Octodec Investments Limited · JSE:OCT
Octodec Investments — HY2025 Earnings Presentation
40 slides from Octodec Investments's earnings presentation, May 2025
Slide 1: HY2025 Interim results for the six months ended 28 February 2025
HY2025 Interim results for the six months ended 28 February 2025 Octodec Investments Limited 0 Interim Results for the six months ended 28 February 2025
Slide 2: Agenda
Agenda Overview 1 Jeffrey Wapnick, CEO Our portfolio performance: residential 2 Charlene Conradie, COO Our portfolio performance: commercial 3 Charlene Conradie, COO Our commitment to operating responsibly 4 Riaan Erasmus, Deputy CEO and FD Financial results and capital management 5 Riaan Erasmus, D
Slide 3: Overview
Overview THE FIELDS
Slide 4: Management team
Management team Jeffrey Wapnick Riaan Erasmus Charlene Conradie Chief Executive Officer Deputy Chief Executive Officer Chief Operating Officer and Financial Director (CFO) THE PARK Octodec Investments Limited 3 Interim Results for the six months ended 28 February 2025
Slide 5: Octodec at a glance
Octodec at a glance WHAT HOW Octodec’s diverse We aim to serve a thriving tenant-base of residents, professionals, government property portfolio employees, students, and entrepreneurs, all of whom live, eat, work, or play within the consists of market- Octodec ecosystem. leading residential, retail,
Slide 6: Salient Features and Performance Highlights
Salient Features and Performance Highlights Increase in revenue of Distributable income after tax Distributable income per share Dividend per share 5.2% (REIT funds from operations) 83.30 cents 62.00 cents to R1 056.2 million R221.7 million Increase of 3.3% (HY2024: R1 004.4 million) (HY2024: R219.5
Slide 7: Rental income analysis
Rental income analysis CBD vs non-CBD A well-diversified portfolio in Gauteng rental income (%) 46.0% Rental income by sector CBD 28 February 2025 (HY2024: 54.6%) Residential 4.4% (HY2024: 33.9%) Non-CBD 7.0% (HY2024: 45.4%) Retail – street shops 54.0% (HY2024: 23.5%) 12.6% 33.9% Offices (HY2024: 18
Slide 8: Our portfolio performance: Residential
Our portfolio performance: Residential JEFF’S PLACE
Slide 9: Residential portfolio overview
Residential portfolio overview Resilient demand amid tenant affordability pressures As at As at 28 February 2025 29 February 2024 − Above inflation rental growth consistent with the prior Split of residential units 9 349 9 242 period Johannesburg (%) 31 36 − Octodec’s well-located, secure, and well-
Slide 10: Residential portfolio update
Residential portfolio update A snapshot of our quality offering addressing various market needs Pretoria – One on Mutual Pretoria – Sharon’s Place Pretoria – Yethu City on Sisulu HY2025 HY2025 HY2025 Number of units 142 Number of units 399 Number of beds 199 Occupancy % (in units) 98 Occupancy % (in
Slide 11: Residential portfolio update
Residential portfolio update Maintaining asset quality in focus Pretoria – Corner Place Johannesburg – Ricci’s Place HY2025 HY2025 Number of units 112 Number of units 281 Occupancy % (in units) 96 Occupancy % (in units) 90 Average rental per month per unit (R) 5 350 Average rental per month per unit
Slide 12: Our portfolio performance: Commercial
Our portfolio performance: Commercial WOODMEAD VALUE MART
Slide 13: Retail – shopping centres overview
Retail – shopping centres overview Proactive management of tenant mix delivers value As at As at 28 February 2025 29 February 2024 Rental income (R’million) 99 93 Rental income growth (%) 6.2 2.7 Rental income growth (like-for-like) (%)** 6.2 2.7 Total vacancies (% of GLA) 6.6 6.8 Core vacancies (%
Slide 14: Retail – street shops overview
Retail – street shops overview Resilient trading among infrastructure and economic challenges As at As at 28 February 2025 29 February 2024 Rental income (R’million) 180 179 Rental income growth (%) 0.6 0.6 Rental income growth (like-for-like) (%)** 1.4 1.7 Total vacancies (% of GLA) 20.4 22.3 Core
