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Short-Form Announcement: Reviewed Financial Results And Dividend Declaration For The Year Ending 29 February 2020
SPEAR REIT LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 2015/407237/06)
Share code: SEA
ISIN: ZAE000228995
Approved as a REIT by the JSE
(“Spear” or “the Company”)
SHORT-FORM ANNOUNCEMENT: REVIEWED FINANCIAL RESULTS AND DIVIDEND
DECLARATION FOR THE YEAR ENDING 29 FEBRUARY 2020
1. SALIENT FEATURES
Distributions per share increased by 6.06% to 91.66 cents per share, from 86.42 cents
per share in the prior corresponding period.
Management has successfully renewed/re-let 113 551m2 at a positive reversion of 1.95%.
Net asset value per share increased by 0.49% to 1221 cents per share, from 1215 cents
per share in the prior corresponding period.
Portfolio occupancy rate of 97.12% and 100% Western Cape based.
Investment property value increased 9.78% to R4.18 billion, from R3.81 billion in the prior
corresponding period.
Loan to Value increased by 2.09% to 39.63%, from 38.82% reported at 28 February 2019.
Revenue increased by 21.27% to R527 million, from R435 million in the prior
corresponding period.
Headline earnings per share increased by 12.67% to 99.09 cents per share, from 87.95
cents per share in the prior corresponding period.
Earnings per share decreased by 31.02% to 103.37 cents per share, from 149.86 cents
per share in the prior corresponding period.
2. DIVIDEND DECLARATION
The directors resolved to declare a final gross dividend of 47.01759 cents per share from
income reserves in respect of the financial year ending 29 February 2020. The dividend
amount, net of South African dividend tax of 20%, is 37.61408 cents per share for those
shareholders who are not exempt from dividend withholding tax or are not entitled to a
reduced rate in terms of the applicable double-tax agreement. The number of ordinary
shares in issue at the declaration date is 205 776 521 and the income tax number of the
Company is 9068437236.
The salient dates of the dividend declaration are:
Declaration date Wednesday, 14 May 2020
Last day to trade cum dividend Tuesday, 02 June 2020
Trading ex-dividend commences Wednesday, 03 June 2020
Record date Friday, 05 June 2020
Date of payment Monday, 08 June 2020
Share certificates may not be dematerialised or rematerialised between Wednesday, 03
June 2020 and Friday, 05 June 2020, both days inclusive.
Tax implications
As Spear is a REIT, the distribution meets the definition of a ‘qualifying distribution’ for the
purposes of section 25BB of the Income Tax Act, No. 58 of 1962 (Income Tax Act).
Qualifying distributions received by South African tax residents will form part of their gross
income in terms of section 10(1)(k)(i)(aa) of the Income Tax Act. Consequently, these
distributions are treated as income in the hands of the shareholders and are not subject
to dividends withholding tax. The exemption from dividends withholding tax is not
applicable to non-resident shareholders, but they may qualify for relief under a tax treaty.
South African tax residents
The dividend received by or accrued to South African tax residents must be included in
the gross income of such shareholders and will not be exempt from income tax (in terms
of the exclusion to the general dividend exception, contained in paragraph (aa) of section
10(1)(k)(i) of the Income Tax Act, because it is a dividend distributed by a REIT. The
dividend is exempt from dividend withholding tax in the hands of South African tax resident
shareholders, provided that the South African resident shareholders provide the following
forms to the Central Securities Depository Participant (“CSDP”) or broker in respect of
uncertificated shares, or to the company, in respect of certificated shares:
a) a declaration that the dividend is exempt from dividend tax; and
b) a written undertaking to inform the CSDP, broker or the company, should the
circumstances affecting the exemption change or the beneficial owner cease to be the
beneficial owner, both in the form prescribed by the Commissioner for the South
African Revenue Service.
Shareholders are advised to contact their CSDP, broker or the company to arrange for
the above-mentioned documents to be submitted prior to payment of the dividend, if such
documents have not already been submitted.
Non-residents shareholders
Dividends received by non-resident shareholders will not be taxable as income and
instead will be treated as an ordinary dividend which is exempt from income tax in terms
of the general dividend exemption in section 10(1)(k)(i) of the Income Tax Act. It should
be noted that up to 31 December 2013, dividends received by non-residents from a REIT
were not subject to dividend withholding tax. Since 1 January 2014, any dividend received
by a non-resident from a REIT will be subject to dividend withholding tax at 20%, unless
the rate is reduced in terms of any applicable agreement for the avoidance of double
taxation (“DTA“) between South Africa and the country of residence of the shareholder
concerned. Assuming dividend withholding tax will be withheld at a rate of 20%, the net
dividend amount due to non-resident shareholders is 37.61408 cents per share. A
reduced dividend withholding rate in terms of the applicable DTA may only be relied on if
the non-resident shareholder has provided the following form to their CSDP or broker in
respect of uncertificated shares, or the company, in respect of certificated shares:
a) a declaration that the dividend is subject to a reduced rate as a result of the application
of DTA; and
b) a written undertaking to inform their CSDP, broker or the company, should the
circumstances affecting the reduced rate change or the beneficial owner cease to be
the beneficial owner, both in the form prescribed by the Commissioner for the South
African Revenue Service.
Non-resident shareholders are advised to contact their CSDP, broker or company to
arrange for the above-mentioned documents to be submitted prior to payment of the
dividend, if such documents have not already been submitted.
Holders of uncertificated shares have to ensure that they have verified their residence
status with their CSDP or broker. Holders of certificated shares will be asked to complete
a declaration to the company.
3. SHORT-FORM ANNOUNCEMENT
This short-form announcement is the responsibility of the directors of the Company. It
contains only a summary of the information in the full announcement (“Full
Announcement”) and does not contain full or complete details. The Full Announcement
can be found at:
https://senspdf.jse.co.za/documents/2020/JSE/ISSE/SEAE/SEAFY20.pdf
Copies of the Full Announcement is also available for viewing on the Company’s website
at https://spearprop.co.za/pdf/investor-relations/Spear-FY2020-Results.pdf. In addition,
electronic copies of the Full Announcement may be requested and obtained, at no charge,
from the Company at info@spearprop.co.za and from PSG Capital.
Any investment decisions by investors and/or shareholders should be based on
consideration of the Full Announcement, as a whole.
The Company has based this short-form on the financial results for the year ended 29
February 2020 which have been reviewed by the Company’s auditors, BDO South Africa,
who expressed an unmodified review conclusion.
4. RESULTS PRESENTATION
Shareholders are invited to view Spear’s year-end results presentation to be broadcasted
on YouTube at 10:00 am SAST on Thursday, 14 May 2020.
Presentation details:
- View and listen mode;
- Link: https://www.youtube.com/watch?v=htPbIOfvrHQ
- Presentation slides will be made available on Spear's website shortly before the
broadcast of the presentation under investor relations / financial results /
presentations, at the following link: https://spearprop.co.za/investor-relations/
Questions and Answers facility:
Q&A facility will be available during the presentation;
https://www.youtube.com/watch?v=-GZtb2sluYY
- Questions may be e-mailed during the presentation to: info@spearprop.co.za
14 May 2020
Sponsor
PSG Capital
Date: 14-05-2020 07:05:00
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