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Audited financial results and declaration of final dividend for the year ended 31 December 2024
RESILIENT REIT LIMITED
Incorporated in the Republic of South Africa
Registration number: 2002/016851/06
JSE share code: RES
ISIN: ZAE000209557
Bond company code: BIRPIF
LEI: 378900F37FF47D486C58
(Approved as a REIT by the JSE)
("Resilient" or "the Company" or "the Group")
www.resilient.co.za
Audited financial results and declaration of final dividend for the year ended
31 December 2024
Nature of the business
Resilient is a retail-focused Real Estate Investment Trust ("REIT") listed on
the JSE Limited ("JSE"). Its strategy is to invest in dominant retail centres
with a minimum of three anchor tenants and let predominantly to national retailers.
A core competency is its strong development skills which support new developments
and the reconfiguration of existing shopping centres to adapt to structural
changes in the market. Resilient also invests directly and indirectly in offshore
property assets.
The Company's focus is on regions with strong growth fundamentals. Resilient
generally has the dominant offering in its target markets with strong grocery
and flagship fashion offerings.
Distributable earnings and dividend declared
The board of directors ("Board") has declared a dividend of 221,28 cents per
share for the six months ended December 2024. The total dividend of 440,25 cents
per share for FY2024 is 8,4% higher than the 406,24 cents per share for FY2023
and 1,7% ahead of the upper end of the 433 cents per share guidance provided.
The South African portfolio recorded comparable net property income ("NPI")
growth of 7,5% for the year (excluding Mahikeng Mall which was extended)
despite the acceleration of planned maintenance. While administered prices,
particularly utilities and rates, continue to increase ahead of inflation
and the in-force escalations of 6,2%, the NPI growth demonstrates the
positive impact of Resilient's energy strategy. The energy strategy is
aimed at reducing dependency on the grid and containing the rise of
electricity costs. This was particularly evident in FY2024 as limited
loadshedding was implemented compared to that of FY2023.
The Group's offshore investments contributed to the growth in distributable
earnings. The euro distribution per share from Lighthouse Properties p.l.c.
("Lighthouse") declined by 4,9% compared to FY2023, however, Resilient
benefitted from its forward exchange contracts that resulted in the Rand
equivalent distribution per share increasing by 4,1%. Leasing activity
contributed to the French portfolio recording NPI growth of 14,3% for
the year. Interest rates reduced by 50 basis points during 2H2024. To
the extent that borrowings were unhedged or hedged by way of interest
rate caps, the Group benefitted from these lower rates. Lower margins
were also secured on the renewal of funding. The rebasing of in-the-money
interest rate hedges that expired during 2H2024 negatively impacted
finance costs.
Commentary on the results
South Africa
Retail sales increased by 3,5% during the year ended December 2024. The
growth in retail sales has been achieved despite construction and asset
management activities at Boardwalk Inkwazi, Diamond Pavilion, Mahikeng
Mall and Tzaneng Mall. Furthermore, the subdued performance of the
mining industry, particularly during 2H2024, has negatively impacted
turnover at Kathu Village Mall, Northam Plaza and Tubatse Crossing.
Tubatse Crossing's turnover was also impacted by the closure of a
3 000m2 Edgars in favour of a new Checkers that will open in
3Q2025. Jabulani Mall achieved turnover growth of 13,6% following
the introduction of a franchised Pick n Pay store. The performance
of Spar and the introduction of Unimart at Mams Mall contributed
to the 13,1% growth in turnover at this shopping centre.
During 4Q2024, retail sales increased by 5,5%, supported by stronger
performance in October (+6,1%) and November (+9,6%). This performance
is the result of two-pot retirement withdrawals and the post payday
Black Friday, which had an impact on December's performance (+2,5%).
During the year, lease renewals over 278 542m2 of gross lettable area
("GLA") were concluded on average 4,7% higher than the expiring rentals.
New leases were concluded for 34 210m2 of GLA on average 15,9% higher
than the rentals of the outgoing tenants. In total, rentals for
renewals and new leases increased on average by 6,1%.
