CAPE TOWN - Tower Property Fund’s distribution per share fell 7.3 percent to 74.2 cents per share in the year to May 31, but “value add opportunities” being implemented should boost profits to boost income and balance sheet strength.
The group’s 45 convenience retail, industrial and office properties in South Africa and Croatia, valued at R5.2 billion, generated a 13 percent increase in revenue to R472 million. Factors increasing revenue included the weakening of the rand against the euro and the sale of the Napier Street units.
Operating profit fell 18 percent to R310 million. Distributable earnings were down 11 percent to R235 million. An increase in net property operating expenses related to rates and electricity credits received in the prior year, the write-off of outstanding Konzum debt and an increase in bad debts written off and provision for doubtful debts in South Africa.
During the year Tower sold non-core properties - a Pick n Pay distribution centre and Nampak, at valuations and at yields above cost of funding.