Octodec Investments Limited (JSE:OCT) News - Interim results for the six months ended 28 February 2022 OCTODEC INVESTMENTS LIMITED Incorporated in the Republic of South Africa Registration number: 1956/002868/06 JSE share code: OCT ISIN: ZAE000192258 (approved as a REIT by the JSE) Interim results for the six months ended 28 February 2022 Rental income R944.4 million (28 February 2021: R898.7 million) Up +5.1% Like-for-like rental growth 1.2% (28 February 2021: (8.5%)) Up >100% Distributable income after tax (REIT funds from operations) R211.8 million (28 February 2021: R199.1 million) Up +6.4% Distributable income per share 79.6 cents (28 February 2021: 74.8 cents) Up +6.4% Dividend per share 50.0 cents (28 February 2021: nil) Up >100% Net asset value (NAV) per share R23.10 (31 August 2021: R23.20) Down -0.4% Cash generated from operating activities before dividend payment R193.9 million (28 February 2021: R184.3 million) Up +5.2% Loan to value (LTV) 41.0% (31 August 2021: 43.2%) Down -5.1% All-in annual weighted average cost of funding 8.3% (31 August 2021: 8.5%) Down -20bps This short form announcement is the responsibility of the directors. This short form announcement is only a summary of the information in the full announcement and does not contain full or complete details. Copies of the full announcement may be requested at the company's registered office (elizeg@octodec.co.za) or the office of the sponsor (sponsor@javacapital.co.za), at no charge, during office hours, Monday to Friday. Any investment decisions made by shareholders and/or investors should be based on a consideration of the full announcement, released on the Stock Exchange News Service (SENS) on 10 May 2022, which may be downloaded from https://senspdf.jse.co.za/documents/2022/JSE/isse/OCT/HY2022.pdf The full announcement is also available on the Octodec Investments Limited website at https://octodec.co.za/wp-content/uploads/2022/05/Interim-Results-HY2022.pdf Octodec Investments Limited (Octodec or the company), its subsidiaries and associated company (the group) is a real estate investment trust (REIT) listed on the JSE Ltd (JSE) with a diversified portfolio of 254 residential, retail, office, industrial and specialised properties situated in the major metropolitan areas of Tshwane and Johannesburg. The portfolio, including an equity-accounted joint venture, has a lettable area of 1 591 673m2 and is valued at R11.0 billion. Dividends and review of results The steps taken in the prior year to retain cash have strengthened Octodec's financial position and enabled it to make a distribution to its shareholders. The board has therefore declared an interim dividend of 50.0 cents per share for the six months ended 28 February 2022 (28 February 2021: nil). % 28 February 28 February change 2022 2021 Revenue (R'000) 4.9 939 699 895 513 Basic and diluted earnings per share (cents) >100 89.9 (73.1) Headline and diluted headline earnings per share (cents) 4.7 120.4 115.0 Distributable earnings per share (cents) 6.4 79.6 74.8 Distribution per share (cents) >100 50.0 - Net asset value per share (Rand) (2.1) 23.1 23.6 Prospects Octodec has experienced an increase in residential leasing activity with reduced vacancies in the residential portfolio during February and March 2022. We believe this will positively impact the group's results in the second half of the year. Although there has been a continued downward resetting of rentals across the sectors, it is pleasing to see that, from an Octodec perspective, several renewals are being concluded at increased rentals. We continue to experience demand from large retailers for space in the Johannesburg and Tshwane CBDs. Octodec's office sector, predominantly occupied by parastatals and SMMEs, is stable, but we do not expect growth from this sector in the short-term due to the current oversupply of office space. Above-inflation increases in administered property costs and the limited ability to pass these increased costs on to tenants, remain a concern. At the same time, the local macro environment remains a cause for concern and, with GDP expected to grow at under 2% for the foreseeable future, we do not anticipate significant growth in rental income, while inflation is expected to increase, impacting costs and, ultimately, our net property income. Concerns around global inflation and rising interest rates continue to dominate economic forecasts, and the breakout of the war between Russia and Ukraine has created further uncertainty. Given the current weak economic environment and an uncertain political climate, the board will, at this stage, not be providing any guidance on distributable income and dividends for the second half of FY2022. Sharon Wapnick Jeffrey Wapnick Chairman Managing director 6 May 2022 OCTODEC INVESTMENTS LIMITED Incorporated in the Republic of South Africa Registration number: 1956/002868/06 JSE share code: OCT ISIN: ZAE000192258 (Approved as a REIT by the JSE) Registered address CPA House, 101 Du Toit Street, Tshwane 0002 Tel: 012 319 8781, e-mail: info@octodec.co.za Directors: S Wapnick (Chairman)(1), JP Wapnick (Managing Director)(2), A Vieira (financial director)(2), RWR Buchholz(4), DP Cohen(3), NC Mabunda(4), EMS Mojapelo(4), MZ Pollack(1), PJ Strydom(4), LP van Breda(4) (1) Non-executive director (2) Executive director (3) Lead independent director (4) Independent non-executive director Group company secretary Elize Greeff CPA House, 101 Du Toit Street, Tshwane 0002 Tel: 012 357 1564, e-mail: elizeg@octodec.co.za Sponsor Java Capital Contact person: Jean Tyndale-Biscoe 6th Floor, 1 Park Lane, Wierda Valley, Sandton 2196 PO Box 522606, Saxonwold 2132 Tel: 011 722 3061, e-mail: sponsor@javacapital.co.za Transfer secretaries Computershare Investor Services (Pty) Ltd Contact person: Leon Naidoo Rosebank Towers, 15 Biermann Avenue, Rosebank 2196 Private Bag X9000, Saxonwold 2132 Tel: 011 370 5000, e-mail: leon.naidoo@computershare.co.za Investor relations Instinctif Partners Contact person: Bryan Silke The Firs, 302 3rd Floor, Cnr Cradock and Biermann Road, Rosebank 2196 Tel: 011 447 3030, e-mail: investorrelations@octodec.co.za Auditors Ernst & Young Inc. Contact person: Gail Moshoeshoe 102 Rivonia Road, Sandton Private Bag X14, Sandton, 2146 Tel: 011 502 0601, e-mail: gail.moshoeshoe@za.ey.com Date of publication 10 May 2022 http://www.octodec.co.za Date: 10-05-2022 07:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.