Resilient owns 27 retail centres with a GLA of 1,2 million square
metres. Resilient's pro rata share of vacancies in the portfolio was
2,0% at December 2024.
France
Resilient owns a 40% interest in Retail Property Investments SAS, the
owner of four regional shopping centres in France, in partnership with
Lighthouse.
The French economy was affected by political instability and slow
economic growth during 2024. Despite these challenges, comparable
sales for the year increased by 1,8%.
Leasing activity resulted in the reduction of the vacancy in this
portfolio from 7,9% at December 2023 to 5,8% at December 2024.
Spain
Resilient and Lighthouse each own a 50% interest in Spanish Retail Investments
SAS, SA, the owner of Salera Centro Comercial ("Salera"), a shopping centre in
Castellon, Spain.
Salera continues to benefit from the consolidation in the region post the
closure of Zara and Oysho on the high street of Castellon de la Plana.
Comparable sales growth of 12,8% was recorded for the 11 months ended
December 2024. The vacancy was 0,1% at December 2024.
Nigeria
In Resilient's FY2023 results, it was reported that the Company would
dispose of its Nigerian operations to Shoprite Holdings Limited. Approval
for the transaction was received from the Competition Commissions in
South Africa and Nigeria in May 2024. The Nigerian operations were
deconsolidated with effect from 1 June 2024.
Energy projects
Resilient's objective is to reduce its reliance on grid-provided electricity
by continuing the expansion of its solar and battery installations in its
South African portfolio. Installed solar energy generation increased by
16,4MWp in FY2024, bringing total capacity to 76,5MWp. This enhanced
capacity is projected to supply 34,2% of Resilient's total energy
consumption. Batteries support the further expansion of Resilient's
solar installations and the introduction of automated micro-grid
systems allows the effective management and optimisation of demand and
consumption. The automated micro-grid systems at Irene Village Mall
and The Grove Mall have been commissioned and are operating well.
It is projected that installed capacity will increase by 10MWp during
FY2025 with an additional 8MWh of battery storage capacity expected to
be implemented. Solar energy will then supply approximately 39,2% of
Resilient's total energy consumption.
Energy efficiency initiatives, aimed at reducing overall energy demand
and consumption, continue to be implemented across the portfolio.
Property valuations
Resilient's entire property portfolio was subject to an external valuation
at December 2024. The South African portfolio was valued by Quadrant
Properties. Resilient's share of the positive revaluation of its South
African portfolio was R1,4 billion (+5,0%).
The French portfolio was valued by JLL and Salera was valued by Colliers.
Resilient's share of the negative revaluation of the French portfolio
was EUR16,7 million and its share of the positive revaluation of Salera
was EUR4,6 million.
The Nigerian portfolio was subject to a valuation by CBRE Excellerate
for the purpose of finalising the closing accounts in respect of the
disposal of Resilient Africa at 31 May 2024. Resilient's share of the
negative revaluation of the Nigerian portfolio was NGN1,1 billion.
Listed portfolio
Resilient elected to receive 75% of the Lighthouse dividend for June
2024 as a scrip dividend and invested a further R300 million in Lighthouse
during its equity raise of September 2024. The Group currently owns 30,4%
of Lighthouse.
Financial performance
Restated
Results results
for the for the
year ended year ended
Dec 2024 Dec 2023 Movement
IFRS information*
Total revenue (R'000)** 3 651 771 3 379 505 272 266
Basic earnings per
share (cents)** 859,06 1 112,28 (253,22)
Diluted earnings per
share (cents)** 855,78 1 109,96 (254,18)
Headline earnings per
share (cents)** 341,91 393,95 (52,04)
Diluted headline earnings
per share (cents)** 340,61 393,13 (52,52)
Dividend per share
(cents) 440,25 406,24 34,01
Net asset value
per share (R) 69,01 65,71 3,30
Management accounts information
Net asset value per
share (R) 69,71 66,28 3,43
Loan-to-value ratio (%) 37,9 35,2 2,7
Gross property expense
ratio (%) 38,8 39,9 (1,1)
Percentage of direct and
indirect property assets
offshore (%) 24,3 22,0 2,3
* This information has not been audited or reviewed, but is extracted from
the audited annual financial statements.
