Company Has Appetite For Foreign Investment With Go-To-Africa Strategy
Botswana Stock Exchange listed Real Estate business, Letlole La Rona(LLR) has performed impressively well in the six months period ending in December 2022 recording growth in both revenue and operating profit.
According to the financial results for the six months,LLR saw a jump in its revenue by 4 percent to P50.2 million from P48.4 million which was recorded in the prior comparative period.
Further, the company’s operating profit has increased by 8 percent to reach P36.5 million while profit before tax of P49.7 million was recorded ,which marks an 8 percent increase as compared to the previous comparative six months. Previously during the first half year results announcement, LLR only managed P46.2 million as its operating profit.
LLR arrears are mostly low due to tenants being able to pay properties they are renting well without default. However the company’s property vacancy stands at three percent, a situation which is expected to downgrade to the usual one percent mark by April 2023 since LLR is engaging more potential tenants to take over the vacant properties.
As part of the highlights of the six months period ,the company’s investment portfolio value has also skyrocketed by 14 percent year-on-year to close the period at P1.4 billion with the acquisition of a 30 percent stake in OAL in July 2022 the main contributor.
According to LLR Chief Financial Officer Pulafela Isaacs the great performance is, “Driven by annual lease escalations and a strong tenant base coupled with below average market vacancy levels.”
Isaacs further noted that there is a significant increase in other income mainly coming from the foreign exchange gains on the OAL shareholder loan, and we are talking about around P5 million.
Long term loans increased significantly following the funding requirements for JTTM Properties Limited and OAL. The net asset value of the company increased to P871.8 million therefore indicating an increase of 7 percent from the previous figure of P813.9 million, which means there is consistent on year-on-year value enhancement to the unit holders.
For her part LLR Chief Executive Officer, Kamogelo Mowaneng said they continue to explore pipeline opportunities in line with their Go-To-Africa strategy with interest on value accretive investments.
“We aim to streamline and expand our Botswana portfolio that’s our intention for now as well as expanding into Africa as opportunities in Botswana are sometimes limited. So we want to explore out there, go on to work with strong partners who know the market, we want to trade in outside of Botswana,” said Mowaneng.
LLR was incorporated in 2010 as Botswana Development Corporation subsidiary and listed in the Botswana Stock Exchange in 2011. As of now the company has around 25 assets in Gaborone as industrial and retail properties and owns key properties such Rail park(Gaborone) Mall and Watershed Mall in Mahalapye.
LLR’s tenant classification stands at 48 percent for multinationals ,26 % SMMEs,12% nationals companies, 9 % state owned companies ,2 % individuals. To date LLR has housed key tenants such Spar, Choppies, Sefalana, Coca Cola and Eureka just to mention a few.
