• Group turnover up 6%
• Profit from operations up 8%
• Group boasts of high occupancy rate
Turnstar Holdings Limited - a Botswana Stock Exchange (BSE) listed property Investment outfit -has had a successful 2015, Board chairman Cuthbert Lekaukau and Managing Director Gulaam Abdoola have declared.
The two state in the company’s 2015 annual report that the company had an exciting year as the group turnover increased by six percent while profit from operations increased by eight percent before tax and fair value.
“Occupancy levels have been high during the year. The high level occupancy combined with the low default rate, which is exceptionally good, given the current economic environment, have been instrumental in producing encouraging results for the Group,” says Lekaukau.
Abdoola says Turnstar has been able to maintain high occupancy rate in all properties.
“We continue to control overhead costs, whilst ensuring that we spend on the on-going maintenance of the properties to ensure that they are in a good state at all times,” he says, adding that the market has realised value in their stock.
Abdoola explains that the climb in linked-unit price in demand is reflective of this value.
“In terms of projects undertaken over the last financial year, the plans and the necessary building permits for our two projects were obtained and the building contracts were signed,” Abdoola says, referring to the refurbishment of Game City mall in Gaborone and the construction of extension to the mall and conference centre at Mlimani Mall in Dar es-Salaam, Tanzania.
With regards to the progression of the two projects, Abdoola says a significant development has been made so far. Going forward, Abdoola says they will be investigating other sources of funding in order to continue growing the company whilst keeping debt at manageable level.
“We look forward to this challenge and to continually work to maximise shareholder returns,” he sates.
The company has said in its report that Botswana’s overall property market remains relatively strong amidst a challenging economic atmosphere. During the year, the property market ranked industrial sector being the strongest followed by residential, retail and commercial office space.
The commercial office space is said to have experienced an oversupply, with vacancies increasing to 5.9 percent while the retail sector was also stagnant due to additional retail space entering the market.
However, despite all these factors the company states that both demand and property values have continued to rise. The company has expressed confidence in the real estate outlook as it is believed to be strong across all sectors with a number of new developments being recently completed to meet the existing demand.
Turnstar’s growth is mainly driven by the Dar es-Salaam operations, which have the strongest demand in quality office space, followed by residential and retail with opportunities in the industrial sector.
The group, which boasts a market capitalisation of P1.4 billion, states it is well-positioned for growth in the future. The expansion of Game City and Mlimani City, which are tenant driven developments, are expected to provide added value and distributable income to Turnstar’s unit holders.
Meanwhile, the group will on the 29th of July, 2015 hold its Annual General meeting where it will among others approve the distribution of dividend and payment of interest as recommended by the directors and also re-elect Pierre Johann Bezuidenhout and Michelle Renee Adelman to the company board of directors.