** Represents continuing operations. The Nigerian operations are classified
as discontinued operations at the reporting date and the comparatives
have been reclassified accordingly.
Outlook
Resilient is well positioned as we enter FY2025. The continuous asset
management initiatives in the South African portfolio ensures that the
portfolio remains relevant and continues to serve the evolving demands of
its customers. The continued rollout of the Group's energy strategy will
serve the Group well in containing the impact of above-inflation increases
in electricity costs. Interruptions in water supply remain a major concern
and progress is being made on the Group's efforts to achieve 2,5 days of
backup water storage at each of its shopping centres to mitigate this risk.
The rotation of Lighthouse from listed investments to direct property, with
the acquisition of dominant regional shopping centres in Iberia, will
result in more predictable earnings. Lighthouse has provided guidance that
its distribution is expected to increase by approximately 5% in FY2025.
The strategy to improve the tenant profile in the French portfolio has
progressed well. As a result of extended lead times until the opening for
trade of new tenants and construction work at Rivetoile, NPI from the
French portfolio is expected to show muted growth in FY2025.
Resilient will continue to maintain a conservative LTV ratio and hedging
profile. Distributions for FY2025 will be impacted by the expiry of
R1,5 billion of in-the-money interest rate hedges.
The Board forecasts growth in distribution of approximately 5,5% or 464,46
cents per share for FY2025 (FY2024: 440,25 cents per share). This assumes
that interest rates remain unchanged, no loadshedding will be implemented,
Lighthouse achieves its guidance, there is no further deterioration of the
macroeconomic environment, no major corporate failures occur and that
tenants will be able to absorb the rising utility costs and municipal
rates. The Board will maintain a payout ratio of 100% of distributable
earnings. This forecast and prospects have not been audited, reviewed
or reported on by Resilient's auditor.
Payment of final dividend
The Board has approved and notice is hereby given of a final dividend of
221,28000 cents per share for the six months ended 31 December 2024.
The dividend is payable to Resilient shareholders in accordance with the
timetable set out below:
Last date to trade cum dividend Tuesday, 8 April 2025
Shares trade ex dividend Wednesday, 9 April 2025
Record date Friday, 11 April 2025
Payment date Monday, 14 April 2025
Share certificates may not be dematerialised or rematerialised between
Wednesday, 9 April 2025 and Friday, 11 April 2025, both days inclusive.
In respect of dematerialised shareholders, the dividend will be transferred
to the Central Securities Depository Participant accounts/broker accounts
on Monday, 14 April 2025. Certificated shareholders' dividend payments
will be posted on or about Monday, 14 April 2025.
The auditor, PricewaterhouseCoopers Inc., has issued an unmodified
audit opinion on the FY2024 AFS. This opinion is available, along with
the FY2024 AFS, at the registered offices of the Company and on the
Company's website at https://www.resilient.co.za/financials. The audit
was conducted in accordance with International Standards on Auditing.
This short-form announcement is the responsibility of the directors and
is only a summary of the information in the FY2024 AFS and does not
include full or complete details. The information regarding the tax
treatment of the dividend is included in the FY2024 results announcement.
The FY2024 results announcement has been released on SENS and is
available on the JSE website at
https://senspdf.jse.co.za/documents/2025/JSE/isse/RESE/FY2024.pdf
and on the Company's website at
https://www.resilient.co.za/financials. Any investment decision by
investors and/or shareholders should be based on the FY2024 results
announcement available on the Company's website. The FY2024 results
announcement is available through a secure electronic manner at the
election of the person requesting inspection.
Resilient's SA REIT ratios are available on the Company's website
at https://www.resilient.co.za/financials.
