File picture: James White/Free Images
File picture: James White/Free Images

MAS Real Estate rockets on the JSE after earnings rise

By Philippa Larkin Time of article published Sep 6, 2019

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JOHANNESBURG – MAS Real Estate rocketed nearly 25 percent on the JSE after the property group, which is focused on retail assets in Central and Eastern Europe (CEE), announced that its distributable earnings per share had increased by nearly 42 percent for the year to June on strong strong tenant performance and acquisitions.

The share later closed 21 percent up at R19 on the JSE on Thursday.

Ron Spencer, chairperson of the MAS board, said: “We are convinced that our strategy of continuing to expand into CEE markets, and divest out of Western Europe is the most appropriate strategy for the group.”

The firm, which has now completed its three-year restructuring plan, said it posted distributable earnings per share of 0.0901 (R1.48), which was partly driven by the acquisition of a number of investment properties during the year. 

The interest earned on the additional preference share investment in PKM Developments and the distributions received from the group’s real estate equity securities had also contributed to the growth.

MAS, which is listed on the Euro MTF Market of the Luxembourg Stock Exchange and the main board of the JSE, said MAS’s investment property, including investment property held for sale, grew by 52.4 percent to €964.7 million (R15.83bn); rental income was up 59.6 percent at €51.6m year on year; and net operating income increased by €51.8 percent to €58.2m.

The net asset value per share increased by 2 percent to 1.37,6 per share, compared to 1.34,9 per share in the prior comparative period.

Some MAS acquisitions include Romania’s Militari Shopping Centre in July 2018, Germany’s Flensburg Galerie shopping centre, and Scotland’s Uberiro House.

In a forward-looking statement, the company said it had set itself a three-year target of growing its distribution per share by 30 percent for the year ending June 30, 2022, from the current distribution level of 0.0875 per share.

It should be noted that this targeted growth will not be linear, given that the strategic changes referred to above will include implementing a phased re-deployment of capital from Western Europe into CEE over time.

In a separate announcement the firm, which owns an 80 percent stake in PKM CEE Investments, an investment JV, said on Thursday that it had bought Prime Kapital’s 20 percent stake.

During the year ended June 30, Prime Kapital received a dividend of 1.9 million in relation to its participation in the Investment JV. Prime Kapital’s share of net profit after tax was €6.5m and its share of the net assets was €7m.


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