| Thu 14 Feb 2002, 0:00 | | Arnold Property Fund: Results For The Period |
|
DECEMBER 2001
ARNOLD PROPERTY FUND LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2001/011887/06)
Share code: ARP ISIN: ZAE000031720
("A-Prop" or "the Company")
RESULTS FOR THE PERIOD FROM 30 AUGUST 2001 TO 31 DECEMBER 2001
* Maiden distribution on target
INCOME STATEMENT Pro rata Forecast
forecast per per the
Reviewed for the prospectus prospectus
the period for the period for the
year
ended ended ending
31 December 31 December 30 June
2001 2001 2002
R'000 R'000 R'000
Net income before interest 36 315 36 857 108 490
Net interest paid 23 537 24 136 71 046
Net income 12 778 12 721 37 444
Distribution to unitholders 12 778 12 721 37 444
Retained income for period - - -
Number of linked units 125 555 065 124 949 157 124 949 157
Headline earnings
per linked unit (cents) 10,2 10,2 30,0
Distribution
per linked unit (cents) 10,2 10,2 30,0
Forward yield based on
a 200 cent linked unit (%) 15,0 15,0 15,0
BALANCE SHEET
Reviewed for
the period
ended
31 December
2001
R'000
Assets
Fixed property - at cost 823 160
Current assets 20 305
Total assets 843 465
Equity and Liabilities
Share capital and share premium 12 367
Debentures 225 999
Long-term loans 539 979
Vendor loans 41 892
Creditors 10 450
Unitholders for distribution 12 778
Total equity and liabilities 843 465
Net asset value per linked
unit (cents) 189,8
CASH FLOW STATEMENT
Cash flow from operating activities 17 220
Cash flow from investing activities (823 160)
Cash flow from financing activities 820 237
Change in cash and cash equivalents 14 297
Cash and cash equivalents at
beginning of period -
Cash and cash equivalents
at end of period 14 297
CHANGES IN UNITHOLDERS' INTEREST
Unitholders' interest at
beginning of period -
Changes in share capital
and share premium 12 366
Changes in debentures 225 999
Net income for period 12 778
distribution to unitholders (12 778)
Unitholders' interest at
end of period 238 365
COMMENTS
1. REVIEW OF OPERATIONS
* Results
The directors are pleased to announce that earnings for the period 30 August
2001 to 31 December 2001 are in line with the earnings forecast in the
Company's listing prospectus. A maiden interest distribution of 10,2 cents
per linked unit has been declared, which represents an annualised yield of
15,0% based on an issue price of 200 cents per A-Prop linked unit.
The results have been prepared in accordance with South African statements
of Generally Accepted Accounting Practice. The company listed on 30 August
2001 and as a result there are no comparitive figures.
The results for the period have been reviewed by the company's auditors,
Deloitte & Touche. A copy of this report is available at the Company's
registered office.
* Property portfolio
The Company has focused on managing and consolidating the portfolio acquired
on listing. Actual income has been compared to forecast income on each
property and variances analysed. Any adjustments to prices paid to vendors
as a result of warranties not being met will be made in the accounts to 30
June 2002. This is likely to have a positive impact on earnings.
The company has taken transfer of all properties, other than the Nqutu
property, property number 53 in the prospectus. This property, acquired for
a purchase consideration of R6,5 million, is expected to be transferred to A-
Prop in March 2002, pending a confirmatory Order of Court. Economic effect
has been given to this acquisition from date of listing, in accordance with
the agreement between the company and the vendors.
* Vacancies
Vacancy levels by area comprise 4% of the portfolio. whilst this is
marginally higher than forecast on listing, it is below the market average
2. LIQUIDITY OF UNITS
No trading restrictions were placed on the linked units issued to the
vendors of properties making up the listed property portfolio. As a
consequence, liquidity was relatively high with 19,1% of the listed units
having traded during the period under review.
3. INTEREST RATE MANAGEMENT
88% of A-Prop's long-term debt has been fixed, 32% for a two-year period and
56% for periods of five years and longer. The weighted average cost of the
interest rate fixes of 13,3% is in line with the interest rate as forecast
in the prospectus. The decision to fix interest rates has limited the
Company's exposure to interest rate movements over the next five years.
4. PROSPECTS
Economic conditions during the last few months have been characterised by
rand weakness coupled with higher interest rates. These factors have had a
negative effect on a property market which was already feeling the impact of
excess supply. This has led to tougher market conditions, with increased
pressure on rental levels.
Nonetheless, the company expects to achieve its forecast earnings for the
period to 30 June 2002.
From a strategic viewpoint, the company is evaluating opportunities to
achieve its longer-term objectives of growing both its property portfolio
and its market capitalisation through the acquisition of quality properties.
5. INTEREST DISTRIBUTION - NUMBER 1
Unitholders are advised that Distribution No.1 in respect of the period 30
August 2001 to 31 December 2001 of 10,2 cents per unit has been declared.
The last date to trade cum interest will be Friday, 1 March 2002 and the
units will trade ex-interest from the commencement of business on Monday, 4
March 2002. The record date is Friday, 8 March 2002 and payment will be made
to unitholders on or about Wednesday, 13 March 2002.
Unitholders may not dematerialise or rematerialise their units between
Monday, 25 February 2002 and Friday, 8 March 2002, both days inclusive.
By order of the Board
P J A CUNNINGHAM R M KAPLAN
Chairman Managing Director
Johannesburg
15 February 2002
