Redefine fund strategy

Posted On Tuesday, 16 October 2001 03:01 Published by eProp Commercial Property News
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REDEFINE Income fund, the R1,6bn property loan stock company, has achieved its goal for the year to August 31, boosting headline earnings a linked unit from 17,44c to 35,03c. It was the company's first full financial year of operation since listing in February last year.

Property-Housing-ResidentialRevenue for the year increased from R103m to R214m, which the company said was derived evenly from its hybrid asset base of directly owned properties and its investments in other property companies listed on the stock exchange.
Redefine, the only hybrid property loan stock company and one of the first to make quarterly payments to linked unit holders, declared a fourth quarterly distribution of 9c a linked unit for the financial year, bringing the total pay out to 35c.
CEO Peter Penhall said this represented income yield of 13% and capital growth of 34% on the review period's closing price of R2,70 a unit.
'It has been a year of solid progress with steady achievement of the goals set by Redefine. As a result, there has been a marked shift in perceptions from an initial cautiousness about the pioneering hybrid nature of Redefine to one of ready acceptance.'
'Redefine has become one of the most highly traded property loan stock counters, with yields that are attracting increasing demand from individual investors and the smaller institutional investment institutions. The major funds have remained active investors.
'This is reflected in liquidity of 33% of total linked units in issue, with 78,9-million linked units being traded at a value of R180m during the financial year,' Penhall said.
Redefine sold 18 noncore properties for R177m. Most of these were acquired as a portfolio by ApexHi Properties in exchange for ApexHi A- and B-class linked units at a combined price of R10 a unit.
Penhall said strong management of the balance sheet had sharply reduced the company's exposure to property portfolio debtors during the financial year.
'Moreover, the property portfolio lease profile is extremely sound, with 30% of leases expiring after financial year 2006.'
On the listed securities side, market value of investments in 12 listed property loan stock companies and property unit trusts rose to R902m, an increase of R160m over the cost of R742m. About 90% of Redefine's listed securities portfolio is held in six prominent counters: ApexHi, Capital, GrayProp, HyProp, Marriott and Sycom.

Last modified on Saturday, 26 April 2014 10:38

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