| Fri 23 Sep 2011, 15:24 | | PPR - Putprop Limited - Abridged audited condensed results for the year ended 30 |
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PPR
PPR
PPR - Putprop Limited - Abridged audited condensed results for the year ended 30
June 2011, notice of annual general meeting and final dividend declaration
PUTPROP LIMITED
Incorporated in the Republic of South Africa
(Registration number 1988/001085/06)
Share code: PPR ISIN: ZAE000072310
("Putprop" or "the company")
Abridged audited condensed results for the year ended 30 June 2011, notice of
annual general meeting and final dividend declaration
The Annual Financial Statements for Putprop Limited have been audited in
accordance with the requirements of the Companies Act of South Africa,
2008 (Section 29(e)(1)) and are published on 23 September 2011. These statements
have been prepared by JE Smith, BSc, BAcc, CIEA, the financial executive of the
company.
Condensed audited statement of comprehensive income for the financial year ended
30 June 2011
% Audited Audited
Change Year ended Year ended
30 June 30 June
2011 2010
R`000 R`000
Property revenue 7.4 36 969 34 426
Straight-line rental income accrual (1 960) 1 036
Gross property revenue (1.3) 35 009 35 462
Property expenses (3 803) (2 605)
Net profit from property operations (5.0) 31 206 32 857
Administration expenses (3 689) (2 992)
Investment and other income 1 457 415
Operating profit before capital items (4.3) 28 974 30 280
Capital items
Fair value adjustments 28 035 19 504
Net profit before taxation 14.5 57 009 49 784
Taxation (12 859) (11 814)
Profit attributable to ordinary 44 150 37 970
shareholders 16.3
Other comprehensive income - -
Total comprehensive income 44 150 37 970
attributable to ordinary shareholders
Earnings and diluted earnings per 153.3 131.9
share (cents) 16.2
Condensed audited statement of financial position as at 30 June 2011
Audited Audited
as at as at
30 June 2011 30 June 2010
R`000 R`000
ASSETS
Non-current assets
Investment properties 237 000 220 182
Other non-current assets
Furniture, fittings and computer equipment 119 43
Investments in subsidiaries and associates 3 769 69
Straight-line rental income asset 3 685 8 902
Other investments 7 098 10 097
251 671 239 293
Current assets
Straight-line rental income asset 5 977 2 720
Trade and other receivables 4 824 518
Taxation receivable - 598
Cash and cash equivalents 28 847 8 133
39 648 11 969
Total assets 291 319 251 262
EQUITY AND LIABILITIES
Capital and reserves
Share capital 4 146 4 146
Accumulated profit 266 063 231 990
270 209 236 136
Non-current liabilities
Deferred taxation 15 385 12 819
15 385 12 819
Current liabilities
Trade and other payables 5 170 2 238
Taxation payable 555 -
Amount due to subsidiary and associates - 69
5 725 2 307
Total equity and liabilities 291 319 251 262
Condensed audited statement of changes in equity for the financial year ended 30
June 2011
Share Accumulated
Capital Profit Total
R`000 R`000 R`000
Balance at 1 July 2009 4 146 200 354 204 500
Profit attributable to equity - 37 970 37 970
holders
Dividends paid - (6 334) (6 334)
Balance at 30 June 2010 4 146 231 990 236 136
Profit attributable to equity - 44 150 44 150
holders
Dividends paid - (10 077) (10 077)
Balance at 30 June 2011 4 146 266 063 270 209
Condensed audited statement of cash flows for the financial year ended 30 June
2011
Audited Audited
Year ended Year ended
30 June 2011 30 June 2010
R`000 R`000
Cash flow generated from operating 10 271 15 134
activities
Net cash generated from operations 28 032 29 127
Investment and other income 1 457 415
Taxation paid (9 141) (8 074)
Dividends paid (10 077) (6 334)
Cash flow generated from (utilised in) 10 443 (15 469)
investing activities
Improvement to investment properties (483) (1 494)
Acquisition of furniture fittings and (104) (6)
computer equipment
Acquisition and development of investment - (13 577)
properties
Proceeds on sale of investment properties 11 800 -
Additions to other investments - (392)
Acquisition of associates (770) -
Cash flow utilised in financing activities - -
Net increase/(decrease) in cash and cash 20 714 (335)
equivalents
Cash and cash equivalents at beginning of 8 133 8 468
year
Cash and cash equivalents at end of year 28 847 8 133
Basis of preparation
The financial statements have been prepared on a going concern and on a
historical cost basis except for investments and investment properties which are
measured at fair value.
The abridged audited condensed results have been prepared in accordance with the
Framework concepts and the measurement and recognition requirements of the
International Financial Reporting Standards, containing information required by
the IAS 34 Interim Financial Reporting and the AC500-standards as issued by the
Accounting Practices Board, and in the manner required by the Companies Act ,
2008 (Act 71 of 2008), as amended, and the Listings Requirements of JSE Limited.
