| Tue 30 Sep 2003, 16:14 | | AUDITED RESULTS FOR THE YEAR ENDED 31 AUGUST 2003 |
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REDEFINE INCOME FUND LIMITED - AUDITED RESULTS FOR THE YEAR ENDED 31 AUGUST 2003
REDEFINE INCOME FUND LIMITED
Registration No. 1999/018591/06
Share code: RDF
ISN Code: ZA000023503
AUDITED RESULTS FOR THE YEAR ENDED 31 AUGUST 2003
CONSOLIDATED INCOME STATEMENT
Audited Audited
31 Aug 2003 31 Aug 2002
R000 R000
Revenue
Property portfolio 197 919 106 695
Listed security portfolio 164 174 142 116
362 093 248 811
Operating costs - property portfolio 52 691 25 678
Administration costs 17 415 11 451
Operating profit 291 987 211 682
Net capital gain (loss) on non-current
assets 51 340 (79 674)
Profit from operations 343 327 132 008
Interest received 6 657 1 211
Profit before finance charges 349 984 133 219
Finance charges 182 447 109 437
Profit before taxation 167 537 23 782
Taxation - -
Profit attributable to linked unitholders 167 537 23 782
Headline earnings and distributions
Profit attributable to linked unitholders 167 537 23 782
Net capital (gain) loss on non-current
assets (51 340) 79 674
Headline earnings and total distributions 116 197 103 456
First quarter 29 135 22 530
Second quarter 34 966 22 771
Third quarter 25 369 28 430
Fourth quarter 26 727 29 725
Earnings per linked unit
Actual number of linked units in
issue (000) 413 016 321 068
Weighted number of linked units in
issue (000) 392 839 279 096
Earnings per linked unit (cents) 42.65 8.52
Headline earnings per linked unit (cents) 29.58 37.07
Distribution per linked unit (cents) 29.75 37.00
Net asset value per linked unit (cents) 240.79 234.74
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Audited Audited
31 Aug 2003 31 Aug 2002
R000 R000
Balance at beginning of period 761 457 644 824
As previously stated 753 666 644 824
Deferred interest rate hedging gain 7 791 -
Net issue of linked units 226 143 190 888
Issue expenses written-off (1 178) (2 372)
Revaluation of interest rate swaps (43 259) -
Profit attributable to linked unitholders 167 537 23 782
Distributions to linked unitholders (116 197) (103 456)
994 503 753 666
CONSOLIDATED BALANCE SHEET
Audited Audited
31 Aug 2003 31 Aug 2002
R000 R000
ASSETS
Non-current asset 2 448 578 1 894 390
Property portfolio 1 139 256 807 777
Listed security portfolio 1 309 322 1 086 613
Current assets 76 729 58 698
Trading securities 5 392 -
Deposits, prepayments and other receivables 19 667 12 034
Tenant debtors 6 384 3 120
Listed security distributions 45 262 43 539
Cash and cash equivalents 24 5
Total assets 2 525 307 1 953 088
EQUITY AND LIABILITIES
Capital and reserves 994 503 753 666
Linked unit capital 883 478 658 513
Non-distributable reserve 146 493 95 153
Deferred interest rate hedging loss (35 468) -
Non-current liabilities 1 468 072 1 115 552
Interest-bearing liabilities 1 432 604 1 115 552
Interest rate swaps 35 468 -
Current liabilities 62 732 83 870
Interest-bearing liabilities 17 086 10 889
Trade and other payables 15 754 10 223
Bank overdraft 3 165 33 033
Unitholders for distribution 26 727 29 725
Total equity and liabilities 2 525 307 1 953 088
CONDENSED CONSOLIDATED CASH FLOW STATEMENTS
Audited Audited
31 Aug 2003 31 Aug 2002
R000 R000
Cash effects from operating activities (15 085) (47 252)
Cash generated from operations 279 900 156 045
Net financing costs (175 790) (108 226)
Linked unit distributions paid (119 195) (95 071)
Cash effects of investing activities (503 242) (621 308)
Net property acquisitions (403 936) (352 570)
Net listed security acquisitions (99 306) (268 738)
Cash effects from financing activities 548 214 603 172
Linked units issued 224 965 188 516
Net borrowings 323 249 414 656
Net movement in cash and cash equivalents 29 887 (65 388)
Opening cash and cash equivalents (33 028) 32 360
Closing cash and cash equivalents (3 141) (33 028)
COMMENTARY
Review Of Results
Redefine Income Fund Limited ("Redefine") increased its interest distribution to
6.5 cents per linked unit for the final quarter of the financial year ended 31
August 2003 exceeding the forecast of 6.25 cents per linked unit. Distributions
for the year ended 31 August 2003 total 29.75 cents (2002: 37 cents) per linked
unit.
