Mash Holdings posts $3m profit

HARARE - Mashonaland Holdings (MSH) says it reported a $3,08 million profit for the year ended September 30, 2018.

This represented a 19 percent increase from a profit of $2,56 million achieved by the listed property company in the prior comparable period.

Supporting the company’s performance improvements during the period were slight increments in occupancy levels, which were at 76 percent, up from 72 percent in 2017.

“The marginal increase was a result of management developing a strong pipeline through market initiatives.

“Management will continue to actively pursue portfolio offering diversification initiatives to ensure that the portfolio offering is aligned to the dynamic occupier market requirements,” Ronald Mutandagayi, MSH board chairperson said in a comment accompanying the company’s financial statements.

The property market, effectively at the receiving end of the occurrences in the mainstream economy, was not spared from the weak economic fundamentals.

Mutandagayi said occupancies generally remained under pressure, “and tenant-initiated downward rent reviews were noticeable especially in the CBD office sector as corporate occupiers sought to match occupancy costs while business revenues were coming off”.

He said the flight to “safe haven” experienced in the third quarter of 2018 saw high grade properties across the market retaining “capital values”.

“Marginal increases in occupancies were experienced in selected sectors and locations of the market.

“The property market still presents pockets of growth hinged on the expected positive political and economic outlook,” he added.

The company’s average annualised portfolio yield remained at six percent, as arrears went down to $1,16 million from $1,78 million in 2017.

“Management will continue ensuring that the fabric of the buildings and equipment are in a good functional state to retain and attract occupancies.

“Engagements with the City of Harare and other key stakeholders are ongoing to enhance the attractiveness of the CBD to both occupiers and investors,” Mutandagayi said.

Total revenue for the year increased by one percent to $4,74 million up from $4,71 million reported for 2017.

The property expenses were 21 percent above prior year comparative period at $1,34 million. 

The company says property management and voids related costs were the main drivers of property expenses.

In its drive to retain existing and attract new occupancies, the company incurred marginally higher repairs and maintenance costs on three of its properties.

Administrative expenses at $1,26 million were nine percent below prior year, resulting in an administrative expenses to income ratio of 25 percent. 

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