unaudited interim results - hyprop · dec 2014 dec 2015 dec 2016 dec 2017 dec 2018 rent ratio -...
TRANSCRIPT
Unaudited interim results As at 31 December 2018
CapeGate, Brackenfell, Cape Town
Stratco
2
• Project architect at ORT
International Terminal
Building (2005 – 2009)
• Development Director at
Compass Group, USA
(2003 – 2005)
• Various retail development
roles at Old Mutual Properties
(1998 – 2003)
• Regional Executive overseeing
Gauteng & Nigeria
• Portfolio Manager – European
investments (2015 – 2017)
• Joined Hyprop as Portfolio
Manager
• Joined Colliers RMS and GM at
Westgate Shopping Centre
• Regional Executive overseeing
Western Cape & Pretoria
portfolio
• Previously GM of Canal Walk
• Previously GM of Menlyn Park
Shopping Mall
• CFO of Mentor Africa Limited
(2007 ‒ 2017)
• Group CFO of Rebhold /
Mvelaphanda Group
(1999 ‒ 2007)
• Extensive experience
• Corporate finance
• Financial reporting &
management
• Taxation & commercial law
• Executive Director at Blend
Property Group
• Manager: Strategic
Investments at Royal Bafokeng
Holdings
• Investment analyst at BJM
• Extensive experience in:
‒ Investments
‒ M&A
‒ Business strategy
Brett Till (50) Wilhelm Nauta (47)
CFO CA (SA)
CIOCA (SA); EDP (Wits)
Morné Wilken (47)
CEOB. Eng (Hons)
Steven Riley (49) Nicole Greenstone (50) Wayne Abegglen (52)
Development ExecutiveB. Arch, PDP (UCT), PMD (GIBS)
Regional ExecutiveHigher Diploma (HR)
• CEO of MAS REI (2018)
• CEO of Attacq Limited
(2011 – 2017)
• COO of Attacq limited
(2008 – 2011)
• Extensive experience in property
development, investment, finance
and corporate restructuring
• His key focus Attacq was the
roll-out of the Waterfall
development in Gauteng,
including Mall of Africa
Joined Dec 2018 Joined Oct 2018 Joined Jul 2016
Joined Nov 2009 Joined Nov 2003
Regional ExecutiveBA (Hons), HDIP ED, Nat Dip Real Estate (valuations)
Joined Oct 2003
Agenda
3
Sub-Saharan Africa
South-Eastern Europe Financial results Outlook
Six month overview
€
$South Africa R
Six month overview
4Canal Walk, Cape Town
Highlights
Refinance of debt
€183mSale of last non-core asset
Distributable income from SA (yoy)
9%Distributable income from Europe (yoy)
17%Vacancies reduced in SA portfolio (retail & office)
1.6%
5
Lakefield
The Glen Shopping Centre, Oakdene, Johannesburg South
Focus Areas, Highs, Lows & Challenges
6
South
AfricaSub-Saharan
Africa
South-Eastern
Europe
Focus Areas
• Moody’s credit downgrade • African impairment / reduced distribution
• New R250m bond for 3.5 years @ 1.44% margin
• Disposal of last non-core asset – Lakefield
• Distributable income from SA up 9% (yoy)
• Stuttafords space all re-let
• Refinance of EUR debt: €183m
• South-Eastern Europe portfolio vacancy <0.1%
• Distributable income from Europe up 17% (yoy)
Highs
Lows
• Managing weakening economy
• Restore Moody's rating to investment grade
• Reducing exposure to Africa
• Growth in distributions
• Edcon restructure
• Repositioning our malls
Challenges
Key Metrics
7
Distribution – cps Distributable earnings - Rm
933 985
500
600
700
800
900
1000
31 Dec 2017 31 Dec 2018
5.6%
Gross assets - Rbn^
42.9 43.2
0
10
20
30
40
50
30 June 2018 31 Dec 2018
NAV per share - R
103.0
99.9
103.7
100.6
98
99
100
101
102
103
104
30 June 2018 31 Dec 2018
Based on IFRS TNAV**
Share price - R
102.381.5
0
20
40
60
80
100
120
30 June 2018 31 Dec 2018
-20.4%
-3.0%
-2.9%
Loan-to-value - %
20.0 21.2
31.2 32.8
0
10
20
30
40
30 June 2018 31 Dec 2018
Based on IFRS See through** Hystead: Guaranteed debt and 60% of NAV
** Incl. Hystead: 60% debt and 60% of NAV
6.4%
5.0%
