Growthpoint withholds final dividend as Covid-19 prompts rising arrears
The group had to raise its provisions for bad debt and provided rental relief due to the effects of the pandemic
SA’s largest property group Growthpoint has deferred a decision on a final dividend as Covid-19 weighs on the outlook for local landlords.
The group, which has a stake in the V&A Waterfront, has seen a surge in arrears and provisions, saying a decision on a final dividend for its year to end-June may be made only in December as it assesses the fallout from the pandemic.
Distributable income per share decreased by 16.05% to 183.1c in the group’s year to end-June, with SA bad debt writeoffs and provisions rocketing to R236.5m, from R18.9m previously.
In SA, the group provided rental relief of R436.3m to its tenants with R158.8m in deferred rent and rental discounts of R277.5m.
“The effects of the pandemic have been devastating, impacting all three of our domestic businesses where property fundamentals were already weak,” the group said.
Growthpoint has opted not to give guidance for its 2021 financial year, saying its prospects “are inextricably linked to our operating environment”.
The non-payment of a final dividend brings its total dividend for the year to 106c, down 51.4% from the year-earlier period.
Growthpoint has a portfolio of 440 directly owned properties in SA, valued at R73.4bn.
The value of the group’s SA properties fell R7.1bn, or 8.8%, driven mainly by lower market rental growth assumptions due to a weak macroeconomic environment and the effect of Covid-19, the group said.
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