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2015 IN PERSPECTIVE

CHIEF EXECUTIVE OFFICER’S REPORT

continued

Clearwater Mall’s R37 million upgrade and extension is under way

and will house leading global fashion brands H&M, River Island and

Top Shop.

For the financial year 2016, the focus will remain on further

improvement and refurbishments, with R180 million already planned,

while R93 million has been earmarked for equipment replacement.

Security for our customers at our shopping centres remains a priority

and, in line with our security strategies, additional capital will be spent

to ensure we implement up-to-date technology. This cost has been

included in the capital committed for 2016.

We continue to pursue a number of masterplan expansion

opportunities at some of our shopping centres, but implementation

remains subject to planning approvals by local councils and the

commitment of key tenants.

Environmental sustainability

Hyprop is committed to implementing sustainable energy-saving

initiatives, where possible. A number of projects to improve energy

efficiency were completed during the year. To date, these have saved

over 14 million kWh with cost savings of some R16 million, through the

energy-efficient lighting replacement and solar PV projects.

Development properties

Centre name

Rentable area

Hyprop’s

effective

shareholding

%

Hyprop’s

effective cost

USD000

Progress

Achimota Mall (Accra, Ghana)

14 624

28,1

27 101

Opened in October 2015

Kumasi City Mall (Kumasi, Ghana)

18 360

28,1

48 658

Under construction, opening April 2017

Waterfalls Project (Lusaka, Zambia)

9,4

1 031

Land holding

Shareholding

With Hyprop having a 100% free-float market capitalisation, trading volumes in our shares increased significantly during the period, especially in the last

quarter. This followed Hyprop’s inclusion in some of the MSCI emerging market indexes. Rising demand fuelled growth in our share price over the year,

resulting in Hyprop significantly outperforming the SAPY index, as shown below.

0,9

1,0

1,1

1,2

1,3

1,4

1,5

1,6

Share price performance

Jul

2014

Aug

2014

Sept

2014

Oct

2014

Nov

2014

Dec

2014

Jan

2015

Feb

2015

Mar

2015

Apr

2015

May

2015

June

2015

Q

Hyprop

Q

SAPY

% share traded 73,0%

50,4%

% offshore shareholders 25,0%

8,5%

June

2015

June

2014

Q1: 28,5 million*

Q4: 92,8 million*

Q3: 41,0 million*

Q2: 15,3 million*

* Number of shares traded per quarter

We successfully installed the second phase of the solar photovoltaic

plant at Clearwater Mall in August 2015. The total size of the plant

(phases 1 and 2) is 1 500kW at peak, with generating capacity of 2,5GWh

per annum.

Given the frequent electricity outages, new generators were installed

at Hyde Park Corner for full back-up power. After minor further capital

expenditure, all shopping centres in the portfolio will have sufficient

back-up power.

Sub-Saharan Africa (excluding SA)

The economic environment in Ghana and Zambia deteriorated in 2015,

partly due to falling oil and other commodity prices as well as fiscal

and trade deficits. This resulted in depreciating local currencies and

rising inflation. Both countries also experienced a severe shortage of

electricity, which affected the consumer market. Subsequent to the

implementation of an IMF loan package, the Ghanaian Cedi rebounded

by 25%.

The performance of the dominant malls like Accra Mall and Manda Hill

has remained resilient, despite the negative impact of the economic

downturn.

10

Hyprop Investments Limited

Integrated Report 2015