^ Including 60% of Hystead gross assets
376.3 385.6330.6
383.8
0
200
400
600
Dec 2017 Dec 2018
Group Excl Africa
2.5% 6.6%
0.7%
Contribution to DPS
Property locations as per the next slide of all the SA assets
H Y D E P A R K
C O R N E R
Gauteng region
Western Cape region
86%
<1%
14%
8
South Africa
CapeGate, Brackenfell, Cape Town
OperationsSouth Africa
Leasing
% of
total
portfolio
Rentable
area
(m²)
Rental
growth
(%)
Contractual
escalation
(%)
Retail 7.4 49 010 -1.8 7.3
New lettings 2.6 17 447 -2.0 7.2
Renewals 4.8 31 562 -1.6 7.3
Offices 13.4 7 920 -7.8 7.8
Total 7.9 56 930 -2.2 7.3
1.2%1.4%
0.9% 0.8% 0.9%1.1%
0.0%
0.5%
1.0%
1.5%
2.0%
Dec-13 Dec-14 Dec-15 Dec-16 Dec-17 Dec-18
Retail vacancy
Lease expiries (retail and office)
25%
18%
12% 14%
31%
0%
10%
20%
30%
40%
*2019/2020 *2020/2021 *2021/2022 *2022/2023 *2023+
9
* Expiries for financial year Jul - Jun
OperationsSouth Africa
10
Rent ratio - portfolio
10.8% 10.7%9.9%
8.6% 8.5% 8.2% 8.0% 7.6%6.5%
0%
5%
10%
15%
Hyde ParkCorner
The GlenShoppingCentre
Canal Walk RosebankMall
ClearwaterMall
AtterburyValue Mart
Woodlands SomersetMall
CapeGate
Deterioration
Improvement
0%1%
6%2%
2% 0%5%
1%
2%
* Figures based on Jul – Dec yoy growth
7.6% 7.7%8.3% 8.5%
8.9%
0%
2%
4%
6%
8%
10%
Dec 2014 Dec 2015 Dec 2016 Dec 2017 Dec 2018
Rent ratio - property
Average monthly foot count / m²
11.810.3
12.3
9.7
15.014.1
15.113.3
11.79.9
12.4
9.6
14.813.6
15.2
12.7
0
5
10
15
20
Canal Walk ClearwaterMall
The GlenShoppingCentre
Woodlands CapeGate SomersetMall
RosebankMall
Hyde ParkCorner
YTD 2017 YTD 2018
1%0%1%
4%
3% 5%
1%
1%
2 6442 930 3 073 3 126 3 102
1 000
2 000
3 000
4 000
5 000
2014 2015 2016 2017 2018
Trading density
0.6%5.6% 3.4% 1.4%
5.5%
Edcon exposure ‒ 31 Dec 2018South Africa
11
92.4%
7.6%
90.6%
9.4%
Exposure per property % of gross income
% of GLA
Other tenants
Edcon
2.3%
1.5%1.3%
0.7% 0.6%
0.4% 0.4%0.2%
0.1%
2.1% 2.1%
1.5%
1.2%
0.9%0.8% 0.7%
0.1% 0.1%
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
CanalWalk
ClearwaterMall
The GlenShoppingCentre
Rosebank Mall WoodlandsBoulevard
CapeGateMall
Somerset Mall Hyde ParkCorner
AtterburyValue Mart
% of gross income % of GLA
Other tenants
Edcon
GLA reduction - m²
2019 2020
66 781
50 871
Strategy in the event of Edcon failureSouth Africa
12
Potential tenants identified for space 79% of Edcon space = 53 000m²
Current concluded deals to reduce exposure Take back space of 7 563m² (11%)
Estimated investment required to re-let and re-configure ±R300m
Time period estimated to re-work and re-tenant the space ±15 - 20 months
Estimated rental loss based on the 15-month period R120m
Gross rental income shortfall between current Edcon
and new assumed income Estimated at -R4.5m / month
Numerous Edcon brands trade profitably in Hyprop mallsStrong likelihood of business components
being sold off with continuous trade
DevelopmentsSouth Africa
13
Property Project
Hyprop share
(Rm)
Completion
date
Rosebank Mall Offices Re-glazing and upgrade of atrium 10.0 Aug 2018
Woodlands Food court upgrade – phase 2 9.8 April 2019
Restroom upgrade 6.0 April 2019
The Glen Downsizing of Edgars to unlock space for Checkers 40.8 Nov 2019
Canal Walk Ratanga Junior and food court upgrade 44.0 Dec 2019
Restroom upgrade 24.0 Phased
Total 134.6
WoodlandsSmaller projects completed
Planned projects Canal Walk
• Dion Wired sub-division
• Refuse yard upgrade
SustainabilitySouth Africa
14
GRESB benchmark
CDP water
Clearwater Mall now generates 15% of total energy from solar power
Savings during the past 6 months
Water saving
24.5%Electricity
5.4%Waste recycling
83%
