Laurence Rapp. Picture: BUSINESS DAY
Laurence Rapp. Picture: BUSINESS DAY

Vukile Property Fund, the JSE-listed real estate investment trust (Reit) with interests in SA and Spanish malls, has warned its shareholders that its dividend will be slashed by nearly a third as the Covid-19 pandemic prevented the company’s tenants from trading in the early part of 2020.

The company, which has Laurence Rapp as its CEO, said on Friday that Vukile’s unbroken, 16-year record of dividend growth would end. In June, the company released preliminary financial results for the year to end-March. When it did so, it deferred its decision to pay a dividend or not.  

The company said that, as highlighted in its financial results for the year to end-March 2020, Vukile had grown its distributable income per share for the period by 3.2% compared with the year to end-March 2019.

“A decision on the final dividend for the 2020 year will be deferred until the publication of Vukile’s audited annual financial statements for financial year 2020, pending JSE feedback to the market on any potential amendments or rulings applicable to the Reit sector, following the broad industry consultation process currently underway,” it said.

The group’s audited financial statements will be published on August 31.

Reits are mandated to pay a minimum of 75% of their distributable income to shareholders each year.

Vukile and other Reits want a reprieve in terms of how much income needs to be paid as dividends and within what specific time period. To date no further feedback has been provided by the JSE, Vukile said.

In the absence of any amendments or rulings applicable to the Reit sector being announced prior to the release of Vukile’s audited financial statements, the Vukile board intends to pay out 75% of its distributable earnings for the 2020 financial year by way of a final dividend to meet the minimum distribution requirements.

This would enable Vukile to maintain its Reit status.

Accordingly, the final dividend is expected to be just more than 48.1c per share, bringing the total dividend for 2020 to 129c per share. The final dividend will be 28.9% lower than the previous period.

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