Johannesburg - Redefine International grew full-year distributable income by 18 percent to £30.1 million (R477.4m) in the year to August and delivered total shareholder returns of 58.9 percent for the year, the dual-listed property group announced yesterday.
Redefine International has a property investment portfolio comprising assets in the UK, Europe and Australia valued at more than £1 billion. It has a primary listing on the London Stock Exchange and completed its inward listing on the JSE’s main board on Monday.
Michael Watters, the chief executive of Redefine International, attributed the significant improvement in performance to the strengthening of the group’s financial position, the enhanced quality of its property portfolio achieved through acquisitions, disposals and asset management, and its corporate restructuring.
Watters said the company’s positive results also reflected an encouraging but gradual improvement in the British and European property markets, which were showing signs of improving investor and occupier sentiment.
During the year Redefine International completed successful capital raisings totalling £144.3m and its market capitalisation reached £500m for the first time.
Adjusted net asset value a share rose by 6.2 percent to 38.66p while the debt restructuring initiatives resulted in a reduced pro-forma loan-to-value ratio of 56.8 percent from 81.7 percent in the previous year. Portfolio occupancy levels also improved to 97.3 percent from 95.9 percent in the six months to February.
The value of its property portfolio grew during the year because of the acquisition of three high-quality German shopping centres with a combined market value of e189m.
After its year-end, the firm announced it had agreed to acquire the Weston Favell Shopping Centre in Northampton in the UK for £84m.
Watters confirmed the next step in restructuring Redefine International was converting to a UK real estate investment trust (Reit) and internalisation of its management, which was well advanced.
“The economic outlook for the year ahead is increasingly positive and we firmly believe that, with an internalised management and industry benchmarked Reit structure, Redefine International is well positioned to deliver strong returns to shareholders,” he said.
Greg Clarke, Redefine International’s chairman, said the European portfolio provided a resilient income contribution backed by strong covenants and inflation-linked leases, while the acquisition of three high-quality German shopping centres with a number of asset enhancement opportunities was expected to provide a stronger asset base from which to drive rental growth.
Clarke said the group’s hotel portfolio performed well during a period that was expected to be weak after last year’s Olympic Games in the UK. Room rates and occupancies held up well considering the outperformance last year.
Australian Stock Exchange-listed Cromwell Property Group, in which Redefine International has a stake of 16 percent, produced a record operating profit of A$102.4m (R964m) and raised its distribution a share by 3.67 percent to 7.25c, but this was offset by a weaker Australian dollar against the pound.
Clarke said the past financial year was another transformative year for the group, which was now on a substantially firmer footing that had already enabled it to make the recently announced accretive investments. He stressed the company’s business model would continue to be focused around a diversified portfolio allowing capital to be recycled into growth areas.
The shares fell 2.38 percent to R7.78 on the JSE. - Business Report