CDP carbon score reduced
61%
B+
42%
A-
First Hyprop submission
2018 2017
Key InitiativesSouth Africa
15
Portfolio approach
Partner with the tenant
Re-invest
Relevance and repositioning of malls
Entertainment
Technology
Embrace online
ServicesCapeGate, Brackenfell, Cape Town
Sub-Saharan Africa
NigeriaGhana
Zambia
Contribution to DPS16
86%
<1%
14%
Manda Hill, Lusaka, Zambia
OperationsSub-Saharan Africa
17
Average monthly foot count / m²
Rent ratio - property
27
17
33 32
22
2928
16
31 31
22
29
0
10
20
30
40
Accra Mall West HillsMall
Achimota Kumasi Manda Hill Ikeja CityMall
YTD 2017 YTD 2018
3%1%
5%2%
4%
0%
6.8%
9.2% 8.9%
6.8%6.0%
8.7% 9.2%
11.1%
7.4%
0%
2%
4%
6%
8%
10%
12%
Accra Mall West Hills Mall Achimota Kumasi Manda Hill
YTD 2017 YTD 2018
Deterioration
Improvement0.3%
0.6%
Note: Turnover provided by tenants
Vacancy as % of GLA
5.8%
10.7% 11.3%14.0%
5.3% 1.5%6.3%
15.6%
3.4%
12.7%
7.2% 3.1%
0%
5%
10%
15%
20%
25%
Accra Mall West HillsMall
Achimota Kumasi Manda Hill Ikeja CityMall
YTD 2017 YTD 2018
0.5%
4.9%7.9%
1.3%
1.9%
1.6%
Lease expiries*
34% 34%
27%
2%3%
0%
10%
20%
30%
40%
2019 2020 2021 2022 2023
* Includes Ikeja
0.8%
0.5%
Key initiativesSub-Saharan Africa
18
Asset management
Right-sizing
Sustainability
West Hills Mall, Accra, Ghana
Reduce exposure
South-Eastern Europe
Contribution to DPS
Macedonia
Serbia
Montenegro
Bulgaria
Croatia
19
86%
14%
The Mall, Sofia, Bulgaria
Hystead at a glance
20
A UK company, modelled on Hyprop
Six high quality dominant shopping centres in capital cities of five countries – scale, credibility, bargaining power
Strategic shareholders: Hyprop (60%) and PDI (40%)
– deep retail experience
Strong operational focus with core competence in active asset
management by in-country teams on site
Executive management team in Europe
European mandate, initial focus on South-Eastern EuropeCity Center One West, Zagreb, Croatia
21
Rent ratio - property
10.39.3
10.412.0
8.8 8.910.5
9.310.2
12.3
8.7 8.8
0%
5%
10%
15%
Delta CityBelgrade
Delta CityPodgorica
Skopje CityMall
The MallSofia
City CenterOne East
City CentreOne West
YTD 2017 YTD 2018
3%2%
3%
0%
Note: Turnover provided by tenants
1% 2%
Rent ratio - portfolio
10.5%
9.0%
10.4%
9.2%
8%
9%
10%
11%
Jun Dec
2017 2018
OperationsSouth-Eastern Europe
Average monthly foot count / m²
28.1
21.6 20.6
12.0 12.1 11.5
27.8
22.0 20.5
11.4 11.9 11.2
0
10
20
30
40
Delta CityBelgrade
Delta CityPodgorica
Skopje CityMall
The MallSofia
City CenterOne East
City CenterOne West
YTD 2017 YTD 2018
2%
1%1%
4%1% 3%
211255
223264
100
200
300
400
Jun Dec
2017 2018
Trading density per month - €
6% 3%
12%13% 14%
19%
14%
28%
0%
5%
10%
15%
20%
25%
30%
2019 2020 2021 2022 2023 2024+
22
Lease expiry profile
0.3%
0.2%
0.0%
0.3%
0.0%0.0%
0.0%
0.1%
0.2%
0.3%
0.4%
Jun-16 Dec-16 Jun-17 Dec-17 Jun-18 Dec-18
Vacancy - portfolio
New lettings & renewals
% of total
portfolio
Rentable area(m²)
Rental growth
(%)
Contractual escalation
(%)
New lettings 1.7 4 079 9.6 1.7
Renewals 5.0 11 729 0.1 1.8
Total 6.7 15 808 2.9 1.8
City Center One West – Zagreb, Croatia
LeasingSouth-Eastern Europe
Debt summarySouth-Eastern Europe
23
Debt maturity profile
Property value
Weighted average loan tenor
Weighted average cost of debt
Proportion of debt hedged
LTV
87%
0%
13%
0%
0%
0%
32%
14%
41%
13%
0% 20% 40% 60% 80% 100%
4-5 years
3-4 years
2-3 years
1-2 years
< 1 yearHyprop guaranteed
Non-recourse€798 m
4.1 years
3.2%
63%
45.7%
2.1 years
2.1%
0%
49.7%
Non-recourseHyprop
guaranteed
24
Developments & sustainabilitySouth-Eastern Europe
Live projects Project Project budget (€ m) Completion date
