ATTACQ, the South African retail, office and industrial REIT (real estate investment trust), sold about half its stake in central and eastern Europe focused MAS in the past three months, with the proceeds going towards reducing debt.
The results for the six months to December 31, released yesterday, showed Attacq sold 69.67 million shares in MAS for R885m cash, cutting its shareholding from 20.7 percent at the end of the interim period, to 10.9 percent.
“A minimum of R1 billion of debt will be settled permanently by June 30, 2021, from disposal proceeds ... When further property disposal transactions close, additional debt will be settled from disposal proceeds,” the group said.
Attacq is trading under a cautionary notice relating to the proposed disposal of an investment property.
Attacq, which counts Waterfall City as a flagship development, reported a 57.5 percent drop distributable income per share to 21.1 cents a share in a six-month period characterised by economic weakness and uncertainty.
No dividend was declared and no guidance was provided.
The decline was mainly due to R53.8m in rental discounts granted, and MAS not paying a dividend given the pandemic uncertainty.
Chief executive Melt Hamman said in a statement: “Attacq’s diversified and quality property portfolio and diligent capital management plus its debt reduction plan supported us in this period and will ensure we are well-positioned to benefit from a future recovery.”
MAS reported a distributable loss per share of 2.7c in the period for Attacq, after also not declaring an interim dividend.
In contrast, Attacq’s R20bn South African portfolio produced distributable income of 26.5c per share.
There was no distributable income contribution from the R400m rest of Africa retail investments.
Group liquidity improved to R1.3bn, from R962.9m at the same time in 2019.
The rental collection rate for the South African portfolio was 100.6 ercent, better than the 98.8 percent at the same time in 2019, which was pre-Covid.
Valuations of the South African portfolio fell 3.2 percent from June 30, 2020, on a like-for-like.
Occupancy in the portfolio improved to 96.4 percent from 94 percent. Net asset value per share fell 26.6 percent to R15.71.
The share price was down 2.4 percent at R6.20 yesterday morning. There were adequate liquidity resources to continue with the development pipeline, said Hamman. Good progress had been made with the disposal programme, and the exit strategy for Rest of Africa retail investments continued.
The focus was to continue to develop Waterfall into a smart, sustainable city, and over 31 000m² developments commenced post period-end, with a further 30 000m² of warehouse space under negotiation.
Attacq shares closed 4.57 percent lower at R6.06 on the JSE yesterday.
BUSINESS REPORT ONLINE