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Audited summarised consolidated results for the year ended 31 March 2024 and prospects for the Group
Vukile Property Fund Limited
(Incorporated in the Republic of South Africa)
(Registration number 2002/027194/06)
JSE share code: VKE
ISIN: ZAE000180865
Debt company code: VKEI
NSX share code: VKN (granted REIT status with the JSE)
(Vukile or the group or the company)
Audited summarised consolidated results and prospects for the Group
for the year ended 31 March 2024
A year of outperformance driven by a clear strategic direction and a laser
focus on execution
SOUTH AFRICAN PORTFOLIO STEADFAST WITH CONTINUED DELIVERY OF POSITIVE METRICS
- Like-for-like retail NOI growth of +5.4%
- Vacancies reduced to 1.9%
- Rental reversions +2.9%, up from +2.3%
- Like-for-like retail portfolio value increased by +5.8%
CASTELLANA PORTFOLIO METRICS BEST-OF-BREED IN SPAIN
- Normalised NOI growth of +11%
- Negligible vacancies at 1.1%
- Positive reversions of +9.7%
- 95% of retail space let to international/national tenants
BALANCE SHEET STRENGTH SUPPORTED BY STRONG LIQUIDITY OF R5.3 BILLION
- Significant available cash balances of R2.4 billion and undrawn
debt facilities of R2.9 billion
- LTV reduced to 40.7%
- Raised R1.7 billion from new share issuances
- Secured a R1.1 billion green loan and sustainability linked funding
post year-end
- Corporate long-term credit rating of AA(ZA) reaffirmed with a stable outlook
GROWTH IN DIVIDEND AND FFO AHEAD OF UPGRADED GUIDANCE FOR THE YEAR
- Total FFO of 154.2 cents per share, up 6.7% on the prior year
- Final dividend of 72.1 cents per share
- Total dividend for the year of 124.2 cents per share, up 10.5% on the prior year
- Total dividend of R1.3 billion fully covered by cash from operations of R2.2 billion
FINANCIAL PERFORMANCE
31 March 31 March %
2024 2023 change
Gross property revenue (Rm) 4 017 3 594 11.8
Operating profit before finance costs (Rm) 2 328 2 389 (2.6)
Profit for the year attributable to owners (Rm) 1 587 1 932 (17.9)(1)
Basic earnings per share (cents) 152.27 197.10 (22.7)(1)
Headline earnings per share (cents) 131.34 134.72 (2.5)(1)
Net asset value (R per share) 21.55 20.48 5.2
Direct property investments (Rm) 36 612 34 627 5.7
Indirect listed property holdings (Rm) 3 680 2 329 58.0
Total dividend (cents per share) 124.24921 112.43357 10.5
(1) In FY23, dividend income from Lar Espana amounted to R228 million. No income from Lar Espana
was included in Vukile's and Castellana's IFRS income in FY24, since Lar Espana only declared their
dividend for the Lar Espana year ended 31 December 2023 after Vukile's year-end. As such, income from
Lar Espana is reflected in Vukile's and Castellana's FY24 results as an accrual, under the non-IFRS
adjustments. This anomaly, relating to the timing of the Lar Espana dividend declaration, has resulted
in a reduction in IFRS profit for the year, basic earnings per share and headline earnings per share.
If in future years, Lar Espana continues to declare its dividend in April of each year, then the
variances relating to income from Lar Espana in Vukile and Castellana's accounts should normalise.
A separate announcement regarding the dividend, including details relating to the taxation treatment
of the dividend, will be released on SENS.
PROSPECTS FOR THE GROUP
Coming off the back of an exceptionally strong year, Vukile remains on track to deliver further growth
for our shareholders.
The South African market has been characterised with uncertainty in the lead up to elections. The global
environment is starting to see green shoots, as markets anticipate the start of an interest rate cutting
cycle in the short to medium-term.
While we see a significant increase in deal flow in the sector the biggest challenge facing the industry,
and Vukile, at this stage is access to capital at an appropriate cost to make deals accretive. Given
Vukile's strong liquidity position with c.R2.4 billion in cash resources we are well-positioned to execute
on our growth strategy, all the while remaining a consumer-focused retail real estate business.
Although we will offer shareholders the option of a dividend reinvestment plan (DRIP) for the FY24 final
dividend, we do not plan that the DRIP will become a permanent feature of our funding strategy. Instead,
a DRIP will be used to assist with optimal capital allocation, when we see potential for accretive deals.
It is not our intention to offer a DRIP at a deep discount to prevailing spot prices.
For the year ending 31 March 2025, we expect to deliver growth in FFO per share of between 2% to 4% and
growth in dividend per share of between 4% to 6%. This forecast assumes:
- Aggregate growth in net operating income (NOI) across the direct property portfolios in SA and Spain
of between 5% and 7%
- A higher cost of funding from increases in base rates in SA and Spain and from the expiry of the
EUR256 million fixed rate loan in Castellana, affecting the FY25 numbers for a full year
- A Lar Espana dividend accrual of 70cps for the period February 2024 to January 2025
- A ZAR/EUR exchange rate of R20.05
This will equate to FFO per share of between 157.3 and 160.4 cents (FY24: 154.2 cents) and a full-year
dividend per share of between 129.2 and 131.9 cents (FY24: 124.2 cents), to be paid with an interim
dividend and a final dividend.
The forecast assumes no material adverse change in trading conditions, contractual escalations and
market-related renewals. The forecast also assumes no material further change in interest rates and
exchange rates from the levels indicated above.
The forecast has not been reviewed or audited by the company's external auditors.
ABOUT THIS ANNOUNCEMENT
This results announcement is the responsibility of the directors of the company. This announcement
is only a summary of the group audited annual financial statements for the year ended 31 March 2024
(FY24 AFS) and does not contain full or complete details. Any investment decision by investors and/or
shareholders should be based on consideration of the FY24 AFS.
The FY24 AFS were audited by PricewaterhouseCoopers Inc., who expressed an unqualified opinion thereon.
The auditor's opinion also includes communication on key audit matters. Key audit matters are those
matters that, in the auditor's professional judgement, were of most significance in their audit of
the FY24 AFS.
The FY24 AFS, incorporating the auditor's opinion thereon, are available on the company's website
at https://www.vukile.co.za/financial-results/ and on the JSE's website at
https://senspdf.jse.co.za/documents/2024/jse/isse/vke/FY2024.pdf. Copies of the FY24 AFS may be
requested, and obtained at no charge, by emailing Johann Neethling at Johann.Neethling@Vukile.co.za
or the company's sponsor, Java Capital at sponsor@javacapital.co.za from Wednesday, 5 June 2024 to
Thursday, 13 June 2024.
Vukile also voluntarily publishes supplementary information to the FY24 AFS, which includes directors'
commentary, and is available on the company's website at https://www.vukile.co.za/financial-results/.
On behalf of the board
NG Payne LG Rapp
Chairman Chief Executive Officer
Houghton Estate
5 June 2024
Sponsor
Java Capital
www.vukile.co.za
Date: 05-06-2024 07:30:00
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