Headline earnings are 29.6 cents (2002: 37.1 cents) per linked unit. Non-current
assets increased by 29.3% to R2.45 billion at 31 August 2003. The Net Asset
Value ("NAV") per linked unit is R2.41 post the AC 133 adjustment in respect of
the value of the rate swaps at 31 August 2003. The NAV per linked unit pre the
AC 133 adjustment is R2.49 (2002: R2.35).
Property Portfolio
Two small properties, Erf 1379 Sunninghill and Mellis Park 2, were sold during
the year under review. The acquisition of a portfolio of 27 properties from Rand
Leases, a Virgin Active gym in Benoni and Scott Street Mall in Newcastle have
increased the property portfolio to R1.14 billion and the gross lettable area to
410 220m2.
The property portfolio at 31 August 2003 comprises 89 properties. Sectoral
spread by revenue is 59% commercial, 27% retail and 14% industrial. The
portfolio comprises 74% A-grade tenants with the balance being B-grade. The
lease expiry profile is better than the sector average with more than 37% of
leases expiring in 2008 and beyond. At 31 August 2003 the portfolio was 93.3%
leased.
During the year under review 39 217m2 of vacant space was leased and leases in
respect of 24 791m2 were renewed.
Listed Securities Portfolio
Redefine"s listed securities portfolio increased by R223 million as a result of
net acquisitions of R129 million and an increase in market value of R94 million.
The listed securities portfolio at 31 August 2003 was valued at R1.31 billion.
Capital Gain On Non-Current Assets
The net capital gain on non-current assets comprises realised profits and losses
on sale and profits and losses on revaluation of the property and listed
security portfolios as follows:
2003 2002
R000 R000
Listed security portfolio - unrealised
profit (loss) 93 729 (112 452)
Listed security portfolio - realised
profit on sale 29 674 28 543
Property portfolio - unrealised (loss)
profit on revaluation (68 773) 9 000
Property portfolio - realised loss on sale (3 290) (4 765)
51 340 (79 674)
The unrealised loss on the property portfolio is limited to a number of
properties and the loss in value is anticipated to be recouped over time through
active management and leasing.
Interest Rate Management
Redefine"s borrowings of R1.43 billion equates to 58% of non-current assets. It
is Redefine"s intention to reduce gearing in the medium term to 45%. 91% of the
borrowings are fixed for periods of five and seven years at an average interest
rate of 12.8%.
Post Balance Sheet Events
Redefine"s purchase of Standard Bank Centre on the Cape Town foreshore was
approved by the Competitions Commission on 1 September 2003. This R218 million
prime investment property has been acquired at an initial yield of 13.3% before
gearing.
Directorate
Brian Azizollahoff was appointed CEO of Redefine on 27 April 2003.
Prospects
It is anticipated that distributions previously projected at no less than 31
cents per linked unit for the year ending 31 August 2004 will be achieved.
Interest Distribution
Unitholders are advised that interest distribution No. 14 in respect of the
period 1 June 2003 to 31 August 2003 of 6.5 cents per linked unit has been
declared.
The last date to trade cum interest Friday, 17 October 2003
Linked units will trade ex interest Monday, 20 October 2003
Record date Friday, 24 October 2003
Payment of interest distribution No. 14 Monday, 27 October 2003
Unitholders may not dematerialise or re-materialise their linked units between
Monday, 20 October 2003 and Friday, 24 October 2003, both days inclusive.
Wolf Cesman, Chairman Brian Azizollahoff, Chief Executive Officer
30 September 2003
BASIS OF PREPARATION
The financial results are determined in accordance with South African Statements
of Generally Accepted Accounting Practice and the accounting policies applied
are consistent with those applied in the previous financial year, except for the
adoption of AC133 Financial Instruments: Recognition and Measurement.
AUDIT OPINION
The financial results have been audited by Fisher Hoffman PKF (Jhb) Inc. and
their unqualified audit opinion is available for inspection at the registered
office of Redefine Income Fund Limited.
REDEFINE INCOME FUND LIMITED
2 Arnold Road, Rosebank,
Johannesburg
P O Box 471917,
Parklands, 2121,
South Africa
Telephone +27 11 283 0110
E-mail: redefine@corpcapital.com
Directors:
W Cesman* (Chairman), E Ellerine*, J Kron*, Brian Azizollahoff# (CEO),
D Solomon*, J Solomon*, M Wainer*
*non-executive British
Company secretary:
Probity Business Services (Pty) Ltd.
P O Box 85392,
Emmarentia, 2129
Telephone: +27 11 726 2446
Date: 30/09/2003 04:00:16 PM Produced by the JSE SENS Department
