Try our mobile app
HYPROP INVESTMENTS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1987/005284/06)
JSE share code: HYP
ISIN: ZAE000190724
JSE bond issuer code: HYPI
(Approved as a REIT by the JSE)
(“Hyprop” or “the Company” or “the Group”)
PRE-CLOSE OPERATIONAL UPDATE AND CHANGES TO THE BOARD OF DIRECTORS
Hyprop continues to create spaces for people to connect by owning and managing dominant retail centres in
mixed-use precincts in key economic nodes in South Africa (SA), Eastern Europe (EE) and sub-Saharan Africa
(SSA). Our multi-skilled diverse team practices conscious retail, underpinned by a sustainable business model,
meaningful social impact and a robust governance framework to create long-term value for all our
stakeholders.
Further to the publication of Hyprop’s Interim Results for the six months ended 31 December 2021 on
17 March 2022, the Company hereby provides an operational update.
BALANCE SHEET AND CAPITAL MANAGEMENT
The disposal of Delta City Mall in Podgorica, Montenegro was successfully implemented in May 2022. The
net proceeds were used to settle €70 million of the Group’s Euro-denominated equity debt. This, together with
other debt repayments, has reduced Hyprop’s Euro denominated equity debt from €373 million at 31
December 2021 to €110 million currently. The in-country Euro debt was reduced from €365 million in June
2021 to €285 million. The net result is the creation of circa €180 million of equity in the EE portfolio.
Rand debt has increased from R5.1 billion at 31 December 2021 to R6.4 billion on 31 May 2022, following
the acquisition of the four EE assets from Hystead and settlement of the purchase price of €173 million.
There has been no change in the US dollar debt in Ikeja City Mall, save for the capitalisation of interest on the
bank loan due to the ongoing US dollar illiquidity in Nigeria.
The current consolidated Group LTV is circa 40%.
SOUTH AFRICA PORTFOLIO
The first Zara and Ted Baker stores in our portfolio opened at Canal Walk. Two new concept stores,
Woolworths’ quick service restaurant NOW NOW and Retail Box, the first bricks and mortar store of this
online retailer, also opened in the centre. Zara’s new store features the latest digital innovations that fully
integrate Zara’s in-store and online shopping experiences. Pringle, Exclusive Books, and the Lacoste and
Totalsports combo stores were relocated and upgraded to the latest specification, and Clicks has been fully
refurbished.
CapeGate’s Checkers was upgraded to the latest FreshX specifications, which includes a Starbucks, and a
Western Cape Blood Services opened to improve the centre’s service offering. Somerset Mall continues to
trade well and remains fully let.
Rosebank Mall’s tenant mix was improved with the addition of an iStore for new products (to complement its
pre-owned store) and TechMarkit, providing a wider range of technology offerings. Exclusive Books was
relocated and upgraded with an in-store Vida E Caffè overlooking the pedestrian walkway in Rosebank. The
tenant offering at Hyde Park Corner was improved with the addition of George’s Grill (a new steakhouse),
Page 1 of 7
Skins (a high-end cosmetics brand) and Calvin Klein. Clearwater’s food court revamp commenced on 20 June
2022 and new Pep Home and Studio 88 stores opened.
The reconfiguration of the upper level at The Glen will be completed in the third quarter of 2022 and will
improve the value offering of the mall with an upgraded HiFi Corporation store as well as Crazy Plastics and
Crazy Pets stores. In line with the Group’s environmental sustainability strategy, propelair toilets have been
installed at the Rosebank Mall Precinct and Hyde Park Corner.
