Accelerate distribution lower than forecastComment on this story
Accelerate, the property fund that listed on the JSE in December, yesterday reported a distribution a share for the three-month and 20-day period to end March of 13.77289c.
The distribution was marginally higher than the similarly pro rata forecast of 13.71818c a share for the corresponding period the previous year, but lower than its previously published forecast of 13.92c for this period.
Michael Georgiou, the chief executive, said the fund was well positioned to create shareholder value by being a participant in the major development in the Fourways area, making the most of opportunities to acquire properties and ensuring properties were well managed and maintained, thereby ensuring sustainable returns to its shareholders.
Accelerate listed with a portfolio of 51 properties acquired for R5.4 billion.
It purchased its portfolio by generating R3.1bn through the issue, the listing of 638 million shares and securing long-term debt financing of R2.4bn.
Its initial portfolio on listing was independently valued at more than R5.9bn and has a strong weighting in retail centres, including the Fourways Mall, Cedar Square, Fourways View, The Buzz Shopping Centre and Fourways Game.
Georgiou said Accelerate had a projected annualised yield of 9.71 percent, which was above the overall property sector yield. It had maintained its local blue chip tenants and been approached by international retail brands, which was encouraging for revenue streams.
The fund reported a profit after tax attributable to equity holders of R552.81 million in the year to March incorporating the trading period of three months and 20 days.
This was considerably higher than the forecast profit after tax attributable to equity holders of R123m for the four-month period to March that was disclosed in the pre-listing statement published in November.
He attributed this variation to a fair value adjustment related to property valuations of R424.9m and a mark-to-market movement of R30.4m on financial instruments.
Income and expenses were well managed and, combined with the effect of fixing debt interest rates, had a positive effect on profitability, he said.
Accelerate earned a gross rental income of R205m for the trading period, comprising net rentals of R160.7m. This included R2.4m for rental guarantees charged to the properties’ vendors and R44.2m of operating expense recoveries.
Its major expenses included R49.8m in utility charges, R6.4m for security and R2.7m in cleaning costs, all of which were largely recovered in terms of its leases.
The fund also spent R2.8m on repairs and maintenance of its properties.
Operating activities resulted in cash inflows of R113.6m, which were used towards paying net finance costs of R51.5m.
Accelerate lost 1.92 percent to R5.10 on the JSE yesterday.