The Mall Sofia Hypermarket redevelopment 23.5 Aug 2019
Planned projects
The Mall Sofia
Food court redevelopment 0.6 Q4 2019
Bathroom refurbishment 0.3 Q4 2019
Re-surfacing open parking 0.4 Q3 2019
Delta City Podgorica Parking equipment and deck repairs 1.0 Q3 2019
Skopje City Mall Right-sizing of various tenancies & internal mall changes 5.2 Q3 2019 & 2-years
Total 7.5
Sustainability Score
BREEAM certification
Delta City Belgrade Very Good
Delta City Podgorica Good
Skopje City Mall Very Good
Key initiatives
25
Execute asset management & redevelopment initiatives
Reposition for relevance & ‘experience’
Deliver the supermarket conversion project at The Mall (Sofia)
Selective acquisitions to bolster scale and diversification
City Center One West – Zagreb, Croatia
Delta City, Belgrade, Serbia
Financial results
26CapeGate, Brackenfell, Cape Town
0
100
200
300
400
500
600
700
800
900
H1 2017 H2 2017 FY 2017 H1 2018 H2 2018 FY 2018 H1 2019
South Africa Sub-Saharan Africa South-Eastern Europe
Distribution growth
27
Cents per share
347 348
695
376 380
757
38616.6% 8.0%
12.1%
8.3% 9.3%
8.8%
2.5%
13.1%
5.6%
89.3%
Distributable earnings
28
Dec 2018
R000
%
Change
Dec 2017
R000
June 2018
R000
Revenue 1 631 673 6 1 539 370 3 113 712
Property expenses (587 669) 13 (521 113) (1 049 892)
Net property income 1 044 004 3 1 018 257 2 063 820
Other operating expenses (20 649) (27) (28 295) (55 778)
Operating income 1 023 354 3 989 962 2 008 042
Net interest (138 862) (14) (161 646) (282 273)
Other income 20 425 (11) 22 996 46 671
Dividends received 111 434 41 78 820 182 778
Net income before fair value adjustments 1 016 352 9 930 132 1 955 219
Net income before fair value adjustments 1 016 352 9 930 132 1 955 219
South Africa 833 022 8 771 784 1 590 217
Sub-Saharan Africa 47 177 (11) 52 960 128 275
South-Eastern Europe 136 153 29 105 388 236 727
Distributable earnings 985 240 6 933 127 1 904 514
South Africa 844 682 9 776 326 1 591 673
Sub-Saharan Africa 4 405 (89) 40 025 78 368
South-Eastern Europe 136 153 17 116 776 234 473
Dec 2018
R000
Dec 2017
R000
June 2018
R000
Total profit for the period/ year attributable to shareholders of the
company181 894 1 436 930 2 529 466
Adjusted for: 803 345 (503 803) (624 952)
Change in fair value - investment property (387 904) (541 802) (646 021)
Change in fair value - derivative instruments (3 515) 6 943 (29 085)
Change in fair value - financial asset 213 364 41 393 (87 761)
Derecognition of financial guarantee (33 674) (11 984) (11 984)
Profit on disposal - investment property (2 697)
Impairment - loans to joint ventures 1 069 991 8 539 166 441
Impairment - joint venture - - 10 103
Deferred and normal tax 10 138 6 080 39 485
Capital and other items * (900) 14 721 (5 831)
Income from sub-Saharan Africa * (64 155) (27 693) (57 602)
Distributable earnings 985 240 933 127 1 904 514
29
* Net effect of converting IFRS earnings to distributable earnings
Reconciliation of attributable net profitto distributable earnings
Bank & DCM debt profile
On balance sheet by lender
Dec 2018
Investec
OMSFIN
RMB
USD bank facilities
EUR bank facilities
Group (incl. guaranteed debt) by lender
Dec 2018
5%
3%54%
34%
4%
10%3%
26%
38%
21%2%
5%
34%
61%
3%
21%
36%
40%
DCM funding
Standard Bank
GroupZAR DCM facilities
ZAR bank facilities
Standard Bank
Group
OMSFIN
DCM funding
RMB
Nedbank
Investec
USD bank facilities
ZAR bank facilities
ZAR DCM facilities
On balance sheet sources of funding
Dec 2018
Group (incl. guaranteed debt) sources of funding
Dec 2018
30
824
1 796
650
2 699
246
2 821
863
317
3 019
250
400 452348 500
1 000
