BY MISHMA CHAKANYUKA
PROPERTY investment and development company Mashonaland Limited Holdings recorded a 7% increase in revenue to $1,68 million in the four months to January, driven by higher occupancy levels across the company’s portfolio.
Revenue, however, was 3% below target, a reflection of the delays in sales of the company’s serviced Old Windsor residential stands.
Managing director Gibson Mapfidza told an annual general meeting that the sale of the stands would commence next month, with the developer’s profit expected to be around $220 000.
“Despite the delays in the stands sales, the operating profit for the period under review at $1,1 million was 47% higher than the same period last year and 22% above budget,” he said.
“The operating profit margin also increased from 45% in prior year to 62% in the period under review.”
Mapfidza said the company had reviewed rentals effective February.
“Through the rent reviews, we have achieved a total portfolio revenue upliftment of 58% to date, effective February 1, 2019. In line with market dynamics and the need to retain our property values, the company reduced its rent review terms to three months to ensure regular rent reviews in line with market dynamics,” he said.
“Year-to-date property expenses at $311 000 were 23% lower than prior year and 30% below budget. Improved occupancies from prior has seen a reduction in the cost of voids expenses. The improved collection from long outstanding debtors between September 2018 and January 2019 has seen a favourable movement in bad debts provision”
The company’s collection rate stands at 86%, an improvement from 64% last year, while voids improved from 29% to 24% as at January.
“Administrative expenses at $490 000 were 41% above prior year and 14% above budget. This reflects the impact of price increases, increased staff costs due to ne staff and also non-recurring expenditures incurred during the period under review. The resulting administration expense to income ratio was 29% compared to 21% for the period last year,” Mapfidza said.
The company will seek to dilute concentration in the central business district through new developments in emerging retail and office park corridors, as well as seeko diversify revenue streams.
“The company also seeks to diversify its revenue streams through leveraging on internal skills and systems so as to embark on third party business. The company is in the process of acquiring the requisite licences to delve into 3rd party business,” Mapfidza said.