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Redefine Income Fund Limited -
Redefine Income Fund Limited
(Registration No. 1999/018591/06)
Share Code: RDF
ISIN Code: ZAE000023503
("Redefine" or "the company")
Short-term dip to be smoothed out from September
Current quarterly distribution from Redefine Income Fund has temporarily reduced
but will be restored to not less than 31c per linked unit for Redefine"s next
financial year ending August 2004.
Redefine"s distribution of 6.25c for the quarter ending May 2003 is 2.25c below
that for the quarter ended February 2003 and although the distribution for the
current quarter will also be lower, the board of Redefine is confident to
forecast an annual distribution of not less than 31c per unit for the next
financial year, based on the composition of the existing portfolios.
Redefine"s CEO Brian Azizollahoff, explains what lies behind the temporary
reduction in distributions.
"The main reason is the underperformance of the property loan stock, Arnold
Properties (A-Prop), in which Redefine holds 31,1%. A-Prop"s forecast
distribution was 28c," he says, "but we received 11c in the first half of
Redefine"s financial year and in light of recent announcements by A-Prop are
projecting a further reduction for the second half."
Azizollahoff says Redefine bought into A-Prop at a discount to market value and
at a 20% yield. "Fundamentally there are some very good elements in the A-Prop
portfolio."
"Redefine has supported a change of management control of A-Prop from April 2003
and management now falls under Corovest. Redefine is monitoring initiatives by A
Prop that will restore and improve its earnings."
Azizollahoff adds that Redefine owns 15% of Rand Leases Properties, which failed
to make a distribution. "We are engaging with management with the intention to
unlock value."
Redefine"s R1.2-billion listed portfolio comprises holdings in ApexHi, A-Prop,
Capital, Grayprop, Growthpoint, Hyprop, Martprop, SA Retail, Shops for Africa,
Spearhead and Sycom.
"The forecast has been prepared on a conservative basis. With improved
performance expected from the property portfolio and lower interest rates our
objective is to deliver distributions higher than the forecast".
Redefine today announced the acquisition of Standard Bank Centre on Cape Town"s
Foreshore for R218 million at an income enhancing yield of 13.31%. The 53 000
m2 building comprises A-grade commercial offices with limited retail space and
adequate on-site parking. The building is modern and efficient. Rentals are
market related with long leases with the major tenants. 90% of the tenants are
"A-grade", amongst them Telkom, SBSA, P & O Nedloyd and Santam. The purchase
consideration will be settled by a combination of Redefine linked units and
cash.
Date: 04/07/2003 09:25:30 AM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
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