Primegro pins earnings dip on static rates

Posted On Friday, 30 May 2003 02:00 Published by eProp Commercial Property News
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LISTED property loan stock company Primegro announced yesterday that its basic headline earnings a linked unit were down 4,7% for the six months to April 30 this year, attributing it to the fact that interest rates had not yet been cut by the Reserve Bank.

Property-Housing-ResidentialPrimegro chief financial officer Stuart Snowball said there was a fixed interest rate for most of the company's debt, but a portion of it had a floating rate and was subject to changes in the interest rate. "The fact that interest rates are not coming down does affect us. The rates increased 4% during the course of the previous financial year and they haven't come down yet," he said. Basic headline earnings a linked unit was 41c compared with 43c for the same period last year. This was payable to linked unit holders.

Primegro reported a substantial increase in revenue to R196,3m from R157,1m for the same period last year, but Snowball said a comparison of results of the two periods was distorted as the income from the acquisition of the R1,1bn Richway portfolio only accrued from January 1 last year. Capital expenditure for the review period amounted to R57,5m compared to R6,9m last year.

The main reason for the increase was that Primegro raised 50% of capital expenditure during the period under review for a R60m extension at the Northgate shopping centre, said Snowball.

Primegro and Growthpoint are set to merge in the next two months and become the largest property loan stock company on the JSE Securities Exchange SA with assets of R5bn. The merged Growthpoint, with a market capitalisation of R3bn, would be among the stock exchange's top 50 listed companies.

Last modified on Monday, 05 May 2014 10:22

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