1 500
2 000
2 500
3 000
3 500
Q1:2019
Q2:2019
Q3:2019
Q4:2019
Q1:2020
Q2:2020
Q3:2020
Q4:2020
Q1:2021
Q2:2021
Q3:2021
Q4:2021
Q1:2022
Q2:2022
Q3:2022
Q4:2022
Q1:2023
Q2:2023
Q3:2023
Q4:2023
Q1:2024
Q2:2024
Q3:2024
Q4:2024
Q1:2025
Total debt maturityRand equivalent – includes guaranteed debt in Hystead and 100% of Ikeja
31
Total debt (Rm)
R824m (Q1:2019) refinanced
for 3 years to 31 March 2022
Refinance in progress
32
31 Dec 2018
(Rm)
30 Jun 2018
(Rm)
South African debt 3 199 2 951
• Bank debt 600 600
• Corporate bonds 2 599 2 350
USD bank debt (Rand equivalent of Hyprop’s effective %) 4 744 4 513
EUR bank debt (Rand equivalent) 5 177 4 963
Cash and cash equivalents (893) (704)
Net borrowings 12 227 11 723
Loan-to-value 32.8% 31.2%
LTV calculationsWith recourse to Hyprop balance sheet
LTV calculations Comparison between Hyprop and Moody’s methodologies
33
Per
Balance Sheet
Moody’s
methodology
Hyprop
methodology
Per
Balance Sheet
Moody’s
methodology
Hyprop
methodology
Dec 2018 Dec 2018 Dec 2018 Jun 2018 Jun 2018 Jun 2018
Hyprop total assets 34 785 233 34 785 233 34 785 233 35 012 920 35 012 920 35 012 920
Financial asset - Hystead 176 473 176 473 152 556 152 556
Hystead total assets 13 941 899 13 217 510
Hystead NAV (total assets - in-country debt) x 60% 4 752 879 4 297 489
Total assets 34 961 706 48 727 132 39 714 585 35 165 476 48 230 430 39 462 965
Hyprop gross debt 8 403 239 8 403 239 8 403 239 7 884 994 7 884 994 7 884 994
Hystead gross debt 12 562 624 12 194 954
Hystead Debt guaranteed by all shareholders (gross) 6 542 190 6 352 742
Hystead Debt guaranteed by PDI (EUR 40m) (659 200) (640 128)
Security from PDI held by Hyprop (EUR 46.8m) (771 489) (748 950)
Total debt 8 403 239 20 965 863 13 514 740 7 884 994 20 079 948 12 848 659
Gross debt / total assets 24.0% 43.0% 34.0% 22.4% 41.6% 32.6%
Jun 2018 (R ‘000)Dec 2018 (R ‘000)
Hystead capital structure (€)
34
PDI
Dec 2018
€ m
HYPROP
Dec 2018
€ m
PDI
Dec 2018
%
HYPROP
Dec 2018
%
Debt guaranteed directly % 40 361 10 90
Adjusted for: 91 (91) 23 (23)
PDI - back to back security - UK Listed shares 47 (47) 12 (12)
Guarantee fee* 44 (44) 11 (11)
Subtotal 131 270 33 67
% Shareholding in Hystead (160) (241) (40) (60)
Perceived (under)/over-exposure (29) 29 (7) 7
Debt guaranteed directly* Guarantee fee
PDI
Dec 2018
%
% Shareholding in Hystead 40
Adjusted for direct guarantees and security: (22)
PDI - €40m direct guarantee to lenders (10)
PDI - €46.8m back to back security
- UK listed shares (12)
Unsecured portion 18
Guarantee fee (60% x 18.3%) (11)
Carry 7
241
160
60%
40%
100% 10%
12%
11%
67%
270
26 305* 25 520*
Equity bridgeHyprop group (Rm)
35
NAV
Jun 2018
Net operating
income
Africa
impairments
Property
re-valuations
Distributions
paid
Currency
translation Other
NAV
Dec 2018
* NAV excluding minorities
25 512 26 064
NAV bridgeHyprop & Hystead (Rm)
36
TNAV – R / share 101
LTV on property assets 25.2%
LTV on total assets 24.0%
TNAV – R / share 104
LTV on property assets 45.0%
LTV on total assets 43.1%
Hystead
Hyprop
NAV
Property
assets
Hystead
cash
Other
assets
In-country
finance
Equity
borrowings
Other
liabilities
Inter-group
eliminations
Aggregated
NAV
Investment profile
37
Core South African portfolio R29.7bn = 73%
Cap rates: 6.3% – 8.8%
Sub-Saharan Africa (excl. SA)Hyprop share R3.4bn
Cap rates: 7.8% – 9.0%
South-Eastern EuropeHyprop share R7.9bn
Cap rates: 7.0% – 9.3%
Totalportfolio R41bn
68% 4%
8%
19%
SA shopping centresSA value centres
SA standalone offices 1%
Outlook & Focus
38Woodlands, Pretorius Park, Pretoria East
Outlook & focus
39
• Reposition malls
