Daily Star Reports on Resilient Achieving Impressive Results

JSE-listed real estate investment trust (Reit) Resilient has reported a dividend per share that exceeded expectations, reflecting an 8.4% increase year-on-year for the year ending 31 December 2024.

The company’s South African portfolio experienced a 7.5% uplift in net property income (NPI) for the year, achieved despite accelerated maintenance plans.

Listen: Sun International CEO discusses capex, Peermont initiatives, and sustainability

Retail

Retail sales saw a rise of 3.5% over the year, a feat accomplished despite construction and asset management activities at Boardwalk Inkwazi, Diamond Pavilion, Mahikeng Mall, and Tzaneng Mall.

Nevertheless, the lackluster performance in the mining sector, especially during the second quarter, adversely affected turnover at Kathu Village Mall, Northam Plaza, and Tubatse Crossing, as indicated in the group’s financial results.

Tubatse Crossing’s turnover was also affected by the closure of a 3,000m² Edgars in preparation for a new Checkers set to open in the third quarter of 2025. Meanwhile, Jabulani Mall reported a turnover increase of 13.6% following the launch of a franchised Pick n Pay store. The performance of Spar and the arrival of Unimart at Mams Mall contributed to the 13.1% turnover growth at this shopping center.

In the fourth quarter of 2024, retail sales rose by 5.5%, attributed to two-pot retirement withdrawals and the effects of Black Friday occurring right after payday, influencing December’s performance.

“The two-pot withdrawals late last year definitely boosted retail sales growth in October and November, but we anticipate a return to normalized retail sales growth rates in 2025,” states Stanlib portfolio manager for listed property, Ahmed Motara.

Read: Two-pot reform: Retrenched workers may access retirement funds

Average rentals for new leases and renewals rose by 6.1%. Resilient owns 27 retail centers providing a gross lettable area of 1.2 million square meters. As of December 2024, Resilient’s pro rata share of vacancies in its portfolio stood at 2%.

Offshore

The group’s offshore investments contributed positively to distributable earnings. Although the euro distribution per share from Lighthouse fell by 4.9% compared to the previous year, Resilient benefited from forward exchange contracts that resulted in a 4.1% increase in the rand-equivalent distribution per share.

Motara notes that the offshore portfolio also demonstrated strong operational metrics. “The income from our stake in Lighthouse has also exceeded our forecasts.”

Regarding the results, CEO Johann Kriek stated that ongoing asset management initiatives in the South African portfolio ensure its relevance and ability to meet the changing demands of its customers.

“The ongoing implementation of the Group’s energy strategy will significantly help in mitigating the impact of above-inflation electricity cost increases. Furthermore, consistent issues with water supply remain a concern, and progress is being made toward achieving 2.5 days of backup water storage at each of our shopping centers to manage this risk,” Kriek adds.

Read: V&A Waterfront shines, driving Growthpoint’s strong results

The Reit acknowledged that while utility and rate costs continue to rise at a pace exceeding inflation and the enforced escalations of 6.2%, Resilient’s energy strategy has been pivotal in containing electricity costs and lessening dependency on the grid. The positive effects of this strategy were particularly evident last year, as there was reduced load shedding compared to 2023.

“Resilient showcased impressive results and performance metrics across the board. They surpassed their revised earnings guidance, and the projection of 5.5% earnings growth for 2025 is still promising (and above the market average of approximately 3% to 4%), considering it’s based on a high base of 8.4% in 2024,” states independent property analyst, Keillen Ndlovu.

“Their portfolio is strong, well-occupied, meticulously maintained, and well-managed,” Ndlovu concludes.

Resilient’s share price

Follow Moneyweb’s comprehensive finance and business news on WhatsApp here.