Delta FY HEPS fall 62.9% to 14.75 cents
Delta Property Fund reported a significant decline in rental income in the year to February, which hit profits for the period. Rental income droped almost
R160million to around R1.23 billion, despite strong collection from its tenants, while headline earnings per share fell 62.8 per cent to 14.75 cents per share. CNBC Africa is joined by Sibongile Masinga, Interim CEO at Delta Property Fund.
Tue, 13 Jun 2023 12:17:55 GMT
Disclaimer: The following content is generated automatically by a GPT AI and may not be accurate. To verify the details, please watch the video
AI Generated Summary
- Significant decline in rental income and profits despite strong tenant collections
- Challenges with high vacancy rates and the need for capital expenditure to make properties tenant-ready
- Efforts to address the financial strain through property disposals and resource reallocation
Delta Property Fund, a real estate investment trust, has faced a challenging year with a significant decline in rental income and profits. Despite strong collections from tenants, the company reported a drop in rental income of almost R160 million to around R1.23 billion. Headline earnings per share fell by 62.8% to 14.75 cents per share. Sibongile Masinga, the Interim CEO at Delta Property Fund, highlighted several key factors contributing to these results in an interview on CNBC Africa. Masinga pointed out that a 30% drop in revenue was due to reversion, a common occurrence for REITs when leases are renewed at lower rates. Additionally, rising costs and a competitive market with oversupply have put pressure on pricing and occupancy rates. The company also faces challenges with vacancies, with a third of their portfolio standing empty. These vacancies require capital expenditure to make the buildings tenant-ready, adding further strain on the company's liquidity. To address these issues, Delta Property Fund is ramping up property disposals to reduce debt and improve occupancy rates. The company is also focusing on reallocating resources efficiently to stabilize its financial position.
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