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Ambit Properties Limited - Reviewed Financial Results And Distribution For The 8
Release Date: 19/11/2004 17:15:00 Code(s): ABT
Ambit Properties Limited - Reviewed Financial Results And Distribution For The 8
Month Period Ended 30 September 2004
AMBIT PROPERTIES LIMITED
Registration number: 2001/007003/06
Share code: ABT ISN code: ZAE000051645
REVIEWED FINANCIAL RESULTS AND DISTRIBUTION FOR THE 8 MONTH PERIOD ENDED 30
SEPTEMBER 2004
Distribution exceeds prospectus forecast by 4,7%
Vacancy factor < 1% 28,2% of issued units traded
The Directors of Ambit Properties Limited submit their report on the group
financial results for the 8 month period from 4 February to 30 September 2004
GROUP INCOME STATEMENT
Notes 4 Feb 2004 to
30 Sept 2004
R`000
Revenue 64 951
Net rental income from properties 39 835
Interest income from associate 4 033
Interest earned 416
Finance costs (19 452)
Net profit before fair value adjustments 24 832
Surplus on revaluation of investment
properties (net of deferred taxation) 30 298
Net profit before debenture interest and taxation 55 130
Debenture interest (26 520)
Net profit before taxation 28 610
Taxation 453
Net profit after taxation 29 063
Share of associate company`s after
tax profits 1 492
Net profit attributable to linked
unitholders 30 555
Headline earnings per linked
unit (cents) (weighted) 3.2 17,04
Earnings per linked unit
(cents) (weighted) 3.2 36,26
Distributable earnings per
linked unit (cents) 16,75
Distribution per linked unit (cents) 16,75
GROUP BALANCE SHEET
30 Sept 2004
R`000
ASSETS
Non-current assets
Investment properties 555 500
Investment in associate 65 836
621 336
Current assets
Trade and other receivables 5 385
Cash resources and short-term investments 29 286
34 671
Total assets 656 007
EQUITY AND LIABILITIES
Capital and reserves
Share capital and reserves 58 422
Non-current liabilities
Debentures 284 989
Deferred taxation 4 893
Interest bearing borrowings 275 654
565 536
Current liabilities
Trade and other payables 5 529
Linked unitholders for distribution 26 520
32 049
TOTAL EQUITY AND LIABILITIES 656 007
GROUP CASH FLOW STATEMENT
4 Feb 2004 to
30 Sept 2004
R`000
CASH GENERATED BY OPERATIONS
Cash generated by operating activities 41 677
Adjusted for:
Interest received 416
Investment income 4 033
Finance costs (19 452)
Debenture interest -
Net cash inflow 26 674
CASH GENERATED FROM INVESTING ACTIVITES
Acquisition of associate (64 344)
Acquisition of investment properties (519 754)
Improvements to investment properties (102)
Net cash outflow (584 200)
FINANCING ACTIVITIES
New units issued 312 856
Issue expenses (1 698)
Long-term liabilities raised 275 654
Net cash inflow 586 812
Net increase in cash and cash equivalents 29 286
Cash and equivalents at beginning of period -
Cash and equivalents at end of period 29 286
GROUP STATEMENT OF CHANGES IN EQUITY
Non-
distri-
Share Share butable Retained
capital premium reserves earnings Total
R`000 R`000 R`000 R`000 R`000
On listing on
4 February 2004 1 493 28 361 - - 29 854
Units issued during the
year 90 1 719 - - 1 809
Net profit for the year - - - 30 555 30 555
Surplus on revaluation of
investment properties - - 30 298 (30 298) -
Initial expenses charged
against share premium - (3 796) - - (3 796)
Balance at 30 September
2004 1 583 26 284 30 298 257 58 422
1. OTHER INFORMATION
Linked units in issue 158 327 490
Weighted average linked units in issue 157 419 569
Net asset value (cents per linked unit)
(including distribution yet to be paid) 234
Listed market price at 30 September 2004
(cents per linked unit) 218
Discount to net asset value 6,8%
2. REVIEW BY THE INDEPENDENT AUDITORS
These preliminary financial results have been
reviewed by KPMG Inc., Ambit`s
auditors. Their unqualified review report
is available at Ambit`s registered office.
3. NOTES TO THE FINANCIAL STATEMENTS
3.1 Accounting Policies
These financial results are prepared in accordance with South
African Statements of Generally Accepted
Accounting Practice and are consistent with those which will
Be applied in the preparation of the audited
financial results. No comparative amounts are shown as this
is the first period of trading.
3.2 Earnings and headline earnings
Earnings and headline earnings for the period 4 February to
30 September 2004 are based on the weighted
average number of linked units in issue for the period, and are
calculated as follows:
R`000
Net profit 30 555
Debenture interest 26 520
Earnings 57 075
Goodwill written off 45
Net surplus on revaluation of investment properties (30 298)
Headline earnings 26 822
3.3 Contingent liabilities
Guarantees
Guarantees amounting to R0,8 million have been issued in lieu of
municipal service deposits.