Total for
the
Trading Metric Year Jan Feb Mar Apr May
5-month
period
2020 1 626 124 1 520 831 1 358 796 334 923 1 141 803 5 982 477
Tenant Turnover
2021 1 307 880 1 400 233 1 531 214 1 510 616 1 683 220 7 433 163
(R'000)
2022 1 665 063 1 572 531 1 730 562 1 841 348 1 811 959 8 621 464
Variance % 2021vs 2020 -19.6% -7.9% 12.7% 351.0% 47.4% 24.3%
Variance % 2022 vs 2021 27.3% 12.3% 13.0% 21.9% 7.7% 16.0%
2020 2 816 2 641 2 364 1 896 2 511 2 535
Trading Density (R) 2021 2 328 2 491 2 728 2 698 2 990 2 647
2022 2 898 2 746 3 047 3 248 3 185 3 024
Variance % 2021vs 2020 -17.3% -5.7% 15.4% 42.3% 19.1% 4.4%
Variance % 2022 vs 2021 24.5% 10.2% 11.7% 20.4% 6.5% 14.2%
2020 6 986 6 527 5 653 2 024 4 192 25 382
Foot Count ('000) 2021 5 424 5 256 5 751 5 248 5 810 27 489
2022 6 219 5 534 6 084 5 990 6 024 29 851
Variance % 2021vs 2020 -22.3% -19.5% 1.7% 159.2% 38.6% 8.3%
Variance % 2022 vs 2021 14.7% 5.3% 5.8% 14.1% 3.7% 8.6%
2020 1.7% 1.8% 2.0% 2.2% 2.3% -
Retail Vacancy (%) 2021 3.1% 2.6% 2.8% 2.8% 2.6% -
2022 1.9% 1.4% 1.5% 1.6% 1.4% -
2020 278 320 321 933 223 520 120 087 142 934 1 086 793
Collections (R'000) 2021 210 521 253 561 259 608 295 323 228 966 1 247 979
2022 229 561 271 178 284 008 301 862 230 535 1 317 144
Variance % 2021vs 2020 -24.4% -21.2% 16.2% 145.9% 60.2% 14.8%
Variance % 2022 vs 2021 9.0% 7.0% 9.4% 2.2% 0.7% 5.5%
Certain prior period amounts have been updated with the most recent information received.
Retail vacancies (1.4% at 31 May 2022) improved over the period and the trading of our entertainment tenants
has shown a marked improvement.
EASTERN EUROPE
All Covid-19 restrictions in the EE portfolio were lifted from mid-March 2022 (including the mandatory
wearing of masks), since which significant improvements in turnover, trading density and footfall were
experienced. Recent performance is in-line with pre-Covid levels.
Page 2 of 7
The two-year refurbishment project at Skopje City Mall was completed in May 2022 (including the upgrade
of bathrooms and the food court, relocation and right sizing of tenants, vertical transport improvements, and
upgrades of external terraces, internal pause areas and signage). The introduction of the largest outdoor
playground with landscaped gardens in North-Macedonia was welcomed by the Skopje community and serves
as a space where people connect and share experiences. The upgrade of the bathrooms at The Mall, in Sofia,
has commenced and will be completed by Q2 2023.
Intimissimi, N Fashion and Amanti Pasta Bar opened at Skopje City Mall. The Mall, in Sofia, secured Ikigai
(a new restaurant), Salad Box, Next Kids, 1001 Pantofki, Al Amar perfumes and AC&Co as new tenants.
We are closely monitoring any potential impact of the Ukrainian / Russian war. Currently there is no direct
impact, however, the increased costs of electricity and fuel may have an impact on retail spend and tenant
occupancy costs, while some tenants are cautious about expanding their businesses at this time.
Total for
the 5-
Trading Metric Year Jan Feb Mar Apr May
month
period
2020 37 071 32 881 18 520 5 558 21 149 115 179
Tenant Turnover (€'000) 2021 28 146 31 064 30 387 29 893 38 747 158 237
2022 32 538 30 115 34 200 41 201 44 599 182 654
Variance % 2021vs 2020 -24.1% -5.5% 64.1% 437.9% 83.2% 37.4%
Variance % 2022 vs 2021 15.6% -3.1% 12.6% 37.8% 15.1% 15.4%
2020 226 201 115 192 133 170
Trading Density (€) 2021 232 191 185 182 236 204
2022 194 180 205 246 266 218
Variance % 2021vs 2020 2.9% -5.3% 60.6% -5.0% 77.7% 19.7%
Variance % 2022 vs 2021 -16.4% -5.7% 10.6% 35.1% 13.0% 7.1%
2020 2 432 2 261 1 203 361 1 058 7 316
Foot Count ('000) 2021 1 591 1 804 1 751 1 641 2 008 8 795
2022 1 821 1 713 1 948 2 082 2 262 9 825
Variance % 2021vs 2020 -34.6% -20.2% 45.5% 354.1% 89.7% 20.2%
Variance % 2022 vs 2021 14.4% -5.0% 11.2% 26.9% 12.6% 11.7%
2020 0.2% 0.3% 0.3% 0.6% 1.3% -
Vacancy (%) 2021 0.4% 1.2% 1.0% 0.5% 0.4% -
2022 0.3% 0.4% 0.4% 0.4% 0.8% -
2020 8 486 6 374 4 709 1 863 2 545 23 977
Collections (€'000) 2021 5 380 5 941 6 216 5 320 5 996 28 853
2022 7 287 7 589 7 534 7 040 7 134 36 584
Variance % 2021vs 2020 -36.6% -6.8% 32.0% 185.6% 135.6% 20.3%
Variance % 2022 vs 2021 35.5% 27.7% 21.2% 32.3% 19.0% 26.8%
Certain prior period amounts have been updated with the most recent information received.
