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Calulo Property Fund Limited - Reviewed Consolidated Financial Results Of The
Group For The Year Ended 30 June 2005
CALULO PROPERTY FUND LIMITED
(formerly ANNUITY PROPERTY FUND LIMITED)
(`the company` or `Calulo`)
(Reg No 1987/006274/06)
incorporated in the Republic of South Africa
Share code: CLO ISIN: ZAE000060711
Reviewed consolidated financial results of the group for the year ended 30 June
2005
Summarised group income
statement Reviewed Audited
results 30 results
June 2005 30 June
2004
R000`s
Revenue
11,921 1,125
Straightline operating
lease adjustment 1,619 -
Other revenue
146 -
Property operating (5,365) (747)
expenses
Net profit from property 8,321 378
rental operations
Fair value adjustments 1,381 350
Change in fair value of 3,000 350
investment property
Attributable to (1,619)
straightlining of
operating lease
adjustment
Earnings before 9,702 728
financing costs and
taxation
Net financing costs (9,653) (521)
Debenture interest (3,203)
distribution -
(Loss) / earnings before (3,154) 207
taxation
Taxation 920 (55)
(Loss) / earnings for (2,234) 152
the year
Reconciliation between
(loss)/earnings and
headline earnings
(Loss) / earnings for (2,234) 152
the year
Revaluation of (1,416) (350)
investment properties
net of tax
Headline loss for (3,650) (198)
shareholders
Debenture interest 3,203 0
Headline loss for linked (447) (198)
unitholders
Reconciliation between
(loss)/earnings and
linked units`
distributable earnings
(Loss)/earnings for the (2,234) 152
year
Net revaluation of (381)
investment property -350.00
Straight line operating (1,619)
lease adjustment -
Movement in fair value 5,423
of interest rate swaps -
Taxation (920) 55
Linked unitholders 269 (143)
distributable earnings
Distribution to linked 4.3
unitholders for the year
(in cents)
Residual earnings not 0.4
distributed to linked
unitholders (in cents)
Total distributable 4.7
earnings per linked unit
Number of shares and 74,485 317
linked units in issue
(000`s)
Weighted average number 14,013 20,780
of linked units in issue
(000`s)
Weighted average number 14,013 20,780
of shares in issue
(000`s)
(Loss) / earnings per (15.9) 0.7
share (in cents)
Headline (loss) per (26.0) (1.0)
share (in cents)
Earnings per linked unit 6.9 0.7
(in cents)
Headline (loss) per (3.2) (1.0)
linked unit (in cents)
Summarised group balance Reviewed Audited
sheet results 30 results
June 2005 30 June
2004
R000`s
ASSETS
Non-current assets
Investment property 380,042 5,000
Equipment, furniture and 148
fittings -
Lease receivable 1,619
-
Deferred tax 1,220
-
383,028 5,000
Current assets
Accounts receivable and 32
prepayments 3,354
Bank and cash 314
3,020
6,374 346
Total assets
389,402 5,346
EQUITY AND LIABILITIES
Share capital and
reserves
Share capital and share 5,719 57
premium
Retained loss (2,082) 152
Total unitholders` funds 3,637 209
Non-current liabilities
Debenture capital 148,225 630
Interest bearing 227,111 3,255
borrowings
Fair value of interest 5,423
rate swaps -
380,759 3,885
Current liabilities
Accounts payable and 1,803 1169
accruals
Due to linked unit 3,203
holders
Short term portion of 0 83
interest bearing
liabilities
5,006 1,252
389,402 5,346
Net asset value per 4.88 66.10
share (cents)
Net asset value per 203.88 265.2
linked unit (cents)
Summarised group cash Reviewed Audited
flow statement results 30 results
June 2005 30 June
2004
R000`s
Cash flows from 6,740 378
operations
Movements in working 133 524
capital
Taxation paid
- -
Net finance costs (7,434) (521)
Cash flows from (562) 381
operating activities
Cash flow from investing (373,846) 0
activities
Cash flows from 377,113 (104)
financing activities
Net movement in cash 3,267 (104)
Net cash at beginning of 314 37
period
Net cash at end of 3,019 314
period
Summarised group Share Share Accumulated Total
statement of changes in capital premium loss
equity
R000`s
Balance at 30 June 2003 316 15,247 (14,876) 687
Attributable profit for - - 152 152
the year
Capital reduction (313) (15,193) 14,876 (630)
Balance at 30 June 2004 3 54 152 209
Linked units issued 742 7,417 8,159
-
Share issue costs (2,497) (2,497)
- -
Attributable loss for (2,234) (2,234)
the year - -
Balance at 30 June 2005 745 4,974 (2,082) 3,637
COMMENTARY
Financial review
The directors of Calulo Property Fund are pleased to report the financial
results for the Fund at 30 June 2005. Calulo, previously Annuity Property Fund,
was restructured as an empowered property loan stock company when Calulo
Investments (Pty) Ltd acquired a controlling interest in the company in
September 2004.
