Presenter: Lindsay Williams  Guest(s): Gerhard van Zyl 

Savings in debt costs, and a strong property performance contribute to listed property loan stock company Vukile increasing distributions by 11.5% for the year to March 2006, and delivering distribution growth of just over 14% for the six months to March. With Gerhard van Zyl from Vukile

LINDSAY WILLIAMS: Gerhard, that interview on the disposal of the V&A by Transnet - did that get you interested?

GERHARD VAN ZYL: Unfortunately I didn’t listen to that - I’m not quite sure what was said.

LINDSAY WILLIAMS: They’re selling 74% of the V&A. I thought perhaps that sort of disposal, and that sort of supply coming onto the market indicates that perhaps certain people think the property market has peaked?

GERHARD VAN ZYL: I suppose that could be true. Without trying to put myself into other people’s shoes there’s no doubt that there are those that would try use current market conditions to offload properties at good prices - so there may be some truth in what you’re saying.

LINDSAY WILLIAMS: Your numbers for the year to the end of March are pretty good - Vukile reported a 30% increase in net profit before debenture interest of just about R225-million, also your property portfolio is up to R3.5-billion. One of the problems many companies like yours come up with now is where to grow form here? Apart from the organic growth that’s indicative of the macro-economic situation - what about acquisitions?

GERHARD VAN ZYL: Yes, that’s obviously one of the areas, and we have managed to concluded some - excluding the additional acquisition of 25% of MICC - R230-million roughly in new acquisitions at very good yields. Once those start contributing that will obviously give a nice boost to the existing portfolio. Then the other area - which is still in our case is still applicable - is the full benefits of the securitisation project that will contribute for the full year, compared to only a few months for this year.

LINDSAY WILLIAMS: The results we’ve seen - how many months of securitisation benefits have you seen?

GERHARD VAN ZYL: That was concluded towards the end of November 2005 - so that makes it four months.

LINDSAY WILLIAMS: Looking ahead now - if you were to make acquisition would you go retail, commercial or industrial?

GERHARD VAN ZYL: On a combined basis we’re about 55% exposed to retail, roughly 35% commercial, and the remainder industrial. I think commercial is really poised for some good growth - but I wouldn’t really stress a preference. If I can get an opportunity to buy in any of the sectors at a good yield for good properties - I would certainly go for any of them.

LINDSAY WILLIAMS: So across the board you’re still bullish?

GERHARD VAN ZYL: Yes, very much so.

LINDSAY WILLIAMS: Vukile’s share price was up 1.6% today closing at R9.15.