Slide 15: Some of the top national retailers across our portfolio
Some of the top national retailers across our portfolio SHOPRITE, TSHWANE SHOPRITE, TSHWANE Octodec Investments Limited 14 Interim Results for the six months ended 28 February 2025
Slide 16: Offices overview
Offices overview Portfolio remains stable, with scope for disposals or conversions As at As at 28 February 2025 29 February 2024 Rental income (R’million) 151 137 Rental income growth (%) 9.8 (2.1) Rental income growth (like for like) (%)** 9.8 (1.4) Total vacancies (% of GLA) 38.4 39.6 Core vacanci
Slide 17: Industrial Overview
Industrial Overview Steady demand with improved performance As at As at 28 February 2025 29 February 2024 Rental income (R’million) 55 54 Rental income growth (%) 2.7 − Rental income growth (like for like) (%)** 5.1 2.4 Total vacancies (% of GLA) 9.4 10.6 Core vacancies (% of GLA) 8.7 10.1 Average l
Slide 18: Material expired / expiring leases > 5 000m²
Material expired / expiring leases > 5 000m² at 28 February 2025 Building Tenant Lease expiry GLA (m²) Renewal status Louis Pasteur Louis Pasteur Private Hospital February 2025 15 446 Tenant currently on a monthly tenancy at a 10% escalation while renewal negotiations are underway. Capitol Towers Ci
Slide 19: Lease expiry profile in line with historic trends
Lease expiry profile in line with historic trends Expiries by rental income and GLA m2 (%) Length of stay 100 91.6 The average stay of a residential tenant is 26.0 months, excluding Hatfield tenants who are traditionally students leasing for 10 months during the academic year. 54.1 The average lengt
Slide 20: New leases and renewals increase/(reversion) by sector
New leases and renewals increase/(reversion) by sector at 28 February 2025 New area New lease Renewal area Renewal growth Sector (m²) (%) (m²) (%) Residential (units) 3 370 2.6 1 691 5.6 Commercial Retail – street shops 13 111 2.1 59 836 1.3 Retail – shopping centres 1 966 19.8 10 442 2.2 Offices 6
Slide 21: Collections remain strong
Collections remain strong Total Collections at 28 February 2025 Billed R1.18 billion Collected to billed (%) (HY2024: R1.13 billion) Collected R1.16 billion 97.1 97.8 (HY2024: R1.11 billion) Collected to billed % 97.7% Commercial Residential (HY2024: 97.4%) NZUNZA HOUSE Octodec Investments Limited 2
Slide 22: Financial results and Capital management
Financial results and Capital management TOM’S PLACE
Slide 23: Distributable earnings (SA REIT FFO)
Distributable earnings (SA REIT FFO) Revenue growth of 5.2% with the Retail Shopping Unaudited Unaudited Centre and Office portfolios showing the % 28 February 2025 29 February 2024 highest growth change R’million R’million Revenue 5.2 1 056 204 1 004 370 Doubtful debts at 2.3% (HY2024: 1.8%) of ren
Slide 24: Distributable earnings [continued]
Distributable earnings [continued] Property expenditure spread Administration cost spread (R’million) (R’million) 181 36 162 34 96 97 84 81 82 78 75 74 14 14 39 37 5 6 25 18 Assessment Collection Bad debts Cleaning, Security Utilities Other Asset management CSI impact spend Other corporate rates fee
Slide 25: Abridged condensed consolidated statement of financial position
Abridged condensed consolidated statement of financial position Unaudited Audited 226 properties at fair value increase of 0.3% 28 February 2025 31 August 2024 Average value per property increased by 3.7% Assets R’million R’million to R50 million Non-current assets Investment property 10 588 000 10
Slide 26: Abridged condensed consolidated statement of financial position [continued]
Abridged condensed consolidated statement of financial position [continued] Unaudited Audited Borrowings stable at R4.4 billion compared 28 February 2025 31 August 2024 to prior year (FY2024: R4.4 billion) Equity and Liabilities R’million R’million R1.0 billion in facilities refinanced for tenors Eq
