Metboard Properties Limited today announced that its final distribution increased by 10,8% to 24 cents per linked unit, while its annual distribution grew by 9% to 43,8 cents per linked unit.

Metboard unitholders received a total capital and income return of 97,9% for the financial year ended 31 March 2006. Metboard’s linked units closed at a record high of 710 cents on 31 March 2006, an increase of 86,4% on the 381 cents closing price at the end of the previous year, after trading actively on the JSE Limited. 

“This represents a substantial growth in returns for Metboard linked unitholders,” says Estienne de Klerk, executive director of Metboard Properties, the only focused industrial property loan stock on the JSE Limited.

De Klerk explains that Metboard linked unitholders can expect continued distribution growth as well as substantial benefits, without the dilution of earnings, as a result of the scheme of arrangement by which Metboard will become a wholly owned subsidiary of South Africa’s largest JSE-listed property holding and investment company, Growthpoint Properties Limited. The offer was accepted by 90.11% of the unitholders present at the scheme meeting in April 2006 and has been sanctioned by the High Court of South Africa.

It is anticipated that the scheme will be implemented in August 2006, effective 30 June 2006. Metboard unitholders will receive a special interim distribution for the quarter ended                  30 June 2006.

“It is envisaged that this special distribution will be the last distribution paid by Metboard as a JSE listed company and will be made to unitholders before the implementation of the scheme in August 2006,” notes de Klerk.

At the year end Metboard’s property assets were valued at R2,177 billion, an increased in value of R307,9 million. This revaluation represented an increase in value of 16,5% is a result of the improved yields that industrial properties are currently trading at.

Metboard’s revenue and net property income increased by 12,5% and 14,3% respectively over the comparative period. This is mainly as a result of property acquisitions, the disposal of underperforming properties, a reduction in vacancies and normal rental escalations.

Vacancies account for 1,5% of gross lettable area, down from the 2,4% at the pervious year end.  Vacancies within the portfolio reduced during the year from 35,304m2 at 31 March 2005 to 21,619m2 at 31 March 2006. New leases were secured over 56,900m2 of space and renewals were achieved over 82,1% of expiring leases equating to 242,000m2.

The company disposed of 17 non-core, underperforming properties for R72,7 million, while it acquired 5 properties at a cost of R63,1 million during the year. At year end, Metboard’s portfolio consisted of 164 properties with gross lettable area of 1,420,592m2. Of this 41% comprised warehousing, 24% industrial parks and mini units, 14% light industrial, 13% manufacturing and 8% retail and motor warehousing.

The portfolio is located nationwide with a concentration in Gauteng. 20% of Metboard’s properties are situated in the Jo’burg Metro, 43% in industrial nodes throughout the remainder of the province, 22% in the Western Cape, 13% in KwaZulu Natal and the remaining 2% in other areas.

Metboard reduced its weighted average cost of finance by 1% during the year to 10,9% with interest rates fixed in respect of 84% of the borrowings for periods ranging from two to six years. At year end, Metboard’s total borrowings amounted to R782,1 million which represent a 35,9% of the value of the property portfolio, a more conservative level compared to the 41,5% of the previous year.

At the year end the company had a market capitalisation of R2 billion and a total of 177,7 million units traded for R908,5 million during the year, equating to 63,4% of the weighted average number of linked units in issue, up from the  48,4% traded during the previously year.  This compares favourably with the listed property sector and overall JSE liquidities of 49% and 48% respectively over the same period.

Metboard continued its ongoing capital expenditure programme. During the year, R30,1 million was spent on capital improvements and an amount of R43,3 million has been budgeted for improvements during the next financial year.

“Ensuring that the property portfolio is well maintained and in excellent lettable condition will drive sustainable income growth in the future” said De Klerk.

Metboard’s final distribution of 24 cents per linked unit will be paid to all unitholders on Monday, 26 June 2006, with the last day to trade on Thursday, 15 June 2006.

~ Ends ~

For further information, please contact:

Metboard Properties Limited
Estienne de Klerk
Tel. 011 286 7642
Cell 082 553 0873

Or

Metboard Properties Limited
Tyrone Govender
Tel. 011 286 7814
Cell 082 804 2349

or

Marketing Concepts
Sandy Davey
Tel. 011 880 2213
Cell 083 453 6668

Sandy Davey
Marketing Concepts
T: 011 783 0700
C: 083 453 6668