These condensed financial statements must be read in conjunction with the most
recently issued annual financial statements for the year ended 30 June 2011.
The accounting policies applied in the preparation of these abridged audited
condensed financial statements, which are based on reasonable judgements and
estimates, are consistent with those applied in the annual financial statements
for the year ended 30 June 2010. The company has implemented the amendments to
IAS 17, Leases and IFRS 8, Operating Segments in the current year. No material
change in disclosure was effected by either standard. The same accounting
policies and methods of computation are followed in these abridged audited
condensed financial statements as compared with the annual financial statements
issued for the year ended 30 June 2011.
Overview
Putprop is a property company which has investments in industrial, retail and
commercial properties and derives its revenue primarily from rental income.
Financial results
The Company did not issue any additional shares during the year, the number of
shares in issue remained constant at 28 792 961. The company`s rental, exclusive
of straight-line rental accruals, has increased by 7.4% from R34.4 million for
the year ended 30 June 2010 ("the comparable period") to R37 million in the
current financial year. Gross property revenue for the year ended 30 June 2011
decreased by 1.3% to R 35.0 million compared to R35.4 million in the comparable
period, due to the reversal of straight-line accruals.
Property costs to income ratio increased to 10.3% from 7.6% in the comparable
period, due to higher expenditure on property maintenance. Our current level of
maintenance and refurbishment is expected to continue for the foreseeable
future. Administration expenses increased by 23.3% in the current financial year
from 7.4% in the comparable period due to increases in staffing and once off
costs. Going forward administration costs are expected to increase at levels of
between 8% and 11%.
Net asset value per share (cents) 938.4 820.1
Reconciliation of headline earnings
% Audited Audited
Change Year ended Year ended
30 June 30 June
2011 2010
R`000 R`000
Profit attributable to equity holders 44 150 37 970
Adjusted for:
- Fair value and impairment (28 035) (19 504)
adjustments
- Tax effects taxation of fair value 3 925
adjustments
Loss on disposal of investment (1 100) 2 730
properties
Gain on disposal of investment 114 -
property
- -
Tax effect of gain (14) -
Headline earnings (10.2) 19 040 21 196
Earnings per share (cents) 16.2 153.3 131.9
The calculation is based on earnings
of R44 150 000 (2010: R37 970 000) and
on the weighted average number of
shares in issue for the year of 28 792
961 (2010: 28 792 961).
Headline earnings per share (cents) (10.3) 66.1 73.7
The calculation is based on headline
earnings of R19 040 000 (2010:
R 21 196 000) and on the weighted
average number of shares in issue for
the year of 28 792 961 (2010: 28 792
961).
Property portfolio
At 30 June 2011 the groups property portfolio comprised 15 properties with a
gross lettable area of 76 948.
The sectoral spread by gross rentals comprised 87% industrial, 9% retail and 4%
commercial. Vacancies decreased during the year to 3.4% of gross lettable area
(2010:5.2%). The company continues to transact primarily with `A` grade tenants.
The lease expiry profile reflects that in terms of gross lettable area, 87% of
the portfolio expires during the next 12 months and 13% from July 2012 onwards.
The primary source of the potential large vacancies in the next 12 months is the
lease agreement with our major tenant Putco Limited which contributes 82% of the
company`s revenue stream. Management has already started negotiations to protect
this major income of the company. We anticipate the lease will be renewed.
Segmental reporting
An operating segment is a component of an entity that engages in business
activities whose operating results are regularly reviewed by the group`s
decision makers. These results are utilised to assess the segments performance
and facilitate decisions regarding resource allocation. The core business of the
group is property rental which is reported into segments based on the nature and
business functions of the tenants for JSE Limited reporting purposes. The
following segments are identified: industrial, retail, commercial and corporate.
The group operates in the greater Gauteng area.
The table below summarises by segment the position for the year ended 30 June
2011.
