Diversification pays off for Texton
Texton Property Fund has achieved strong dividend and net asset value growth thanks to its decision to diversify across assets in the UK and SA, according to CEO Angelique de Rauville.
The company announced robust results for the year to June, declaring a total dividend per share of R1.0363, up 9.4% year on year, while its property portfolio value grew 39.3% to R5.77bn.
De Rauville said Texton had had to deal with the fallout of the vote for the UK to leave the EU, and a slowing South African economy.
"We are encouraged by the stellar results, despite some unforeseen events in our operating environment.
"We are not aware of any direct negative impact from Brexit on our UK tenant base, given the strength of our covenants and long-term nature of our leases.
"In SA we continued actively managing the legacy portfolio, restructuring the business, disposing of non-core assets, and focusing on fewer, larger, better-quality assets with long-term leases," she said.
Texton's portfolio is geographically split by value between the UK, which accounts for 38.8%, and SA, which accounts for 61.2%.
The company increased the gross lettable area of its portfolio 22.6% to 427,831m² by acquiring six properties during the year, two of them in SA and four in the UK.
"In the next year we may move to being 50% invested in SA and 50% in the UK. I feel SA is overtraded at the moment, and we have found more growth potential in the UK recently," De Rauville said.
Texton had been attracted to industrial property opportunities in the UK.
"About 48% of our UK assets are in the industrial sector.
"Many of the tenants in these properties are net exporters and they have benefited from a weaker pound," she said.
De Rauville extended her contract as acting CEO to end-2016.
Chief operating officer Nic Morris will assume the role of MD from September 1, and take over as CEO from January 1 2017.
De Rauville will focus on the UK operations, where she is based.
Source: Business Day
Source: I-Net Bridge
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