| Wed 18 Aug 2021, 12:11 | | EMIRA PROPERTY FUND LIMITED - Reviewed condensed consolidated provisional financial results for year ended 30 June 2021 and dividend distribution |
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Reviewed condensed consolidated provisional financial results for year ended 30 June 2021 and dividend distribution
EMIRA PROPERTY FUND LIMITED
Incorporated in the Republic of South Africa
(Registration number 2014/130842/06)
JSE share code: EMI ISIN: ZAE000203063
JSE Bond Company code: EMII
(Approved as a REIT by the JSE)
(“Emira” or “the Company”)
REVIEWED CONDENSED CONSOLIDATED PROVISIONAL FINANCIAL RESULTS FOR THE YEAR ENDED
30 JUNE 2021 AND DIVIDEND DISTRIBUTION DECLARATION
Nature of business
Emira is a diversified Real Estate Investment Trust (“REIT”), with a property portfolio of predominantly
South African assets, and a growing component of offshore assets in the USA. In line with its strategic
objectives, Emira’s property portfolio spans multiple sectors, namely office, retail, industrial and
residential. The Company is focused on growing the quality and value of its portfolio of property
investments, in order to sustain and enhance its distribution growth to shareholders.
Commentary
Distributable earnings for the year ended 30 June 2021 has decreased by 3.2% to R649,1m. After
taking into account adjustments to reflect the cash backed position, the Board of Directors of Emira
(“Board”) has approved the declaration of a final dividend of 66,65 cents per share for the six months
to 30 June 2021 (June 2020: 30,26 cents). This is a period-on-period increase of 120,2%, bringing the
full-year dividend per share to 118,65 cents (2020: 104,36 cents), an increase of 13,7%.
It has been encouraging to see the strong recovery of the global economy, despite the setbacks
experienced by the varying degrees of third wave COVID-19 restrictions imposed by countries in
response to the spread of the Delta variant. Having entered the pandemic in a weak position, the
South African economy has been slower to bounce back. The recent unrest and looting in Gauteng
and KwaZulu-Natal are expected to hamper the local recovery even further. That said, the diversified
nature of Emira’s investments on a sectoral and geographical basis, including its offshore exposure
and its co-investment methodology, has proved defensive with some sectors and regions being hit
harder than others. Fundamentally, Emira’s local operations continue to be strained. While some
positive signs have started to emerge, they vary by sector and region. In contrast, the United States of
America’s (“USA” or “US”) economy is growing again and is close to returning to near-normal, and the
Fund’s open-air retail centre assets are performing well.
Despite the unprecedented environment in which the Fund has been operating, the Fund has achieved
its objectives for the year, which included:
• optimising net income and delivering a cash backed return to investors;
• selectively recycling assets and upgrading core assets through reinvestment;
• retaining a high proportion of tenants whose leases expired during the year;
• maintaining above industry average occupancy levels;
• collecting rentals timeously;
• improving liquidity and extending the debt expiry profile; and
• driving diversification across all areas of the business to reduce risk.
While the Fund is unable to materially impact the macroeconomic environment in which it operates,
management’s approach has been to ensure the fundamentals are performed with excellence.
Financial summary
The reviewed condensed provisional financial results for the year ended 30 June 2021, as compared
to the year ended 30 June 2020 (“comparative period”), are set out below:
• Revenue decreased by 1.4% to R1 481 million compared to R1 501 million for the comparative
period;
• Operating profit decreased by 2.61% to R722 million compared to R741 million for the
comparative period;
• Headline earnings per share increased by 950.45% to 188.24 cents compared to 17.92 cents for
the comparative period;
• Earnings per share increased by 165.26% to 96.38 cents compared to (147.69) cents for the
comparative period;
• Net asset value per share decreased by 0.7% to 1 518 cents compared to 1 530 cents for the
comparative period;
• Distributable earnings decreased by 3.2% to R649 million compared to R671 million for the
comparative period; and
• Dividend increased by 13.7% to 118.65 cents per share compared to 104.36 cents per share for
the comparative period.
Unmodified review opinion
The auditor has issued an unmodified review opinion for the year ended 30 June 2021. A copy of the
auditor’s review conclusion is available for inspection at Emira’s registered office together with the
financial statements identified in the auditor’s report.
Dividend distribution declaration
The Board has approved, and notice is hereby given that a final gross dividend of 66,65 cents per share
has been declared, payable to the registered shareholders of Emira on Monday, 13 September 2021.
In making its decision on whether to pay out a dividend and the quantum thereof, the Board has
assessed the Company’s solvency and liquidity position, taking into account the Company’s current
position together with forecasts.
