Dipula Properties CEO Izak Petersen.
Image: Supplied
Dipula Properties delivered robust results from its South African mainly convenience, rural and township retail assets in the six months to February 28, with distributable earnings up 20%.
Lower interest rates, the refinancing of debt at better rates, portfolio-enhancing acquisitions, a reduction of vacancies to 7% from 8.5%, a better trading environment, organic growth of the portfolio, and asset management initiatives were all factors that had “gone into the stew” to produce the strong results, CEO Izak Petersen said in an online presentation on Wednesday.
The distributable earnings of R310 million translated to half-year distributable earnings per share of 30.56 cents.
"This performance reflects our focus on long-term shareholder value. We continue to show that we are an actively and optimistically managed business,” said Petersen.
"Dipula shareholders have enjoyed exceptional returns since listing, a performance further validated in November 2025 when Dipula was ranked number one in the Sunday Times Top 100 Companies.”
Dipula also upgraded its distributable earnings guidance from 7%, to between 7% and 8% for its 2026 financial year, a target Petersen said they could likely reach even if there was a 50-basis point increase in interest rates due to the impact of the Middle East conflict.
He said there has been speculation that the SA Reserve Bank might be forced to raise interest rates soon, just as was the case in the US where inflation had risen sharply, but the volatility of the Middle East conflict made firms forecasts about the likely impacts nearly impossible at this stage, he said.
He said they also had a good pipeline of potential asset acquisitions, but a sharp rise in interest rates could affect potential deal flow.
The SA REIT took transfer of five acquisitions worth about R700m at various stages from September 2025. The largest of these was the R480m purchase of Protea Gardens Mall in Soweto, transferred in January 2026.
Dipula owns 155 properties and generates 67% of income from retail properties located close to where people live in townships, rural, and urban convenience locations.
It also has a portfolio of mid-sized logistics and industrial assets (16% of income), office assets (14%), and a non-core affordable residential property portfolio (3%). The majority (58%) of the assets are in Gauteng.
Supported by positive property valuations, asset management, and the acquisitions, the property portfolio increased in value by 12% to R11.5 billion in the period, buoyed by higher income prospects.
Petersen said a highlight for the year was their inclusion in the FTSE/JSE All Property Index (ALPI) and the SA REIT Index, from March 23, 2026, which had resulted in "significantly improved” trading activity in the shares.
He said the inclusion meant their stock will “speak to a bigger pool of investors” while the share would also likely trade at closer to its real value, rather than its value being impeded by a lack of liquidity in the shares traded.
He said focus on prudent tenant selection and retention was expected to support stable income growth, while balance sheet resilience remained a priority.
Dipula’s revenue, excluding straight-lining, increased 7% to R811m in the interim period. Net property income rose 9%.
Cost containment and improved recovery levels continued to be a management priority, and the total cost-to-income ratio of 42.8% reflected a marginal decrease, notwithstanding property expenses increasing 5%, largely coming from escalating municipal charges and utilities costs.
Operational highlights included significant leasing activity, with retail portfolio vacancies at a steady 5%. Letting activity was led by the retail and industrial sectors. Office occupancies were stable.
Dipula disposed of 12 non-core properties for R130m. Proceeds contributed to repaying debt, funding asset management strategies, acquisitions, and sustainability initiatives.
Dipula invested R56m in refurbishments and redevelopments, of which R30m was for income-generating capital expenditure. Solar PV capacity grew significantly, nearly trebling from about 6 MWp to 16.6 MWp.
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