| Fri 31 Aug 2001, 0:00 | | Martprop - Financial Results And Distribution |
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MARRIOT PROPERTY FUND LIMITED
SHARE CODE: MRT
ISIN CODE: ZAE000015707
FINANCIAL RESULTS AND DISTRIBUTION
The directors of Marriott Property Fund Managers Limited, management company
of Marriott Property Fund (Martprop) submit their report on the audited
income statement and balance sheet of the group for the year ended 31 July
2001.
CONSOLIDATED BALANCE SHEET (R000) 2001 2000
Assets
Non-current assets
Fixed property 1 199 700 1 133 632
Current assets
Cash resources and short term 42 213 126 148
investments
Trade and other receivables 14 700 17 674
1 256 613 1 277 454
Unitholders' funds and liabilities
Unitholders' funds 1 225 160 1 190 433
Current liabilities
Trade and other payables 13 825 9 938
Distributions payable 17 628 77 083
1 256 613 1 277 454
CONSOLIDATED INCOME STATEMENT (R000) 2001 2000
Revenue (Rental income) 173 387 171 962
Net property income 141 466 141 839
Interest received 11 596 14 639
Fund expenses (5 064) (4 899)
Headline earnings 147 998 151 579
Capital surplus/(deficit) on disposal 1 053 (10)
of properties
Write-up/(-down) on revaluation of 14 457 (88 916)
fixed properties (Note 4)
Net profit 163 508 62 653
Unit in issue 641 016 629 251
Weighted average units in issue 630 575 629 251
Net distributable income + (cents per 23,50 24,50
unit)
Net headline earnings * (cents per 23,47 24,09
unit)
Net profit * (cents per unit) 25,93 9,96
+ based on actual units in issue at distribution dates.
* based on weighted average units in issue.
CONSOLIDATED STATEMENT OF CHANGES 2001 2000
IN UNITHOLDERS' FUNDS (R000)
Unitholders' funds at beginning of 1 190 433 1 281 328
year
Capital movements 34 657 (89 054)
Write-up/(-down) on revaluation of 14 457 (88 916)
fixed properties
Capital surplus/(deficit) on disposal 1 053 (10)
of fixed properties
Other (96) (128)
Total before issue of new units 15 414 (89 054)
Issue of new units on 22 June 2001 19 243 -
Maintenance reserves
Net movement 70 (1 841)
Revenue movements - -
Net profit 163 508 62 653
Transfer (to)/from capital (15 414) 89 054
Unclaimed distributions written back 174 618
Net transfer (to)/from maintenance (70) 1 841
reserves
Available for distribution 148 198 154 166
Distributions paid (148 198) (154 166)
Unitholders' funds at end of year 1 225 160 1 190 433
DISTRIBUTION RECONCILIATION 2001 2000
Available for distribution
- R000 148 198 154 166
- Cents per unit 23,50 24,50
Distributions declared in respect of
(cents per unit):
No. 11 declared 01/03/2001 11,75 12,25
(02/03/2000)
No. 12 declared 01/06/2001 9,00 -
No. 13 declared 30/07/2001 2,75 12,25
(31/08/2000)
23,50 24,50
ABRIDGED CONSOLIDATED CASH FLOW 2001 2000
STATEMENT (R000)
Cash inflows from operating
activities
Net profit for the period 163 508 62 653
Adjustments for:
Interest received (11 596) (14 639)
Write-(up)/down on revaluation of (14 457) 88 916
fixed properties
Capital (surplus)/deficit on disposal (1 053) 10
of fixed properties
Operating profit before working 136 402 136 940
capital changes
Working capital changes 6 942 (3 011)
Cash generated from operations 143 344 133 929
Interest received 11 596 14 639
Distributions paid (207 560) (153 962)
Net cash outflow from operating (52 620) (5 394)
activities
Cash outflows from investing (50 558) (10 711)
activities
Net cash inflow from financing
activities
Proceeds from issue of new units 19 243 -
Net decrease in cash (83 935) (16 105)
Cash at beginning of year 126 148 142 253
Cash at end of year 42 213 126 148
OTHER INFORMATION 2001 2000
Uncommitted cash for property 18 717 39 524
investment (R000)
Expected net proceeds from sale of 39 557 13 582
properties (R000)
Vacancy factor (based on lettable 7% 5%
area)
Valuation analysis (cents per unit)
Net asset value 191 189
Listed market price 184 175
Discount to net asset value 4% 7%
Capitalised interest (R000) 290 288
COMMENTS
1. Results
The performance of the Fund's property portfolio has been in line with
management's expectations and, despite continued pressure on rentals and
lower interest rates, net distributable income for the year of 23,50 cents
per unit (2000 : 24,50 cents per unit) has been achieved. The decline in
distributions is primarily attributable to the decline in interest received.