• Partner with tenants
• Portfolio approach
• Reduce exposure
• Active asset management
• Strengthen the entertainment
and restaurants
• Secure rights for extensions
South Africa Sub-Saharan Africa (Excl. SA) South-Eastern Europe
Hyprop
• Strategy
• Review debt position
• Restore Moody’s investment grade
• Recycle capital to support growth
• Cash-backed distributions
• Long-term investment decisions
Questions & Answers
40Hyde Park Corner, Johannesburg
Appendices
41Rosebank Mall, Johannesburg
Aggregated Balance Sheet
42
Hyprop Group Hystead Group* Aggregated Hyprop Group incl Hystead**
Dec 2018
R000
June 2018
R000
Dec 2018
R000
June 2018
R000
Dec 2018
R000
June 2018
R000
Non-current assets 33 558 090 33 951 124 13 263 131 12 703 739 46 644 748 46 502 308
Investment property 31 303 632 30 854 277 13 193 168 12 676 758 44 496 800 43 531 035
Other property investments 2 054 164 2 918 721 - - 2 054 164 2 918 721
Other non-current assets 200 294 178 126 69 963 26 981 93 784 52 551
Current assets 1 403 616 1 214 350 678 768 512 699 1 991 283 1 650 565
Receivables and other current assets 502 494 498 858 172 641 106 232 584 033 528 607
Cash and cash equivalents 901 122 715 492 506 127 406 466 1 407 250 1 121 958
Total assets 34 961 706 35 165 475 13 941 899 13 216 438 48 636 031 48 152 873
Non-current liabilities 6 435 083 8 203 399 12 306 924 8 926 768 18 393 430 16 944 481
Borrowings – in-country 5 872 230 7 815 651 5 922 643 2 873 344 11 794 873 10 688 995
Borrowings – equity - - 5 717 950 5 550 277 5 717 950 5 550 277
Other non-current liabilities 562 853 387 748 666 331 503 146 880 607 705 209
Current liabilities 3 014 212 566 840 1 255 510 4 082 283 4 178 621 4 572 639
Borrowings – in-country 2 531 009 69 343 97 791 2 943 557 2 628 800 3 012 900
Borrowings – equity - - 824 240 800 070 824 240 800 070
Other current liabilities 483 203 497 497 333 479 338 656 725 581 759 669
Total liabilities 9 449 295 8 770 239 13 562 434 13 009 051 22 572 051 21 517 120
Net Assets 25 512 410 26 395 236 379 465 207 387 26 063 980 26 635 753
TNAV (Excl. - deferred tax, fin liab) 25 703 215 26 573 238 594 989 267 845 26 470 309 26 874 214
TNAV per share *** (Rands per share) 101 104 104 105
LTV (Borrowings/property assets) 25.2% 23.3% 45.0% 43.2%
LTV (Borrowings/total assets) 24.0% 22.4% 43.1% 41.6%
* Hystead Group excludes the financial liability and goodwill written off
** After elimination of inter-group balances
*** Based on 255 540 828 Hyprop shares in issue for distribution purposes
Balance sheet extracts
43
31 Dec 2018
(Rm)
30 Jun 2018
(Rm)
Change
(%)
Hyprop’s share
Investment property (South Africa) 29 479 28 785 2.4
Investments in sub-Saharan Africa
(excl. South Africa)3 422 4 470 (23.4)
South-Eastern Europe 4 148 3 843 7.9
Held-for-sale 206 199
Other assets (includes cash) 1 221 1 041
Total assets 38 477 38 338 0.4
Net borrowings 12 227 11 722 4.3
Guarantees on Balance Sheet
44
Details of movement in financial guarantees
Dec 2018
R000
Dec 2017
R000
Jun 2018
R000
Balance at beginning of the period 185 686 163 855 163 855
Net change 162 891 29 409 21 831
Recognition of new financial guarantees 196 565 41 393 33 815
Derecognition of expired guarantees (33 674) (11 984) (11 984)
Balance at end of period 348 577 193 264 185 686
Property valuations
45
31 Dec 2018
(USD million)
30 Jun 2018
(USD million)
Total value 550 638
Ikeja City Mall 121 151
AttAfrica & Manda Hill 429 487
Hyprop share 241 283
Rentable
area (m²) Value/m²
Cap rate
(%)
147 946 USD 3 715 7.5 – 9.0
Rentable
area (m²) Value/m²
Cap rate
(%)
241 326 EUR 3 309 6.9 – 9.2
