Broadcast Type: Interview; Emira Property Fund, a real estate investment trust listed on the JSE, provided its half-year update for the first half of its new financial year ended September 2024, with CEO Geoff Jennett discussing the company's performance amid improved South African sentiment and interest rate cuts following the elections.
we continue this week with updates from our beloved j s e companies today at about eleven fifteen we got update emira from property fund limited there estate investment is a real trust listed on the j e they gave us their half s year update for the first half of their new year ended financial september twenty twenty four the line by joined on the company's c jeff general e o to take a look at company's performance the c if we can make of the business sense and some of the that have decisions taken place good evening geoff to speak to you lovely again you caught up in may and i and we are reflecting on full year results and it looked it was a good like strong year how the new year started has it started well me it's for interesting in terms of the position that we were in at the may where we hadn't end of had the elections south african the sentiment has definitely improved of in terms of hope and wishes at the south african environment is going to be better there's certainly been some interest rate world cuts throughout the so that is certainly also a nice bit of a starting tailwind from side the property and at emira we've been very busy in the last six months we've delivered our k p eyes on delivered increased per distributable income share slightly better dividend we've increased nav our our vacancies have improved and to sell we've managed a significant amount of properties locally here and managed to deploy them offshore an into investment into poland which we're very excited about geoff let's get into into poland that let's get and let's get into some the disposals of clearly there's movements been a lot of by way of acquisitions and disposals me through take just how the business is repositioned now from the last time you spoke and i so at the moment time that we spoke at the last we had us only our investment offshore which was about nineteen of our total percent assets and eighty-one percent local now that's changed in that we've still our us investments got which now because asset base of our being slightly higher that's sixteen now just percent in the u s and we've now got eleven percent sitting in poland that eleven percent and increase by another in ten percent by march of next year so the moment our at local or offshore exposure close to twenty seven is percent and to get up to thirty that's going seven percent the end of march by so that's a meaningful tvet when you've then got thirty seven of percent your portfolio sitting offshore earnings hard currency us dollars and euros and that's diversifier a meaningful when you compare that through to other players and removes that over reliance have on that we our south african portfolio are you feeling jeff how about the south african portfolio i mean as you said before around may we had the elections to contend then we've with since seen very little load shedding you and i have but just spoken about emira has been what doing on the green side of it how sa are you feeling about the portfolio at the moment feeling so we certainly much better than what we would have been feeling or like we were months ago feeling six vacancies have improved lowering of interest rate certainly helps us and helps our tenants less load shedding sort just gives a bit more of confidence in my tenants and in terms of ourselves investing into the economy so those are important and indicators so and we've seen that in terms of our our evaluations on local properties that now there's a with this positive sentiment there is a a better outcome hope for clearly the hard has to happen work still here in south africa but at least we're on we're on that path but better it hasn't the changes south africa here in haven't changed our trajectory we in that are are chasing our thirty-seven exposure percent offshore and we look at what our euro denominated returns are on our euro polish investment it's a twenty one percent euro denominated r seven i point two percent thirteen of income and to fourteen percent of capital growth can't get that i here in south africa i can't get that in the u s either and so from the business to chase side you need returns it in terms of where the are so until that that balance change and might and the returns offshore and then are less the risk proposition proposition and the return in south africa would then improve we would then and change that around geoff perhaps i can ask you this interest what is the with poland south african businesses there for have gone a variety of reasons set up retail whether to stores out property whether it's to build portfolios why poland of all of the european markets what's one so appealing about that ja so so if you look at the polish growth rate over the in g d p last twenty years it's percent per been six annum it's second only china over through to that twenty year period growing economy it's a it's the central distribution hub for the entire central and eastern and a bit of western europe its labour force is very well educated it's unemployment is low its base cost its labour force is cheaper than elsewhere and it's it's cost of development there much cheaper as is well so we are businesses move seeing out of other areas now while into poland we particularly like poland is of this because logistics sector focus to that we wanted sort of embark on and very we managed importantly to find a partner based that was in poland and that was absolutely to us key to have a partner on ground that is co the invested with us not earning that's fees or anything got but they've really skin in the game can run portfolio the for their own benefit and for hours and so it was a combination of those of all things and that's why gone into emira has poland why other people have there and gone they've done things differently the retail side certainly on i can't comment on but certainly that from our side it was economy it was the partner the sector it was the it was the healthy returns can get that we and the the cooperation planning that we're between us it looks like a good time to be in the right kinds of regions jeff before want to look i let you go i at distributable earnings slightly that's up under seven percent as a result of that the interim dividend is also up well but i imagine as it also just gives you a bit more comfort with business is where the sitting net asset value also per share increasing quite nicely everything kind of looking really better than it should have or than it was better and if we headline earnings look at per share that's a big difference from where it was the last period jimmy yes just to quickly just say on headline earnings per the share understand that also the capital gains includes which is why our nav went up and that's why we judge ourselves only on the distributable income and and nav and the dividend but you're right this has been a very good six months well and we're positioned in terms of growing from this base which we're pleased with and it's always i think a function of the hard work that you put in all the time eventually and hard work delivers success and that's we're starting to see now what freeing capital up some means you have the opportunity at to look more stuff are jeff you looking at stuff so we've got our second our polish tranche of investment which will take in our stake detail invest group from twenty five percent up to forty five percent need and that we to exercise and conclude before the end of march and our that's why in terms of disposal we've done that and exciting so that's and ja so so that's the thing that we're focussing only in on the moment a laser focus on how the going business is to reposition itself and continue to do well we wish you the best for the of luck rest of the year if we look forward to catching up of the year at the end or if you interesting in the do something that for meantime we'll leave it at now jeff thanks so much time and for the insights the who is that's jeff janet the c e o property of emira fund on their first six the new financial months of year and how they've reshaped the business when you're growing your money