Growthpoint Properties Limited reported its full-year results for the year ended June 30, 2026, highlighting a 4.3% increase in distributable income per share to 152.6 cents, alongside a 7.4% rise in dividend per share to 133 cents. The company raised its payout ratio to 87.5% from 85% in the prior year, retaining 12.5% of distributable income for reinvestment, amounting to ZAR 647 million in pre-tax cash. Total distributable income reached ZAR 5.2 billion, up by ZAR 216 million year-over-year, while net asset value per share grew 3.8%, and total group assets expanded 2.8% to ZAR 160 billion. However, growth momentum slowed in the second half of 2026, with a focus on asset disposals and strategic reinvestments amid market headwinds.
The company disposed of 29 assets valued at ZAR 4.9 billion—including ZAR 3 billion in offices, ZAR 1.3 billion in logistics, and ZAR 600 million in retail—while committing ZAR 3.6 billion to new developments. Growthpoint’s South African portfolio, representing 55% of distributable income and 49% of total assets, saw like-for-like net property income growth of 4.4%. However, Gauteng’s office sector remained under pressure, with vacancy rates at 18.6% and negative lease reversions of -10.2%. The Western Cape office vacancy dropped to below 4%, while retail vacancies remained low at 3.5%, with trading densities rising 2.7% year-over-year.
Internationally, Growthpoint’s Australian subsidiary (GOZ) improved its loan-to-value ratio to 41% and saw foreign currency income decline by ZAR 300 million due to a strengthening rand. The company also exited the U.K. market in August 2025 and reduced its Australian cross-currency swap refinancing costs from 2% to 4% after two interest-rate hikes. Despite these challenges, Growthpoint maintained strong balance sheet flexibility, with ZAR 5.7 billion in unutilized capital facilities and ZAR 323 million in cash at year-end.
For FY2027, the company expects dividend growth to slow to 1%–3%, with distributable income growth of about 1.3% if the payout ratio remains at 87.5%. Key risks include office-market weakness in Gauteng, higher funding costs, and foreign exchange pressures. Shares fell 0.63% to 1,584, trading below the midpoint of their 52-week range of 1,432–1,901.
CEO Norbert Sasse emphasized that while office vacancies remain a concern, particularly in Gauteng, the sector is not dead, and well-positioned properties remain viable investments. The company also reiterated its commitment to strategic asset sales, stating it would not dispose of assets at all costs, and highlighted ample balance sheet capacity to support future growth.