31 Dec 2018
(EUR million)
30 Jun 2018
(EUR million)
Total value 799 740
Hyprop share 460 444
Sub-Saharan Africa (Excluding SA) South-Eastern Europe
Rand denominated debtSouth African portfolio
46
Maturity profile 31 Dec 2018 (years) 30 June 2018 (years)
Fixed rates and swaps 2.9 3.3
Facilities 3.3 3.8
% of debt fixed 101.6 113.6
Average cost of funding 9.5 9.4
358
650
425
317250
400452
348
0
200
400
600
800
Q1:2019
Q2:2019
Q3:2019
Q4:2019
Q1:2020
Q2:2020
Q3:2020
Q4:2020
Q1:2021
Q2:2021
Q3:2021
Q4:2021
Q1:2022
Q2:2022
Q3:2022
Q4:2022
Q1:2023
Q2:2023
Q3:2023
Q4:2023
Q1:2024
Q2:2024
Q3:2024
Q4:2024
Q1:2025
South African debt (Rm)
USD debtSub-Saharan Africa
47
Maturity profile 31 Dec 2018 (years) 30 June 2018 (years)
Fixed rates and swaps 2.0 2.4
Facilities 2.2 2.7
% of debt fixed 58.1 63.5
Average cost of funding 5.0 4.8
African debt ($m)
100
17
167
60
0
50
100
150
200
Q1:2019
Q2:2019
Q3:2019
Q4:2019
Q1:2020
Q2:2020
Q3:2020
Q4:2020
EUR debtSouth-Eastern Europe
48
Maturity profile 31 Dec 2018 (years) 30 June 2018 (years)
% of debt fixed 32.1 -
Average cost of funding 2.1 1.7
50
164
183
0
50
100
150
200
Q1:2019
Q2:2019
Q3:2019
Q4:2019
Q1:2020
Q2:2020
Q3:2020
Q4:2020
Q1:2021
Q2:2021
Q3:2021
Q4:2021
Euro Debt (€m) (only guaranteed loans)
Edcon exposure by brand
49
* Gross income (based on basic rental & operating cost)
Jet 0.8%
Boardmans 0.4%
River Island 0.3%
Edgars Beauty 0.2%
Edgars Cosmetics Gallery 0.2%
Top Shop 0.1%
J-Exchange/Free 2BU 0.1%
Edgars Active 0.1%
Dune 0.1%
Jigsaw, 0.1%
Accessorize 0.1%
La Senza 0.1%
Edgars 4.5%
Edcon Brands
% of total gross
income*
% of total
GLA
Edgars 4.46% 6.81%
Jet 0.77% 1.10%
CNA 0.55% 0.44%
Boardmans 0.36% 0.29%
River Island 0.27% 0.16%
Edgars Beauty 0.19% 0.10%
Edgars Cosmetics Gallery 0.17% 0.08%
Top Shop 0.13% 0.10%
J-Exchange/Free 2BU 0.10% 0.08%
Edgars Active 0.09% 0.05%
Dune 0.08% 0.02%
Jigsaw 0.06% 0.02%
Accessorize 0.06% 0.02%
La Senza 0.05% 0.02%
Salsa 0.04% 0.03%
Inglot 0.04% 0.01%
TM Lewin 0.03% 0.02%
Jo Malone 0.03% 0.01%
Edgars Office 0.03% 0.05%
Lipsy 0.03% 0.02%
Dr. Martens 0.03% 0.02%
MAC 0.02% 0.01%
Bobbi Brown 0.02% 0.01%
Total 7.62% 9.45%
CNA 0.5%
OperationsSouth Africa
50
Per month (R/m²)
4 004
3 6573 548
3 251
2 9452 836
2 6812 458
2 261
1 000
2 000
3 000
4 000
5 000
Hyde ParkCorner
CanalWalk
SomersetMall
ClearwaterMall
CapeGate RosebankMall
Woodlands AtterburyValue Mart
The GlenShoppingCentre
* Figures based on Jul – Dec yoy growth
Trading density*
1%
1%
1%0%
0%
3%
3%
0%0%
Average monthly foot count – millions / m²
12
10
12
10
1514
15
13
12
10
12
10
15
14
15
13
0
2
4
6
8
10
12
14
16
18
20
CanalWalk
ClearwaterMall
The GlenShoppingCentre
Woodlands CapeGate SomersetMall
RosebankMall
Hyde ParkCorner
YTD 2017 YTD 2018
1%0%
1%
4%
3%5%
1%
1%
Lease expiry profile
51
Retail
Expiring area
(m²)
% Rentable area
of centre
Clearwater 33 301 38
CapeGate Regional Mall 29 393 46
Canal Walk 23 105 16
Rosebank Mall 16 059 24
The Glen 14 697 18
Woodlands Boulevard 10 575 15
Somerset Mall 9 639 14
Hyde Park Corner 8 824 31
Atterbury Value Centre 6 675 14
Retail 152 268 23
Offices 6 604 15
Total 158 871 22
Expiring area
(m²)
% Rentable area
of centre
17 641 20
3 986 6
33 222 22
3 231 5
7 258 9
22 845 32
8 673 13
3 827 13
9 530 20
110 213 17
6 544 15
116 757 17
2019 / 2020 2018 / 2019
Trading performance
52
Primary categoryTrading density
growth% of
total turnover% of area
Department stores: Clicks, Dis-Chem, Edgars, Game, Woolworths (0.5) 27,1 25,3
Apparel (3,6) 18,8 21,3
Food/supermarket 1,4 11,5 10,6
Home furnishings 7,3 4,9 6,8
Speciality/toys (6,5) 5,4 6,5
