Attacq sees 57.5% decline in distributable earnings due to COVID-19
Attacq’s distributable income per share slumped 57.5 per cent year-on-year, for the six months ended December. Due to the impact of Covid-19, the property investment company granted rental discounts amounting to R53.8 million. The group’s liquidity did, however, improve to R1.3 billion. Jackie van Niekerk, CEO of Attacq joins CNBC Africa for more.
Tue, 23 Mar 2021 15:43:10 GMT
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AI Generated Summary
- Attacq reports a 57.5% decline in distributable earnings for the six months ended December, attributing the decrease to the impact of Covid-19 on its operations.
- Despite financial challenges, Attacq's retail tenants demonstrate a strong willingness and ability to pay rent, signaling a positive trend in rental collections.
- The company freezes dividend payments to shareholders as a precautionary measure to maintain liquidity and sustain a resilient capital structure amidst ongoing economic uncertainty.
Attacq, a property investment company based in South Africa, has faced a challenging period due to the impact of Covid-19 on its operations. The company reported a 57.5% decline in distributable earnings for the six months ended December, reflecting the financial strain caused by the pandemic. Despite the significant drop in earnings, Attacq CEO Jackie van Niekerk remains optimistic about the company's ability to navigate the current economic landscape. In a recent interview with CNBC Africa, van Niekerk discussed the company's focus on maintaining liquidity, supporting tenants, and adapting to changing market conditions. One of the key highlights from the interview was the resilience shown by Attacq's retail tenants, who have demonstrated a willingness and ability to pay their rental bills. Van Niekerk attributed this positive trend to the gradual easing of lockdown restrictions and trade limitations, which have allowed businesses to resume operations and generate revenue. He emphasized that as long as the economy remains open and there are no further lockdown measures imposed, he expects rental collections to remain stable. Despite this positive development, Attacq has taken precautionary measures by freezing its dividend payments to shareholders. This decision reflects the company's concerns about the ongoing uncertainty and the need to preserve capital in the face of potential challenges in the future. Van Niekerk underscored the importance of maintaining a sustainable capital structure to withstand any unforeseen developments in the market. The interview also touched upon Attacq's development projects, particularly the Waterfall Node, which includes the Mall of Africa. Van Niekerk noted that while there had been some slowdown in development activities, the company had observed a resurgence in construction projects in recent months. He highlighted the launch of new developments within the office and industrial sectors, such as the Cotton On warehouse. Despite the challenges posed by Covid-19, Attacq remains committed to its long-term vision of building a functional and vibrant city around the Waterfall Node. In response to the changing dynamics of the office space market, van Niekerk acknowledged the shift towards hybrid work models, where employees alternate between working from home and the office. He expressed confidence in Attacq's ability to adapt to these changes and provide flexible office solutions that cater to diverse tenant needs. Looking ahead, van Niekerk outlined the company's plans for its African portfolio, with a focus on strategically exiting non-core assets and prioritizing investments in South Africa, particularly the Waterfall development. The CEO also shared his views on South Africa's economic recovery prospects, noting that while government initiatives provide some level of certainty, challenges such as vaccine distribution and political instability continue to pose risks. Despite these uncertainties, van Niekerk emphasized Attacq's commitment to delivering quality property offerings and ensuring a safe environment for its tenants. The company's resilient portfolio and strategic focus on liquidity management position it well to weather the ongoing economic challenges and capitalize on future opportunities.