The directors have declared an interim dividend influenced by the possible new development strategy that will require cash resources.

An interim dividend of 25 cents, compared with a previous 70 cents per share has been declared.

Headline earnings were down 22% to R7.1-million from R9.1-million before.

Gross rentals were flat at R14-million from R14.1-million.

The company said the Wynberg Property in Sandton was sold to the City of

Johannesburg Metropolitan Municipality in October 2002 for R3.2-million, excluding VAT. The new owner took immediate occupancy, which eliminated the overhead costs to Putprop.

Putprop has negotiated the waiving of the 9% escalation clause for Putco Limited for the 2002-03 financial year (effective January 2003), for the unoccupied premises at Boksburg, Lea Glen, Wembley and Garthdale.

The net effect of these changes largely offset the 9% escalation in rentals on the other properties, it said.

The cost of operating increased to R2.3-million from R0.9-million for the comparable period last year due largely to the devaluation of the Boksburg and Lea Glen properties, the rates and taxes and security costs for the properties where the leases have expired, and the fact that Putprop carried these expenses for the Wembley property until October 2002.

"The previous tenant of the Wembley Property performed extensive renovations which will allow us to rent or sell the Wembley property more easily," Putpro said.

A large fire broke out at Putprop's Soshanguve depot in Limpopo in November 2002. The damaged portion is being rebuilt and an insurance claim is being processed.

A detailed assessment is done on an annual basis to determine the maintenance required on all properties in order to ensure their continued suitable state of repair. The cost of these actions will be about R0.26-million for the financial year.

On prospects, Putpro said its is continuing with marketing efforts to find purchasers or tenants for any vacant premises.

The anticipated sale of the Wembley property did not materialise. Discussions are at an advanced stage regarding the sale of the Baragwanath property in Soweto.

The company said its directors are of the view that the time is right to investigate diversification into other property development projects in industrial, commercial and/or residential markets.

This would require the restructuring of the current resources to be able to actively participate in these markets. A plan will be developed to determine the way forward, the company said.