3.4 Primary business segments for the period ended 30 September 2004
Income
statement Retail Commercial Industrial Corporate Group
R`000 R`000 R`000 R`000 R`000
Revenue 32 994 19 899 7 674 4 384 64 951
Net rental
income
from
properties 23 857 14 345 6 489 (4 856) 39 835
Interest income
from associate - - - 4 033 4 033
Interest earned 38 9 18 351 416
Finance costs - - - (19 452) (19 452)
Net surplus on
revaluation
of investment
properties 17 581 8 203 4 514 - 30 298
Debenture
interest - - - (26 520) (26 520)
Taxation - - - 453 453
Share of associate
company`s after
tax profits - - - 1 492 1 492
Net profit
attributable
to linked
unitholders 41 476 22 557 11 021 (44 499) 30 555
Balance sheet
Investment
properties 324 050 160 300 71 150 - 555 500
nvestment in
associate - - - 65 836 65 836
Current
Assets 3 105 1 798 453 29 315 34 671
Total
assets 327 155 162 098 71 603 95 151 656 007
Deferred
taxation 3 103 1 434 796 (440) 4 893
Trade and
other
payables 2 578 1 263 461 1 227 5 529
Linked
unitholders for
distribution - - - 26 520 26 520
Capital,debentures
and borrowings - - - 619 065 619 065
Total
liabilities 5 681 2 697 1 257 646 372 656 007
4. COMMENTS
4.1 Results
Ambit`s distribution for the 8 months ended 30 September 2004 amounts
to 16,75 cents per linked unit, which is 0,75 cents per
unit above the projected distribution in the prospectus released prior
to listing. This distribution
represents an annualised return of 12,6% on the listing price of
200 cents per linked unit.
4.2 Property portfolio
The property portfolio has performed substantially in accordance with
management`s expectation and the
forecast as presented in the listing prospectus, notwithstanding that
13 properties had not been transferred as
at listing date. The last of these was transferred on 19 March 2004.
The portfolio has a favourable occupancy rate which is well above
industry norms. The vacancy improved from
2% of rental value at listing to an excellent 0,8% at year-end (2,4%
of rentable area to 1,4%). Tenant retention has
also been extremely good, with 78% of lease renewals by rental value (76%
by area) being successfully concluded.
4.3 Oryx investment
Ambit`s investment of R64,3 million acquired 28,9% of the equity of Oryx
Properties Limited, a Namibian listed property loan stock company. This
investment has performed in line with expectations.
This investment represents 10,6% of Ambit`s year-end assets and forms
part of Ambit`s investment strategy to
seek good quality property investments in selected neighbouring
countries. The net asset value of Oryx at
30 June 2004 was 570 cents per unit (Ambit`s cost of acquisition was
542 cents per unit). Oryx has embarked
on a 19 189m2 extension to Maerua Mall Shopping Centre at a cost of
N$179 million, with completion due in
March 2006.
4.4 Valuations
In conformity with Generally Accepted Accounting Practice, the
portfolio is valued at each reporting date.
The portfolio has been revalued by Directors at R555,5 million. This
represents an increase of R35,6 million (7%)
on original acquisition cost. The surplus, net of deferred tax, has
been transferred to non-distributable reserves.
4.5 Borrowings
At year-end Ambit`s debt was R275,65 million, which represents a long-
term debt to long-term assets ratio of
44,4%. R166,7 million of this debt (60%) was subject to fixed interest
agreements for periods from 2004 to
2009. The average interest rate as at period end was 10,7%.
4.6 Post balance sheet events
Ambit has contracted to acquire 12 Nourse Avenue, Epping, Cape Town
for R11,8 million at a forward yield of
14%. The transaction was effective 1 October 2004 and the purchase
consideration was for cash. Sale
agreements have been concluded in respect of five small properties
with transfers due in November and December 2004. These are three KFC occupied
properties in Cape Town, Mayors Walk in Pietermaritzburg and North Beach Garage
in Durban. The net disposal proceeds total R16,5 million, which gives rise to a
surplus over acquisition costs of R3,9 million.
4.7 Liquidity
During the 8 month period under review trade in Ambit linked units
amounted to 28,2% of the units in issue,
which is in line with the tradeability of property loan stock companies
listed in the Real Estate sector on the JSE.
4.8 Prospects
The improving underlying fundamentals of the property market, with
falling vacancies, increasing rentals and
low inflationary expectations, should benefit quality property
portfolios. Accordingly, Ambit is well positioned to
benefit from this positive environment.
5. TRADING STATEMENTS
In terms of paragraph 3.4 (b) (v) of the Listing Requirements of the JSE,
Ambit, in agreement with the JSE, has adopted
distributable earnings per linked unit as the financial results measurement
for trading statement purposes. It is
effective for this period ended 30 September 2004.
6. DECLARATION OF DISTRIBUTION
Notice is hereby given of distribution Number One amounting to 16,75 cents
per unit, for the 8 month period to
30 September 2004. This distribution comprises interest on debentures of
16,75 cents per unit.
Last date to trade cum distribution Friday, 3 December 2004
Units will trade ex distribution Monday, 6 December 2004
Record date to participate in the distribution Friday, 10 December 2004
Payment of distribution Monday, 13 December 2004
Linked unit certificates may not be dematerialised or re-materialised
between Monday, 6 December 2004 and Friday, 10 December 2004, both days
inclusive.
On behalf of the board
DL Brown Chairman
NBS Harris Chief Executive Officer 18 November 2004
Directors: DL Brown (Chairman), NBS Harris (CEO)*, JH Beare, CJ Ewin,
NP Mageza, IN Moloto, F Uys, F Meisenholl (alternate) *executive
news@ambitprops.co.za
http://www.ambitprops.co.za
Registered Office
Ambit Properties Limited
1st Floor, Palazzo Towers West
Monte Casino Boulevard
Fourways, 2055
PO Box 783676
Sandton, 2196
AUDITORS
KPMG
20 Kingsmead Boulevard
Kingsmead Office Park, Durban, 4001
PO Box 1496, Durban, 4000
SPONSOR
EXCHANGE SPONSORS
Registration number 1999/024433/07
Hyde Park Manor, 79 Hyde Lane, Hyde Park, 2196
PO Box 411216, Craighall, 2024
TRANSFER SECRETARIES
Computershare Investor Services 2004 (Pty) Ltd
Registration number 2004/0003647/07
70 Marshall Street, Johannesburg, 2001
PO Box 61051, Marshalltown, 2107
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