With a low vacancy rate of only 0.8% it is evident that the centres have retained their dominance in the
respective regions.
Page 3 of 7
SUB-SAHARAN AFRICA (EXCLUDING SOUTH AFRICA)
In Nigeria and Ghana, most of the Covid-19 restrictions have been lifted, reduced or cancelled, allowing
restaurants and cinemas to operate at full capacity.
Ikeja City Mall, the premier shopping destination in Lagos, remains fully let, with a waiting list of strong
prospective tenants. The anchor tenant, Shoprite, has signed a US dollar referenced lease on 5 000m² for a
further five years, and customers are eagerly awaiting the opening of the new 900m² Nike store in August
2022. The centre’s restroom facilities will be upgraded early in the new financial year. The lack of US dollar
liquidity remains a challenge in the country, preventing the payment of interest on US dollar debt and interest
or dividends to shareholders.
At Accra Mall, Levi's, FastForward, Yves Rocher, Celio, Clarks and Royal Rose (fine dining Chinese
restaurant) opened in the second half of the financial year, further improving the tenant mix. Several exciting
new tenants are expected to open before the end of the calendar year.
New tenants in West Hills Mall include Maydan Home Décor, Motion Furniture, Unique Collections and
Madagastar E-gaming. These additions to the tenant mix follow the opening of DoK Shoes, Nat-1 (health and
beauty), Sonotech Medical Diagnotics Centre and Jays Auto Spa Carwash earlier in the financial year.
At Kumasi City Mall, P2Lounge and Oregano (both restaurants) and Mac Cosmetics are the latest additions
to the tenant mix, with Gamel Clothing, Spendstree Photos and Kent’s Cup expanding into bigger shops.
Turnover and trading density in Ghana have been affected by the 36% depreciation of the Ghanaian Cedi
against the US dollar since 30 June 2021. Despite this, footcount for the whole portfolio remained largely flat
year-on-year and collections have been robust throughout the period. Vacancy levels have reduced from 11.7%
to 10.9% over the past twelve months as a result of focused asset management. We are closely monitoring the
impact of the Cedi depreciation on rentals, collections and occupancy rates.
Total for
Performance measure Year Jan Feb Mar Apr 4-month
period
2020 44 978 40 810 45 324 24 085 155 196
Turnover (GHC'000) 2021 45 694 42 291 46 907 45 589 180 481
2022 50 239 44 783 50 002 48 879 193 903
Variance % 2021 vs 2020 1.6% 3.6% 3.5% 89.3% 16.3%
Variance % 2022 vs 2021 10.0% 5.9% 6.6% 7.2% 7.4%
2020 7 986 7 465 8 003 4 161 27 616
Turnover (US$’000) 2021 7 771 7 267 8 092 7 817 30 948
2022 7 964 6 445 6 622 6 175 27 205
Variance % 2021 vs 2020 -2.7% -2.6% 1.1% 87.9% 12.1%
Variance % 2022 vs 2021 2.5% -11.3% -18.2% -21.0% -12.1%
2020 1 064 956 1 390 758 1 042
Trading Density (GHC) 2021 1 309 1 185 1 275 1 234 1 256
2022 1 135 1 063 1 205 1 170 1 143
Variance % 2021 vs 2020 22.9% 23.9% -8.3% 62.8% 20.5%
Variance % 2022 vs 2021 -13.2% -10.3% -5.5% -5.2% -9.0%
Page 4 of 7
2020 189 175 245 131 184
Trading Density (US$) 2021 223 204 220 212 215
2022 180 153 160 148 160
Variance % 2021 vs 2020 17.8% 16.4% -10.4% 61.5% 16.9%
Variance % 2022 vs 2021 -19.1% -24.9% -27.5% -30.2% -25.6%
2020 2 226 1 862 1 844 1 123 7 056
Footcount (Ikeja incl.) ('000) 2021 2 142 1 782 1 907 1 825 7 657
2022 2 134 1 783 1 838 1 851 7 606
Variance % 2021 vs 2020 -3.8% -4.3% 3.4% 62.5% 8.5%
Variance % 2022 vs 2021 -0.4% 0.0% -3.6% 1.4% -0.7%
2020 12.2% 12.7% 12.9% 12.8%
Vacancy (Ikeja incl.) (%) 2021 11.0% 11.1% 11.6% 11.7%
2022 11.3% 11.0% 11.4% 10.9%
2020 3 878 3 243 3 142 2 384 12 647
Collections (Ikeja incl.)