The results incorporate profits from property acquisitions announced in the
press on 18 January 2005. The circular containing the revised listing
particulars issued on 11 March 2005 forecast earnings of 6.1 cents for the three
month period April to June 2005. However due to a delay in the conveyancing
process the properties were only transferred on 22 April 2005 and the forecast
was revised to 4.1 cents. This revised forecast was announced on SENS on 22
April 2005.
The fund recorded distributable earnings of 4.7 cents as compared to 4.1 cents
as per the revised prelisting forecast.
Fund performance
Results for the two months are ahead of the revised prelisting forecast and a
maiden distribution of 4.3 cents will be paid to unitholders on 26 September
2005. Since this is the first reporting period of the enlarged company, no
prior distributions have been declared.
Included in the results are fair value adjustments relating to interest rate
swaps as well as a revaluation of investment property relating to the Albert
Road property. This property was disposed of post balance sheet date and the
proceeds reinvested in an additional property. Adjustments required by AC105/IAS
17 (operating leases) to the balance sheet and the income statement are offset
by changes in the fair value of the properties and therefore have no material
impact on the results.
Acquisitions and disposals
No other properties have been acquired or disposed of during the period under
review other than those contained in the prelisting document.
Details of the acquisition published in SENS on 24 August 2005 relating to the
BSI Warehouse situated in Pietermaritzburg and its financial effects are shown
below under post balance sheet events. The disposal of the Albert Road property
also published on SENS on 24 August 2005 and referred to below is in line with
the fund`s strategy of investing only in buildings with sustainable earnings as
the lease expires in April 2006 and renewal is not certain.
Post balance sheet events
In terms of an announcement released on SENS dated 24 August 2005, Calulo linked
unit holders were advised that Calulo has sold the property letting enterprise
situated at 253 Albert Rd to Wolfsburg Arch Investments 4 (Pty) Limited for R8
million (the disposal) and acquired Erf. 2206, Shorrits Retreat, Registration
Division FT, Pietermaritzburg-Msunduzi Municipality from Red Chip Investments
for R14 250 000 (the acquisition).
The pro forma financial effects of the disposal and the acquisition, separately
treated, on the company`s headline earnings, net asset value and tangible net
asset value per linked unit are not material. The combined effect of the two
transactions is also immaterial.
Capital Commitments
Funding for the acquisition has been approved by Rand Merchant Bank. In
addition, capital expenditure of R5 million has been approved for the
installation of air conditioning plant to be fitted to the Johnson`s Control
Warehouse in PE.
Prospects
The core portfolio is performing well with some good opportunities arising
during the year to renegotiate leases over some 18000 sqm which is currently let
at below market rentals. The re-tenanting and re-branding of Orchards Village
in Nelspruit also offers some upside potential but is not without its risks.
Providing there is no interest rate spike induced by currently high oil prices,
conditions should remain favourable for Calulo to add additional properties to
the portfolio over the next six months to nine months. The objective is to
increase the size of the fund through quality acquisitions to improve liquidity
and tradability in the linked units.
Accounting Policies
The financial statements are prepared in accordance with South African
Statements of Generally Accepted Accounting Practice and are consistent with
those applied in the prior periods. Adjustments were made in the current period
to recognise revenue on a straight line basis over the lease term in accordance
with IAS17/AC105.
PricewaterhouseCoopers Inc. have reviewed the results for the year ended 30 June
2005 and their report is available for inspection at the company`s registered
office.
Payment of debenture interest
Notice is hereby given that distribution number 1 of 4.3 cents per linked unit
has been approved in respect of the period ended 30 June 2005. The last day to
trade the linked units cum distribution is Friday, 16 September 2005 and the
record date will be Friday, 23 September 2005. The linked units will start
trading ex-distribution from Monday, 19 September 2005. Distributions will be
made to unitholders on Monday, 26 September 2005.
Linked unit certificates may not be dematerialised or rematerialised between
Monday, 19 September 2005 and Friday, 23 September 2005 both days inclusive.
For and on behalf of the Board Registered office
RJ Harman (CEO) 2a Delaney Rd, Plumstead,
M Faku (Chairman) 7800
PO Box 610, Plumstead, 7801
Cape Town
DATE Company Secretary:
CK Loydall (Mrs)
Directors: RJ Harman*, M Diale,
M Faku, N Madikizela*
* Executive
Transfer secretaries
Computershare Investor Services
2004 (Proprietary) Limited
70 Marshall Street,
Johannesburg, 2001 (PO Box
61051, Marshalltown, 2107)
2 September 2005
Sponsor
Sasfin Corporate Finance
A division of Sasfin Bank Limited
Date: 02/09/2005 04:54:17 PM
Produced by the JSE SENS Department
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