Fountainhead Property reports income growth

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The property unit trust saw income increase from 619 million rand for the six months ended 31 March 2013 to 632 million rand in 2014.

“Fountainhead has declared a distribution of 29 cents per unit for the six months ended 28 February 2014. The core portfolio, excluding properties acquired, properties disposed of/to be disposed of or properties under development delivered contractual rental and net property income growth of 6.4 per cent and 7.3 per cent respectively,” [DATA FPT:Fountainhead Property Trust Management] said.

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“Vacancies in the office and industrial portfolios increased during the period. Rental reversions on lease renewals remained at similar levels when compared to the 2013 financial year. The retail portfolio tenant retention remains robust with 86 per cent of expired leases being renewed.”

However, operating profit decreased to 451 million rand in 2014 from 458 million rand in 2013 while profit for the period increased from 330 million rand to 785 million rand.

Headline earnings showed a decline from 364 million rand in 2013 to 341 million rand in 2014 and headline earnings per unit decreased from 31.31 cents to 29.37 cents.

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“Fountainhead expects to produce growth of seven per cent to eight per cent in income distributions from its current portfolio in the 12 months to 31 August 2014 compared with the annualised distribution for 11 months of 54.5 cents to 31 August 2013,” it said.

“Fountainhead has made meaningful progress on improving the quality of its portfolio through developments, acquisitions and planned disposals of non-core properties in 2014. While the trust will retain its emphasis on large retail assets, it will also pursue investments in other sectors where it is able to identify high quality growing income such as the Robor industrial property.”