Dividend tax treatment
In accordance with Resilient's status as a REIT, shareholders are
advised that the dividend of 221,28000 cents per share for the six
months ended 31 December 2024 ("the dividend") meets the requirements
of a "qualifying distribution" for the purposes of section 25BB of
the Income Tax Act. The dividend will be deemed to be a dividend,
for South African tax purposes, in terms of section 25BB of the
Income Tax Act.
The dividend received by or accrued to South African tax residents
must be included in the gross income of such shareholders and will
not be exempt from income tax (in terms of the exclusion to the general
dividend exemption, contained in paragraph (aa) of section 10(1)(k)(i)
of the Income Tax Act) because it is a dividend distributed by a REIT.
This dividend is, however, exempt from dividend withholding tax in the
hands of South African tax resident shareholders, provided that the
South African resident shareholders provide the following forms to
their CSDP or broker, as the case may be, in respect of uncertificated
shares, or the Company, in respect of certificated shares:
a) a declaration that the dividend is exempt from dividends tax; and
b) a written undertaking to inform the CSDP, broker or the Company,
as the case may be, should the circumstances affecting the exemption
change or the beneficial owner ceases to be the beneficial owner,
both in the form prescribed by the Commissioner for the South African
Revenue Service. Shareholders are advised to contact their CSDP, broker
or the Company, as the case may be, to arrange for the above-mentioned
documents to be submitted prior to payment of the dividend, if such
documents have not already been submitted.
Dividends received by non-resident shareholders will not be taxable
as income and instead will be treated as an ordinary dividend which is
exempt from income tax in terms of the general dividend exemption in
section 10(1)(k)(i) of the Income Tax Act. Any distribution received
by a non-resident from a REIT will be subject to dividend withholding
tax at 20%, unless the rate is reduced in terms of any applicable
agreement for the avoidance of double taxation ("DTA") between South
Africa and the country of residence of the shareholder. Assuming
dividend withholding tax will be withheld at a rate of 20%, the net
dividend amount due to non-resident shareholders is 177,02400 cents
per share.
A reduced dividend withholding rate in terms of the applicable DTA
may only be relied on if the non-resident shareholder has provided
the following forms to their CSDP or broker, as the case may be, in
respect of uncertificated shares, or the Company, in respect of
certificated shares:
a) a declaration that the dividend is subject to a reduced rate as
a result of the application of a DTA; and
b) a written undertaking to inform their CSDP, broker or the Company,
as the case may be, should the circumstances affecting the reduced
rate change or the beneficial owner ceases to be the beneficial
owner, both in the form prescribed by the Commissioner for the South
African Revenue Service. Non-resident shareholders are advised to
contact their CSDP, broker or the Company, as the case may be, to
arrange for the above-mentioned documents to be submitted prior to
payment of the dividend if such documents have not already been
submitted, if applicable.
Shares in issue at the date of declaration of this dividend:
365 204 738.
Resilient's income tax reference number: 9579269144.
By order of the Board
Johann Kriek Monica Muller
Chief executive officer Chief financial officer
Johannesburg
18 March 2025
Directors
Alan Olivier (chairman); Stuart Bird; Des de Beer**; Des Gordon;
Johann Kriek*; Dawn Marole; Monica Muller*; Protas Phili;
Thando Sishuba; Barry Stuhler**; Barry van Wyk
* Executive director
** Non-independent non-executive director
Company secretary
Sue Hsieh
(MBA, PGDip, LLB, Fellow member of CGISA)
Registered address
4th Floor, Rivonia Village, Rivonia Boulevard
Rivonia, 2191
Transfer secretaries
JSE Investor Services Proprietary Limited
5th Floor, One Exchange Square, Gwen Lane
Sandown, 2196
Sponsor
Java Capital Trustees and Sponsors Proprietary Limited
6th Floor, 1 Park Lane, Wierda Valley
Sandton, 2196
Debt sponsor
Nedbank Limited (acting through its Corporate and Investment Banking division),
3rd Floor, Corporate Place, Nedbank, Sandton, 135 Rivonia Road, Sandton, 2196
Date: 18-03-2025 05:00:00
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