Retail Commercial Industrial Corporate Total
R`000 R`000 R`000 R`000 R`000
30 June 2011
Segment Revenue
Contractual rental 3 456 1 377 32 136 - 36 969
income
Straight-line 34 (211) (1 783) - (1 960)
rental adjustment
Total revenue 3 490 1 166 30 353 - 35 009
Segmental result
Operating 2 898 1 298 27 010 (3 689) 27 517
profit/(loss)
Interest Received - - - 1 457 1 457
Fair value (1 200) (3 000) 32 235 - 28 035
adjustments to
investment
properties
Net profit/(loss) 1 698 (1 702) 59 245 (2 232) 57 009
before tax
Other Information
Property assets 32 600 9 500 194 900 - 237 000
Trade and other 198 - 2 414 2 212 4 824
receivables
Cash and cash - - - 28 847 28 847
equivalents
Segment assets 32 798 9 500 197 314 31 059 270 671
Trade and other 124 1 652 1 503 1 891 5 170
payables
Segment 124 1652 1 503 1 891 5 170
liabilities
30 June 2010
Segment Revenue
Contractual rental 3 501 1 523 29 402 - 34 426
income
Straight-line 566 17 453 - 1 036
rental adjustment
Total revenue 4 067 1 540 29 855 - 35 462
Segmental result
Operating 3 882 1 167 27 808 (2 992) 29 865
profit/(loss)
Interest received - - - 415 415
Fair value 3 065 483 15 956 - 19 504
adjustments to
investment
properties
Net profit/(loss) 6 947 1 650 43 764 (2 577) 49 784
before tax
Other Information
Property assets 33 800 24 200 162 182 - 220 182
Trade and other - 59 362 97 518
receivables
Cash and cash - - - 8 133 8133
equivalents
Segment assets 33 800 24 259 162 544 8 230 228 833
Trade and other 18 261 209 1 750 2 238
payables
Segment 18 261 209 1 750 2 238
liabilities
Borrowings
The company has no loans at present. In terms of the company`s Articles of
Association borrowings are limited to 100% of the company`s equity.
Valuation of property portfolio
An independent external valuation of all the portfolio properties at 30 June
2011 was carried out. The fair value adjustment amounted to R28.0 million (2010:
R19.5 million) and is reflected as an increase in the Statement of Comprehensive
Income.
Capital commitments
The company has approved the purchase of the Detpak property situated in Kya
Sands for an amount of R13.8 million. (2010: nil).
Prospects
Property fundamentals continue to remain fairly strong in spite of the
constraints of a general slowdown of the economy and the volatility of local and
international markets. Our strategy is to enhance our property portfolio by
investing in suitable industrial, retail and commercial properties thus
enhancing our income streams. To this end the company will continue to pursue
suitable tenanted properties in the year ahead.
The group expects to maintain its current growth in the year ahead.
Notice of general meeting
Notice is hereby given that the annual general meeting of shareholders of
Putprop shares, as at the record date of Friday, 21 October 2011, will be held
at 11:00 on Wednesday, 9 November 2011 at the registered office of the company,
91 Protea Road, Chislehurston, Sandton.
The board of directors of the company determined that, in terms of section
62(3)(a), as read with section 59 of the Companies Act, 2008 (Act 71 of 2008),
the record date for the purposes of determining which shareholders of the
company are entitled to participate in and vote at the annual general meeting is
Wednesday, 9 November 2011. Accordingly, the last day to trade to be entitled to
vote will be 21 October 2011.
DIRECTORATE
During the year under review Mr Albino Carleo resigned as an executive director
and as Chief Executive Officer, with effect from 31 March 2011, following his
decision to retire. Mr Bruno Carleo was appointed as the new Chief Executive
Officer, with effect from 1 April 2011.
Dividend declaration
The directors have resolved to declare a final dividend of 15 cents per share
for the year ended 30 June 2011 to be paid to all ordinary shareholders recorded
in the share register on the record date. The dividend is declared out of
current year profits before tax of R57.0 million (2010:R49.8 million). The total
dividend paid for the year is 30 cents per share (2010: 20 cents per share). In
compliance with the requirements of Strate and Schedule 24 of the JSE Listings
Requirements, the following dates are applicable:
Last day to trade cum the dividend Friday, 14 October 2011
Date trading commences ex the dividend Monday, 17 October 2011
Record date Friday, 21 October 2011
Date of payment Monday, 24 October 2011
Share certificates may not be dematerialised or rematerialised between Monday,
17 October 2011 and Friday, 21 October 2011, both dates inclusive.
Subsequent Events
The company has purchased the Detpak property for R13.8 million. There are no
other significant subsequent events that have a material impact on the financial
statements at 30 June 2011.
Audit report
These audited abridged condensed results for the year ended 30 June 2011 have
been audited by the company`s auditors, Mazars whose unmodified audited report
is available for inspection at the company`s registered office as detailed
below.
Directorate
A B Adrian Independent non-executive Chairman
A L Carleo-Novello Executive Director
A Carleo*
B C Carleo Chief Executive Officer
J E Smith Financial Director
P Senatore Independent non-executive Director
P Nucci Independent non-executive Director
*Retired 31 March 2011
Company Secretary
J E Smith
Registered Office and Postal Address
91 Protea Road
Chislehurston
Sandton, 2196
Share Transfer Secretaries
Computershare Investor Services (Proprietary) Limited
70 Marshall Street
Marshalltown
(PO Box 61051, Marshalltown, 2107)
Sponsor
Merchantec Capital
2nd Floor, North Block, Hyde Park Office Tower
Corner 6th Road & Jan Smuts Avenue
Hyde Park, 2196
(PO Box 41480, Craighall, 2124)
Auditors
Mazars
5 St. David`s Place
Parktown 2193
23 September 2011
Date: 23/09/2011 15:24:13 Produced by the JSE SENS Department.
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