CAPE TOWN - DELTA Property Fund’s re-issued and corrected audited annual financial statements for the year to February 29, 2020 reflected a 48.7 percent decline in distributable earnings to 34.6 cents per share (2019: 67.4c), primarily due to rental reversions on leases renewed, increased vacancies and corporate tax payable on earnings retained, a statement said yesterday.
Net asset value per share fell 22.3 percent to R5.54 (R7.13) and was mainly negatively affected by a fair value adjustment to investment properties.
The company went through significant changes after the 2020 financial year, including the appointment of a new board to drive a better performance.
Forensic reports last year also found irregular practices, such as previous executives who had “in the execution of their duties undermined the company’s governance practices, which resulted in non-compliance with internal controls of the company, including unsubstantiated payments, procurement irregularities and other unethical business dealings”.
“The board is putting in place measures to enhance the financial reporting, operating and compliance internal controls of the group to avoid a re-occurrence of the irregularities and financial reporting misstatements that occurred,” the statement said.
The board would also try to recover damages from the responsible parties, including recoveries from related parties.
The board was also looking to remedy regulatory breaches caused by the irregular activities of previous executives. The required reporting of these instances of wrongdoing had been made by the company, and the board was committed to assisting these authorities when necessary.