Collins Property Group swung into a R108 million net profit in the six months to August 31 from a loss of R958m at the same time a year before, the latest results showed yesterday.
An interim dividend would be declared after the conversion to a Reit (Real Estate Investment Trust). Revenue increased to R581m from R570m. Profit from continuing operations increased to R159m from R139m.
The disposal of the UK assets in the second half of last year was part part of a restructuring, a process intended to result in the conversion into a Reit during the current financial year, should approvals be obtained in time.
The restructuring started with the bringing of the company onshore from a tax perspective at the end of February.
An agreement was reached with the owners of U Reit Collins, whereby they swopped their 25.7% shareholding in the South African division of the group for a 21.78% shareholding in the company through the issue of shares at a price of R13.64 per ordinary share.
The name of the company was also changed from Tradehold Limited to Collins Property Group, to leverage off the well-respected name of Collins in the local property market.
Total assets now amount to R12.2 billion. Earnings per share was 42 cents compared to a loss of 373c per share for the corresponding period.
There was a renewed focus in the period on balancing the local portfolio with properties in western Europe.
In the past six months Collins obtained a share in four mainly industrial properties in the Netherlands to add to the six it already owns in Austria. A senior staff member would move to the Netherlands in January next year to grow the portfolio in Europe, with potential assets in Germany under consideration.
In South Africa, good progress was made in selling down assets to free up cash for the offshore expansion. This recycling of assets was also aimed at improving the quality and profitability of the portfolio.
In the period seven properties were sold for R62m while properties to the value of R159m were expected to be sold before the end of the financial year.
Locally the group was increasing its presence in the Western Cape. Several projects were at various stages of investigation and development, the focus for now being mainly on convenience retail.
The bulk of the group’s gross lettable area of just more than 1.5 million square metres consists of large industrial warehouses and distribution centres let to mainly national and JSE-listed companies.
BUSINESS REPORT