Emira Property Fund Limited (JSE:EMI) News - Unaudited Condensed Consolidated Interim Financial Results for 31 December 2021 and dividend declaration

EMIRA PROPERTY FUND LIMITED
Incorporated in the Republic of South Africa
(Registration number 2014/130842/06)
JSE share code: EMI    ISIN: ZAE000203063
JSE Bond Company Code: EMII
(Approved as a REIT by the JSE)
(“Emira” or “the Fund” or “the Company”)

UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL RESULTS FOR THE SIX MONTHS
ENDED 31 DECEMBER 2021 AND DIVIDEND DECLARATION

Nature of business

Emira is a diversified Real Estate Investment Trust (“REIT”), with a property portfolio of predominantly
South African assets, and a component of offshore assets in the USA. In line with its strategic
objectives, Emira’s property portfolio spans multiple sectors, namely office, retail, industrial and
residential. The Company is focused on growing the quality and value of its portfolio of property
investments, in order to sustain and enhance its distribution growth to shareholders.

Commentary

Distributable earnings for the six months ended 31 December 2021 has marginally decreased to
R329,2m. Emira’s Board of Directors (the “Board”) has approved the declaration of an interim dividend
of 56,59 cents per share for the six months to 31 December 2021 (December 2020: 52,00 cents) after
taking the adjustments into account to reflect the cash backed position. This is a period-on-period
increase of 8,8%. It is however noted that the declared December 2020 dividend was after the deferral
of 5,09 cents of the available cash backed dividend per share to the second half of the year. This was
because of the uncertainty at that stage on the future operational performance of Emira’s
investments. A similar deferral has not been deemed necessary for the current period.

The diversified nature of Emira’s investments, on both a sectoral and geographical basis, continues to
safeguard the Fund and despite the continued pressure on local property fundamentals the portfolio
performed above expectations. The “fourth wave” was expected to further slow down the recovery
of the local economy and while it did have some impact, it was pleasing to see that only minor
restrictions were placed on tenants’ businesses. The steady performance of the local industrial and
retail sectors has countered the strained office market, while the Fund’s exposure to the stable
economy of the United States of America has provided a buffer to the low growth South African
environment.

Although the Fund is unable to materially impact the macroeconomic environment in which it
operates, management’s approach is to continue to ensure the fundamentals are performed with
excellence.

Financial summary

The unaudited condensed consolidated interim financial results for the six months ended
31 December 2021, as compared to the six months ended 31 December 2020 (“comparative period”),
are set out below:

•     Directly held portfolio revenue decreased by 2,6% to R722 million compared to R741 million for
      the comparative period;
•     Portfolio operating profit decreased by 10,15% to R319 million compared to R355 million for
      the comparative period;
•     Headline earnings per share decreased by 28,5% to 57,29 cents compared to 80,12 cents for
      the comparative period;
•     Earnings per share increased by over 100% to 64,02 cents compared to (0,46) cents for the
      comparative period;
•     Net asset value per share increased by 4,4% to 1 540,5 cents compared to 1 475,3 cents for the
      comparative period;
•     Distributable earnings decreased by 1,3% to R329 million compared to R334 million for the
      comparative period; and
•     Dividend declared increased by 8,8% to 56,59 cents per share compared to 52,00 cents per
      share for the comparative period.

Dividend distribution declaration

The Board has approved, and notice is hereby given that, an interim gross dividend of 56,59 cents per
share has been declared (December 2020: 52,00 cents), payable to the registered shareholders of
Emira on Monday, 14 March 2022. In making its decision on whether to pay out a dividend and the
quantum thereof, the Board has assessed the Company’s solvency and liquidity position, taking into
account the Company’s current position together with forecasts.

The issued share capital at the declaration date is 522 667 247 listed ordinary shares. The source of
the dividend comprises net income from property rentals, income earned from the Company’s equity-
accounted investments, interest earned on loans receivable and interest earned on cash on deposit.

Last day to trade cum dividend                            Tuesday, 8 March 2022
Shares trade ex-dividend                                  Wednesday, 9 March 2022
Record date                                               Friday, 11 March 2022
Payment date                                              Monday, 14 March 2022

Share certificates may not be dematerialised or rematerialised between Wednesday, 9 March 2022
and Friday, 11 March 2022, both days inclusive.