The issued share capital at the declaration date is 522 667 247 listed ordinary shares. The source of
the dividend comprises net income from property rentals, income earned from the Company’s equity
accounted investments, interest earned on loans receivable and interest earned on cash on deposit.
Last day to trade cum dividend Tuesday, 7 September 2021
Shares trade ex-dividend Wednesday, 8 September 2021
Record date Friday, 10 September 2021
Payment date Monday, 13 September 2021
Share certificates may not be dematerialised or rematerialised between Wednesday, 8 September
2021 and Friday, 10 September 2021, both days inclusive.
In accordance with Emira’s status as a REIT, shareholders are advised that the dividend meets the
requirements of a “qualifying distribution” for the purposes of section 25BB of the Income Tax Act, No.
58 of 1962 (“Income Tax Act”). Accordingly, qualifying distributions received by local tax residents must
be included in the gross income of such shareholders (as a non-exempt dividend in terms of section
10(1)(k)(aa) of the Income Tax Act), with the effect that the qualifying distribution is taxable as income
in the hands of the shareholder. These qualifying distributions are, however, exempt from dividend
withholding tax in the hands of South African tax resident shareholders, provided that the South
African resident shareholders have provided the following forms to their Central Securities Depository
Participant (“CSDP”) or broker, as the case may be, in respect of uncertificated shares, or the transfer
secretaries, in respect of certificated shares:
a) a declaration that the dividend is exempt from dividends tax; and
b) a written undertaking to inform the CSDP, broker or the transfer secretaries, as the case may be,
should the circumstances affecting the exemption change or the beneficial owner cease to be the
beneficial owner, both in the form prescribed by the Commissioner for the South African Revenue
Service. Shareholders are advised to contact their CSDP, broker or the transfer secretaries, as the
case may be, to arrange for the abovementioned documents to be submitted prior to payment of
the dividend, if such documents have not already been submitted.
Qualifying dividends received by non-resident shareholders will not be taxable as income and instead
will be treated as ordinary dividends but which are exempt in terms of the usual dividend exemptions
per section 10(1)(k) of the Income Tax Act. Any distribution received by a non-resident from a REIT
will be subject to dividend withholding tax at 20%, unless the rate is reduced in terms of any applicable
agreement for the avoidance of double taxation (“DTA”) between South Africa and the country of
residence of the shareholder. Assuming dividend withholding tax will be withheld at a rate of 20%, the
net amount due to non-resident shareholders will be 53,32000 cents per share. A reduced dividend
withholding tax rate in terms of the applicable DTA, may only be relied on if the non-resident
shareholder has provided the following forms to their CSDP or broker, as the case may be, in respect
of the uncertificated shares, or the transfer secretaries, in respect of certificated shares:
a) a declaration that the dividend is subject to a reduced rate as a result of the application of a DTA;
and
b) a written undertaking to inform their CSDP, broker or the transfer secretaries, as the case may be,
should the circumstances affecting the reduced rate change or the beneficial owner cease to be
the beneficial owner, both in the form prescribed by the Commissioner for the South African
Revenue Service. Non-resident shareholders are advised to contact their CSDP, broker or the
transfer secretaries, as the case may be, to arrange for the abovementioned documents to be
submitted prior to payment of the dividend if such documents have not already been submitted,
if applicable.
Local tax resident shareholders as well as non-resident shareholders are encouraged to consult their
professional advisors should they be in any doubt as to the appropriate action to take.
The Company’s tax reference number is 9995/739/15/9.
This short form announcement is the responsibility of the Board and does not contain full or complete
details. Any investment decisions by investors and/or shareholders should be based as a whole on
consideration of the reviewed condensed consolidated provisional financial results for the year ended
30 June 2021 released on SENS on 18 August 2021 and which may be downloaded from:
https://emira.co.za/financial-reporting/ and at
https://senspdf.jse.co.za/documents/2021/jse/isse/EMIE/June21Prov.pdf
or may be viewed, at no cost, at the registered office of the Company, or requested electronically via
the sponsor (sponsor@questco.co.za), during ordinary business hours, for a period of 30 calendar days
following the date of this announcement.
Registered office: 1st Floor, Block A, Knightsbridge, 33 Sloane Street, Bryanston, 2191
Bryanston
18 August 2021
Sponsor
Questco Corporate Advisory Proprietary Limited
Debt Sponsor
Rand Merchant Bank (a division of FirstRand Bank Limited)
Date: 18-08-2021 12:11:00
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