Sporting/outdoor goods & wear 3,5 5,8 5,8
Food service 5,9 6,4 5,7
Entertainment/movies (1,3) 1,0 5,3
Electronic/photography/music/mobile 1,8 7,0 3,9
Shoes 2,9 2,0 2,1
Books/cards/stationery (1,3) 1,8 1,8
Health & beauty 0,8 2,4 1,6
Jewellery 1,1 2,7 0,9
Eyewear 2,3 1,0 0,6
Note: IPD/MSCI allocations
* Figures based on Jul – Dec yoy growth
Company structure South African portfolio
53
100% owned
Co-owned
Somerset MallClearwater Mall Hyde Park Corner
Rosebank Mall Woodlands Boulevard CapeGate
Atterbury Value MartOffices
Cradock Heights
Canal Walk (80%) The Glen (75,15%)
SOUTH
AFRICA
South African properties
54
Portfolio summary
Canal Walk &
Canal Walk
Offices
Clearwater
Mall
The Glen
Shopping Centre
Woodlands
Boulevard
CapeGate
Regional Mall
% Ownership 80% 100% 75.15% 100% 100%
GLA 158 750 87 060 80 431 71 624 63 832
Vacancy levels 0.5% 1.9% 3.7% 0.7% 0.0%
Avg foot count per m² / month 11.7 9.9 12.4 9.6 14.8
South African properties
55
Portfolio summary
Somerset
Mall
Rosebank
Mall
Hyde Park Corner
& Offices
Atterbury
Value Mart
Cradock
Heights
Rosebank Mall
Offices
% Ownership 100% 100% 100% 100% 100% 100%
GLA 69 018 65 836 38 771 48 641 4 468 18 249
Vacancy levels 0.1% 0.8% 6.7% 0% 30.4% 12.8%
Avg foot count per m² / month 13.6 15.2 12.7 - - -
100% owned
AttAfrica
(Mauritius)
Manda Hill
(Zambia)
Ikeja City Mall
(Nigeria)
Accra Mall
(Ghana)
West Hills Mall
(Ghana)
Achimota Retail Centre
(Ghana)
Kumasi City Mall
(Ghana)
37,5% 50% 75%
50%
Hyprop Investments Mauritius
47% 75% 75%45%
Company structure Sub–Saharan African
56
SUB-SAHARAN
AFRICA
Sub-Saharan Africa properties
57
Portfolio summary Accra Mall West Hills Mall Achimota Kumasi Manda Hill Ikeja City Mall
% Ownership 17.6% 16.8% 28.1% 28.1% 68.8% 75.0%
GLA m² 21 311 28 272 15 534 18 604 42 002 22 223
Vacancy levels 6.3% 15.6% 3.4% 12.7% 7.2% 3.1%
Avg foot count per m² / month 28 16 31 31 22 29
Company structure South-Eastern Europe portfolio
58
60%
owned
100% 100% 90%
Delta City
Belgrade
(Serbia)
Delta City
Podgorica
(Montenegro)
Skopje City Mall
(Macedonia)
The Mall
Sofia
(Bulgaria)
City Center
One - East,
Zagreb
(Croatia)
City Center
One - West,
Zagreb
(Croatia)
100% 100% 90%
Hystead Limited
(established in the UK)
SOUTH-
EASTERN
EUROPE
South-Eastern Europe properties
59
Portfolio summary
Delta City
Belgrade
Serbia
Delta City
Podgorica
Montenegro
Skopje
City Mall
Macedonia
The Mall
Sofia
Bulgaria
City Center
One East
Zagreb, Croatia
City Center
One West
Zagreb, Croatia
% Ownership 60% 60% 60% 60% 54% 54%
GLA 29 862 23 753 36 264 51 211 48 574 46 760
Vacancy levels 0% 0% 0% 0% 0.2% 0%
Avg foot count per m² / month 27 21 20 13 11 10
DisclaimerForward-looking statements
60
• This document contains forward-looking statements that, unless otherwise indicated, reflect the group’s
expectations as at 31 December 2018
• Actual results may differ materially from the group’s expectations if known and unknown risks or uncertainties
affect its business, or if estimates or assumptions prove inaccurate
• The group cannot guarantee that any forward-looking statement will materialise and, accordingly, readers are
cautioned not to place undue reliance on any forward-looking statements
• The group disclaims any intention and assumes no obligation to update or revise any forward-looking statement
even if new information becomes available as a result of future events or for any other reason, other than
as required by the JSE Listings Requirements
Contact detailsInvestor relations
61
Mobile: +27 82 497 9827
Tel: +27 10 003 0661
E-mail: [email protected]
Michèle Mackey