In accordance with Emira’s status as a REIT, shareholders are advised that the dividend meets the
requirements of a “qualifying distribution” for the purposes of section 25BB of the Income Tax Act,
No. 58 of 1962 (“Income Tax Act”). Accordingly, qualifying distributions received by local tax residents
must be included in the gross income of such shareholders (as a non-exempt dividend in terms of
section 10(1)(k)(aa) of the Income Tax Act), with the effect that the qualifying distribution is taxable
as income in the hands of the shareholder. These qualifying distributions are, however, exempt from
dividend withholding tax in the hands of South African tax resident shareholders, provided that the
South African resident shareholders have provided the following forms to their Central Securities
Depository Participant (“CSDP”) or broker, as the case may be, in respect of uncertificated shares, or
the transfer secretaries, in respect of certificated shares:

a) a declaration that the dividend is exempt from dividends tax; and
b) a written undertaking to inform the CSDP, broker or the transfer secretaries, as the case may be,
   should the circumstances affecting the exemption change or the beneficial owner cease to be the
   beneficial owner, both in the form prescribed by the Commissioner for the South African Revenue
   Service. Shareholders are advised to contact their CSDP, broker or the transfer secretaries, as the
   case may be, to arrange for the abovementioned documents to be submitted prior to payment of
   the dividend, if such documents have not already been submitted.

Qualifying dividends received by non-resident shareholders will not be taxable as income and instead
will be treated as ordinary dividends but which are exempt in terms of the usual dividend exemptions
per section 10(1)(k) of the Income Tax Act. Any distribution received by a non-resident from a REIT
will be subject to dividend withholding tax at 20%, unless the rate is reduced in terms of any applicable
agreement for the avoidance of double taxation (“DTA”) between South Africa and the country of
residence of the shareholder. Assuming dividend withholding tax will be withheld at a rate of 20%, the
net amount due to non-resident shareholders will be 45,27200 cents per share. A reduced dividend
withholding tax rate in terms of the applicable DTA, may only be relied on if the non-resident
shareholder has provided the following forms to their CSDP or broker, as the case may be, in respect
of the uncertificated shares, or the transfer secretaries, in respect of certificated shares:

a) a declaration that the dividend is subject to a reduced rate as a result of the application of a DTA;
   and
b) a written undertaking to inform their CSDP, broker or the transfer secretaries, as the case may be,
   should the circumstances affecting the reduced rate change or the beneficial owner cease to be
   the beneficial owner, both in the form prescribed by the Commissioner for the South African
   Revenue Service. Non-resident shareholders are advised to contact their CSDP, broker or the
   transfer secretaries, as the case may be, to arrange for the abovementioned documents to be
   submitted prior to payment of the dividend if such documents have not already been submitted,
   if applicable.

Local tax resident shareholders as well as non-resident shareholders are encouraged to consult their
professional advisors should they be in any doubt as to the appropriate action to take.

The Company’s tax reference number is 9995/739/15/9.

Short form announcement

This short form announcement is the responsibility of the Board, is only a summary of the information
in the full announcement and therefore does not contain full or complete details. Any investment
decisions by investors and/or shareholders should be based as a whole on consideration of the
unaudited condensed consolidated interim financial results for the six months ended 31 December
2021 which was released on SENS and may be downloaded from
https://senspdf.jse.co.za/documents/2022/jse/isse/EMIE/Interims21.pdf
or may be requested via email from sponsor@questco.co.za. The full announcement is also available
on the Company’s website at: https://emira.co.za/financial-reporting/

Registered office: 1st Floor, Block A, Knightsbridge, 33 Sloane Street, Bryanston, 2191

Bryanston
16 February 2022

Sponsor
Questco Corporate Advisory Proprietary Limited
Ground Floor, Block C, Investment Place, 10th Road, Hyde Park, 2196

Debt Sponsor
Rand Merchant Bank (a division of FirstRand Bank Limited)

Date: 16-02-2022 11:40:00
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