Liberty Two Degrees H1 revenue up 12.3%

Liberty Two Degrees, a prominent mall and office owner, saw its shares rise by a modest 1% following a significant 40% surge after news broke of a potential buyout offer from major shareholder Liberty. The proposed offer, priced at a premium, would result in L2D being consolidated within the greater Standard Bank Group and delisted from the JSC. Despite this development, Liberty Two Degrees recently released its interim results which showcased a 6.8% increase in its period, highlighting higher foot counts across its malls, reduced vacancies, and improved reversions in its retail portfolio. CNBC Africa's Fifi Peters sat down with Amelia Beattie, Chief Executive of Liberty Two Degrees, to delve deeper into these updates. Discussing the market's response to the potential buyout offer, Beattie expressed her satisfaction with the positive sentiment received from various stakeholders, including investors and shareholders. She emphasized that the market's lack of perceived risk regarding the deal closure was evident by the closing price aligning with the offer price, indicating strong confidence in the transaction's completion. Beattie reassured stakeholders that despite the shift to an unlisted space, the core focus on managing assets efficiently and effectively remains unchanged. Addressing the decision to depart from the JSC, Beattie attributed the move to the illiquidity of L2D's shares and the substantial discount at which they were trading compared to their perceived value. She stressed the board's belief that the assets were better suited for the unlisted space, aligning with the long-term strategic vision of the company. Regarding the total value of Liberty's offer, Beattie disclosed a figure of approximately two billion for the 40 percent stake in L2D. While negotiations are ongoing, this valuation sets the stage for future discussions and potential outcomes. Reflecting on Liberty Two Degrees' interim results, Beattie outlined a period marked by challenges such as load shedding, interest rates, and economic uncertainty. Despite these obstacles, the company achieved notable successes, with reported turnovers on the rise and flagship properties like Santon achieving record-high trading densities. Beattie attributed this resilience to the quality of the portfolio, exceptional customer experiences, and a dedicated team committed to delivering excellent results. In response to questions about consumer spending habits amid economic pressures, Beattie emphasized the allure of the mall experience in capturing a larger share of the consumer wallet. By offering compelling tenant mixes, engaging customer experiences, and unique attractions, L2D continues to draw in crowds and drive foot traffic to its properties. Beattie highlighted the improvement in reversions as a reflection of the trading density within the malls, with higher turnovers enabling tenants to afford increased rental rates. This positive trend signifies a promising outlook for future negotiations and rental uplifts within the retail portfolio. Despite challenges in the broader office market, Liberty Two Degrees has observed an uptick in occupancy within its office segment, particularly due to the ability to accommodate smaller tenants and a tailored approach to leasing strategies. This successful leasing model has contributed to the overall resilience of the office portfolio. As Liberty Two Degrees navigates potential transformative changes, including the buyout offer and delisting from the JSC, Beattie's leadership remains pivotal in steering the company through a dynamic market landscape. With a focus on operational excellence, strategic asset management, and creating exceptional retail and office environments, Liberty Two Degrees is poised to continue its growth trajectory and deliver value to stakeholders.