File picture: James White
File picture: James White

Three property groups postpone dividend payouts over volatility

By Edward West Time of article published Mar 24, 2020

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CAPE TOWN - Three property groups - EPP, Hyprop and Redefine - have postponed dividend payouts in the wake of market volatility and uncertainty about the impact of the Covid-19 pandemic.

EPP said yesterday that its board decided the 5.2 (R97.72) per share cash dividend declared on March 12 for the six months ended December 31 would be postponed to June 29 to preserve liquidity for now.

The decision would be reviewed later this year. Dividends equal to 53million and EPP’s undrawn facilities of 95m would position EPP to remain well capitalised, the group said.

Redefine said the dividend payment for the six months to end-February 2020 would be deferred.

Yesterday, it also withdrew guidance of a 5-7percent decline in income per share for the 2020 financial year, compared with 2019.

Regarding the deferred dividend, Redefine’s directors said while the group was in a good position to meet solvency and liquidity obligations, the decision to defer the dividend was taken as a “precautionary measure” and to “bolster liquidity” in a time of uncertainty.

Hyprop’s board said the 308.73cents per share dividend for the six months ended December 31 would only be paid on or about October 5, due to the need to proceed with “extreme caution,” as it was not yet possible to quantify the business impact of the Covid-19 virus.

“Payment of the interim dividend in October 2020 will strengthen the company’s ability to weather the difficult conditions that are anticipated in the next few months,” Hyprop’s board said in a statement.

In addition, after taking account of feedback from institutional shareholders during the post interim results roadshow, its dividend reinvestment option would be reviewed in September 2020, in the context of market conditions at the time.

EPP said it was involved in talks with the Polish government, and with trade representative organisations, about the 47billion stimulus package announced by that government for employees’ protection support, so that some of the funds could go to retail mall tenants immediately.

The aim of the package included employees’ liquidity support for companies, financial support for companies, financial support for healthcare systems, measure to protect the functioning of the financial system, and increased spending on public investments and infrastructure.

Hyprop said it remained in a strong financial position, with a see-through loan-to-value of 34.2percent. The company had established Covid-19 task teams covering the group's South African, Eastern European and sub-Saharan Africa operations.

There had been a decline in footfall in Hyprop’s South African malls since a state of emergency was declared on March 15.

On March 13, the Bulgarian government closed all shopping centres until April 13, impacting The Mall of Sofia. The governments of Montenegro, Macedonia and Croatia had since declared states of emergency and ordered malls to close, impacting Delta City, Podgorica, Skopje City Mall, City Centre One East and City Centre One West.

The closures in Montenegro and Macedonia were for 14 days and in Croatia for 30 days.


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