Resilient Property Income Fund. Picture: SUPPPLIED
Resilient Property Income Fund. Picture: SUPPPLIED

Resilient, which owns Amanzimtoti’s Galleria Mall, says distributions to shareholders for the year to end-June will probably be at the lower end of its previous guidance because of Edcon’s woes.

Edcon’s Edgars chain plans to close two stores in Resilient’s portfolio, the landlord said on Tuesday. National tenants plan to take up this space at higher rentals, it said.

But with effect from April, Resilient said it would only include 59.1% of its basic rental on Edgars, Edgars Beauty and Jet stores in its distributable earnings.

That would result in an R11.1m reduction in Resilient’s distributable earnings for the 2019 financial year, the landlord said.

"Distribution is now expected to be at the lower end of guidance," Resilient said.

At the half-year mark, the group said it expected to pay distributions of between 530c and 550c a share for the year to end-June.

Resilient added on Tuesday that earnings were being dented by higher costs for repairs and maintenance of electrical items because of Eskom’s power cuts. It added that no fees from trading or development profits were included in distributable earnings.

The group said it expected a positive revaluation of its SA property portfolio. It also expected its loan-to-value ratio to be below 30% at the end of June.

"Under challenging market conditions, Resilient’s shopping centres continue to trade well and vacancies in the SA portfolio remain below 2%."

Resilient’s shares were 0.7% down at R61.60 in early afternoon trade on Tuesday.

hedleyn@businesslive.co.za