Slide 27: Capital allocation and requirements
Capital allocation and requirements Asset recycling and redeployment – Sold and transferred ten properties for R49 million net of commission – Killarney Mall held for sale – Objective is to dispose of all non-core and assets <R10 million or mothballed properties – Objective is to acquire assets in e
Slide 28: Cash generated from operations
Cash generated from operations Cash flow bridge for the period ended 28 February 2025 (R’million) 475.6 (205.4) (0.8) 116.1 (173.0) 49.0 69.2 5.9 (10.0) (92.3) Cash and bank Cash generated Net finance Taxation Dividend paid - Developments, Payments Proceeds Net borrowings Cash and bank balances as a
Slide 29: Borrowings
Borrowings Weighted Unaudited average interest Debt carefully managed within internal targets set 28 February 2025 rate per annum – LTV at 39.5% Assets R’billion % – Interest cover ratio (ICR) at 2.14x Bank loans – secured 4 062.2 9.5 Bank covenants: Domestic Medium-Term Note (DMTN) Programme – – Gr
Slide 30: Diversified sources of funding
Diversified sources of funding Successful refinancing of expiries 28 February 2025 31 August 2024 Successful refinancing of facilities: – Refinance of three ABSA credit facilities with tenors of four years 7.6% 8.6% (total R600 million) – Refinance of two SBSA credit facilities for 21.6% 34.9% 35.1%
Slide 31: Funding expiry profile
Funding expiry profile Hedging strategy considers interest rate cycle Loan expiry profile Interest rate derivatives expiry profile (R’million and %) (R’million and %) The weighted average term to expiry of the loans and interest rate derivatives is currently 2.6 years (FY2024: 2.4 years) and 1.2 yea
Slide 32: Our commitment to operating responsibly
Our commitment to operating responsibly YETHU CITY ON SISULU
Slide 33: Solar installations demonstrating environmental stewardship
Solar installations demonstrating environmental stewardship Number of installations completed to date kWh production Estimated savings for the period (R) 10 2 462 925 3 985 531 (Total capital investment of R65.3 million) (February 2025 YTD) (February 2025 YTD) THE FIELDS THE PARK ODEON FORUM Octodec
Slide 34: Projects demonstrating social commitment
Projects demonstrating social commitment Our initiatives have created significant community change, fulfilling 33 dreams with Reach for a Dream through room makeovers and hospital visits, and providing 3.6 million meals through Feed the Future to ECD centres in our areas. We invested R1.28 million i
Slide 35: Outlook and Prospects
Outlook and Prospects THE FIELDS
Slide 36: Tempered optimism in outlook
Tempered optimism in outlook Outlook and prospects − Increase in business confidence, following the creation of the Government of National Unity and halt to loadshedding − Geopolitical risks are creating uncertainty, with the local GNU appearing to have difficulties in staying the course − Interest
Slide 37: YETHU CITY ON SISULU
YETHU CITY ON SISULU = Ra B , / /
Slide 38: Growth opportunity in Yethu City on Sisulu
Growth opportunity in Yethu City on Sisulu − Yethu City is an innovative co-living pilot offering quality, well-priced urban housing − Key features of the “Yethu City” brand: Well-designed co-living spaces Lower rental entry point compared to our other residential accommodation All-inclusive r
Slide 39: Questions and answers
Questions and answers CORNER PLACE
Slide 40: Our Vision
Our Vision To innovate and create sustainable economic value by investing in a multisector property portfolio. We remain cognisant of our role as a responsible corporate citizen and aim to achieve our vision, ambition and purpose in a manner that takes the interests of all our stakeholders into acco