A final distribution of 2,75 cents per unit is reported in this
announcement. An interim distribution of 11,75 cents per unit was made in
respect of the first six months and, as a consequence of the issue of new
units on 22 June 2001, a broken period distribution of 9,00 cents per unit
was declared on 1 June 2001.
2. Property portfolio
The Fund has disposed of six properties for a total of R26,6 million.
Agreements are in place for the sale of a further eight properties for a
total consideration of R39,6 million. All of these disposals are in
accordance with the investment strategy of the Fund to enhance long-term
earnings growth and focus on quality property investments.
These duel objectives of the management company have been met in the
acquisition of a R64,2 million portfolio of prime warehousing properties in
Meadowdale, Gauteng. The transaction was settled by cash and the issue of
units and management is confident that these properties will generate long-
term sustainability and growth of income.
3. Prospects
The industrial property market remains static in the face of disappointing
GDP growth and generally market rentals have failed to appreciate as
anticipated. Office rentals and demand for CBD - periphery office space
have similarly remained depressed and the Fund's exposure to these
commercial properties, although limited, will bring further pressure on
future earnings. Notwithstanding these concerns, management is forecasting
that the Fund will deliver improved earnings to unitholders in the year
ahead.
4. Accounting policies
The group results have been prepared in accordance with South African
Statements of Generally Accepted Accounting Practice. In view of the recent
amendments to these statements, the accounting policies of the group have
been amended. The most significant impact, as a result of this, relates to
the accounting for the maintenance provisions/reserves (as a result of AC
130) and property/investment revaluations (as a result of the early adoption
of AC 135), all of which have resulted in the restatement of prior year
results.
Fixed properties are regarded as investment properties. In anticipation of
the changes to Generally Accepted Accounting Practice the Fund's properties
were revalued at 31 July 2000 and again at 31 July 2001. In terms of AC 135
the revaluation movements are now reflected in the income statement, whereas
previously they were shown in the statement of changes in unitholders'
funds.
5. STRATE
The JSE Securities Exchange South Africa's implementation of the Share
Transactions Totally Electronic (STRATE) settlement system has commenced and
all listed entities will be required to transfer to STRATE. Accordingly
Martprop's planned dematerialisation is scheduled for 1 October 2001. A
document will be sent to unitholders in this regard.
DISTRIBUTION DECLARATION
Notice is hereby given of the declaration of Distribution No. 13 in respect
of the income distribution period 23 June 2001 to 31 July 2001. The
distribution amounts to 2,75 cents per unit and is payable to unitholders
registered as such in the books of the Fund at the close of business on
14 September 2001. Cheques will be posted on or about 29 September 2001.
BY ORDER OF THE BOARD
Marriott Property Services
(Proprietary) Limited
(Secretaries)
31 August 2001
MARRIOTT PROPERTY FUND MANAGERS LIMITED
Registered Office
Marriott at Kingsmead
Kingsmead Office Park
Durban, 4001
PO Box 207, Durban, 4000
Transfer Secretaries
Mercantile Registrars Limited
8th Floor
11 Diagonal Street
Johannesburg, 2001
PO Box 1053,
Johannesburg, 2000
