancy levels in terms of rentable area were as follows:
Sector
% Mar 2010 Sep 2009 Mar 2009
Retail 5 6 4
Office blocks 12 7 5
Industrial 9 8 7
Specialised - - -
Total 7 6 5
By value, the vacancies equated to 5 percent of potential rental income,
slightly up on the 4 percent at year-end.
In the retail sector 61 percent of the vacancies were contained in The
Brightwater Commons, Northmead Mall and at Centurion Mall. Vacancies have
stabilised in the retail portfolio.
The office sector had a vacancy of 12.4 percent which is primarily situated in
Grayston Ridge, AMR Office Park and The Ambridge. The increased vacancy is
reflective of the depressed letting market in the office sector.
The industrial sector had a vacancy of 9.4 percent. Approximately 29 percent of
the total vacant industrial area has been let for future occupation.
7. PROSPECTS
It is anticipated that the distribution per unit for the year ending
30 September 2010 will increase by approximately 4 percent compared with the
financial year ended 30 September 2009. This is based on the Board`s assessment
of the current economic climate and the short-term dilution of the Blue Route
Mall redevelopment. This forecast has not been reviewed or reported on by the
Fountainhead Property Trust`s auditor.
8. DISTRIBUTION ANNOUNCEMENT
Notice is hereby given of distribution No. 54 of 27.25 cents per unit for the
six months ended 31 March 2010.
The last date to trade cum distribution will be Friday, 14 May 2010. The units
of Fountainhead Property Trust will commence trading ex-distribution on Monday,
17 May 2010 and the record date will be Friday, 21 May 2010. The distribution
will be paid on Monday, 24 May 2010.
Unit certificates may not be dematerialised or rematerialised between Monday,
17 May 2010 and Friday, 21 May 2010, both dates inclusive.
BY ORDER OF THE BOARD
Fountainhead Property Trust Management Limited
(Reg No. 1983/003324/06)
29 April 2010
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)
Short name: FPT
Share code: FPT ISIN: ZAE000097416
Sponsor: Standard Bank
E-mail: fountainhead@standardbank.co.za
Website: www.fountainheadproperty.co.za
30 April 2010
Date: 30/04/2010 09:00:01 Produced by the JSE SENS Department.
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