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Real Estate Investments Zambia PLC the leading property developer in Zambia listed on the Lusaka Stock Exchange has released its Full Year Results. Check out insights into this company in their presentation which appears below Sign up to receive email alerts on company news and daily share price from their company investor relations http://bit.ly/1sa2z3x
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Interim Results - 2014
Statement of results for Real Estate Investments Zambia PLC and its subsidiaries (“the Group”) for the six months ended
30th
June 2014
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME
K’ 000
6 months
to
30.06.2014
K’ 000
6 months
to
30.06.2013
Unaudited Unaudited
Turnover 19,101 22,509
Operating Profit before Finance Income /(Expense) 10,934 14,747
Interest expense on long term loans (3,838) (7,007)
Interest income 157 65
Profit before exchange gain/(loss) 7,253 7,805
Change in fair value of investment property 24,150 0
Exchange loss (6,739) (7,379)
Profit /(loss) from equity accounted investee (2,451) (511)
Profit/(Loss) before Taxation (attributable to
Shareholders)
22,213 (85)
Taxation (1,974) (1,803)
Profit/(Loss) after tax 20,239 (1,888)
Dividend on Ordinary shares (Kwacha per share)
- Interim
0
0
Headline Earnings per share (on Profit before
exchange gain/(loss)):
0.128
0.138
Earnings per share before tax: 0.393 (0.002)
Earnings per share after tax: 0.358 (0.033)
Weighted average number of ordinary shares
56,460,198
56,460,198
In compliance with the requirements of the Securities
(Registration of Securities) Rules, 1993, and the listing rules of
the Lusaka Stock Exchange, Real Estate Investments Zambia PLC
announces the results of the Group for the six months ended 30th
June 2014. These interim results are derived from the Group’s
management accounts, which have been approved by the
Directors, but have not been audited.
Group Performance
The Directors are pleased to present the Interim Results for the
period ending 30th June 2014. The Board reports that the Group’s
financial performance has been positively affected by the
revocation of Statutory Instrument No. 33 – The Bank of Zambia
(Currency) Regulation Number 33 of 2012. With the repayment of
a large part of the Group’s foreign exchange debt in 2013 the
charge for interest expense has been substantially reduced from
K7m in 2013 to K3.8m in 2014. The Kwacha has depreciated
during the first half of the year from K5.5185 at 31st December
2013 to K6.256 as at 30th June 2013, but seems to have settled at
the K6 - $1 range in the last months. The results therefore show a
year on year Profit before exchange losses of K7.25m against
K7.80m in 2013.
The policy of the Board in prior years in respect to International
Accounting Standard No. 40 has been to revalue properties on an
annual basis. However, with the dramatic depreciation of the
Kwacha in the six month reporting period the Directors
unanimously determined that an independent valuation of
Investment Properties should be undertaken as at 30th June 2014.
This was intended to match the valuation of Dollar denominated
liabilities to the valuation of the Group’s assets. As a result the
interim statement shows a revaluation of investment properties by
K24.15m and an exchange loss of (K6.74m) at 30/06/2014. The
Directors have resolved to consistently apply this policy in future
years.
Shareholders will also note the dramatic change in the income tax
expense between the 2013 financial year and the six months
results to June 2014. As explained in the 2013 Annual Report the
Government of the Republic of Zambia has introduced a ‘Final
Tax’ on Gross Rental Income at 10% of invoice value. This
resulted in the write back of deferred tax previously shown in the
Balance Sheet as liability and therefore a credit to the Income
statement of K76.85m. The income tax expense shown in the
2014 Interim Statement reflects the final 10% tax on rental
income with certain minor adjustments for income tax on separate
sources of revenue such as interest earnings.
Interim Dividend
In view of the foregoing, the Directors have resolved that the
Group defers the declaration of an interim dividend. The
Directors will review the results for the full year and will
recommend a final dividend that will take into account the
undeclared interim dividend on those results for approval by
Shareholders at the Annual General Meeting (AGM) that is
required to be held before the 31st March 2015. Shareholders are
alerted that the date of the AGM is set as 26th March 2015.
The Directors, therefore, wish to announce that no interim
dividend for the year ending 31st December 2014 has been
declared payable to Ordinary Shareholders as at the date of this
notice to the public.
STATEMENT OF FINANCIAL POSITION
K’ 000
30.06.2014
K’ 000
30.06.2013
Unaudited Unaudited
Assets
Plant and equipment 2,454 4,395
Investment property 359,268 439,988
Investment property under development 43,531 39,660
Lease straight-lining receivable 1,057 10,458
Other investments 13,703 9,464
Amounts due from equity accounted investee 13,587 11,549
Goodwill 32,607 32,607
Current assets 13,247 10,741
Total assets 479,454 558,862
Equity and liabilities
Total equity 389,212 272,788
Non-current liabilities 83,228 152,480
Deferred tax liabilities - 124,111
Current liabilities 7,014 9,483
Total equity and liabilities 479,454 558,862
BY ORDER OF THE BOARD SPONSORING BROKER
STOCKBROKERS ZAMBIA LIMITED
Sydney E Popota
Company Secretary
19th
September 2014
Robin P.S. Miller
Managing Director
Lusaka