Financial Results | Property & Real Estate
Botswana Stock Exchange listed diversified real estate company, Letlole La Rona Limited has reported impressive financial results for the six months ended December 2022.
Released this week figures show that revenue for the reporting period increased by 4% to P50.2 million from P48.4 million in the prior comparative six months, whilst operating profit was up 8% to P36.5 million. Profit before tax of P49.7 million was reported, an increase of 8% on the prior comparative six months.
“We are encouraged by the strong results, notwithstanding a challenging economic environment. Our performance was mainly underpinned by annual lease escalations, our quality tenant base and below average market vacancy levels, especially in our warehouse portfolio,” Kamogelo Mowaneng, Letlole La Rona Chief Executive Officer said on Tuesday when briefing members of the media and investors
LLR reported a weighted average lease expiry period of 3.3 years and escalation rates averaging 6.8% per annum for the period ended 31 December 2022.Its investment portfolio value increased by 14% year-on-year to close the period at P1.4 billion, mainly driven by the acquisition of a 30% stake in OAL in July 2022.
The Company also recorded a significant increase in other income, predominantly due to foreign exchange gains on the OAL shareholder loan. “We continue to explore pipeline opportunities locally, and regionally in line with our Go-to-Africa strategy and our interest remains on value-accretive investments,” Mowaneng said.
An interim distribution of 9.11 thebe per linked unit was declared on the 6th of February 2023 for the half-year period to 31 December 2022, comprising of a dividend of 0.05 thebe and debenture interest of 9.06 thebe per linked unit which will be paid to linked unit holders registered in the books of the Company at the close of business on 24 February 2023.
In terms of its five-year strategy, LLR said it continues to invest in the optimisation of its existing portfolio. As such the Company continued to invest in resourcing key positions and internal promotions to support its strategy, resulting in an increase in expenses. In addition, ongoing refurbishments to LLR’s investment properties impacted on the fair value of its property portfolio, which increased by P7.3 million.
“Our collection efforts continue to support strong cash flows and outstanding debtors
are steadily declining, collection rates have largely been above 100% during the review period and the quality of our tenants has improved as some defaulting tenants exited the base. As a result, our provision for bad and doubtful debts have also been steadily declining,” she explained.
Long-term loans increased significantly during the period under review on the back of the funding requirements for JTTM Properties (Proprietary) Limited (JTTM) and OAL.
The net asset value of the Company closed at P871.8 million, representing an increase of 7% from the prior year’s figure of P813.9 million, showing consistent year-on-year value enhancement to unitholders.
An interim distribution of 9.11 thebe per linked unit was declared on the 6th of February 2023 for the half-year period to 31 December 2022, comprising of a dividend of 0.05 thebe and debenture interest of 9.06 thebe per linked unit which will be paid to linked unit holders registered in the books of the Company at the close of business on 24 February 2023.
Going forward, LLR said it will leverage the solid platform that it has created over the past 12 years to further grow, diversify and deliver value to its unitholders whilst positively impacting the communities that it operates in.
“Our goal remains the maximization of value for our stakeholders and provision of
sustainable returns. This will be achieved through the core values of Excellence, Agility, Innovation, and Integrity as we seek growth and diversification both locally and regionally,” Mowaneng said.