2021 3 083 2 801 3 437 2 796 12 117
(US$'000)
2022 3 535 3 330 3 262 3 968 14 095
Variance % 2021 vs 2020 -20.5% -13.6% 9.4% 17.3% -4.2%
Variance % 2022 vs 2021 14.6% 18.9% -5.1% 41.9% 16.3%
Certain prior period amounts have been updated with the most recent information received.
Hyprop and Attacq have reduced the bank debt in the Ghana portfolio by a combined US$ 5 million in March
2022, in order to degear the portfolio. We are proactively working on extending the term of the bank debt that
expires in tranches between December 2022 and February 2023 with the incumbent lender who is willing to
extend all facilities.
Hyprop will continue to pursue the exit strategy for its SSA assets while driving value creation through active
asset and property management initiatives. Implementation of the sale of Ikeja City Mall is delayed due to the
US$ liquidity crisis in Nigeria, however, we are making progress on this transaction and the disposal of the
remaining three Ghanaian assets.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG)
We have done an in-depth double materiality analysis on the impact of all ESG factors on our business for our
SA portfolio and will expand this to include our EE portfolio. Through this we have developed a sustainability
framework and revised the UN Sustainable Development Goals (SDGs) that we have committed to, being
SDG 6, 7, 8, 11 and 12. These SDGs are a reminder of how our operations can impact some of the world’s
biggest challenges.
Our sustainability framework is built around three pillars, each of which are linked to the SDGs we have
committed to:
• Creating spaces and connecting people;
• Partnering for climate resilience; and
• Inclusivity across our value chain.
Page 5 of 7
CHANGES TO THE BOARD AND BOARD COMMITTEES
BOARD
Stewart Shaw-Taylor, who is due to retire by rotation at Hyprop’s 2022 annual general meeting, has informed
the board of directors of the Company (the Board) that he does not intend to offer himself for re-election at
that meeting. He will remain as a non-executive director and a member of the board committees on which he
serves until the annual general meeting.
The Board thanks Stewart for his considerable contribution to the Company and wishes him well in his future
endeavours.
Richard Inskip has been appointed as an independent non-executive director with effect from 1 July
2022. Richard has 35 years of experience as a Senior Executive / Board Director in the Retail and Retail
Financial Services industries. While he was based in South Africa for the majority of his career, he has
worked in the United Kingdom, Australia and multiple African countries. Richard was previously the Chief
Operating Officer of the Massmart Group.
The Board welcomes Richard and looks forward to his contribution.
Richard’s appointment is in terms of Hyprop’s board nomination policy and succession planning.
COMPOSITION OF THE BOARD COMMITTEES
Hyprop has reconstituted its Board committees with effect from 1 July 2022 as follows:
1. The Audit and Risk Committee will continue to comprise Mr T Mokgatlha (Chairman), Mr S Shaw-
Taylor, Ms Z Jasper, Ms A Dallamore.
2. The Nomination Committee will comprise Mr G Tipper (Chairman), Mr S Shaw-Taylor, and new
appointments Messrs S Noussis and R Inskip.
3. The Remuneration Committee will comprise Mr S Shaw-Taylor (Chairman), Mr G Tipper, and new
appointments Messrs S Noussis and R Inskip. Mr T Mokgatlha is stepping down from the Remuneration
and Nomination committees due to other commitments and the Board thanks him for the contribution he
made.
4. The Social and Ethics Committee will comprise Ms N Mandindi (Chairperson), Messrs B Till and M
Wilken, and new appointment Ms Mzobe.
5. The Investment Committee will comprise Mr G Tipper (Chairman), Messrs S Shaw-Taylor, K Ellerine, S
Noussis, M Wilken, W Nauta, and new appointments Mr L Dotwana and Ms B Mzobe. Ms A Dallamore
will step down as a member of the committee but will attend meetings where information technology
matters are considered.
IN CLOSING
We are confident that the Group’s strategy remains relevant, and will continue to focus on the following:
1. Strengthening of the balance sheet by:
• Reducing the Euro debt;
• Exiting sub-Saharan Africa (excluding South Africa); and
• Recycling assets that do not accord with the Group’s long-term strategy.
2. Securing new growth opportunities;
Page 6 of 7
3. Repositioning the SA portfolio for sustainable growth;
4. Increasing the dominance of the properties in the Eastern European portfolio; and
5. Pursuing the non-tangible asset strategy.
Hyprop’s annual results for the year ended 30 June 2022 are scheduled to be released in late September 2022.
Hyprop will hold a virtual presentation at 14:00 this afternoon to discuss this operational update. Please contact
Lizelle du Toit at lizelle@hyprop.co.za should you wish to join the presentation. A recording of the
presentation will be available on Hyprop’s website thereafter.
29 June 2022
Sponsor
Java Capital
Page 7 of 7
