Property development company Attacq lifted its headline earnings a share for the year ended June 30 to 12c, from 2c the year before, while basic earnings per share (EPS) rose to 197.9c and diluted EPS rose to 196.7c.
Attacq achieved 15.3% year-on-year growth in adjusted net asset value per share (NAVPS) to R21.89 for the year under review, with the compound yearly growth rate in adjusted NAVPS being 29.4% since inception.
“Our total asset value grew by 18.6% to R27.6-billion since June 2015, when it stood at R23.3-billion,” CEO Morné Wilken said on Tuesday.
He noted that the international portion of Attacq’s assets showed positive growth both in value and its percentage contribution to overall net asset value, with international asset value increasing by 34.5% to R5.9-billion.
“Our pursuit of our vision is to invest in quality real estate, develop great properties and grow a strong rental portfolio in South Africa, as well as other emerging and developed markets,” he said.
The company’s Waterfall City development completion rate increased to 49.5% standing at 410 000 m2.
It also saw an increase in net rental income of 17.2% to R1.1-million, which included only two months of rental income from the Mall of Africa, which was completed at the end of April.
Vacancies reduced from 4% in June 2015 to 2.4% as at June 30.
The development profit made in the period from Mall of Africa was R580-million and around R178-million from other developments.
“The super-regional Mall of Africa, in Waterfall City, which is 80% owned by Attacq, is already trading above expectation and has been designed to allow for an expansion of 25 000 m2,” Wilken noted.
He stated that Waterfall remained the “jewel in the Attacq crown” and was a catalyst for regional growth.
He pointed out that the Mall of Africa alone would attract more than 15-million people a year.
“The projected growth in office space is expected to be almost 30% a year until 2020. The opening of the 26-storey PwC Tower will accelerate this growth even further,” he noted.
International investments increased by 34% to R5.8-billion and 15% of Attacq’s total assets are in developed markets.
Attacq’s investment in developed markets focuses on investments in real estate group MAS and in Cyprus.
“The current international market is a challenging one and we have seen its influence in the performance of MAS Real Estate and our African investments. Our investments in Serbia and Cyprus have stood us in good stead and we have enjoyed healthy development profits from other developments,” Wilken explained.
During the year under review, the Karoo agterskot shares vested and Attacq thereafter also sold R200-million worth of MAS shares at R22 a share. The market value of the company’s investment as at June 30 was R2.9-billion, which is R200-million higher than its book value.
MAS had traditionally only focused on Germany, Switzerland and the UK, but has now expanded its focus to include the higher growth markets in Central and Eastern Europe (CEE).
Six per cent of Attacq’s total assets are in emerging markets, where it focuses on joint ventures with partners with local expertise, while bringing investment and property skills to its investments in larger or metropolitan areas.
Its international emerging markets investments include six operational malls in Serbia and one under construction.
As part of its emerging markets strategy, Attacq holds a 25% shareholding in Atterbury Serbia, which acquired a 33% shareholding in an existing portfolio of seven properties developed by MPC Properties, of which one is still under construction.
Attacq also has investments in five operational malls across Africa.
“We look forward to future growth in this regard as currently we feel that this area of Attacq has undertraded somewhat,” said Wilken.
He said the company expected slower growth in South Africa to continue, owing to political uncertainty.
Wilken also identified local services and utilities supply, coupled with pressure on resources, as potential business risks for the country. The uncertainty caused by Britain’s decision to exit the European Union and the US Presidential elections will, in his view, have an impact on Attacq’s offshore markets.